KRS 299.430: Action to collect unpaid assessments -- Exclusion of policyholder --

Refund.

(1) An action may be brought by the company against any policyholder to recover all

assessments, made upon him under the provisions of KRS 299.310 to 299.470 or

under the bylaws of the company, that he neglects or refuses to pay. If the company

is compelled to bring action in order to collect an assessment, it may recover the

amount assessed with fifty percent (50%) added thereto, in addition to lawful

interest, as a penalty for the neglect and refusal to pay within the time required.

(2) The officers of a company may proceed to collect any assessment when due and

unpaid for thirty (30) days, and the refusal or neglect on their part to endeavor to do

so, or to perform any of th e duties imposed by KRS 299.310 to 299.470, shall

render them liable individually for the amount lost by any person because of such

neglect or refusal, and an action may be maintained against them for such loss.

(3) A policyholder who refuses to pay his as sessment may, for that or any other reason

satisfactory to the directors or executive committee, be excluded by a majority of

the directors or executive committee, or as the bylaws may prescribe, from the

company. He shall remain liable for payment of any assessment made prior to his

exclusion, and for the penalty above provided in case action is brought against him

within twelve (12) months after the time the assessment was due. If any

policyholder is excluded as provided in this subsection, and the policy issued to him

is canceled, the secretary shall at once enter that fact, with the date, upon the records

of the company, and notify the policyholder, in person or by mail, of his exclusion.

If by mail, the postage shall be prepaid and the notice shall be a ddressed to the

address given in the application or policy, or the last address given the secretary by

the policyholder. From and after the date of personal notice, or five (5) days after

the mailing of notice, the policy shall be canceled and all liabilit y for the policy

shall cease, but the insured shall be entitled to receive from the company a

repayment of an equitable portion of all unearned money in excess of his legal

contribution to the reserve fund to which he has contributed. Not more than twenty

percent (20%) of assessments may be computed as the policyholders' legal

contribution to the reserve fund.