A company that sells insurance to credit union members wants to move to the Hawkeye State.
CUNA Mutual Insurance Society, Madison, Wis., a company that has had a close affiliate with CUNA Mutual Life Insurance Company, Waverly, Iowa, for 15 years, has told Wisconsin insurance regulators that it wants to redomesticate itself and other Wisconsin affiliates to Iowa by February.
Special committees are looking into the possibility of recommending whether CUNA Mutual ought to merge with CUNA Mutual Life, but “it cannot be emphasized enough that no formal decision to merge has occurred,” Janet Ekenberg, a senior law specialist at CUNA Mutual, writes a letter to Wisconsin insurance regulators.
CUNA Mutual has attached a letter from James Armstrong, Iowa deputy insurance commissioner, stating that Iowa has no objections to the proposed redomestication.
The Credit Union National Association, Madison, formed CUNA Mutual in 1935 to sell loan protection insurance products and other insurance products to credit union members
CUNA Mutual formed a “permanent affiliation” with CUNA Mutual Life in 1990.
CUNA Mutual was formed as the Mutual Aid Society of the German Lutheran Synod of Iowa and Other States in 1879, according to an examination report posted on the Web site of the Iowa Insurance Division.
The old Mutual Aid Society moved to its current hometown of Waverly in 1922 and became a legal reserve life insurance company in 1937. The company changed its name to Century Companies of America, the last name it held before the affiliation with CUNA Mutual, in 1984, according to the examination report.
Legally, CUNA Mutual and CUNA Mutual Life are still separate companies.
Wisconsin and Iowa have similar insurance laws, but CUNA Mutual wants to redomesticate its Wisconsin units to Iowa in part because “Wisconsin’s demutualization law is both archaic…and untested,” Ekenberg writes. “To our knowledge, no Wisconsin mutual insurance company has ever gone public after demutualizing.”
In Iowa, several large insurers have demutualized, and at least 2 have used mutual holding companies as bases for going public, Ekenberg writes.
“While CUNA Mutual has no plans for demutualization, if changing business requirements ever dictate that demutualization is a prudent course for the company and its policyholders, it wants to be positioned to move as quickly as reasonably possible,” Ekenberg writes.
Iowa also has a new law that could let a mutual holding company include certain types of derivatives in its legal reserves, and CUNA Mutual might want to try using that law, Ekenberg writes.
Wisconsin has posted documents related to the CUNA Mutual redomestication request at Document Link