and fees of office received by him, and for what purpose. And whenever any insurance company, doing business in this State, shall voluntarily surrender to the Insurance Commissioner its certificate of authority previonsly granted, thereby withdrawing from business in this State, the Commissioner must make due publication of such surrender and withdrawal daily for the period of one week, in each of two daily newspapers, the one published in the city of San Francisco, and the other in the city of Sacramento. It is further enacted, that if any action hereafter commenced in any District Court of this State, by a citizen thereof, against a foreign corporation or company doing insurance business in this State, such corporation or company shall transfer, or cause be transferred, such action to the United States Circuit Court, the right of such corporation or company to transact insurance business in this State shall thereupon and thereby cease and determine; and the Insurance Commissioner shall immediately revoke the certificate of such corporation or company authorizing it to do business in this State, and publish such revocation daily, for the period of two weeks, in each of some two daily newspapers, the one published in the city of San Francisco, and the other in the city of Sacramento. [In effect April 1, 1878.]

Amendments-of 1874 added sentence before last; those of 1878 added last sentence; rest of section based on Stats. 1868, p. 336. Insurance-see Civil Code, §§ 2527-2766.

Insurance corporations-see Civil Code, §§ 414-450,

Report of Insurance Commissioner-distribution of, § 337.

596. No person or company must transact insurance business in this State without first procuring from the Insurance Commissioner a certificate of authority, as in this chapter provided; and all policies issued or renewed and all insurances taken before obtaining such certificate of authority, are null and void; and any person who as agent or pretended agent of any insurance company, or other person, shall, without the possession of such certificate of authority, solicit, issue or procure to be issued in this State any policy of insurance, shall forfeit to the people of this State the sum of two hundred dollars for each aud every policy so issued, or procured to be issued. But any company or corporation belonging to any other State or country, having policies of life insurance outstanding in this State, and that were issued in accordance with the laws of this State, shall have the right to maintain a special agent in this State for the collection of renewal premiums on such policies, and the Commissioner is hereby authorized to issue to the duly appointed special agent of such company or corporation, a certificate authorizing him to collect such renewal premium; such certificate to be issued on the production to the Commissioner of satisfactory evidence

that such company or corporation is authorized to transact life insurance business in the State or country to which it belongs. And any person who, as agent of either the insured or insurer, shall collect such renewal premiums, must, on or before the tenth day of January, annually, file with the Commissioner a statement, under oath, showing the gross amount of such annual premiums collected by him during the year ending on the thirty-first day of December next preceding, and pay into the office of the Commissioner the sum of twenty dollars, gold coin of the United States. Failing to make such statement and payment within the time named, such person shall forfeit to the people of the State of California the sum of one hundred dollars for each and every policy so renewed by the payment to him of such renewal premium. All penalties and forfeitures under this section must be collected by the Insurance Commissioner, and for the purposes of such collections suits may be instituted by him, in the name of the people of the State of California, in any Court of competent jurisdiction. [Approved April 26, 1880.]

Original section-consisting of first two clauses, founded on Stats. 1868, p. 336.

597. The Commissioner, whenever necessary, or whenever he is requested by verified petition, signed by three persons interested, either as stockholders, policy holders, or creditors of any person engaged in insurance business, showing that such person is insolvent under the laws of this State, must make examination of the business and affairs relating to the insurance business of such person; and for such purpose has free access to all the books and papers of such person, and must thoroughly inspect and examine all his affairs, and ascertain his condition and ability to fulfill his engagements, and whether he has complied with all the provisions of law applicable to his insuranco transactions. Such person and his officers and agents must open his books and papers for the inspection of the Commissioner, and otherwise facilitate such examination; and the Commissioner may administer oaths and examine under oath any persons relative to the business of such person; and if he finds the books to have been carelessly or improperly kept or posted, he must employ sworn experts to rewrite, post, and balance the same, at the expense of such person. Such examination must be conducted in the county where such person has his principal place of business, and must be private, unless the Commissioner deems it necessary to publish the result of such investigation, in which case he may publish the same in two of the public newspapers of this State, one of which must be published in the City of San Francisco.

Basis of section-and of three succeeding sections, Stats. 1868, p. 336.

598. The Commissioner may collect the sum of five hundred dollars from any person engaged in the business of insurance, for each refusal to give full and truthful information, and response in writing, to any inquiry in writing by the Commissioner relating to the business of insurance as carried on by him; and for that purpose suits may be instituted by the Commissioner, in the name of tho people of the State of California, in any Court of competent jurisdiction.

599. The Commissioner may issue subpoenas for witnesses to attend and testify before him on any subject touching insurance business, or in aid of his duties, which must be served, obeyed, and enforced as provided in the Code of Civil Procedure for civil cases; the Commissioner to issue attachments and impose the penalty for disobedience; and, in addition, the defaulting witness may be punished as provided in the Penal Code.

600. Whenever the Commissioner ascertains that any person engaged in the insurance business is insolvent within the meaning of this chapter, he must revoke the certificate granted, and send by mail to such person, addressed to him at his principal place of business, or deliver to him personally, notice of such revocation, and cause notice thereof to be filed in his office, and also to be published daily for four weeks in some newspaper published in the City of San Francisco. He must require such person, after receiving notice of the revocation, or after the first publication thereof, to discontinue the issuing of any new polícies, and the renewal of any previously issued; and in such cases must require the person, or the manager or agent of the business, to repair the capital thereof within such period as he may designate in such requisition, by assessment upon the stockholders for such amounts as will make the capital equal to the amount of the paid up capital, exclusive of assets needed to pay all ascertained liabilities for losses reported, for expenses and taxes, and exclusive of the entire premiums received for outstanding risks.

601. In case any person, upon the requisition of the Commissioner, fails to make up the deficiency of the capital in accordance with the requirements of this chapter, or to comply in all respects with the laws of this State, the Commissioner must communicate the fact to the Attorney-General, who must commence an action in the name of the people of this State, in the Superior Court of the county where the person in question is located, or has his principal office, against such person, and apply for an order requiring cause to be shown why the business should not be closed; and the Court must thereupon hear the allegations and proofs of the respective parties, as in POL. CODE-10.

other cases. If it appears to the satisfaction of the Court that such person is insolvent, or that the interests of the public so require, the Court must decree a dissolution of such corporation, and a winding up of its affairs, and a distribution of the effects of such person; but otherwise, the Court must enter a decree annulling the act of the Commissioner in the premises, and authorizing such person to resume business. But the Commissioner must not be held liable for damages if he has acted in good faith. In the event of any additional losses occurring upon new risks taken after the expiration of the period limited by the Commissioner in the requisition, and before the deficiency has been filled up, the Directors of any company, corporation, or association, are individually liable to the extent thereof. [In effect April 3, 1880.]

Superior Court-substituted for District Court by amdt. 1880; rest of section based on Stats. 1868, p. 336.

602. Whenever provision for the liabilities of any person engaged in the business of fire, marine, or inland navigation insurance in this State, for losses reported, expenses, taxes, and reinsurance of all outstanding risks, estimated at fifty per cent. of the premiums received and receivable on all fire risks and marine time risks, at the full premiums received and receivable on all other marine risks, would so far impair his capital stock paid in as to reduce the same below two hundred thousand dollars, or below seventy-five per cent. of said capital stock paid in, such person is insolvent; and in the case of a person engaged in such insurance in this State, on the mutual plan, if the available cash assets of such person shall not exceed his liabilities, as herein before enumerated, in the full sum of two hundred thousand dollars, such person is insolvent; and whenever provision for the liabilities of any person engaged in any kind of insurance business in this State, other than life, provided for in section four hundred and twenty of the Civil Code of this State, for losses reported, expenses, taxes, and reinsurance of all outstanding risks, estimated at such rates as are accepted by the insurance authorities of the State of New York, would so far impair his capital stock paid in as to reduce the same below one hundred thousand dollars, or below seventy-five per cent. of said capital stock paid in, such person is insolvent; and in case of a person engaged in such insurance business in this State, on the mutual plan, if his available cash assets shall not exceed his liabilities, as herein before enumerated, in the full sum of one hundred thousand dollars, such person is insolvent. In the case of a company or corporation engaged in the business of life insurance, whenever its liabilities for losses reported, expenses, taxes, and reinsurance of all its outstanding risks, at rates based upon the American Expe

rience Table of Mortality, and interest at the rate of four and one-half per centum per annum, exceeds its assets, such company or corporation is insolvent. [In effect April 1, 1878.]

Origin of section-last sentence addded by amdts. 1878; preceding clause as to mutual plan added and verbal changes made by amdts. 1874: original section based on Stats. 1868, p. 336.

603. The Commissioner must keep and preserve, in a permanent form, a full record of his proceedings, including a concise statement of the condition of each person visited or examined by him.

Same basis-for section as most of preceding sections, Stats. 1868, p. 336.

604. The Commissioner may employ an actuary to make the valuation of life policies, at the compensation of not exceeding three cents for each thousand dollars of insurance, to be paid by the person or corporation for which the valuation is made.

Basis of section-see Stats. 1870, p. 860.

605. The Commissioner must require in advance, in United States gold coin, the following fees:

1. For filing the articles of incorporation, or certified copy of articles, or other certificate required to be filed in his office, thirty dollars;

2. For filing the annual statement required to be filed, twenty dollars;

3. For filing any other papers required by this chapter to be filed, five dollars;

4. For furnishing copies of papers filed in his office, twenty cents per folio;

5. For certifying copies, one dollar each;

6. For each certificate issued as provided in Section 619, the sum of five dollars.

Basis of section-and of next one also, see Stats. 1868, p. 336.

606. If the salary of the Commissioner and the expenses of his office exceeds the fees and charges collected by him, such excess must be annually assessed by the Commissioner upon all persons or corporations engaged in the business of insurance in this State, and they are severally liable therefor, pro rata, according to the amount of premiums received or receivable from risks taken in this State, respectively, during the year ending on the thirty-first day of December next preceding the assessment. The Commissioner must collect all fees and assessments, and pay monthly into the State Treasury whatever amounts may be received and collected by him.

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