(a) No domestic or foreign insurance company shall be qualified and authorized to do business in this state until:
Terms Used In Tennessee Code 56-2-103
Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
Attorney: means the person designated and authorized by subscribers as the attorney-in-fact having authority to obligate them on reciprocal insurance contracts. See Tennessee Code 56-16-102
Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
Deed: The legal instrument used to transfer title in real property from one person to another.
Foreign: when used without limitation, includes all companies formed by authority of any other state or government. See Tennessee Code 56-1-102
Person: means any association, aggregate of individuals, business, company, corporation, individual, joint-stock company, Lloyds-type organization, organization, partnership, receiver, reciprocal or interinsurance exchange, trustee or society. See Tennessee Code 56-16-102
Plaintiff: The person who files the complaint in a civil lawsuit.
Reciprocal: means the aggregation of subscribers under a common name. See Tennessee Code 56-16-102
Record: means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in a perceivable form. See Tennessee Code 1-3-105
Service of process: The service of writs or summonses to the appropriate party.
Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
signed: includes a mark, the name being written near the mark and witnessed, or any other symbol or methodology executed or adopted by a party with intention to authenticate a writing or record, regardless of being witnessed. See Tennessee Code 1-3-105
State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
United States: includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
Venue: The geographical location in which a case is tried.
(1) It files or deposits with the commissioner a properly certified copy of its charter or deed of settlement and, if a foreign insurance company, a statement of its financial condition and business on December 31 preceding the date on which it applies for permission to transact business, in the form and detail the commissioner requires, signed and sworn to by its president and secretary, or other proper officers, and pays for the filing of the copy and statement the sum of one hundred dollars ($100). If it is a foreign insurance corporation, it shall also file and deposit with the commissioner a certified statement of the secretary of state to the effect that its name complies with the requirements of title 48, chapter 14 or title 48, chapter 54, as applicable;(2) It satisfies the commissioner that it is fully and legally organized under the laws of the state or foreign nation of its incorporation, and that it possesses and maintains the amount of capital, if a stock company, or surplus funds, if a mutual, reciprocal or Lloyd’s plan insurer, required by § 56-2-114 and the amount of additional surplus required by § 56-2-115, to do the kind or kinds of business it proposes to transact;(3) It, by duly executed instrument filed in the commissioner’s office, constitutes and appoints the commissioner, the commissioner’s chief deputy, or their successors, its true and lawful attorneys upon either of whom all lawful process in any action or legal proceeding against it may be served, and in the instrument agrees that any lawful process against it, which may be served upon its attorney, shall be of the same force and validity as if served on the company, and that the authority of the instrument shall continue in force, irrevocably, as long as any liability of the company remains outstanding in this state. Any process issued by any court of record in this state and served upon the commissioner or the commissioner’s chief deputy by the proper officer of the county in which the commissioner or the chief deputy may have an office shall be deemed a sufficient process on the company, and it is the duty of the commissioner or the chief deputy, promptly, after service of process by any claimant, to forward, by registered mail, an exact copy of the notice to the company. Service of process from any county in this state upon the commissioner or the chief deputy by the proper officer of the county in which the commissioner or the chief deputy may have an office shall establish proper venue in the county from which the process was issued, if the plaintiff resides in that county, whether the insurance company has an office or agency located in one (1) or more other counties of this state or not;(4)(A) If it is a foreign stock or mutual life insurance company, it satisfies the commissioner that it has and shall maintain on deposit with the state treasurer, or with the proper officer of some other state, securities in the actual cash value of at least two hundred thousand dollars ($200,000) consisting of bonds of the United States, or any agency or instrumentality of the United States, which have been included in the three (3) highest grades by any of the recognized securities rating firms, bonds of this state, bonds of the state of domicile, or bonds publicly issued by any solvent institution created or existing under the laws of the United States or any state of the United States, which have been included in the three (3) highest grades by any of the recognized securities rating firms, and the company files with the commissioner the certificate of the official with whom the securities are deposited, stating the time and amount, and that the official is satisfied that they are worth two hundred thousand dollars ($200,000) and that the deposit is made with the official by the company for the protection of all policyholders and creditors in the United States;(B) Notwithstanding subdivision (a)(4)(A), the commissioner may decline to accept as a deposit any specific issue of securities that the commissioner has determined may not provide the necessary protection to policyholders and creditors in the United States;(5) If it is a foreign insurance company, it files a report of its real estate holdings, if required by the commissioner in the commissioner’s discretion, so as to give the information required concerning domestic life insurance companies in § 56-3-305. The commissioner may refuse to admit and authorize a foreign insurance company to do business in this state in the event its land and the building or buildings on the land in which it has its principal office, and its other real property used in the transaction of insurance business, exceeds the maximum percentage of its admitted assets prescribed for domestic life insurance companies in § 56-3-305; and(6) The commissioner shall not approve any articles of incorporation or issue a certificate of authority to any company until finding that:
(A) The company has submitted a plan of operation; and(B) The incorporators, directors and proposed officers are of known good character and there is no good reason to believe that they are affiliated, directly or indirectly, through ownership, control, management, reinsurance transactions or other insurance or business relations with any person or persons known to have been involved in the improper manipulation of assets, accounts, reinsurance, or any matter inimical to the business of insurance.(b) The commissioner is authorized to promulgate rules and regulations the commissioner deems reasonable and necessary requiring the furnishing of information relative to election or appointment of new officers and directors by insurance companies licensed to do business in this state. If, after a hearing afforded the officer or director and the insurance company, the commissioner finds that the officer or director is incompetent, untrustworthy, or of known bad character, the commissioner may order the removal of the person as an officer or director of the insurance company. If the insurance company does not comply with the removal order within thirty (30) days after its receipt of the order, the commissioner may suspend the insurance company’s certificate of authority to do business in this state until such time as the company is in compliance with the order.
