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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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