5. Corporations engaged in the business of insuring titles to real estate may, after the investment of one hundred thousand dollars in the manner provided for in subdivisions one, two, three and four of this section, invest an amount not exceeding fifty per cent of their subscribed capital stock, in the preparation or purchase of the materials or plant necessary to enable them to engage in such business; and such material or plant shall be deemed an asset valued at the actual cost thereof, in all statements and proceedings required by law for the ascertainment and determination of the condition of such corporations. 6. Corporations organized for and engaged in the business of fire, life, health, accident and marine insurance, may, after the investment of two hundred thousand dollars, and corporations formed or organized for the transaction of business in any kind of insurance not enumerated in section four hundred and nineteen of the Civil Code may, after the investment of one hundred thousand dollars, in the manner provided in subdivisions one, two, three and four of this section, invest the balance of their capital and any accumulations in interest-bearing first-mortgage bonds of any corporations (except mining companies), not in default of interest, organized and carrying on business under the laws of any State of the United States. Provided, that a two-thirds vote of all the directors of such corporations shall approve such investment. It shall be the duty of the officers of such corporation to report quarterly, on the first days of January, April, July and October of each year to the Insurance Commissioner a list of such investments so made by them, and the Insurance Commissioner may, if such investments, or any of them, seem injudicious to him, require the sale of the same. But no investment in the securities named in subdivisions one, two, three and six of this section must be made in an amount exceeding the market value of such securities, at the date of such investment. 7. Life insurance companies, or corporations, no matter when organized, may loan upon their own policies; provided, that the amount so loaned upon each policy shall not exceed the reserve against said policy at the time said loan is made; provided further, that no policy loans whatever shall ever be used as security which may be deposited with the Insurance Commissioner under section six hundred and thirty-four of the Political Code; and provided further, that whenever any such loan in any amount is made on a policy registered with the Insurance Commissioner under said section six hundred and thirty-four of the Political Code, such registration shall be forthwith canceled. Nothing in this section contained shall be construed as in anywise affecting the provisions of section four hundred and forty-four of this code. [New section; approved March 3, 1905; in effect in sixty days.] Note.-See also § 421 as approved March 21, 1905, relating to same subject. § 421. Corporations organized under the laws of this State for the transaction of business in any kind of insurance, may invest their capital and accumulations in the following named securities : 1. In the purchase of, or loans upon interest-bearing bonds of the United States government. 2. In the purchase of, or loans upon interest-bearing bonds of any of the States of the United States, not in default for interest on such bonds. 3. In the purchase of, or loans upon interest-bearing bonds of any of the counties and incorporated cities and towns of any State or Territory of the United States not in default for interest on such bonds. 4. In loans upon unincumbered real property, which shall be worth, at the time of the investment, at least, forty per cent more than the sum loaned, or upon merchandise or cereals in warehouse, but in no instance shall such loan be made in excess of seventy-five per cent of the security taken. 5. Corporations engaged in the business of insuring titles to real estate may, after the investment of one hundred thousand dollars in the manner provided for in subdivisions one, two, three and four of this section, invest an amount not exceeding fifty per cent of their subscribed capital stock, in the preparation or purchase of the materials or plant necessary to enable them to engage in such business; and such material or plant shall be deemed an asset valued at the actual cost thereof, in all statements and proceedings required by law for the ascertainment and determination of the condition of such corporations. 6. Corporations organized for and engaged in the business of fire, life, health, accident and marine insurance, may, after the investment of two hundred thousand dollars, and corporations formed or organized for the transaction of business in any kind of insurance not enumerated in section four hundred and nineteen of the Civil Code may, after the investment of one hundred thousand dollars, in the manner provided in subdivision one, two, three and four of this section, invest the balance of their capital and any accumulations in the purchase of or loans upon the stock of any corporation (except mining companies) organized and carrying on business under the laws of the State of California which have at the time of investment a market value of not less than their paid-in value, and which are rated as first-class securities, or in interest-bearing firstmortgage bonds of same not in default of interest; provided, that a two-thirds vote of all the directors of such corporations shall approve such investment. It shall be the duty of the officers of such corporation to report quarterly during the months of January, April, July and October of each year to the Insurance Commissioner a list of such investments so made by them, and the Insurance Commissioner may, if such investments, or any of them, seem injudicious to him, require the sale of the same. But no investment in the securities named in subdivisions one, two, three and six of this section must be made in an amount exceeding the market value of such securities, at the date of such investment. 7. Life insurance corporations may loan upon their own policies; provided, that the amount so loaned upon each policy shall not exceed the reserve against said policy at the time said loan is made; provided further, that no policy loans whatever shall ever be used as security which may be deposited with the Insurance Commissioner under section six hundred and thirtyfour of the Political Code; and provided further, that whenever any such loan in any amount is made on a policy registered with the Insurance Commissioner under said section six hundred and thirty-four of the Political Code, such registration shall be forthwith canceled. 8. Nothing in this section contained shall be construed as in anywise affecting the provisions of section four hundred and forty-four of this code. [New section; approved March 21, 1905; in effect in sixty days.] CHAPTER II. FIRE AND MARINE INSURANCE CORPORATIONS. SEC. 424. Payment of subscriptions. Capital to be all paid up in twelve months. 425. Certificate of capital stock paid up to be filed, and when. 426. Property which may be insured. 427. Funds may be invested, how. [Repealed March 3 and 21, 1905; in effect in sixty days.] 428. Rate of risk. 429. Amounts to be reserved before making dividends. 430. Reservation by companies with less than $200,000 capital. 432. Corporations for insuring titles to real estate. § 424. The entire capital stock of every fire or marine insurance corporation must be paid up in cash within twelve months from the filing of the articles of incorporation, and no policy of insurance must be issued or risk taken until twenty-five per cent of the whole capital stock is paid up. § 425. The president and a majority of the directors must, within thirty days after the payment of the twenty-five per cent of the capital stock, and also within thirty days after the payment of the last installment or assessment of the capital stock limited and fixed, prepare, subscribe, and swear to a certificate setting forth the amount of the fixed capital and the amount thereof paid up at the times respectively in this section named, and file the same in the office of the County Clerk of the county where the principal place of business of the corporation is located, and a duplicate thereof, similarly executed, with the Insurance Commissioner. § 426. Every corporation formed for fire or marine insurance, or both, may make insurance on all insurable interests within the scope of its articles of incorporation, and may cause itself to be reinsured. § 427. [Repealed March 3, and 21, 1905; in effect in sixty days.] See § 421. 123 Cal. 203. § 428. Fire and marine insurance corporations must never take, on any one risk, whether it is a marine insurance or an insurance against fire, a sum exceeding one tenth part of their capital actually paid in, and intact at the time of taking such risk, without at once reinsuring the excess above one tenth. [Amendment approved March 21, 1905; in effect in sixty days.] Note. § 428. The change consists in the insertion of the words "at once" before "reinsuring." § 429. No corporation formed subsequent to April first, eighteen hundred and seventy-eight, under the laws of this State, and transacting fire, marine, inland navigation insurance business, or insurance provided for by section four hundred and twenty (420) of this code, except insurance of the title to real property, must make any dividends except from profits remaining on hand after retaining unimpaired : 1. The entire subscribed capital stock; 2. All the premiums received or receivable on outstanding marine or inland risks, except marine time risks; 3. A fund equal to one half the amount of all premiums on all other risks not terminated at the time of making such dividend; 4. A sum sufficient to pay all losses reported or in course of settlement, and all liabilities for expenses and taxes. [Amendment in effect March 5, 1887.] § 430. No fire or marine insurance corporation, with a subscribed capital of less than two hundred thousand dollars, must declare any dividends, except from profits remaining on hand after reserving: 1. A sum necessary to form, with the subscribed capital stock, the aggregate sum of two hundred thousand dollars; 2. All the premiums received or receivable on outstanding marine or inland risks, except marine time risks; 3. A fund equal to one half the amount of all premiums on fire risks and marine time risks not terminated at the time of making such dividend; 4. A sum sufficient to pay all losses reported or in course of settlement, and all liabilities for expenses and taxes. § 431. [Repealed March 21, 1905; in effect in sixty days.] See note following § 452. § 432. Corporations transacting business in insuring titles to real estate shall annually set apart a sum equal to twentyfive per cent of their premiums collected during the year, which sum shall be allowed to accumulate until a fund shall have been |