CHAPTER 3. MUTUAL LIFE AND ACCIDENT.FORMATION
IC 27-8-3
Chapter 3. Mutual Life and Accident.Formation
IC 27-8-3-1
Authority to incorporate; purposes; articles of incorporation;
initial applications; approval and filing documents; license
Sec. 1. Any number of persons not less than five (5), a majority
of whom are citizens of this state, may associate themselves together
as a corporation, association, or society for the purpose of transacting
the business of life or accident, or life and accident insurance, and
for the payment of partial and permanent disability claims to living
members, upon the assessment plan, for the purpose of mutual
protection and relief of its members, and for the payment of
stipulated sums of money to the families, heirs, executors,
administrators, or assigns of the deceased members, or for the
payment of total and permanent disability claims to living members
of such company, association, or society, as the member may direct,
in such manner as may be provided in the bylaws; and may receive
money, either by voluntary donation or contribution, for which
purpose, they shall make, sign, and acknowledge, before any officer
authorized to take acknowledgment of deeds in this state, articles of
incorporation or association, in which shall be stated the name or
title by which such corporation, association, or society shall be
known in law, the location of its principal business office (which
office must be located in this state), the names and residence of the
persons signing the articles of incorporation or association, the object
of the corporation, association, or society, with its plan of doing
business clearly and fully defined, the number of its directors,
trustees or managers and the names of those selected to serve until
its first annual meeting, and, in case of life corporations,
associations, or societies, the limit as to age of applicants for
membership, which shall not exceed sixty-five (65) years, and that
medical examinations are required, but no medical examination shall
be required in case of accident corporations, associations, or
societies, and that bona fide applications have been secured for two
hundred thousand dollars ($200,000) by not less than two hundred
(200) persons, who have each made application for membership in
such proposed corporation, association, or society, and, in case of a
life corporation, have each been examined and recommended by a
reliable physician, and in all cases have each deposited with the
parties asking the certificate for such corporation, association, or
society the sum of two dollars ($2) on each one thousand dollars
($1,000) of insurance applied for as an advance assessment for
mortuary or accident or disability indemnity purposes, as the case
may be; which certificate of association and applications, together
with the certificate of some solvent bank or banks that all such
advance funds are deposited therein to be turned over to the treasurer
of such corporation, association, or society when organized, shall be
submitted to the insurance commissioner, who shall carefully
examine the same, and, if he shall find that the objects and purposes
are fully and definitely set forth and are clearly within the provisions
of this chapter, and that the name or title is not the same or does not
so closely resemble a title in use as to have a tendency to mislead the
public, the commissioner shall submit the same to the attorney
general for examination, and if found by him to be in accordance
with this chapter and not inconsistent with the constitution and laws
of the United States and of this state, he shall certify to and deliver
the same to the secretary of state, who shall cause the same, with the
certificate of the attorney general, to be recorded in a book to be kept
for that purpose; and, upon application of the signers thereof, the
secretary of state shall furnish to them a certified copy of such
articles and certificates, under his hand and the seal of this state, and
the secretary of state shall thereupon file in the office of the
commissioner a certified copy of all papers pertaining to the
organization of such corporation, association, or society. Thereupon,
the commissioner shall issue a license, authorizing said corporation,
association, or society to transact the business set forth in the
certificate of incorporation. Such corporation, association, or society
shall deposit with the commissioner a copy of all its forms of policy
issued by them, together with a copy of its bylaws and all forms of
application for insurance.
(Formerly: Acts 1897, c.195, s.1.) As amended by P.L.252-1985,
SEC.275.
IC 27-8-3-2
Corporate powers
Sec. 2. A corporation, association, or society, organized under the
provisions of this chapter, shall, by the name adopted by such
corporation, association, or society, in law, be capable of suing and
being sued, and may have power to make and enforce contracts in
relation to the business of such corporation, association, or society,
may have and use a common seal and may change or alter the same
at pleasure, and, in the name of the corporation, association, or
society, or by a trustee chosen by their board of directors, shall, in
law, be capable of taking, purchasing, holding, and disposing of real
and personal property for the purposes of their organization, may by
their board of directors, trustees or managers, make bylaws not
inconsistent with the constitution and laws of this state or of the
United States, which bylaws shall define the manner of electing
directors, trustees, or managers, or officers of such corporation,
association, or society, and the qualifications and duties of the same,
with terms of office not exceeding three (3) years, also the
qualifications and privileges of the members thereof.
(Formerly: Acts 1897, c.195, s.2.) As amended by P.L.252-1985,
SEC.276.
IC 27-8-3-3
Directors, trustees, or managers
Sec. 3. The affairs of all corporations, associations, or societies
organized or doing business under the provisions of this chapter shall
be managed by not less than five (5) directors, trustees, or managers,
a majority of whom shall be residents of the state of Indiana, who
shall be elected from and by the members, at such time and place and
for such period, not exceeding three (3) years, as may be provided for
in the bylaws, and may be eligible for reelection, provided that as
near as practicable, an equal number shall be elected each year.
Whenever directors, trustees, or managers shall be elected, a
certificate, under the seal of the corporation, association, or society,
giving the names and residences of those elected and the term of
their office, shall be filed in the office of the insurance
commissioner. Vacancies in the board of directors, trustees, or
managers shall be filled in the manner provided in the bylaws. Such
board of directors, trustees, or managers shall fix the compensation
to be paid to all officers and managers of such corporation,
association, or society.
(Formerly: Acts 1897, c.195, s.3.) As amended by P.L.252-1985,
SEC.277.
IC 27-8-3-4
Determination of fee rates and amount of premiums, assessments,
or periodical calls; risks
Sec. 4. The trustees, directors, or managers, or the persons
designated in the bylaws of the corporation, association, or society,
subject to the provisions of this chapter, shall fix the fee rates and
amounts of premiums, assessments, or periodical calls, and the time
and manner of the payment thereof, and the risks to be assumed by
such corporation, association, or society, and the duration thereof,
and may change the same, from time to time, as the experience of the
corporation, association, or society may require. An affidavit made
by the person having charge of the mailing of notices of premiums,
assessments, or periodical calls that any such notice was mailed to
his last postoffice address, stating the date of mailing, shall be prima
facie evidence thereof.
(Formerly: Acts 1897, c.195, s.4.) As amended by P.L.252-1985,
SEC.278.
IC 27-8-3-5
Reincorporation of domestic assessment plan companies;
exceptions
Sec. 5. Any domestic corporation, association, or society,
transacting business of life or accident or life and accident insurance
and providing for the payment of total and permanent disability
claims to living members, upon the assessment plan, may be
reincorporated or reorganized under the provisions of this chapter
under its existing corporate name, by filing with the insurance
commissioner a declaration of their desire to do so, signed and duly
acknowledged by a majority of its board of directors, trustees, or
managers, with a statement in like manner signed and acknowledged
by them that such corporation, association, or society, having insured
the lives or provided for the payment of accident indemnity, has
accumulated the fund required by section 7 of this chapter, or having
engaged in the business of accident insurance only, has accumulated
the fund required by section 11 of this chapter, and that such funds
are safely invested and held for the purposes for which the same
were accumulated, as provided in the bylaws of such corporation,
association or society, whereupon the commissioner, if approved by
him, shall file the same, together with his certificate of such
approval, with the secretary of state, who shall issue to such
corporation, association, or society a certificate of such
reincorporation or reorganization, under the seal of the state, and
attach thereto copies of all papers so filed with the secretary of state,
and the same shall be recorded in the office of the secretary of state,
and copies thereof filed in the office of the commissioner, and such
corporation, association, or society shall thereupon be deemed to be
reincorporated and reorganized under the provisions of this chapter.
It shall not be obligatory upon any such existing corporation,
association or society to incorporate or reincorporate under this
chapter, and any such domestic corporation, association, or society
may continue to exercise all the rights, powers, and privileges not
inconsistent with this chapter, pursuant to its articles of incorporation
or association, the same as if incorporated or reincorporated under
this chapter.
(Formerly: Acts 1897, c.195, s.5.) As amended by P.L.252-1985,
SEC.279.
IC 27-8-3-6
Application of chapter to assessment plan companies; exceptions
Sec. 6. Any incorporation, association or society organized to
insure lives, which provides for the payment of policy claims, or the
accumulation of reserve or emergency funds, and the expenses of the
management and prosecution of the business by payments to be made
either at periods named in the contract or upon assessments as
required, by persons holding similar contracts, and wherein the
insured's liability to contribute to the payment of policy claims
accrued or to accrue is not limited to a fixed sum, shall be deemed to
be engaged in the business of life insurance upon the assessment
plan, and shall be subject only to the provisions of this chapter.
However, nothing contained in this chapter shall be construed as
applicable to any association of religious or secret societies, or to any
class of mechanics, express, telegraph or railroad employees, or
veterans described in IC 10-17-5-2 or IC 10-17-5-1 formed for the
mutual benefit of the members thereof and their families exclusively,
or to any secret or fraternal societies, lodges or councils that may be
organized, or that are now organized and doing business in this state,
which conduct their business and secure members on the lodge
system exclusively, having ritualistic work and ceremonies in their
societies, lodges or councils, and which are under the supervision of
the grand or supreme body, nor to any association organized solely
for benevolent purposes and not for profit.
(Formerly: Acts 1897, c.195, s.6.) As amended by Acts 1980, P.L.38,
SEC.17; P.L.2-2003, SEC.69.
IC 27-8-3-7
Accumulation of reserve or emergency fund; investment;
additional funds; use of excess
Sec. 7. Every such life insurance corporation, association, or
society shall accumulate and maintain a reserve or emergency fund
equal to such sum as might be realized from one (1) assessment on,
or periodical payment by, policy or certificate holders thereof, and,
in no event, less than the amount of its maximum policy or
certificate. Such fund, if not already accumulated, shall be
accumulated by every such corporation, association, or society
existing on March 9, 1897, by September 9, 1897, and by every
corporation, association, or society formed under this chapter after
March 9, 1897, within six (6) months from the date of its
incorporation or organization, and shall be held as a trust fund for the
purposes for which such fund was created or accumulated. In case
such fund or any portion thereof shall have been used by the
corporation, association, or society for the purpose or purposes for
which the same was created or accumulated and the amount thereof
thereby reduced to less than the amount of one (1) death assessment
or periodical payment, the amount of such reduction below the
amount of one (1) death assessment or periodical payment shall be
made up and restored to said fund within six (6) months thereafter.
Such fund may be held in cash or invested in the same class of
securities required by law for the investment of funds by insurance
corporations; and nothing contained in this chapter shall prevent the
creation and accumulation of other funds in excess of the amount
required in this chapter to provide for the purposes of such
corporation, association, or society. If such fund is in excess of the
amount of one (1) death assessment or periodical payment upon all
certificate or policyholders and not less than the sum of fifty
thousand dollars ($50,000), the excess or any portion thereof may be
used in the reduction of assessment or periodical payments by policy
or certificate holders by ratable cash dividends or credits, or in such
other equitable division or apportionment thereof as its bylaws or
rules may provide, and such use shall not be deemed or construed to
mean a profit received by members within the meaning of the statutes
of this state, or the pro rata excess on any policy or certificate
terminated by death or surrender may be refunded to the holder or
beneficiary, as may be provided for in said policy or contract;
provided, that nothing contained in this chapter shall be construed to
permit any contract promising any fixed cash payment to any living
certificate or policyholder excepting in the contingency of physical
disability.
(Formerly: Acts 1897, c.195, s.7.) As amended by P.L.252-1985,
SEC.280.
IC 27-8-3-8
Assignment of policy to person without insurable interest void
Sec. 8. No corporation, association or society doing business of
life insurance under this chapter shall issue any policy of life
insurance in which the beneficiary named has no insurable interest.
Any assignment of the policy or certificate to a person having no
insurable interest in the insured life, except as security for actual
debt, with remainder over to the beneficiary or to the estate of the
insured, shall render such a policy or certificate void.
(Formerly: Acts 1897, c.195, s.8; Acts 1971, P.L.391, SEC.1.)
IC 27-8-3-9
Annual report; failure to file report and pay fees; suspension from
doing business
Sec. 9. Every such life insurance corporation, association, or
society doing business under this chapter shall, on or before March
1 in each year, make and file with the insurance commissioner a
report of its affairs and operations during the year ending on
December 31 immediately preceding, which report shall be in lieu of
all other reports required by this title and shall be in such form as the
commissioner may require. Such report shall be verified by such of
the officers of the corporation, association, or society as the
commissioner may require. Any corporation, association, or society
refusing or neglecting to make such report, or to make payment of
any of the fees required by law, shall, upon the order of the
commissioner, cease to do business in this state until such report and
payment shall be made and until the costs of such action be paid.
(Formerly: Acts 1897, c.195, s.9.) As amended by P.L.252-1985,
SEC.281.
IC 27-8-3-10
Accident insurance business on assessment plan
Sec. 10. Any corporation, association, or society organized to
insure against the contingency of death or physical disability of the
assured thereunder resulting from accidental injuries, and which
provides for the payment of policy claims, the accumulation of
reserve or emergency funds and the expenses of the management and
prosecution of the business, by payments to be made, either at
periods named in the contract or upon assessments as required by
persons holding similar contracts, and where the assured's liability to
contribute to the payment of benefits accrued or to accrue is not
limited to a fixed sum, shall be deemed to be engaged in the business
of accident insurance upon the assessment plan, and the business
involving the issuance of such contracts shall be carried on in this
state only by duly organized and authorized corporations,
associations, or societies, which shall be subject only to the
provisions and requirements of this chapter.
(Formerly: Acts 1897, c.195, s.10.) As amended by P.L.252-1985,
SEC.282.
IC 27-8-3-11
Reserve emergency fund
Sec. 11. Every such accident insurance corporation, association,
or society shall accumulate and maintain a reserve emergency fund
of at least two thousand dollars ($2,000). Such fund, if not already
accumulated, shall be accumulated by every such corporation,
association, or society existing on March 9, 1897, by September 9,
1897, and by every corporation, association, or society organized
under this chapter within six (6) months of the completion of its
organization and the receipt of its certificate of authority to transact
business in this state, and every corporation, association, or society
subject to the provisions of this chapter shall add to such emergency
fund thereafter two and one-half percent (2 1/2%) of the amount
realized from every premium, assessment, or periodical call until
such fund shall be equal to the amount of two dollars ($2) for every
five thousand dollars ($5,000) of insurance in force. Such emergency
fund, or any part thereof, may be used for the payment of death and
indemnity claims; provided, that if the amount of such fund be
thereby reduced below the amount contemplated in this chapter, the
amount by which such fund is reduced be made up and restored
within six (6) months thereafter. Such fund may be held in cash or
invested in the same class of securities required by law for the
investment of funds by insurance corporations, and nothing
contained in this chapter shall prevent the creation and accumulation
of other funds in excess of the amount required in this chapter to
provide for the purposes of such corporation, association, or society.
(Formerly: Acts 1897, c.195, s.11.) As amended by P.L.252-1985,
SEC.283.
IC 27-8-3-12
Report of affairs and operations; suspension for failure to file
Sec. 12. (a) Every such accident insurance corporation,
association, or society doing business under this chapter shall, on or
before March 1 in each year, make and file with the insurance
commissioner a report of its affairs and operations during the year
ending on December 31 immediately preceding, which report shall
be in lieu of all other reports required by this title and shall be
verified by such officers of the corporation, association or society, as
the commissioner may require, and shall contain answers to the
following questions:
(1) First, what number of certificates or policies were issued
during the year or applicants admitted?
(2) Second, what was the amount of death indemnity affected
thereby?
(3) Third, what number of death losses were incurred?
(4) Fourth, what number of death losses were paid and amount
thereof?
(5) Fifth, what were the total number of indemnity claims paid
and amount thereof?
(6) Sixth, what were the number of death and number of
indemnity claims unpaid?
(7) Seventh, does the corporation, association, or society charge
annual dues or membership fee? If so, how much?
(8) Eighth, what was the total amount received and whether
from assessment, annual dues, membership fees, or other
sources, and the disposition thereof?
(9) Ninth, does corporation, association, or society use moneys
received for payment of claims to pay expenses, in whole or in
part? And, if so, state the amount used.
(10) Tenth, what is the amount of the emergency fund and how
invested?
(11) Eleventh, if organized under the laws of this state, state
such fact and the date of organization.
(12) Twelfth, what were the number of policies in force and
death insurance in force at the beginning of the year, and such
other information as may be required by the superintendent of
insurance?
(b) Any corporation, association, or society refusing or neglecting
to make such report or to make payment of any one of the fees
required by this chapter shall, upon the order of the insurance
commissioner, cease to do business in this state until such report and
payment shall be made and until the costs of such action be paid.
(Formerly: Acts 1897, c.195, s.12.) As amended by P.L.252-1985,
SEC.284.
IC 27-8-3-13
Authority to deposit securities; investment of reserve funds
Sec. 13. This chapter shall not be construed to limit the
accumulation of a reserve or emergency fund by any corporation,
association, or society subject to the provisions of this chapter. Any
such corporation, association, or society may, in its discretion,
through its officers or directors, deposit with the insurance
commissioner such securities and for such amounts as may be
approved by him, and, when so deposited, shall be retained by him
for the purposes described in this chapter. All other investments of
reserve funds shall be made in the same class of securities as are
allowed by law for the investment of funds by insurance
corporations.
(Formerly: Acts 1897, c.195, s.13.) As amended by P.L.252-1985,
SEC.285.
IC 27-8-3-14
Specification of amount payable upon particular contingency;
obligation for payment; suspension of right to issue new policies
until payment made
Sec. 14. Every policy or certificate issued after March 9, 1897, by
any corporation, association, or society doing business under this
chapter and promising payment to be made upon a contingency of
death or physical disability shall specify the sum of money which it
promises to pay under such contingency, and the number of days
after satisfactory proof of the happening thereof on which such
payment shall be made. Upon the occurrence of such contingency,
unless the contract shall have been avoided by fraud, or by breach of
its conditions, the corporation, association, or society shall be
obligated to the beneficiary for such payment, at the time and to the
amount specified in the policy or certificate. If such corporation,
association, or society shall refuse or fail to make such payment for
sixty (60) days after final judgment has been obtained against such
claim, the insurance commissioner shall notify the corporation,
association, or society not to issue any new policies or certificates
until such indebtedness is fully paid; and no officer or agent of the
corporation, association, or society shall make, sign, or issue any
policy or certificate of insurance while such notice is in force.
(Formerly: Acts 1897, c.195, s.14.) As amended by P.L.252-1985,
SEC.286.
IC 27-8-3-15
Transfer or reinsurance of risks; approval; notice of preference for
transfer to different corporation
Sec. 15. No such corporation, association or society, organized
under the laws of this state, shall transfer its risks to, or reinsure them
in any other corporation, association or society unless the contract of
transfer or reinsurance is first submitted to and approved by a
two-thirds (2/3) vote of a meeting of the insured, called to consider
the same, of which meeting, a written or printed notice shall be
mailed to each member, certificate or policyholder, at least thirty
(30) days before the day fixed for such meeting. If such transfer or
reinsurance shall be approved, every member, certificate or
policyholder of the corporation, association or society, who shall file
with the secretary thereof, within ten (10) days after the meeting, a
written notice of his preference to be transferred to some other
corporation, association or society, than that named in the contract,
shall be accorded all the rights and privileges, if any, in aid of such
transfer as would have been accorded under the terms of such
contract had he been transferred to the corporation, association or
society named therein. No such corporation, association or society,
organized under the laws of this state, shall transfer its risks or
assets, or any part thereof, to, or reinsure its risks, or any part
thereof, in any insurance corporation, association or society of any
other state or country which is not at the time of such transfer or
reinsurance authorized to do business in this state under the laws
thereof.
(Formerly: Acts 1897, c.195, s.15.)
IC 27-8-3-16
Examination at request of corporation; certificate of results;
expense
Sec. 16. The insurance commissioner shall, at the request of any
corporation, association, or society doing business under the
provisions of this chapter in this state on the assessment plan, make
an examination of such corporation, association, or society, and shall
furnish a certificate of the results of such examination, showing all
its assets and how invested, and such other particulars as may be
deemed necessary to show the character and condition of said
corporation, association, or society, and the necessary expense of
said examination shall be paid by the corporation, association, or
society requesting it.
(Formerly: Acts 1897, c.195, s.16.) As amended by P.L.252-1985,
SEC.287.
IC 27-8-3-17
Visitation and inspection; insolvency or improper business
practices; report; order to show cause for termination of business
Sec. 17. All corporations, associations, and societies to which this
chapter is applicable, with their books, papers, and vouchers, shall be
subject to visitation and inspection by the insurance commissioner or
such person as he may designate, at the expense of said association.
The commissioner may address any inquiries to such corporation,
association, or society, in relation to its doings or condition, or any
other matter connected with its transactions relative to the business
contemplated by this chapter. All officers of such corporation,
association, or society shall promptly reply in writing to all such
inquiries, under the oath of its president, secretary, or other officers,
if required. When the commissioner on investigation, shall be
satisfied that any corporation, association, or society, organized
under the laws of this state, doing business in this state of the
character defined in this chapter, is insolvent because of matured
death claims or other obligations due and unpaid, exceeding its assets
and death assessments or periodical payments, called or in process
of collection, or has exceeded its powers, failed to comply with any
provision of law, or is conducting business fraudulently, he shall
report the facts to the attorney general, who, if he shall be of the
opinion that the facts require such action, may thereupon apply to
any court having jurisdiction thereof, within the county in which the
principal office of such corporation, association, or society in this
state is located, for an order requiring the officers of such
corporation, association, or society to show cause, at a reasonable
time and place within such county, why such corporation,
association, or society should not be restrained from continuing to
transact business, with power to the court to adjourn the hearing
thereon from time to time, not exceeding sixty (60) days in all.
(Formerly: Acts 1897, c.195, s.17.) As amended by P.L.252-1985,
SEC.288.
IC 27-8-3-18
Attorney general; exclusive power to apply for accounting,
injunction, or receivership
Sec. 18. No order, judgment, or decree providing for an
accounting or enjoining, restraining, or interfering with the
prosecution of the business of any domestic insurance corporation,
association, or society subject to the provisions of this chapter, or
appointing a temporary or permanent receiver thereof, shall be made
or granted otherwise than upon the application of the attorney
general on his own motion, or after his approval of a request in
writing thereof by the insurance commissioner, except in an action
by a judgment creditor or in proceedings supplementary to execution.
(Formerly: Acts 1897, c.195, s.18.) As amended by P.L.252-1985,
SEC.289.
IC 27-8-3-19
Foreign corporations; requirements for authority to do business;
revocation of authority; retaliation clause
Sec. 19. Any corporation, association, or society organized under
the authority of another state or government to issue, or which is
engaged in the business of issuing, policies or certificates of life or
accident or life and accident insurance, and for the payment of total
and permanent disability claims to living members on the assessment
plan, as a condition precedent to transacting business in this state,
shall deposit with the insurance commissioner:
(1) a certified copy of its articles of incorporation or
association;
(2) a certified copy of a vote or resolution of the board of
directors of said company consenting that service of process in
any suit against such company may be served upon an
individual resident of Indiana, a corporate resident of Indiana,
or an authorized Indiana insurer, appointed by the company as
the company's agent for service of process, with like effect as
if such company was chartered, organized, or incorporated in
the state of Indiana, and agreeing that any process served upon
such agent shall be of the same legal force and validity as if
served upon said company, and agreeing that such service may
be so made with such effect while any liability remains
outstanding against such company in this state;
(3) a statement, under oath of its president and secretary, in the
form by the commissioner required, of its business for the
preceding year;
(4) a certificate, under oath of its president and secretary, that
it is paying, and for the twelve (12) months then next preceding,
has paid, the maximum amount named in its policies or
certificates in full;
(5) a certificate from the proper authority in its home state that
corporations, associations or societies of this state, engaged
according to the provisions of this chapter in life or accident, or
life and accident insurance, and for the payment of total and
permanent disability claims to living members upon the
assessment plan, are legally entitled to do business in such
state;
(6) a copy of its policy or certificate, application, and bylaws,
which must show that the insured's liability to contribute to the
payments of benefits is not limited to the payment of a fixed
periodical sum; and
(7) evidence satisfactory to the commissioner that the
corporation, association, or society accumulates a fund equal in
amount to that required of similar corporations, associations, or
societies of this state and that such accumulation is permitted by
the law of the corporation, association, or society and is for the
benefit of policy or certificate-holders only, and is invested in
securities authorized under the law of its incorporation or
association.
The insurance commissioner shall thereupon issue or renew the
authority of such corporation, association, or society to do business
in this state, and such authority shall be revoked whenever the
commissioner, on investigation, is satisfied that such corporation,
association, or society is not paying the maximum amount named in
its policies or certificates in full. Upon such revocation, the
commissioner shall cause notice thereof to be published in a
newspaper of general circulation, published in the city of
Indianapolis, Indiana, and no new business shall be thereafter done
by its agents in this state. If any such corporation, association, or
society is authorized by the law under which it is incorporated to
issue contracts of insurance not contemplated in this chapter, it shall
nevertheless be permitted to transact in this state the character of
business authorized by this chapter upon complying in all other
respects with the requirements thereof and filing with the
commissioner an agreement duly executed by the proper officers that
such corporation, association, or society will not enter into or issue
within this state any contract of insurance, policy, or agreement not
authorized by this chapter. Upon a breach of such agreement by any
such corporation, association, or society, the commissioner shall
forthwith revoke and cancel its authority to transact business in this
state. When any other state or country shall impose any obligation
upon any such corporation, association, or society of this state, the
like obligation shall be imposed upon similar corporations,
associations, or societies and their agents of such state or country
doing business in this state. If the laws of such state where such
corporation, association, or society is organized will not admit
corporations, associations, or societies organized in this state, or
doing business under this chapter, to do business in such state, then
such corporations, associations, or societies shall not be admitted to
do business in this state.
(Formerly: Acts 1897, c.195, s.19.) As amended by P.L.252-1985,
SEC.290; P.L.268-1999, SEC.19.
IC 27-8-3-20
Foreign corporations; service of process
Sec. 20. All processes in any action or proceeding against any
foreign corporation, association, or society doing business in this
state under the provisions of this chapter may be served upon an
individual resident of Indiana, a corporate resident of Indiana, or an
authorized Indiana insurer, appointed by the corporation, association,
or society as its agent for service of process, and any lawful process
against it which is served on the agent shall be of the same legal
force and validity as if served on the corporation, association, or
society, and this provision shall continue in force so long as any
liability remains outstanding against the corporation, association, or
society in this state, service upon such agent shall be deemed
sufficient service upon the principal. When legal process against any
such corporation, association, or society is served upon such agent,
the agent shall immediately notify the corporation, association, or
society of such service by registered letter, prepaid, directed to its
secretary, or, in case of a corporation, association or society of a
foreign country, to the resident manager, if any, in this country, and
shall, within two (2) days after such service, forward in the same
manner a copy of the process served on the agent to such secretary
or manager, or to any person previously designated by the
corporation, association, or society, in writing. The agent shall keep
a record of all processes served upon the agent which record shall
show the day and hour when such service was made.
(Formerly: Acts 1897, c.195, s.20.) As amended by P.L.252-1985,
SEC.291; P.L.130-1994, SEC.42; P.L.116-1994, SEC.58;
P.L.268-1999, SEC.20.
IC 27-8-3-21
Fraudulent representations; offenses
Sec. 21. A person who knowingly makes a false or fraudulent
statement or representation in or with reference to any application for
insurance, or for the purpose of obtaining any money or benefit in or
to any corporation, association, or society transacting business under
this chapter, commits a Class A misdemeanor.
(Formerly: Acts 1897, c.195, s.21.) As amended by Acts 1978, P.L.2,
SEC.2726.
IC 27-8-3-22
Eligible beneficiaries; change of beneficiary
Sec. 22. Any member of such corporation, association or society
may name as his payee or beneficiary any person or persons, natural
or artificial, permitted by the by-laws of such corporations,
associations or society, or, if the by-laws thereof permit, the
insurance of such member may be made payable to his estate. Any
member of such corporation, association or society, naming as his
payee or beneficiary any such person or persons, may make such
designation either revocable or irrevocable, and the option which he
elects to exercise shall be set out in and be made a part of his
application for a certificate or policy of insurance. When the right of
revocation has been reserved, or in case of the death of any payee or
beneficiary under either a revocable or an irrevocable designation,
the insured, subject to any existing assignment of the policy, may
designate a new payee or beneficiary, with or without reserving the
right of revocation, by filing written notice thereof at the home office
of the corporation, association or society, accompanied by the policy
for suitable endorsement thereon. No person who shall have been
designated as a payee or beneficiary by the insured shall have or
obtain any vested interest in the death benefits which may accrue in
the event of the death of the insured until such death benefits shall
have become due and payable upon the death of the insured.
(Formerly: Acts 1897, c.195, s.22; Acts 1923, c.185, s.1.)
IC 27-8-3-23
Exemption of benefits and premiums from judicial process
Sec. 23. (a) As used in this section, "premium" includes any
deposit or contribution.
(b) The money or benefit provided or rendered by any
corporation, association, or society authorized to do business under
this chapter shall not be liable to attachment by garnishee or other
process, and shall not be seized, taken, appropriated, or applied by
any legal or equitable process, nor by any operation of law, to pay
any debt or liability of a policy or certificate holder or any
beneficiary named therein.
(c) A premium paid for an individual life insurance policy that
names as a beneficiary, or is legally assigned to, a spouse, child, or
relative who is dependent upon the policy owner is not exempt from
the claims of the creditors of the policy owner if the premium is paid:
(1) not more than one (1) year before the date of the filing of a
voluntary or involuntary bankruptcy petition by; or
(2) to defraud the creditors of;
the policy owner.
(d) The insurer issuing the policy is discharged from all liability
by payment of the proceeds and avails of the policy (as defined in
IC 27-1-12-14(b)) in accordance with the terms of the policy unless,
before payment, the insurer has received at the insurer's home office,
written notice by or on behalf of a creditor of the policy owner that
specifies the amount claimed against the policy owner.
(Formerly: Acts 1897, c.195, s.23.) As amended by P.L.252-1985,
SEC.292; P.L.253-1995, SEC.4.
IC 27-8-3-24
Violations; revocation of power to do business
Sec. 24. An officer or agent of any corporation, association, or
society subject to this chapter who fails to comply with this chapter,
knowingly makes in any report or statement any false or fraudulent
statement, or refuses to permit the insurance commissioner or any
examiner duly authorized by him for the purpose to make
examination of its condition and business, books, papers, and
vouchers commits a Class C infraction. A person who fails to comply
with or violates this chapter commits a Class C infraction. If an
examination of the condition and business of any such corporation,
association, or society transacting business in this state is prevented
by an offense under this section, the insurance commissioner shall
revoke the certificate of authority issued to such corporation,
association, or society, and it is unlawful for it to do business in this
state until it has submitted to an examination, and the insurance
commissioner has issued to it a new certificate of authority
authorizing it to continue business in this state.
(Formerly: Acts 1897, c.195, s.24.) As amended by Acts 1978, P.L.2,
SEC.2727.
IC 27-8-3-25
Fees
Sec. 25. The fees to be paid by each such corporation, association,
or society to the insurance commissioner for the authority to such
corporation, association, or society, and its insurance producers
under the license granted by him to each corporation, association, or
society, to transact business in the state of Indiana shall be as
follows:
For filing copy of charter or articles of incorporation,
twenty-five dollars ($25).
For filing each annual statement, twenty dollars ($20).
For issuing certificate of authority or license to company,
corporation, association or society, one dollar ($1).
For issuing license to each insurance producer, one dollar ($1).
For affixing seal and certifying to any paper, one dollar ($1).
For renewal of license, each such corporation, association, or
society shall file with the commissioner its annual statement,
for which it shall pay the sum of twenty dollars ($20).
For the privilege of transacting business in this state, a foreign or
alien company, association, or society, admitted and licensed under
this chapter, shall pay an annual tax upon premiums or assessments
derived from business written within this state, such tax to be as
defined and determined under IC 27-1-18-2, which is declared to be
applicable in its terms and provisions to such a company, association,
or society; provided also, that when any other state or country shall
impose any obligations in excess of those imposed by this chapter
upon any such corporation, association, or society of this state, a like
obligation shall be imposed on similar corporations and their agents
of such state or country doing business in this state; and provided
also, that such corporation, association, or society, in transacting
business in this state, shall be subject only to the provisions of this
chapter.
(Formerly: Acts 1897, c.195, s.25; Acts 1955, c.55, s.1.) As amended
by P.L.252-1985, SEC.293; P.L.178-2003, SEC.59.
IC 27-8-3-26
Exempt organizations
Sec. 26. Nothing contained in sections one through twenty-five of
this chapter shall be construed to apply to secret or fraternal
societies, lodges or councils that are now organized, or that may
hereafter be organized, which conduct their business and secure
members on the lodge system, exclusively, having ritualistic work
and ceremonies in their societies, lodges or councils, and which are
under the supervision of a grand or supreme body, nor to any
association organized solely for benevolent purposes and not for
profit; nor to any association of religious or secret societies, nor to
any class of mechanics, express, telegraph or railroad employees or
veterans described in IC 10-17-5-2 or IC 10-17-5-1 or any existing
societies now doing business and formed for the mutual benefit of
the members thereof and their families exclusively.
(Formerly: Acts 1897, c.195, s.26.) As amended by Acts 1980,
P.L.38, SEC.18; P.L.2-2003, SEC.70.
IC 27-8-3-27
Legal reserves; compulsory deposits; filing of forms; exceptions
Sec. 27. (a) Notwithstanding any of the provisions of sections 1
through 26 of this chapter, every corporation or association
organized and operating under the provisions of this chapter shall on
or before July 1, 1970, comply with the provisions of IC 27-1 relative
to the maintenance of legal reserves required on all life insurance and
health and accident insurance policies issued in this state, and
relative to compulsory deposit of assets by life insurance companies,
and relative to filing of forms, with particular reference to but not
limited to IC 27-1-12-9 through IC 27-1-12-13, IC 27-1-13-8, and
IC 27-1-20-1 through IC 27-1-20-11.
(b) Provided, that this section shall not apply to any corporation
or association that has prior to July 1, 1970, reorganized and
accepted the provisions of IC 27-1, as provided in IC 27-1-11. Nor
shall this section apply to any insurance policies issued or sold prior
to July 1, 1970, or prior to any such reorganization under IC 27-1,
whichever occurs earlier.
(c) Provided, further, that with respect to insurance policies issued
by any corporation or association on a pure assessment basis, no
premiums having been collected in advance, which corporation or
association is incorporated and operating under this chapter as of
August 18, 1969, and which has had in force between August 18,
1964, and August 18, 1969, insurance policies covering not less than
fifteen thousand (15,000) members, such company or association
shall maintain, beginning January 1, 1971, a legal reserve on its life
assessment business on the basis of monthly renewable term
insurance, and said monthly unearned premium reserve shall be
calculated at one dollar and thirty cents ($1.30) per member.
(d) Such legal reserve shall be deposited with the insurance
department under compulsory deposit provisions referred to in
subsection (a).
(Formerly: Acts 1897, c.195, s.26a; Acts 1969, c.236, s.1.) As
amended by P.L.252-1985, SEC.294.