Section 1209. Management and by-laws of mutual insurance corporations

(a)
  The management  of  the  business  and  affairs  of  a  domestic  mutual
  insurance corporation shall be vested in a board of directors.
    (b)  Such  corporation  shall  have not less than seven directors. The
  directors, except as provided in section four thousand two  hundred  ten
  of this chapter, shall be elected at the annual meetings of the members,
  and  all except four of the directors of such corporation, elected after
  the organization of  the  corporation  is  completed  and  it  has  been
  licensed to issue insurance policies, must be members of the corporation
  or  officers  of member corporations. At any time after the first annual
  meeting, the directors may be divided into not exceeding three groups as
  nearly equal as possible, and thereafter the directors in one group only
  or their successors  shall  be  elected  annually  as  provided  in  the
  by-laws.  The  board of directors of such corporation shall hold regular
  meetings at least four times in each calendar year. At least one of such
  meetings shall be held within this state and the other meetings  may  be
  held elsewhere.
    (c)  The  board  of  directors  of  such  corporation shall elect such
  officers as are provided for in the  by-laws.  At  least  one  principal
  officer  shall  be  a  director, but the number of officers and salaried
  employees who are directors shall at all times be less than a quorum  of
  the board of directors, as prescribed in the charter or by-laws.
    (d) The by-laws of any such corporation organized after January first,
  nineteen hundred forty may be adopted at a directors' meeting held after
  receipt  from  the  superintendent of a certificate of incorporation and
  before the issuance of a  license  to  do  an  insurance  business.  The
  by-laws,  except as to corporations which elect their directors pursuant
  to the provisions of section four  thousand  two  hundred  ten  of  this
  chapter,  may  thereafter  be made or amended only by a majority vote of
  all members present in person or by proxy at any annual meeting or other
  stated or special meeting called for such purpose, except that the board
  of directors of any mutual insurance corporation may amend  its  by-laws
  as  to any provisions which do not impair the members' rights or enlarge
  their obligations under insurance policies. The by-laws of any  domestic
  mutual  insurance corporation which elects its directors pursuant to the
  provisions of such section may be amended by the board of directors.  No
  by-law  or  amendment  or  repeal  of  a  by-law  of any domestic mutual
  insurance  corporation  shall  be  effective  until  approved   by   the
  superintendent.
    The  superintendent  may  refuse  such  approval if he finds that such
  by-law, amendment or repeal does not conform with  the  requirements  of
  law,  or  is  not  equitable  to  the corporation's policyholders, or is
  inconsistent with its objects and purposes.
    (e) No domestic mutual insurance corporation, except a domestic mutual
  insurance company organized before January first, nineteen hundred forty
  to do only marine protection and indemnity insurance, shall  enter  into
  any  agreement under which any person, partnership or corporation agrees
  to pay all or a portion of the expenses of management of such  insurance
  corporation   in  consideration  of  an  agreement  to  pay  him  either
  commissions on premiums due  the  insurance  corporation  or  any  other
  compensation for his services.
    (f) No domestic mutual insurance corporation, except a domestic mutual
  insurance company organized before January first, nineteen hundred forty
  to  do  only marine protection and indemnity insurance, shall enter into
  any agreement with any of the officers or directors, or with any firm or
  corporation in  which  any  such  officer  or  director  is  pecuniarily
  interested  directly  or  indirectly,  whereby the insurance corporation
  agrees to pay, for the acquisition of business, any commission or  other

  compensation which under the agreement is increased or diminished by the
  amount  of  such  business or by the insurance corporation's earnings on
  such business.