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304.16-060 Trustee groups.
The lives of a group of individuals may be insured under a policy issued to the trustees of
a fund established by two (2) or more employers in the same industry or in related
industries or by one (1) or more labor unions, or by one (1) or more employers and one
(1) or more labor unions, which trustees shall be deemed the policyholder, to insure
employees of the employers or members of the unions for the benefit of persons other
than the employers or the unions, subject to the following requirements:
(1) At no time shall a policy be issued to insure employees of any employer whose
eligibility to participate in the fund as an employer arises out of considerations
directly related to the employer's being a commercial correspondent or business
client or patron of another employer, except where such other employer exercises
substantial control over the business operations of the participating employers.
(2) The persons eligible for insurance shall be all of the employees of the employers or
all of the members of the unions, or all of any class or classes thereof determined by
conditions pertaining to their employment, or to membership in the unions, or to
both. The policy may provide that the term "employees" shall include retired
employees or union members, and the individual proprietor or partners if an
employer is an individual proprietor or a partnership. No director of a corporate
employer shall be eligible for insurance under the policy unless such person is
otherwise eligible as a bona fide employee of the corporation by performing
services other than the usual duties of a director. No individual proprietor or partner
shall be eligible for insurance under the policy unless he is actively engaged in and
devotes a substantial part of his time to the conduct of the business of the proprietor
or partnership. The policy may provide that the term "employees" shall include
trustees or their employees, or both, if their duties are principally connected with
such trusteeship.
(3) The premium for the policy shall be paid by the trustees wholly from funds
contributed by the employer or employers of the insured persons, or by the union or
unions, or by both or partly from such funds and partly from funds contributed by
the insured persons. A policy on which no part of the premium is to be derived from
funds contributed by the insured persons specifically for their insurance shall insure
all eligible persons, except those who reject the coverage in writing.
(4) An insurer may exclude or limit the coverage on any person for whom evidence of
individual insurability is not satisfactory to the insurer.
(5) The amounts of insurance under the policy shall be based upon some plan
precluding individual selection either by the insured persons or by the policyholder,
employers or unions.
Effective: July 15, 2008
History: Amended 2008 Ky. Acts ch. 140, sec. 4, effective July 15, 2008. -- Created
1970 Ky. Acts ch. 301, subtit. 16, sec. 6, effective June 18, 1970.
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