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154.20.530 Mortgage insurance corporation -- Trust account.

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154.20-530 Mortgage insurance corporation -- Trust account. The authority may cause to be established, by any number of natural persons not in excess <br>of fifteen (15), a Kentucky nonprofit corporation which shall have as its purpose the <br>insurance of mortgage loans entered into by and between lenders and persons or <br>corporations located in Kentucky and offering gainful employment to the inhabitants of <br>the Commonwealth. The mortgage insurance corporation shall not be deemed to have <br>been established for the purposes of this chapter unless and until its articles of <br>incorporation shall have been approved by the authority, and if so approved, no approval <br>by the Department of Insurance shall be required. Such articles of incorporation, in order <br>to secure such approval, shall contain, inter alia, the following provisions: <br>(1) The corporation shall be designated &quot;Kentucky Mortgage Insurance and Guarantee Corporation;&quot; (2) No member of the board of directors of the insurance corporation shall receive any emoluments for his services thereon, except that he may be reimbursed for <br>expenditures incurred by him in the performance of duties for the insurance <br>corporation; (3) All assistance fees received by the insurance corporation shall be held in a trust account in one or more banks and trust companies having a principal place of <br>business in the Commonwealth; (4) The trust account shall be held for the security of the holders of mortgage loans or bonds guaranteed by the insurance corporation, except that provision may be made <br>for the payment of expenses of the insurance corporation from the trust account or a <br>segregated portion thereof; (5) The trust account shall be governed by a trust agreement entered into by and between the insurance corporation and the trustee or trustees. Said trust agreement <br>shall contain such lawful provisions and limitations as may be deemed appropriate, <br>and may include a pledge of premiums and other moneys deposited in the fund to <br>the payment of the obligations insured by the insurance corporation; and (6) The trust agreement shall make appropriate provisions for the investment by the trustee or trustees of funds in the trust account for the benefit of the insurance <br>corporation and of any claimants against the trust account. The moneys so pledged <br>and thereafter received by the trust account shall be subject to the lien of such <br>pledge without any further act, and the lien of such pledge shall be valid and <br>binding against all parties in accordance with the terms of the trust agreement. Effective: July 15, 2010 <br>History: Amended 2010 Ky. Acts ch. 24, sec. 198, effective July 15, 2010. -- Amended 1980 Ky. Acts ch. 340, sec. 17, effective July 15, 1980. -- Created 1978 Ky. Acts <br>ch. 96, sec. 15, effective July 1, 1978. Formerly codified as KRS 154.555.