Senate Commerce Committee Statement to Senate, No. 4270 — State of New Jersey (December 16, 2021)

Summary

The Senate Commerce Committee of the State of New Jersey, in a statement dated December 16, 2021, reports favorably Senate Bill No. 4270, which changes the law concerning insurance holding companies. The bill adds a presumption of control when a person solicits proxies to elect directors representing 10 percent or more of the board members, and defines "own" or "owned" to include voting securities underlying convertible securities, options and securities futures contracts. It adds circumstances under which a person must file information with the Department of Banking and Insurance and obtain approval. The statement says the purpose is to let the Commissioner of Banking and Insurance review any acquisition of control of a domestic insurer.

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SENATE COMMERCE COMMITTEE

STATEMENT TO

SENATE, No.
4270

STATE
OF NEW JERSEY

DATED: DECEMBER
16, 2021

The
Senate Commerce Committee reports favorably Senate Bill No. 4270.

This
bill makes certain changes to the law concerning insurance holding companies.

This
bill adds a distinct presumption of control when a person solicits proxies for
the purpose of electing directors representing 10 percent or more of the board
members and adds a definition of “own” or “owned” to include all voting
securities underlying convertible securities, options, securities futures
contracts, and aggregating shares “owned” by persons acting in concert.

The
bill adds to the law additional circumstances under which a person is required
to file information with the Department of Banking and Insurance and obtain
approval and requires additional information to be included in the filing. The
bill clarifies that the purpose of these provisions is to enable the
Commissioner of Banking and Insurance to review any acquisition of control of a
domestic insurer or of any other person controlling a domestic insurer in order
to determine whether or not the acquisition of control would be adverse to the
public interest or protection of the existing and future policyholders of the
company or is being sought by persons who would utilize such control adversely
to the public interest or protection of policyholders, and to enable the
commissioner to make the findings required pursuant to the law.

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