A. Subject to the provisions of this section a domestic stock insurer may merge or consolidate with one or more domestic or foreign stock insurers by complying with the applicable provisions of the statutes of this state governing merger or consolidation of stock corporations formed for profit. A domestic stock insurer may, as the surviving corporation resulting therefrom, so merge with a domestic general business corporation formed for profit under the general corporation laws of this state if the assets of such general business corporation are in major part such as the insurer could invest its funds in under Article 9 [Chapter 59A, Article 9 NMSA 1978] (investments) of the Insurance Code.

B. No such merger or consolidation shall be effectuated unless in advance thereof the plan and agreement therefor have been filed with the superintendent and approved in writing by him after a hearing thereon after notice to the stockholders of each corporation involved. Prior to or at time of filing the plan, a foreign insurer party to the proposed merger or consolidation if not then an authorized insurer shall file with the superintendent the documents and information required as for application for certificate of authority under Paragraphs (1), (3), (4), (5) and (7) of Subsection A, and under Subsection B, of Section 88 [59A-5-21 NMSA 1978] of the Insurance Code. The superintendent shall give his approval within a reasonable time after such filing unless he finds such plan or aggreement [agreement]:

(1) contrary to law; or

(2) unfair or inequitable to the stockholders of any corporation involved; or

(3) would substantially reduce the security of and service to policyholders of the domestic insurer, or result in a surviving insurer which does not meet paid-in capital stock requirements for certificate of authority of a like insurer under Section 83 [59A-5-16 NMSA 1978] of the Insurance Code or is otherwise inadequately financed for reasonable continuing conduct of its business; or

(4) would materially tend to lessen competition in the insurance business in this state or elsewhere as to the kinds of insurance involved, or would materially tend to create a monopoly as to such business; or

(5) is subject to other material and reasonable objections.

C. No director, officer, agent or employee of any corporation party to such merger or consolidation or any other person shall receive any fee, commission, special compensation or other valuable consideration whatsoever for in any manner aiding, promoting, or assisting therein except as set forth in such plan or agreement.

D. Nothing in the Insurance Code shall be deemed to prohibit merger or consolidation between insurers theretofore transacting different kinds of insurance, if the certificate of authority of the surviving and continuing corporation as originally issued or amended covers all the kinds of insurance to be transacted after effectuation of merger or consolidation.

History: Laws 1984, ch. 127, § 582.

Bracketed material. — The bracketed material was inserted by the compiler and it is not part of the law.

Cross references. — For the Insurance Code, see 59A-1-1 NMSA 1978 and notes thereto.