COMPILED CODE - Iowa Legislature - State of Iowa

380
i 5696-a4. MUTUAL ASSESSMENT ASSOCIATIONS. Tit. XVIII, Ch. 8.
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any class as shown by the second preceding section, representing the
following amount of insurance: Classes one, two, three, and five,
two hundred fifty thousand dollars each, class four, one hundred thousand
dollars and no county mutual assessment association shall issue
policies until applications for insurance to the amount of fifty thousand
dollars representing at least fifty applicants have been received,
and no application for insurance during the period of organization
shall exceed two per cent of the amount required for organization,
nor after one year of organization one per cent of the total insurance
in force, any reinsurance taking effect simultaneously with the policy
being deducted in determining such maximum single risk. Neither
shall any association issue policies of insurance until its articles of
incorporation, by-laws and form of policy shall have been submitted
to the commissioner of insurance and if upon examination of same
he finds them to conform to the provisions of this chapter he shall at
once issue to the association a certificate authorizing it to transact an
insurance business.
[C, '97, § 1761 ; S., '13, § 1759-c; 39 G. A., ch. 120, § 3.]
SEC. 5696-a4. Assessments—loans—emergency fund—net assets
required.
1 Such associations may collect a policy and contingent fee, and
2 such assessments, provided for in their articles of incorporation and
3 by-laws, as are required to pay losses and necessary expenses, and
4 for the creatioa and maintenance of an emergency fund for the pay-
5 ment of excess losses and no part of such emergency fund can be
6 claimed by any member whose policy expires or is surrendered for
7 cancellation.
8 Any association may collect assessments for losses and expenses
9 for one year in advance ; or for more than one year in advance where
10 such advance assessment does not exceed five mills on each dollar of
11 insurance in force; and in case the funds of any association are not
12 sufficient to pay losses that have been reported or adjusted the asso-
13 ciation may borrow money for payment of losses until such time as
14 it is practical to make an assessment or until the regular assessment
15 period.
16 Funds raised by such associations which because of temporarily
17 low rate of losses are not needed to pay losses and expenses in any
18 year, may be passed to an emergency fund to be held for payment of
19 excess losses in a subsequent year or years ; such fund may be depos-
20 ited in banks, or at the option of the board of directors may be in-
21 vested in the classes of securities permitted by section fifty-six hun-
22 dred twenty-two of the compiled code ; but under the direction of the
23 board of directors and with the consent of the commissioner of insur-
24 anee a part of such fund may be invested in a home office building.
25 When the emergency fund of any association reaches an amount
26 equal to one hundred per cent of the average cost per thousand on
27 all policies in force for the full term for which assessment is col-
28 lected and not less than one hundred thousand dollars or such amount
29 of capital stock as is required of domestic companies, such associa-
30 tions may issue policies of fixed premiums.
31 Associations using a basis rate whose risks consist principally
32 of store buildings and their contents, manufacturing establishments,
33 public garages, lumber yards, office buildings, hotels, theaters, moving