§ 54

Illinois § 54

• Jurisdiction: Illinois
• Topic: REGULATION
• Ch. 215: INSURANCE
• Act 215 ILCS 5/: Illinois Insurance Code.
• Art.: Article III - Domestic Mutual Companies

Text

(Section scheduled to be repealed on January 1, 2027) Sec. 54. Dividends. (1) The board of directors or trustees of any company subject to the provisions of this Article doing the kind or kinds of insurance business described in Class 1 of Section 4 may declare dividends to its members. (2) The board of directors or trustees of any company subject to the provisions of this article doing any of the kind or kinds of business described in Classes 2 and 3 of Section 4 may from time to time fix and determine the amount of dividends or of unabsorbed or unused premiums or premium deposits to be returned to each policyholder, and may for such purpose establish reasonable classifications or groupings of policyholders and plans for the distribution of such refunds upon each general kind of insurance or groups or classes thereof and may establish reasonable territorial divisions upon policies expiring during a fixed period, after retaining sufficient funds for the payment by the company of all outstanding policy and other obligations. (3) The declaration and payment of dividends by any company subject to the provisions of this Article shall be subject to the following conditions: (a) No dividend shall be declared or paid at any time except out of earned, as distinguished from contributed, surplus, nor when the surplus of the company is less than the surplus required in section 43 for the kind or kinds of insurance the company is authorized to write, nor when the payment of such dividend will reduce its surplus to less than such amount. (b) No dividend shall be declared or paid contrary to any restriction contained in the articles of incorporation.

Legislative History

(Source: P.A. 86-753 .)