§ 6407 — Restrictions on dividends

New York § 6407

• Jurisdiction: New York
• Law ISC: Insurance
• Art. 64: Title Insurance Corporations

Text

§ 6407. Restrictions on dividends. (a) No title insurance corporation\nshall declare or pay any cash or property dividend on its capital\nshares, or declare or distribute a stock dividend except out of earned\nsurplus, meaning, for the purpose of this section, surplus not\nattributable to contributions made to surplus within five years next\npreceding or to appreciation in value of investments not sold or\notherwise disposed of.\n (b) No such corporation shall declare or pay any cash or property\ndividend to shareholders which, together with all such dividends\ndeclared or paid by it during the next preceding twelve months, exceeds\nten percent of its then outstanding capital shares unless, after\ndeducting such dividends, it has a surplus to policyholders at least\nequal to fifty percent of its reinsurance reserve or a surplus at least\nequal to fifty percent of the minimum capital required of such insurer\nto transact the business of title insurance, whichever shall be greater.\nFor the purpose of this section, "surplus" means the amount of the\ninsurer's admitted assets in excess of (i) all of its liabilities,\nincluding its reinsurance reserve, and (ii) its outstanding capital\nshares.\n (c) No such corporation shall declare or distribute any stock dividend\nwhich shall reduce surplus to an amount less than fifty percent of its\nthen outstanding capital shares.\n