US Laws, Codes, Statutes & Cases

                                  TITLE  41
                                  INSURANCE
                                  CHAPTER 28
                    ORGANIZATION AND CORPORATE PROCEDURES
                         OF STOCK AND MUTUAL INSURERS
    41-2847.  LEVY OF CONTINGENT LIABILITY. (1) If at any time the assets of a
domestic mutual insurer are less than its liabilities and the minimum amount
of surplus required to be maintained by it under this code for authority to
transact the kinds of insurance being transacted, and the deficiency is not
cured from other sources, its directors may, if the same is approved by the
director, levy an assessment only on its members who held the policies
providing for contingent liability at any time within the twelve (12) months
next preceding the date the levy was authorized by the board of directors, and
such members shall be liable to the insurer for the amount so assessed.
    (2)  The levy of assessment shall be for such an amount, subject to the
director's approval, as is required to cure such deficiency and to provide a
reasonable amount of working funds above such minimum amount of surplus, but
such working funds so provided shall not exceed five per cent (5%) of the sum
of the insurer's liabilities and such minimum required surplus as of the date
of the levy.
    (3)  As to the respective policies subject to the levy, the assessment
shall be computed upon such reasonable basis as may be approved by the
director in writing in advance of the levy.
    (4)  No member shall have an offset against any assessment for which he is
liable, on account of any claim for unearned premium or loss payable.
    (5)  As to life insurance, any part of such assessment upon a member which
remains unpaid following notice of assessment, demand for payment, and lapse
of a reasonable waiting period as specified in such notice, may, if approved
by the director as being in the best interests of the insurer and its members,
be secured by placing a lien upon the cash surrender values and accumulated
dividends held by the insurer to the credit of the member.