(a) Before soliciting any applications for insurance as required under § 23-69-112 as a qualification for the certificate of authority, the incorporator or incorporators of the proposed insurer shall deposit with the Insurance Commissioner acceptable securities in the penal sum of one hundred thousand dollars ($100,000) in favor of the state and for the use and benefit of the state and of applicant members and creditors of the corporation. The deposit shall be conditioned as follows:
(1) For the prompt return to applicant members of all premiums collected in advance;
(2) For payment of all indebtedness of the corporation; and
(3) For payment of costs incurred by the state in the event of any legal proceedings for liquidation or dissolution of the corporation, all in the event the corporation fails to complete its organization and secure a certificate of authority within one (1) year from and after the date of its certificate of incorporation.
(b) The remaining portion of a deposit held under this section shall be released and discharged upon settlement and termination of all liabilities against the deposit.
(c) This section does not apply to mutual insurers licensed on or before August 13, 2001.
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