KRS 304.33-340: Assessments.

(1) Report to court. As soon as practicable but not more than two (2) years from the

date of an order of liquidation under KRS 304.33 -200 of an insurer issuing

assessable policies, the liquidator shall make a report to the court setting forth:

(a) The reasonable value of the assets of the insurer;

(b) The insurer's probable total liabilities; and

(c) The probable aggregate amount of the assessment necessary to pay all claims

of creditors and expenses in full, including expenses of administration and

costs of collecting the assessment.

(2) Levy of assessment.

(a) Upon the basis of the report provided in subsection (1) of this section,

including any supplements and amendments thereto, the court may levy ex

parte one (1) or more assessments against all members of t he insurer who are

subject to assessment.

(b) Subject to any applicable legal limits on assessability, the aggregate

assessment shall be for the amount that the sum of the probable liabilities, the

expenses of administration and the estimated cost of colle ction of the

assessment exceeds the value of existing assets, with due regard being given

to assessments that cannot be collected economically.

(3) Order to show cause. After levy of assessment under subsection (2) of this section,

the court shall issue an order directing each member who has not paid the

assessment pursuant to the order to show cause why the liquidator shall not have a

judgment therefor. If a member of the insurer also appears to be indebted to the

insurer apart from the assessment, the court, upon application of the liquidator, may

also direct the member to show cause why he should not pay the other indebtedness.

Liability for such indebtedness shall be determined in the same manner and at the

same time as the liability to pay the assessment.

(4) Notice. The liquidator shall give notice of the order to show cause, by publication if

so directed by the court and by first -class mail to each member liable thereunder,

mailed at least twenty (20) days before the return day of the order to show cau se, to

his last known address as it appears on the records of the insurer.

(5) Orders and hearings.

(a) If a member does not appear and serve objections upon the liquidator upon the

return day of the order to show cause under subsection (3) of this section , the

court shall make an order adjudging the member liable for the amount of the

assessment against him and other indebtedness, pursuant to subsection (3) of

this section, together with costs, and the liquidator shall have a judgment

against the member therefor.

(b) If on such return day, the member appears and serves objections upon the

liquidator, the court may hear and determine the matter or may appoint a

referee to hear it and make such order as the facts warrant. Any order made by

a referee under this paragraph shall have the same force and effect as if it were

a judgment of the court, subject to review by the court upon application within

thirty (30) days.

(6) Collection. The liquidator may enforce any order or collect any judgment under

subsection (5) of this section by any lawful means.