§ 27-27-39 — Dividends - Liability for Illegal Dividends by Domestic Insurers

Alabama § 27-27-39

• Jurisdiction: Alabama
• Title 27: Insurance
• Ch. 27: Organization and Corporate Procedures of Stock and Mutual Insurers

Text

(a) Any director of a domestic stock or mutual insurer who knowingly votes for, or concurs in, declaration or payment of a dividend to stockholders or members except as authorized in Sections 27-27-37 or 27-27-38 shall, upon conviction thereof, be guilty of a misdemeanor and shall be jointly and severally liable, together with other such directors likewise voting for or concurring, for any loss thereby sustained by the insurer.
(b) Any stockholder receiving such an illegal dividend shall be liable in the amount thereof to the insurer.
(c) The commissioner may revoke or suspend the certificate of authority of an insurer which has declared or paid such an illegal dividend.

Legislative History

(Acts 1971, No. 407, p. 707, §535.)