Any person otherwise qualified may be a director of two or more insurers, but no such interlocking directorate shall be used as a means of substantially lessening competition in the business of insurance or of creating a monopoly.

Whenever the commissioner has reason to believe that there is a violation of this section, he shall serve upon the insurer or insurers and the director or directors, as the case may be, a notice pursuant to Section 38 of a hearing before the commissioner to be held not less than thirty days after the service of such notice, and requiring such insurer or insurers and such director or directors, as the case may be, to show cause why an order should not be made by the commissioner directing such insurer or insurers and such director or directors, as the case may be, to cease and desist from such violation.

If, after a hearing in accordance with the procedure provided in Section 704, the commissioner finds that there has been a violation of this section he shall issue and cause to be served upon such insurer or insurers and such director or directors, as the case may be, an order reciting the facts found by him, and setting forth the respects in which there has been a violation of this section, and directing such insurer or insurers and such director or directors, as the case may be, to cease and desist from such violation.

Any such cease and desist order of the commissioner shall be subject to judicial review. Subject to said judicial review, any person violating any such cease and desist order shall be guilty of a misdemeanor and the commissioner may, after a hearing in accordance with the procedure provided in Section 704, decline to grant or renew or may suspend or revoke a certificate of authority of any insurer or insurers violating any such cease and desist order.

(Added by Stats. 1949, Ch. 180.)