2013 New York Consolidated Laws
ISC - Insurance
Article 42 - (4202 - 4241) LIFE INSURANCE COMPANIES AND ACCIDENT AND HEALTH INSURANCE COMPANIES AND LEGAL SERVICES INSURANCE COMPANIES
4210 - Election of directors of domestic mutual life insurance companies.

 
    §  4210.  Election  of  directors  of  domestic  mutual life insurance
  companies. (a) (1) The directors of every domestic mutual life insurance
  company shall be elected in the manner and subject  to  the  regulations
  prescribed in this section.
    (2)  Every  such company shall, in accordance with its charter, either
  elect its entire board of directors biennially, or divide its  board  of
  directors  into  not more than three classes, as nearly equal as may be,
  in which case the members of one class only shall be elected annually.
    (3) In this section:
    (A) "Policyholder" means the person insured under an individual policy
  of life insurance or of accident and health insurance  issued  upon  the
  application  of  such person, the person who effectuates any such policy
  upon the person of another pursuant to subsection (c) of  section  three
  thousand  two  hundred  five  of  this  chapter,  the person to whom any
  annuity or pure endowment is presently or prospectively payable  by  the
  terms  of  an  individual  annuity  or a pure endowment contract, except
  where the policy or contract declares some other person to be the  owner
  or  holder  thereof,  in  which case such owner or policyholder shall be
  deemed  the  policyholder,  and  except  in  cases  of   assignment   as
  hereinafter  provided.  In  the  case  of  any such individual policy or
  contract insuring two or more persons jointly the persons  insured,  or,
  if  any  such policy be issued upon the application of some third person
  or persons, the person  or  persons  who  effectuated  any  such  policy
  pursuant to subsection (c) of section three thousand two hundred five of
  this chapter shall be deemed one policyholder within the meaning of this
  section. In case any such policy or contract shall have been assigned by
  an  assignment  absolute  on  its  face,  to  an assignee other than the
  company which shall have issued such policy, and in case  the  signature
  of such assignee, either attested by the assignor or acknowledged by the
  assignee,  shall  have  been  more than six months prior to any election
  hereinafter referred to, filed at the principal office of such  company,
  then  such assignee shall be deemed a policyholder within the meaning of
  this section. In the case of every policy or contract of group insurance
  or group annuity contract, issued by  such  company,  the  employer,  or
  other  person, firm, corporation or association to whom or in whose name
  the master policy shall have been issued and held, shall be  deemed  one
  policyholder  within  the  meaning  of  this  section.  Whenever in this
  section reference is made to a policy of life insurance for one thousand
  dollars  or  more,  such  reference  shall  be  deemed  to  include,  as
  equivalent thereto, an annuity contract which at normal date of maturity
  requires the payment of one hundred dollars or more annually, and a pure
  endowment  contract  for  the  principal  sum of one thousand dollars or
  more.
    (B) "Acknowledged", when  used  in  reference  to  any  instrument  or
  signature,  shall  have  the  same  meaning which it has in reference to
  conveyances of real property eligible for recording  under  section  two
  hundred ninety-one of the real property law.
    (b) (1)  Every  participating  policyholder  of such company and every
  policyholder  of  such  company  whose   policy   or   contract   is   a
  non-participating  policy or contract described in the first sentence of
  paragraph one of subsection (e) of section  four  thousand  two  hundred
  thirty-one  of  this  article, or a variable annuity contract subject to
  paragraph one of subsection (d) of section  four  thousand  two  hundred
  forty of this article and whose policy or contract shall be in force and
  shall  have  been  in  force  for  at  least  one year prior to any such
  election shall be  entitled,  without  further  qualification,  to  vote
  thereat,  either  in  person  or  by  mail  or  by proxy, as hereinafter
  provided, except that any company may adopt a  resolution  amending  its

  charter or by-laws so as to provide that all voting by policyholders for
  directors  shall  be  by ballot alone and not by proxy. In the event any
  company adopts such an amendment, all mention of proxy or proxies or  of
  persons  to  receive  proxies  in  this section, shall not apply to such
  company and such company shall conduct its elections only  by  means  of
  ballots  as  long  as such amendment is in effect. Any such company may,
  upon the approval of the superintendent, confer, upon all or  any  class
  of  its  non-participating  policyholders  holding  a policy or contract
  issued pursuant to the special permit granted by the  superintendent  in
  accordance with paragraph one of subsection (e) of section four thousand
  two  hundred  thirty-one  of  this  article, the same rights to vote for
  directors   possessed   by   its   participating   policyholders.    The
  superintendent  may  give  such  approval  if he finds that the proposed
  change is in conformity with  the  requirements  of  law  and  that  the
  representation  of  the policyholders therein conferred is equitable and
  reasonable.
    (2) Every other person having a right to vote in any such election  by
  virtue  of  any  contract  which was made prior to April twenty-seventh,
  nineteen hundred six, and which shall be in force at the  time  of  such
  election, shall be entitled to vote thereat in similar manner.
    (3)  In  any election of directors of a domestic mutual life insurance
  company pursuant to the provisions of this section,  every  policyholder
  shall  be  entitled  to  one  vote  only,  irrespective of the number of
  policies or contracts held by him and of the amount thereof.
    (c) (1) Not less than five months nor more than eight months prior  to
  any such election, on request of not less than twenty-five policyholders
  entitled  to  vote  at  the  last  prior election, which request must be
  subscribed and affirmed as true under the penalties of perjury  by  each
  of  such  policyholders and must be filed in duplicate with such company
  at least five days before any hearing thereon, the superintendent, after
  notice of not less than five days to such company and a hearing thereon,
  may in his discretion order such company within a  period  of  not  more
  than  forty-five  days and not less than thirty days thereafter, to file
  in his office, or in some suitable place designated by him and under his
  custody, a full and correct copy of its list or card  catalogue  of  the
  names  and last known postoffice addresses of all policyholders who have
  been such for at least six months under a policy of life  insurance  for
  one  thousand  dollars or more, or to file any part of such list or card
  catalogue as the superintendent specifies.
    (2) A list or any part thereof which may be so ordered filed  pursuant
  to  paragraph  one hereof shall be arranged, classified and corrected as
  directed  by  the  superintendent;  and  if  one  or  more   independent
  nominations  are  made, as specified in subsection (h) hereof, then such
  election shall be deemed a contested election and  a  complete  list  or
  card  catalogue  of names of all policyholders who are eligible to vote,
  as defined in this section, under a policy of  life  insurance  for  one
  thousand  dollars or more shall be so filed within forty-five days after
  the copy of the  certificate  of  such  nominations,  certified  by  the
  superintendent shall have been filed at the home office of such company,
  and  such  list or card catalogue shall be corrected from the records of
  such home office so that a list or card catalogue, as nearly correct  as
  may  be,  shall  be  on file as aforesaid down to within three months of
  such election.
    (d) (1) Such list or card catalogue or  any  part  thereof  so  filed,
  while  in  the  custody  of  the  superintendent,  shall  be  subject to
  inspection, under regulations prescribed by  him,  at  any  time  during
  business  hours by any policyholder of such company or by his authorized
  representative, and in case of a contested election,  under  regulations

  to  be  prescribed  by the superintendent, may be used in the canvass of
  the policyholders of the company.
    (2)  After  such  election,  or, if no independent nomination has been
  made, then after the time for such independent nominations has  expired,
  such  list or card catalogue shall be returned to the company filing the
  same.
    (e) If all or any class of the policyholders  of  any  domestic  stock
  life  insurance company shall be entitled to vote at any election of the
  directors of such company, such policyholders, subject to the provisions
  of the company's charter, shall be entitled to vote in person, by  proxy
  or  by  mail,  as  herein  provided,  and under the conditions stated in
  subsection  (c)  hereof,  a  similar   list   or   card   catalogue   of
  policyholders,  qualified  to  vote,  in  accordance with the charter or
  by-laws of such corporation, except the holders of industrial  policies,
  shall be filed and maintained in the office of the superintendent, or in
  some  suitable place designated by him and under his custody, and at the
  home office  of  such  company,  respectively,  similarly  arranged  and
  similarly  subject  to inspection and copy and withdrawal as in the case
  of mutual life insurance companies as above provided.
    (f) Where policyholders in any company shall have made nominations  as
  hereinafter  prescribed,  they  or  a committee representing them, shall
  upon demand, and with the approval of the superintendent and the payment
  to the company of the actual cost of making such copies, be furnished by
  such company with a copy of such list of policyholders or  with  a  copy
  therefrom  of  the  policyholders  residing in a designated territory. A
  copy of a list so taken, or of  any  part  thereof,  shall  be  held  by
  persons receiving the same inviolate and solely for the purposes of said
  nominators  in  a pending election and shall not be transmitted to other
  persons for any other use whatever. At the close of the canvass  of  the
  votes all copies of such lists shall be returned to the company.
    (g)  At  least  seven  months  prior  to  the  date of any election of
  directors in any such company, the board  of  directors  shall  nominate
  candidates  for  every  vacancy  to be filled at such election and shall
  also appoint three persons, jointly or severally, to receive proxies  to
  be  voted  for  said nominees, and shall also file in duplicate with the
  superintendent and at its home office a certificate of the names of  the
  candidates so nominated and of the persons so designated to receive said
  proxies, which shall be described as the "administration ticket."
    (h)  (1) (A) In every such company which had over one hundred thousand
  policies or contracts of the kind or kinds specified in  subsection  (a)
  hereof,  in  force at its last preceding election, each in the amount of
  one thousand dollars or more, of life insurance or an equivalent thereto
  as hereinbefore provided, any policyholders, prospectively qualified  as
  voters  at  the  next  ensuing election of directors, equal in number to
  one-tenth of one per centum of such total  policies  in  force  or  five
  hundred,  whichever  number is greater, and in every other such company,
  any five hundred or more of such  prospectively  qualified  voters,  may
  make  other  nominations  for  one  or  more  vacancies  in the board of
  directors to  be  filled  at  any  such  election  by  filing  with  the
  superintendent, at least five months before the election, a certificate,
  subscribed  and  affirmed as true under the penalties of perjury by each
  of such policyholders, giving the names and addresses of the  candidates
  nominated,   the  names  and  addresses  of  three  persons  jointly  or
  severally, designated to receive proxies to be voted for said  nominees,
  and  an  appropriate  name  or title designated by the superintendent to
  distinguish  such  ticket  from  the  administration  ticket  and  other
  nominations.

    (B)  If  the  superintendent finds after investigation or hearing that
  such other nominations have been made as specified in  this  subsection,
  he may certify to such certificate.
    (C)  Such  nominators  shall  also  file  a  copy of said certificate,
  certified by the superintendent, at the home office of  the  company  at
  least five months before such election.
    (D)  Any  policyholder  who  will be qualified to vote at such ensuing
  election if he continues his policy or contract in force at the time  of
  such election, shall be deemed prospectively qualified to vote thereat.
    (2)  (A)  All  certificates  of  nomination  shall be accompanied by a
  written acceptance of such nomination by each nominee thereon.
    (B) The supreme court in the judicial district in which  such  company
  has its home office may for cause shown direct the name of any candidate
  to be stricken from a ticket on file.
    (C) The provisions of subsection (k) hereof shall apply to any vacancy
  so created.
    (3)  If  no independent nomination shall have been made as provided in
  subsection (h) hereof, then the provisions of subsections  (i)  to  (k),
  hereof  inclusive,  of  this  section, shall not be applicable, and such
  election of  directors  shall  be  conducted  in  accordance  with  such
  reasonable  rules  and  regulations as the superintendent may prescribe;
  but no votes shall be cast or counted except by  ballot  signed  by  the
  policyholder  and for candidates nominated by the board of directors, in
  accordance with subsection (g) of this section or for such candidate  as
  the  board  of directors may have nominated to fill vacancies among said
  candidates caused by the  death,  disability  or  refusal  to  stand  as
  candidates of any one or more of those so nominated.
    (i) (1) (A) At least three months prior to any such contested election
  the  company shall cause to be mailed, in a sealed envelope with postage
  prepaid, to each policyholder whose name shall  be  upon  said  complete
  list  or card catalogue and whose policy shall still be in force, at his
  last known post-office address, a serially numbered official ballot in a
  form approved  by  the  superintendent  and  containing  the  respective
  tickets  nominated  as hereinbefore provided and the names and addresses
  of the persons so appointed to receive proxies. A corresponding serially
  numbered  stub  or  card  containing  the  name  and  address   of   the
  policyholder  to  whom each ballot is sent shall be retained at the home
  office of the company for the purpose of identifying  said  ballot  when
  returned.
    (B)  Such  official  ballot  shall  be conveniently arranged under the
  names or titles by which the nominations have been designated and  shall
  have printed upon it the name of the company, the post-office address of
  its  home office, the number of directors to be elected and the names of
  those whose terms expire, the date of the election and  instructions  as
  herein  provided  for executing such official ballot or for the use of a
  proxy as herein provided and a designated space for the signature of the
  policyholder, the number of one of his policies and the signature  of  a
  subscribing witness.
    (C)  No  other  or  different  ballot  shall  be  used,  except that a
  duplicate ballot or ballots may be  supplied  to  any  policyholder  and
  voter  or to the holder of his proxy, for his own use, pursuant to rules
  and regulations prescribed by the superintendent.
    (D) There shall be inclosed in such sealed envelope with such official
  ballot a suitable return gummed envelope having  inscribed  thereon  the
  name  and  post-office  address  of  the home office of the company, the
  corresponding serial number,  and  the  words  "ballot  for  directors".
  There  shall  also be inclosed in such sealed envelope or printed on the
  back of such ballot, a suitable blank proxy together with a statement of

  the right of the policyholder to vote either by  mail  or  by  proxy  as
  herein provided or in person.
    (E)  No other papers or written or printed matter shall be inclosed in
  such sealed envelope. Specimen copies of such  sealed  envelope,  ballot
  and proxy shall be submitted to the superintendent for his approval, and
  no  such  envelope  and inclosures shall be mailed unless the same shall
  have been approved by him.
    (2) A policyholder desiring to vote directly by mail must indicate the
  name of the nominee or nominees for whom he desires to  vote  or  strike
  out  the name or names of those for whom he does not desire to vote upon
  the official ballot so provided or must otherwise suitably  indicate  in
  the  blank spaces thereon the nominee or nominees for whom he desires to
  vote, and must sign the said official ballot in his own  handwriting  in
  the  presence  of a subscribing witness, and place or cause to be placed
  thereon the number of at least one policy held by him. Failure to  state
  or  to correctly state such policy number shall not render a ballot void
  or subject the policyholder to any penalty.
    (3) Such policyholder desiring to vote directly by mail  must  inclose
  the  official ballot so marked in such return envelope or in a similarly
  inscribed envelope. Such  envelope  containing  the  ballot  sealed  and
  postpaid  shall  be mailed by the policyholder to the home office of the
  company. No policyholder may vote for more than the number of  directors
  so  to  be  elected  and  all  ballots  upon  which  the  intent  of the
  policyholder does not fairly appear shall be void.
    (j) (1) A policyholder may vote by proxy executed to one  or  more  of
  the  persons  designated  in  the  certificates  filed  as  provided  in
  subsections (g) and (h) of this section. The execution of a proxy  shall
  be  attested  by a subscribing witness and the proxy shall set forth the
  number of at least one policy held by the  person  giving  it.  A  proxy
  shall  not  be  valid  unless  executed within three months prior to the
  election and shall be used only at  such  election  or  any  adjournment
  thereof  and  may  not  be  revoked  by the policyholder giving the same
  unless it  appears  that  the  policyholder  was  induced  by  fraud  or
  misrepresentation to execute the proxy.
    (2)  In exercising such proxy the holder or holders thereof shall vote
  only upon the official ballot, or the duplicate  thereof,  furnished  to
  such policyholder as hereinbefore provided, to which such proxy shall be
  attached.    In so voting the proxy holder shall sign said ballot in the
  name of the policyholder, and shall also sign his own name as proxy.
    (3) Ballots voted by proxy holders shall be mailed to the home office,
  or voted in person by said proxy holder, in the same  manner  as  herein
  prescribed for ballots voted directly by policyholders.
    (k)  (1)  The votes at such contested election shall be limited to the
  candidates nominated as aforesaid and to substituted nominees chosen  as
  follows:
    (A)  In case any vacancy occurs more than five months prior to the day
  set for such election, the board of directors, if such vacancy occurs on
  the administration ticket, or a majority  of  the  nominators,  if  such
  vacancy  occurs  on  any  independent  ticket,  shall  nominate  another
  candidate to fill such vacancy by filing at least one month prior to the
  date of  such  election  a  certificate  of  said  nomination  with  the
  superintendent  and  a  certified copy thereof at the home office of the
  company, and the name of the candidate so selected shall be set forth in
  the official ballot sent out by the company.
    (B) If such vacancy occurs within five months of  such  election  then
  the  board of directors, including those elected at such election, shall
  have power to fill such vacancy.

    (2) All ballots by mail shall be received, at the home office  of  the
  company  holding  such  contested  election,  by  two  or  more persons,
  one-half  of  whom  shall  be  appointed  for  that   purpose   by   the
  superintendent  and  one-half  by  the  directors  of  the  company. The
  compensation  of  the  custodians  so  appointed  shall  be  paid by the
  company. Such custodians shall keep a  daily  record  of  the  envelopes
  marked  as  containing  ballots  for directors which are received at the
  home office, and shall securely retain them in their  joint  custody  in
  safety vaults or compartments accessible only to such custodians and not
  to  either  of  them  separately,  under  regulations  prescribed by the
  superintendent. Prior to the closing of the polls on election  day  said
  custodians  shall  deliver  all  ballots  so  received  by  them  to the
  inspectors of election.
    (3) The election shall be held at the home office of the company.  The
  polls shall be opened at ten o'clock in the  forenoon  and  remain  open
  until four o'clock in the afternoon of the day of the election, at which
  time  they  shall be closed. All votes cast at such election shall be by
  ballot as hereinbefore provided.
    (4) The superintendent shall appoint an adequate number  of  competent
  and  disinterested  inspectors of election and may appoint if necessary,
  expert  accountants  and  other  assistants  and   may   authorize   the
  procurement  of  stationery  and  supplies  necessary for conducting the
  election and canvassing the votes. The reasonable compensation  of  such
  inspectors,  expert  accountants  and other assistants prescribed by the
  superintendent, and other necessary disbursements approved by him, shall
  be paid by the company. Such inspectors shall have  power  to  determine
  all   questions   concerning   the  verification  of  the  ballots,  the
  ascertainment of the validity thereof, the qualifications of the  voters
  and  the  canvass  of the vote, and with respect thereto shall act under
  such rules and regulations as are prescribed by the superintendent.
    (5) All envelopes  marked  substantially  as  hereinbefore  prescribed
  received  by  mail at the office of the company at any time prior to the
  day of election or on that day before the  polls  are  closed  shall  be
  forthwith  delivered  intact without opening to the custodians appointed
  as hereinbefore provided and  before  the  polls  are  closed  shall  be
  delivered to the inspectors of election.
    (6)  No  person  shall  conceal  or  withhold or aid or abet any other
  person in concealing or withholding from the  custodians  or  inspectors
  any  such envelope; nor shall any person, other than an inspector, or an
  authorized assistant, open or aid or abet any person to  open  any  such
  envelope.
    (7)  No  ballots  received  by  mail  at  the office of the company or
  offered personally or by proxy after  the  polls  are  closed  shall  be
  counted. All ballots offered personally or under proxies and all ballots
  received  by  mail  at the office of the company as aforesaid before the
  polls are  closed  shall  be  received  by  the  inspectors  subject  to
  verification  and  ascertainment  of  the  validity  thereof  and of the
  qualifications of the voters.
    (8) Immediately upon the closing of the  polls  the  inspectors  shall
  proceed  to  the  examination of the ballots and shall canvass the votes
  lawfully cast. The canvass  shall  proceed  from  day  to  day  and  the
  inspectors,  or  a  majority  thereof,  shall  certify the result to the
  company and to the superintendent as  soon  as  it  is  completed.  Such
  certificate  shall be subscribed and affirmed by such inspectors as true
  under the penalties of perjury. Unless contested by  the  superintendent
  or  other  qualified  person  pursuant  to  paragraph twelve hereof, the
  results so certified shall be decisive. The superintendent  may  require

  the  inspectors  to  report  for determination by him any questions upon
  which they may disagree.
    (9) Representatives designated by a majority of each three persons who
  shall  have  been  appointed as aforesaid to receive proxies to be voted
  for tickets nominated for such contested election,  in  such  number  as
  shall  be  approved  by  the  superintendent,  may be present during the
  casting, verification and canvass of the votes. The compensation of such
  representatives shall not be a charge upon or paid from the funds of the
  company.
    (10) All ballots and proxies received by the  inspectors  of  election
  shall immediately upon the completion of the canvass be placed in sealed
  packages  and  shall be preserved by the said inspectors for a period of
  four months, subject to the order of any court  having  jurisdiction  of
  any  proceedings  relating thereto. The necessary expenses of preserving
  such ballots and proxies shall be paid by the company as a part  of  the
  expenses of such election.
    (11)  The  superintendent shall have power to supervise and direct the
  methods and procedure of any such contested election  and  to  make  all
  further   needful   rules  and  regulations  concerning  the  same.  The
  superintendent shall prescribe the method of distribution of ballots and
  proxies to policyholders, qualified to vote at such  election,  who  are
  not  included  in  such  list  or  card  catalogue,  and shall prescribe
  reasonable rules and regulations for the casting of such ballots and the
  exercise of such proxies. All bills for or on account of the  custodians
  of  ballots  and inspectors of election, their employees, assistants and
  other necessary expenses or disbursements, during the  conduct  of  such
  contested  election,  and the canvass of the votes, shall be approved by
  the superintendent before payment by the company.
    (12) Any such contested election and the conduct thereof shall at  all
  times,  on  petition  of  the superintendent or of any person or persons
  qualified with respect to any procedure or right  therein  which  is  in
  question, be subject to the supervision and control of the supreme court
  in  the  judicial district in which such company has its home office, in
  like manner as elections for state, county and  municipal  officers,  so
  far as analogous thereto.
    (l) The inclusion by any such company of the name of any person in any
  list of policyholders required by this section shall not be construed as
  an  admission  by  the company of the validity of any policy or contract
  and no such list shall be competent evidence against the corporation  in
  any  action  or  proceeding in which the question of the validity of any
  policy or contract or of any claim under it is involved.
    (m) (1) No insurance  company,  and  no  officer,  agent  or  employee
  thereof  shall  knowingly  omit,  from any list or card catalogue herein
  required to be filed, the  name  of  any  policyholder  required  to  be
  included  therein,  or shall knowingly omit to give the correct name and
  address of such policyholder, or shall knowingly give a  wrong  address,
  or  shall  expend,  advance or lend any money of the company contrary to
  the provisions of this section.
    (2) Except where such expenditure is otherwise authorized or  required
  by this section, no money of the company shall be expended in connection
  with  any  such  election  or  in canvassing therefor, and no officer or
  agent of the company shall directly or indirectly make  any  advance  or
  loan  of such moneys to any person in connection with or for the purpose
  of such election or canvass unless the  expenditure  or  loan  is  in  a
  contested election and shall be limited to reasonable amounts authorized
  by  the board of directors of the company and approved in advance by the
  superintendent.

    (3) No officer, salaried agent or employee of any such company  shall,
  within  the  period  between  the  filing  of  the  nominations  and the
  election, during business hours, devote any of his  time  to  soliciting
  votes  in  support  of  or  in  opposition  to  any candidate or list of
  candidates  in  connection  with  any  such  election  of  directors. No
  officer, agent or employee of any such company shall  compel  or  coerce
  any  other  such  officer,  agent  or  employee to support, work for, or
  oppose any candidate or any list of candidates. Neither  the  stationery
  or  supplies of any such company nor office space devoted to the conduct
  of its business shall be used for furthering the interest of any  ticket
  or  candidate  at  any election of directors. Notwithstanding the above,
  the company may utilize the time  of  officers,  employees  and  agents,
  office  space,  stationery  and supplies in circumstances where money of
  the  company  may  be  expended  pursuant  to  paragraph  two  of   this
  subsection,  but  no officer, employee or agent shall in connection with
  any election be coerced to undertake activity outside the scope  of  the
  duties of the position of such officer, employee or agent.
    (4)  No  person,  firm  or  corporation,  whether  connected with such
  company or otherwise, shall issue or cause to be issued any circular  or
  other  written  or  printed  communication,  either  in  behalf of or in
  opposition to any ticket or any candidate for election  as  director  of
  such company which contains any false statement.
    (5)  No policyholder shall sell or offer to sell any vote or proxy for
  any sum of money or anything of value. No agent shall be paid or receive
  any sum of money or anything of value in connection with the voting of a
  ballot or obtaining of a proxy.