TITLE 41

INSURANCE

CHAPTER 28

ORGANIZATION AND CORPORATE PROCEDURES OF STOCK AND MUTUAL INSURERS

41-2835.  Directors. (1) The affairs of every domestic insurer shall be managed by a board of directors consisting of not less than five (5) directors or more than twenty-five (25) directors.

(2)  Directors shall be elected by the members or stockholders of a domestic insurer at the annual meeting of stockholders or members. Directors may be elected for terms of not more than five (5) years each and until their successors are elected and have qualified and if, to be elected for terms of more than one (1) year, the insurer’s bylaws shall provide for a staggered term system under which the terms of a proportionate part of the members of the board of directors shall expire on the date of each annual meeting of stockholders or members.

(3)  A director of a mutual insurer shall be a policyholder thereof.

(4)  As to an insurer operating as an authorized insurer only in the state of Idaho, a majority of the members of the insurer’s board of directors shall be citizens of and shall actually reside in this state.

(5)  Notwithstanding the provisions of subsection (1) of this section, a service corporation converted to a mutual insurer pursuant to section 41-2854A, Idaho Code, shall be managed by a board of directors consisting of not less than five (5) directors or more than twenty-five (25) directors. In the case of a service corporation that was a professional service corporation under chapter 34, title 41, Idaho Code, immediately prior to the effective date of its plan of mutualization, the board of directors after the effective date may include professionals of the kind or kinds designated in the corporation’s articles of incorporation as participant licensees immediately prior to such effective date, as long as a majority of directors are not professionals of the kind or kinds so designated. In the case of a service corporation that was a hospital service corporation under chapter 34, title 41, Idaho Code, immediately prior to the effective date of its plan of mutualization, the board of directors after the effective date shall include one (1) or more individuals representing a hospital or hospitals, as long as a majority of directors are not representing or employed by any hospital. In the case of a service corporation that was a combined professional service and hospital service corporation under chapter 34, title 41, Idaho Code, immediately prior to the effective date of its plan of mutualization, the board of directors after the effective date shall include one (1) or more individuals representing a hospital or hospitals, and one (1) or more professionals of the kind or kinds designated in the corporation’s articles of incorporation as participant licensees immediately prior to such effective date, as long as a majority of directors are neither such professionals nor representing or employed by any hospital, nor any combination thereof; further, the number of directors who are hospital representatives shall equal the number of directors who are professionals of the kind or kinds designated as participant licensees in the corporation’s articles of incorporation in effect immediately prior to such effective date. Notwithstanding the provisions of subsection (3) of this section, a director elected as a hospital representative need not be a policyholder as long as the represented hospital is a policyholder.

History:

[41-2835, added 1961, ch. 330, sec. 603, p. 645; am. 1994, ch. 78, sec. 2, p. 177; am. 2003, ch. 163, sec. 4, p. 461; am. 2021, ch. 145, sec. 1, p. 397.]