CHAPTER 1. LLOYDS INSURANCE
IC 27-7
ARTICLE 7. SPECIAL TYPES OF INSURANCE
IC 27-7-1
Chapter 1. Lloyds Insurance
IC 27-7-1-1
Participating underwriters; certificate of authority; application
Sec. 1. No persons, partnerships or corporations shall engage inthe business of such insurance as is herein specified as "Lloyds"unless twenty-five (25) or more persons, partnerships orcorporations, a majority of whom shall be bona fide residents of thestate of Indiana shall have a certificate of authority from the auditorof state (commissioner of insurance) so to do. The application forsuch certificate of authority shall be signed by the attorney orattorneys in fact of those persons desiring such certificate, and mustbe accompanied by a declaration which must set forth the followingprovisions:
1. The name under which the business is to be conducted, whichname shall contain the word "Lloyds," and shall not be similar to thatof any existing Lloyds association or corporation in this state, as, inthe opinion of the auditor of state, is calculated to deceive ormislead.
2. The exact location of the principal office in which the businessis to be conducted, which office must be in the state of Indiana.
3. The kind of insurance intended to be written, which shall beonly as hereinafter stated.
4. An exact copy of the articles of association or copartnershipagreement, made by and between such underwriters.
5. Name, address and amount subscribed by each of theunderwriters so proposing to engage in said business.
6. The designation or appointment of one (1) or more attorneys infact, who shall have residence in Indiana, with full name and address,upon any one of whom summons or consent legal process can beserved.
7. That amounts subscribed by said underwriters have been paidas follows: Not less than twenty-five per cent (25%) of saidsubscriptions in cash, not more than fifty percent (50%) of saidsubscription secured by collateral note (payable on thirty (30) days'demand) duly approved by a committee selected by the subscribersto pass thereon, and not over twenty-five per cent (25%) of saidsubscription evidenced by subscriber's individual note.
8. That the total of said subscription shall not be less than twohundred and fifty thousand dollars ($250,000), and that at leasttwenty-five per cent (25%) thereof has been paid in cash.
(Formerly: Acts 1919, c.177, s.1.)
IC 27-7-1-2
Policies; filing; contents; special provisions
Sec. 2. There shall be filed with the auditor of state a copy of each
form of policy by it issued. Said policies shall show the name andaddress, as well as the amount of the subscription of each subscriber,and shall be signed by the attorneys in fact, and they shall contain thefollowing special provisions:
First: Whenever, under the terms of this policy, notice or consentis required to be given to or by the company, notice or consent givento or by the attorney or attorneys in fact shall be sufficientcompliance therewith, and each underwriter hereon shall be boundthereby, the same as though notice or consent had been given to orby each of such underwriters individually.
Second: In no event, shall the liability of any underwriter exceedthe sum underwritten by him or them hereon, and, in no event, shallany underwriter be liable for any part of the sum underwritten hereonby any other underwriter.
Third: The insured agrees by the acceptance of this policy that nounderwriter hereon shall, in any event, be liable for claimsexceeding, in the aggregate, on all policies, certificates or contractsissued on his or their behalf, in the name of this Lloyds for anamount in excess of the unpaid portion, if any, of his or their originalsubscription or contribution to said Lloyds, as indorsed hereon.
Fourth: In case of action brought to enforce the provisions of thispolicy, same shall be brought against the attorney or attorneys in factfor the underwriters, as representing all of the said underwriters, andeach of the underwriters hereto hereby agrees to abide by the finalresults of any suit so brought as fixing the proportionate amount ofhis or their individual liability.
Fifth: This policy is made and accepted subject to all thestipulations and conditions contained therein, together with suchother provisions, agreements or conditions as may be indorsedhereon, or added hereto, and as to such provisions and conditions, noofficer, agent or representative shall have such power or be deemedor held to have waived such provisions or conditions unless suchwaiver, if any, shall be indorsed upon or attached hereto, nor shallany privilege or permission affecting the insurance under this policyexist or be claimed by the assured unless so indorsed or attached.
(Formerly: Acts 1919, c.177, s.2.)
IC 27-7-1-3
Additional underwriters
Sec. 3. After any Lloyds is authorized to do business in this statepursuant to this law, it may be joined by other and additionalunderwriters, but, in that event, such underwriters who maythereafter join such authorized Lloyds shall be held to be bound bythe documents on file with the auditor of state concerning suchLloyds.
(Formerly: Acts 1919, c.177, s.3.)
IC 27-7-1-4
Examination; issuance of certificate of authority
Sec. 4. After such documents specified shall have been filed, the
auditor of state shall cause an examination of such Lloyds to bemade, and after he has specified that all of the facts alleged in thedeclaration are true, and that the articles of association orcopartnership agreement is of such character that the rights of thepolicyholders will be protected thereunder, he shall issue, or causeto be issued, a certificate of authority to such Lloyds to do suchbusiness as is specified in the declaration, which certificate shall beissued to such Lloyds under the name designated and approved,authorizing the underwriters thereof to do the business permittedthrough its attorney or attorneys in fact.
(Formerly: Acts 1919, c.177, s.4.)
IC 27-7-1-5
Investments
Sec. 5. Any such Lloyds as may be thus authorized to do businessin this state shall not invest its funds except in accordance with thelaws of this state relative to the investment of the funds of domesticstock insurance companies doing a similar business, except in suchsecurities as may be held by said Lloyds as a guaranty for thepayment of any subscription.
(Formerly: Acts 1919, c.177, s.5.)
IC 27-7-1-6
Unearned premium reserve
Sec. 6. Such Lloyds shall maintain the same unearned premiumreserve as is required of all domestic stock companies writing a likebusiness.
(Formerly: Acts 1919, c.177, s.6.)
IC 27-7-1-7
Insurance authorized under Lloyds plan; deposits; additionaldeposits; withdrawal of deposits
Sec. 7. The following insurance shall be authorized and permittedto be written by Lloyds under this chapter:
(1) For the purpose of making insurance on dwelling-houses,stores and all kinds of buildings and household furniture, andother property against loss or damage, including loss of use oroccupancy, by fire, lightning, windstorm, tornado, cyclone,earthquake, hail, frost or snow, bombardment, invasion,insurrection, riots or civil war or commotion, military orusurped power, and by explosion, whether fire ensues or not,except explosions on risks specified in this section, and alsoagainst loss or damage by water to any goods or premisesarising from the breakage or leakage of sprinklers, pumps, orother apparatuses erected for extinguishing fires, and of waterpipes, and against accidental injury to such sprinklers, pumps,or other apparatuses, and upon vessels, boats, cargoes, goods,merchandise, freight, and other property against loss or damageby all or any of the risks of lake, river, canal, and inlandnavigation and transportation, as well as by any or all of the
risks of credit and upon automobiles, whether stationary orbeing operated under their power, which shall include all or anyof the hazards of fire, explosions, transportation, collision, lossby legal liability for damage to property and to persons resultingfrom the maintenance and use of automobiles and loss byburglary or theft or both.
(2) For the purpose of making insurance upon vessels, freights,goods, wares, merchandise, specie, bullion, jewels, profits,commissions, bank notes, bills of exchange and other evidenceof debt, bottomry and respondentia interests, and everyinsurance appertaining to or connected with marine risks andrisks of transportation and navigation, including the risks oflake, river, canal, and inland transportation and navigation, andto effect reinsurance on any risk of the subscribers hereto, orany of said risks wholly or in part, or the transfer thereof, andto accept any authorized risk whether direct or by reinsurance.
(3) For the purpose of making insurance against loss or damageresulting from accident to or injury sustained by an employeeor other person for which accident or injury the insured isliable.
Provided, that no such insurance shall be written by any Lloydsunder this chapter until such Lloyds shall have deposited with thedepartment of insurance of the state of Indiana the sum oftwenty-five thousand dollars ($25,000) in the direct or indirectobligations of the United States or of any state of the United States.In the event the total of all unsatisfied and unappealed from finalawards made by the worker's compensation board under IC 22-3-2through IC 22-3-6 against any Lloyds having made the above depositshall exceed the amount of the above said deposit, then thedepartment of insurance may require such Lloyds to make anadditional deposit or deposits in cash in direct or indirect obligationsof the United States or of any state of the United States in a sumequal to the difference between the amount of the unsatisfied finalawards and the amount of the deposit with the department ofinsurance. The department of insurance is hereby authorized anddirected to receive such deposit or deposits and to hold themexclusively for the protection of the holders of such insurancepolicies. Any deposit so made shall not be withdrawn except uponfiling with the department of insurance evidence satisfactory to it thatsuch Lloyds has no unsecured liability outstanding in this state uponany such insurance policy, and upon the approval of the departmentof insurance such Lloyds may withdraw such deposit, except that theabove mentioned additional deposit may be withdrawn with theapproval of the department of insurance upon filing satisfactoryevidence that the total of all unsatisfied and unappealed from finalawards made by the worker's compensation board do not exceed theamount of twenty-five thousand dollars ($25,000).
(Formerly: Acts 1919, c.177, s.7; Acts 1937, c.143, s.1.) As amendedby P.L.252-1985, SEC.224; P.L.28-1988, SEC.85.
IC 27-7-1-8
Supervision and control
Sec. 8. The auditor of state shall have the same supervision andcontrol over Lloyds as he has over stock insurance companiesincorporated under the laws of Indiana.
(Formerly: Acts 1919, c.177, s.8.)
IC 27-7-1-9
Foreign Lloyds association; certificate of authority; application;unearned premium reserve
Sec. 9. The insurance commissioner may, in his discretion, issuea certificate of authority to a Lloyds domiciled in another state to dobusiness in this state, for permission to do which application is madeas may be authorized by the articles of association or copartnershipagreement under which said Lloyds is operated, provided, however,that in no event shall authority be given to any such Lloyds to do anykind of insurance business other than those specified in section 7 ofthis chapter. The application for such certificate shall specify thekind of business such Lloyds desires the authority to transact in thisstate. It must be signed by the attorney or attorneys in fact for suchLloyds, and must file with the auditor of state a certificate from theinsurance department of its home state that it has and maintains at alltimes an unearned premium reserve as is required of stock companiesof said state, and that the total subscription of its subscribers shallnot be less than two hundred and fifty thousand dollars ($250,000),and that at least twenty-five percent (25%) thereof is paid in cash.
(Formerly: Acts 1919, c.177, s.9.) As amended by P.L.252-1985,SEC.225.
IC 27-7-1-10
Foreign Lloyds association; documents required; appointment ofattorney for service of process
Sec. 10. A true copy of the articles of association or copartnershipagreement, power of attorney, and a copy of each form of policy byit issued, verified by the attorney or attorneys in fact, shall be filedwith the auditor of state, as well as a copy of the last report filed withthe insurance department of its home state, and also a declaration andagreement, duly executed and acknowledged by the attorneys in factof said Lloyds, appointing the auditor of state as a true and lawfulattorney for such Lloyds and the underwriters thereof in and for thisstate, upon whom all legal process in any action or proceedingsagainst said Lloyds or the underwriters thereof may be served, andthat any service upon him shall be equivalent to the personal servicewithin the state of such persons of each and every such underwriter.
(Formerly: Acts 1919, c.177, s.10.)
IC 27-7-1-11
Revocation of certificate of authority; grounds
Sec. 11. The certificate of authority of any such Lloyds, whetherdomestic or foreign, shall be revoked by the insurance commissioner
if at any time it appears that any underwriters are issuing policies ofinsurance within the state under apparent authority of such certificatewithout filing such declaration and agreement as aforesaid, or if suchLloyds does not maintain at all times the funds specified in thischapter, or has violated its agreement or the law, or is found to be insuch a condition that the further transaction of business by it will behazardous to the policyholders, its creditors, or the public.
(Formerly: Acts 1919, c.177, s.11.) As amended by P.L.252-1985,SEC.226.
IC 27-7-1-12
Taxation
Sec. 12. In lieu of all other taxes, licenses and fees, state or local,such Lloyds shall pay annually, on account of the transaction of suchbusiness in this state, the same taxes, licenses and fees as arerequired to be paid by mutual companies with principal officessimilarly located and transacting the same kind of business. In theapplication of the retaliatory law, the taxes and fees exacted byanother state from a Lloyds insurance with principal offices inIndiana shall apply.
(Formerly: Acts 1919, c.177, s.12.)