KRS 299.400: Collection and use of membership or policy fees -- Levy and collection of

assessments.

(1) Any company may collect such membership fees or policy fees as are provided for

in its bylaws, and any portion of the fees not expended for agents' commissions and

the expenses of writing insurance shall be placed in the reserve fund of the

company.

(2) The directors or executive committee of the company may declare, levy and issue

assessments in such amounts and at such times as in their judgment is for the best

interests of the company. When the reserve fund equals one and one -half percent

(1.5%) of the insurance in force against fire, and two and one-half percent (2.5%) of

the insurance in force against windstorm, and one -half of one percent (0.5%) of the

insurance in force against any other hazard, then no assessment shall be made for a

greater sum than the amount of losses and expenses sustained and accrued since the

last previous assessment was issued. All assessments shall be made pro rata upon

all property at such time insured, according to its classification.

(3) If at any time the total liabilities of a company exceed its actual cash assets to an

amount equal to fifty cents ($0.50) for each one hundred dollars ($100) of insurance

held by the company, the s ecretary shall notify the officer whose duty it is to call a

meeting of the directors or executive committee, and that officer shall immediately

call the directors or executive committee in session. The directors or executive

committee shall, within thirty (30) days, declare, levy and issue an assessment

sufficient to pay all the liabilities of the company that are in excess of its actual cash

assets.