HB20-1091 Summary

• Establishes a framework allowing domestic stock insurers to divide into 2 or more resulting insurers through an approved plan of division that includes asset/liability allocation and share distribution details.

• Requires the dividing insurer to obtain commissioner approval following a public hearing; the commissioner must find the division will not jeopardize financial stability, terms are fair to policyholders and shareholders, and resulting insurers will be solvent.

• Specifies that resulting insurers hold allocated assets and liabilities by operation of law as successors to the dividing insurer; each resulting insurer is liable only for liabilities allocated to it under the plan.

• Allows a division to occur simultaneously with a merger or consolidation of resulting insurers, and enables shareholders of dividing insurers that do not survive to claim appraisal rights.

• Takes effect August 5, 2020, subject to referendum petition rights under the Colorado constitution.