CHAPTER 5. AN ACT TO ESTABLISH AN INSURANCE DEPARTMENT IN THE TERRITORY OF NEW MEXICO AND TO REGULATE INSURANCE COMPANIES DOING BUSINESS THEREIN. H. B. No. 73; Approved February 9, 1905. CONTENTS. Sec. I. Insurance department established. Sec. 2. Sec. 3. Sec. 4. Sec. 5. Sec. 7. Superintendent of insurance. Term. Qualifications. Seal of insurance department. Effect of sealed documents as evidence. Transfer of papers in other offices to office of superintendent of insur ance. Sec. 8. Superintendent of insurance to keep and preserve records. Fine Superintendent of insurance to examine companies wishing to do business Sec. 10. Superintendent of insurance may publish result of examinations. Revo Sec. 11. Sec. 13. Sec. 14. Sec. 15. Sec. 16. Sec. 17. Sec. 18. Sec. 19. Sec. 20. Sec. 21. Sec. 22. Sec. 23. Sec. 24. Moneys to be paid into territorial treasury. Expenses of insurance de- Prohibition against doing business for unauthorized companies. Penalty. Annual statement of insurance companies to superintendent of insur ance required. Information to be included in statement. Evidentiary value of company's refusal to comply with provisions of act.. Paid up capital required of insurance companies. Duty of superintendent of insurance to examine form of all policy contracts. Prohibition against policies failing to provide for cancellation on equitable terms. Penalty for violation of act. Foreign companies to write no policies except on approval of resident agent. Prohibition against re-insuring. Superintendent of insurance authorized to examine books at principal office of company violating section 22. Penalty for refusal of company to allow inspection. sions of act. Sec. 25. Exemption of fraternal, religious and benevolent societies from provi Exception. Fee for filing annual statement of fraternal, religious and benevolent societies. Mutual companies not exempted by provisions of this act. Sec. 26. Section 2136 of Compiled Laws of 1897, prohibiting mutual companies from doing business upon stock company plan, and vice versa, re-enacted. Section 2139, Compiled Laws of 1897, placing fine on fire insurance companies failing to give proper security, as required by Section 2138, Compiled Laws of 1897, re-enacted. Sec. 28. Reports hitherto sent to territorial auditor to be sent to superintendent of insurance. Sec. 29. Domestic companies to file copy of articles within 30 days after organization. Sec. 30. Sections, 2115, 2117-2120, 2122-2126, 2128-2135, Compiled Laws of 1897, relating to insurance duties of territorial auditor and certain requirements of insurance companies, repealed. Act of Legislative Assembly 1861, entitled "An Act to incorporate a fire company in the city of Santa Fe," repealed. Chapter 106, Laws of 1901, relating to transaction of business by fire insurance companies otherwise than through resident agents, repealed. Sec. 31. Act not to affect policies or insurance contracts in force before its passage. Be it enacted by the Legislative Assembly of the Territory of New Mexico: Section 1. That there is hereby established a department, to be known as the Insurance Department of the Territory of New Mexico, which department shall be charged with the execution of all laws now in force, or which shall hereafter be enacted, in relation to insurance companies doing business in the Territory of New Mexico. Sec. 2. It shall be the duty of the governor, by and with the consent of the legislative council, to appoint a superintendent of insurance, who shall be the head of the said insurance department, and who shall hold his office for the period of two years and until a successor is appointed and qualified, but in no case shall such superintendent hold any position as an officer, agent or employe of any insurance company, nor shall he be directly or indirectly interested in any insurance company except as a policy holder. Sec. 3. Such superintendent of insurance shall within thirty days after being so appointed, and before entering upon the discharge of the duties of his said office, take and subscribe an oath to support the Constitution of the United States and the Organic Act of the Territory of New Mexico and to faithfully and impartially perform the duties of his said office and shall also give a bond to the Territory of New Mexico in the sum of twenty thousand ($20,000.00) dollars, conditioned for the faithful performance of all the duties required of him by law, which bond shall be approved by the governor and shall be filed and recorded, together with the said oath, in the office of the secretary of the territory. Sec. 4. Such superintendent of insurance shall receive a salary of two thousand four hundred ($2.400.00) dollars per annum, which shall be paid out of the insurance fund hereinafter provided for. Sec. 5. The seal of the said insurance department shall be a circular disc with the word "Superintendent" in the center, surrounded by the words "Insurance Department of New Mexico," an impression of which shall be filed in the office of the secretary of the territory. Every certificate or other paper executed by said superintendent in pursuance of any authority conferred on him by law, and sealed with his seal office, and all copies of papers certified by said superintendent and authenticated by said seal, shall in all cases be evidence equally and in like manner as the original thereof, and shall have the same force and effect as the originals would in any suit or proceedings in any court of this territory. Sec. 6. The said superintendent shall have an office at the territorial capitol, and may employ persons to make personal examination of the condition and affairs of insurance companies, when necessary, as required by law; and, whenever he may think necessary, he shall call upon the solicitor general of the territory for legal counsel and such assistance as may be necessary to enforce the provisions of this act. Sec. 7. All books and documents and all other papers whatsoever relating to insurance, in the offices of any of the officers of the territory shall, on demand, be delivered and transferred to the superintendent of insurance, who shall give a receipt for the same, which shall be a full release from all responsibility in connection with such documents, books and papers. Sec. 8. It shall be the duty of the superintendent of insurance to file in his office and safely keep all books and papers required by law to be filed therein, and to keep and preserve in permanent form a full record of his proceedings, including a concise statement of the condition of such insurance companies reported and examined by him, to issue certificates of authority to transact insurance business to any insurance companies which have fully complied with the laws of this territory, and to issue such other certificates as required by law in the organization of insurance companies and the transaction of the business of insurance and generally to do and to perform with justice and impartiality all such duties as are or may be imposed on him by the laws in relation to the business of insurance in this territory; and he shall, annually, at the earliest practical date after the returns are received from the several companies, make a report to the governor of the affairs of the insurance department, which report shall contain a tabular statement and synopsis of the several statements as accepted by the superintendent, and such other matters as in his opinion may be of benefit to the public, and shall make such recommendations as he may deem proper in regard to the subject of insurance in this territory, and shall set forth in a statement, verified by oath and the certificate of the territorial auditor, the sums received and disbursed by him, from and to whom, and for what purpose. The superintendent of insurance shall, within ninety (90) days after entering upon the discharge of the duties of the office, furnish to all insurance companies doing business in this territory, a copy of this act, and necessary blanks to comply therewith, and shall annually, in December, furnish such blanks for the filing of statements as required by law. The superintendent on retiring from office shall deliver to his qualified successor, all furniture, papers and property pertaining to his office. Sec. 9. The superintendent may, with the consent of the governor, whenever he deems it prudent, visit, and examine or cause to be visited and examined by some competent person, or persons he may appoint for that purpose, any insurance company applying for admission or already admitted to do business by agencies in this territory. Such examination shall include a thorough inspection and examination into its affairs, especially as to the financial condition and ability of said company to fulfill its obligations to the policy holders, and whether it has complied with the laws of this territory, and such company shall pay the proper charges incurred in such examination, including the expenses of the commissioner, or his deputies, and the expenses and compensation of his assistants employed therein. The superintendent may also make an examination, with the consent of the governor of any such company, upon the request of five (5) or more of the stockholders, creditors, policy holders, or persons pecuniarily interested therein, who shall make affidavit of their belief, with specifications of their reasons therefor in writing, that such company is in unsound or insolvent condition: Provided, That only the United States branches of all foreign companies in this territory may be examined by said superintendent. For the purpose aforesaid, the commissioner or his deputy or person making the examination, shall have free access to all books and papers of any insurance company that relate to its business, and the books and papers kept by any of its agents, and may summon and administer oaths or affirmations to witnesses, and examine the directors, officer, agents and trustees of any such company, and any other person, in relation to its affairs, transactions and conditions. He may require and compel the production of records, books, papers, contracts or other documents by attachment, if necessary; and shall have the right to punish for contempt by a fine or imprisonment, or both, any person failing or refusing to obey such summons or order of such superintendent. Any person testifying falsely in reference to any matter, material to said investigation, examination or inquiry, shall be deemed guilty of perjury; and, in addition to the punishment for contempt in refusing to attend, or answer, or produce books and papers, any person who shall refuse to give such superintendent full and truthful information and answer in writing to any inquiry or question made in writing by said superintendent, in regard to the business or insurance carried on by such person, or to appear and testify under oath before the superintendent in regard to same, shall be deemed guilty of a misdemeanor, and, upon conviction thereof, shall be punished by a fine not exceeding five hundred ($500.00) dollars, or imprisonment not exceeding three (3) months. Any director, officer, manager, agent or employe of an insurance company, or any other person, who shall make any false certificate entry or memorandum upon any of the books or papers of any insurance company, or upon any statement or exhibit filed or offered to be filed in the insurance department of this territory, or used in the course of any examination, inquiry or investigation, with the intent to deceive the superintendent of insurance, or any other person employed or appointed by him to make any inquiry, examination, or investigation, shall, upon conviction, be punished by a fine not exceeding one thousand ($1,000.00) dollars and by imprisonment for not less than two (2) months in the county jail, nor more than five (5) years in the penitentiary: Provided. That any company whose license has been revoked by said superintendent, may appeal from said order to the district court, which court, upon the filing of the proper petition, shall cause the record and orders of the superintendent to be brought before it, and upon a hearing of the case by the court de novo, the court shall either confirm or revoke the order of said superintendent as in its discretion may appear just. Sec. 10. When the superintendent deems it to the interest of the public he may publish the result of any examination or investigation in any newspaper of general circulation in the territory. When it appears to the superintendent of insurance from the report of the person appointed by him or other satisfactory evidence, that the affairs of any company doing business in the territory are in an unsound condition, he shall revoke the authority granted to such company to do business |