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Title XXIV BUSINESS AND FINANCIAL INSTITUTIONS

Chapter 380

previous next Effective - 01 Jan 1985, see footnotebottom

  380.131.  Loss or judgment against company, business basis to determine procedure — failure to pay assessment, effect. — 1.  After receiving notice of any loss or damage to a member's property or after the rendition of any judgment against a company, the directors of a company operating solely on an assessment basis shall verify such loss, damage or judgment and shall assess each member an amount in proportion to the amount of risk such member has with the company.  Failure to pay the assessment within thirty days of notification shall justify the company in cancelling a member's policy and returning a member's deposit after deducting the amount of the assessment owed.

  2.  If a company has chosen to operate on a premium plus assessment basis, it shall pay all losses and judgments from premiums received or amounts collected on promissory notes.  The amount deducted from each member's premiums paid or demanded from each member's promissory note shall bear such relationship to the total loss as that member's total premium bears to the total premiums collected in the calendar year that the loss is incurred.  If such funds are insufficient to cover the loss or judgment, the directors may assess each member in the same manner; but, there shall not be more than one assessment for losses in any calendar year.  The directors may borrow sufficient funds to pay losses until such time as they may collect the assessment.  Failure to pay any assessment within thirty days of notification shall justify the company in cancelling a member's policy.

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(L. 1984 H.B. 1498)

Effective 1-01-85


---- end of effective   01 Jan 1985 ----

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