33-14-63. Filing of surety bond or deposit by incorporators of proposed insurer; conditions of bond or deposit; release and discharge.

Prior to the solicitation of any applications for insurance pursuant to the requirements for a certificate of authority of a mutual insurer, the incorporators of the proposed insurer shall file with the Commissioner a corporate surety bond in the penalty of $15,000.00 in favor of the state and for the use and benefit of the state and of applicant members and creditors of the corporation. The bond shall be conditioned as follows:#

1. (1)

   For the prompt return to applicant members of all premiums collected in advance;#

2. (2)

   For payment of all indebtedness of the corporation; and#

3. (3)

   For payment of costs incurred by the state in the event of any legal proceedings for liquidation or dissolution of the corporation.#

4. All of the conditions shall become due and payable only in the event the corporation fails to complete its organization and secure a certificate of authority within two years from and after the date of the certificate of incorporation.

In lieu of such bond, the incorporators may deposit with the Commissioner $15,000.00 in cash or United States government bonds negotiable and payable to the bearer, with a market value at all times of not less than $15,000.00, to be held in trust upon the same conditions as required for the bond.#

Any such bond filed or deposit made or remaining portion thereof held under this Code section shall be released and discharged upon settlement and termination of all liabilities against it.#