P.R. Laws tit. 26, § 3411
When the members of the insurance cooperative are cooperatives, these shall have the right to nominate one of their members as candidate for director, provided that the affiliate cooperative complies with the duties and obligations of the members established in this chapter.
(1) Every director or candidate for director of an insurance cooperative shall comply, as of his/her nomination and during all of his/her incumbency, with the following requirements:
(a) Must have taken seminars on cooperativism. The candidate who aspires to be a director of the insurance cooperative for the first time, shall also take and approve during the first year of his/her incumbency an insurance course prepared by the insurance cooperative that has been submitted for the consideration of the Insurance Commissioner. The course shall include, at least, general principles of insurance, kinds of insurance marketed by the insurance cooperative and matters concerning the operations of the insurance cooperative. Every director shall participate in the continuing education program to be implemented by the insurance cooperative to ensure his/her permanent training.
(b) Must comply with all the requirements established in the bylaws of the insurance cooperative.
(c) Must be eligible for fidelity bond coverage.
(d) Shall be a resident of and actually reside in Puerto Rico.
(e) At least three fourths (¾) must be American citizens.
(2) The following shall be impediments for becoming the director of an insurance cooperative:
(a) Failure to comply with any of the requirements established in subsection (1) of this section.
(b) Having declared bankruptcy at some time, whether voluntarily, involuntarily or fraudulently, or to have fraudulently executed a general assignment in the benefit of collectors.
(c) Having been convicted of a felony, a misdemeanor, or found liable in a civil action lawsuit, in both cases at the state or federal level, abroad or in his/her country of origin, for actions that imply illegal appropriation, fraud, moral depravity or any other serious criminal conduct.
(d) Being director or officer of any of the financial institutions described in §§ 301–335 of this title or of the Cooperative Bank of Puerto Rico. For purposes of this provision, an officer is any person who, by virtue of any designation or contract and by means of the payment of a salary, compensation or remuneration, fills a position that entails his/her participation in decision-making or in the design and implementation of the policies of the aforementioned financial institutions. This prohibition, however, shall not prevent a director of a cooperative credit union from also being the director of an insurance cooperative.
(e) Having direct or indirect economic interest in any non-cooperative insurance company or any company whose business competes with that of the insurance cooperative.
(f) Failure to comply with the bylaws adopted by the insurance cooperative and its Board of Directors to preserve integrity and avoid conflicts of interest in the performance of his/her duties as director of the insurance cooperative.
(g) Having been separated as a member from the Board or committee, or as officer of the administration of a cooperative or any other corporation, association or entity, for the causes established by the laws of the Commonwealth of Puerto Rico or by the laws of the United States, in any other international jurisdiction or in his/her country of origin. Provided, That the removal as a group due to syndication contemplated by the law shall not be considered to be an impediment with respect to the director concerned if he/she presents attesting proof of having been redressed or held harmless with respect to the reasons that caused the termination by the competent authority that executed said removal as a group.
(h) Any person who is a member of the Board of Directors of two (2) or more central entities of the Cooperative Movement of Puerto Rico, as defined in the bylaws of the insurance cooperative, shall be hindered from becoming a member of the Board of Directors of the insurance cooperative at the same time.
(i) Having litigations or legally representing, in any venue, the moving party of a case against the insurance cooperative.
Should any of the aforementioned impediments arise while the director is performing his/her functions, it would disqualify him/her from continuing to be a director, in which case the Board of Directors shall continue the procedure established for the involuntary separation of members.
History —Ins. Code, added as § 34.110 on June 26, 1959, No. 84, p. 220, § 1; June 25, 1965, No. 86, p. 200, § 7; July 20, 1979, No. 165, p. 420, § 10; Dec. 13, 1990, No. 36, p. 1545, § 4; Nov. 12, 2007, No. 174, § 12, eff. 30 days after Nov. 12, 2007.