KRS 299.370: Reserve fund -- Source -- Use -- Investment.

All portions of membership fees, policy fees, and assessments not necessarily used for

expenses of writing insurance and payment of losses and expenses accrued at the time of

their collection shall constitute a reserve fund, which may be used from time to time in

anticipation of collection of assessments. The reserve fund shall be the property of the

company, but in event of liquidation, voluntary or involuntary, the reserve fund shall be

apportioned pro rata to the policyholders whose policies are in force at the time of

liquidation, in proportion to the amount of premiums paid on the policies from the date of

their issuance. The governing authorities of the company may invest the reserve fund or

any portion of it in the same securities as fire insurance co mpanies are permitted by law

to invest in, and may pledge or sell the securities to raise money to more effectively carry

out the lawful purposes of the company.