CHAPTER 3. MUTUAL LIFE AND ACCIDENT.FORMATION
IC 27-8-3
Chapter 3. Mutual Life and Accident.Formation
IC 27-8-3-1
Authority to incorporate; purposes; articles of incorporation;initial applications; approval and filing documents; license
Sec. 1. Any number of persons not less than five (5), a majorityof whom are citizens of this state, may associate themselves togetheras a corporation, association, or society for the purpose of transactingthe business of life or accident, or life and accident insurance, andfor the payment of partial and permanent disability claims to livingmembers, upon the assessment plan, for the purpose of mutualprotection and relief of its members, and for the payment ofstipulated sums of money to the families, heirs, executors,administrators, or assigns of the deceased members, or for thepayment of total and permanent disability claims to living membersof such company, association, or society, as the member may direct,in such manner as may be provided in the bylaws; and may receivemoney, either by voluntary donation or contribution, for whichpurpose, they shall make, sign, and acknowledge, before any officerauthorized to take acknowledgment of deeds in this state, articles ofincorporation or association, in which shall be stated the name ortitle by which such corporation, association, or society shall beknown in law, the location of its principal business office (whichoffice must be located in this state), the names and residence of thepersons signing the articles of incorporation or association, the objectof the corporation, association, or society, with its plan of doingbusiness clearly and fully defined, the number of its directors,trustees or managers and the names of those selected to serve untilits first annual meeting, and, in case of life corporations,associations, or societies, the limit as to age of applicants formembership, which shall not exceed sixty-five (65) years, and thatmedical examinations are required, but no medical examination shallbe required in case of accident corporations, associations, orsocieties, and that bona fide applications have been secured for twohundred thousand dollars ($200,000) by not less than two hundred(200) persons, who have each made application for membership insuch proposed corporation, association, or society, and, in case of alife corporation, have each been examined and recommended by areliable physician, and in all cases have each deposited with theparties asking the certificate for such corporation, association, orsociety the sum of two dollars ($2) on each one thousand dollars($1,000) of insurance applied for as an advance assessment formortuary or accident or disability indemnity purposes, as the casemay be; which certificate of association and applications, togetherwith the certificate of some solvent bank or banks that all suchadvance funds are deposited therein to be turned over to the treasurerof such corporation, association, or society when organized, shall besubmitted to the insurance commissioner, who shall carefullyexamine the same, and, if he shall find that the objects and purposes
are fully and definitely set forth and are clearly within the provisionsof this chapter, and that the name or title is not the same or does notso closely resemble a title in use as to have a tendency to mislead thepublic, the commissioner shall submit the same to the attorneygeneral for examination, and if found by him to be in accordancewith this chapter and not inconsistent with the constitution and lawsof the United States and of this state, he shall certify to and deliverthe same to the secretary of state, who shall cause the same, with thecertificate of the attorney general, to be recorded in a book to be keptfor that purpose; and, upon application of the signers thereof, thesecretary of state shall furnish to them a certified copy of sucharticles and certificates, under his hand and the seal of this state, andthe secretary of state shall thereupon file in the office of thecommissioner a certified copy of all papers pertaining to theorganization of such corporation, association, or society. Thereupon,the commissioner shall issue a license, authorizing said corporation,association, or society to transact the business set forth in thecertificate of incorporation. Such corporation, association, or societyshall deposit with the commissioner a copy of all its forms of policyissued by them, together with a copy of its bylaws and all forms ofapplication for insurance.
(Formerly: Acts 1897, c.195, s.1.) As amended by P.L.252-1985,SEC.275.
IC 27-8-3-2
Corporate powers
Sec. 2. A corporation, association, or society, organized under theprovisions of this chapter, shall, by the name adopted by suchcorporation, association, or society, in law, be capable of suing andbeing sued, and may have power to make and enforce contracts inrelation to the business of such corporation, association, or society,may have and use a common seal and may change or alter the sameat pleasure, and, in the name of the corporation, association, orsociety, or by a trustee chosen by their board of directors, shall, inlaw, be capable of taking, purchasing, holding, and disposing of realand personal property for the purposes of their organization, may bytheir board of directors, trustees or managers, make bylaws notinconsistent with the constitution and laws of this state or of theUnited States, which bylaws shall define the manner of electingdirectors, trustees, or managers, or officers of such corporation,association, or society, and the qualifications and duties of the same,with terms of office not exceeding three (3) years, also thequalifications and privileges of the members thereof.
(Formerly: Acts 1897, c.195, s.2.) As amended by P.L.252-1985,SEC.276.
IC 27-8-3-3
Directors, trustees, or managers
Sec. 3. The affairs of all corporations, associations, or societiesorganized or doing business under the provisions of this chapter shall
be managed by not less than five (5) directors, trustees, or managers,a majority of whom shall be residents of the state of Indiana, whoshall be elected from and by the members, at such time and place andfor such period, not exceeding three (3) years, as may be provided forin the bylaws, and may be eligible for reelection, provided that asnear as practicable, an equal number shall be elected each year.Whenever directors, trustees, or managers shall be elected, acertificate, under the seal of the corporation, association, or society,giving the names and residences of those elected and the term oftheir office, shall be filed in the office of the insurancecommissioner. Vacancies in the board of directors, trustees, ormanagers shall be filled in the manner provided in the bylaws. Suchboard of directors, trustees, or managers shall fix the compensationto be paid to all officers and managers of such corporation,association, or society.
(Formerly: Acts 1897, c.195, s.3.) As amended by P.L.252-1985,SEC.277.
IC 27-8-3-4
Determination of fee rates and amount of premiums, assessments,or periodical calls; risks
Sec. 4. The trustees, directors, or managers, or the personsdesignated in the bylaws of the corporation, association, or society,subject to the provisions of this chapter, shall fix the fee rates andamounts of premiums, assessments, or periodical calls, and the timeand manner of the payment thereof, and the risks to be assumed bysuch corporation, association, or society, and the duration thereof,and may change the same, from time to time, as the experience of thecorporation, association, or society may require. An affidavit madeby the person having charge of the mailing of notices of premiums,assessments, or periodical calls that any such notice was mailed tohis last postoffice address, stating the date of mailing, shall be primafacie evidence thereof.
(Formerly: Acts 1897, c.195, s.4.) As amended by P.L.252-1985,SEC.278.
IC 27-8-3-5
Reincorporation of domestic assessment plan companies;exceptions
Sec. 5. Any domestic corporation, association, or society,transacting business of life or accident or life and accident insuranceand providing for the payment of total and permanent disabilityclaims to living members, upon the assessment plan, may bereincorporated or reorganized under the provisions of this chapterunder its existing corporate name, by filing with the insurancecommissioner a declaration of their desire to do so, signed and dulyacknowledged by a majority of its board of directors, trustees, ormanagers, with a statement in like manner signed and acknowledgedby them that such corporation, association, or society, having insuredthe lives or provided for the payment of accident indemnity, has
accumulated the fund required by section 7 of this chapter, or havingengaged in the business of accident insurance only, has accumulatedthe fund required by section 11 of this chapter, and that such fundsare safely invested and held for the purposes for which the samewere accumulated, as provided in the bylaws of such corporation,association or society, whereupon the commissioner, if approved byhim, shall file the same, together with his certificate of suchapproval, with the secretary of state, who shall issue to suchcorporation, association, or society a certificate of suchreincorporation or reorganization, under the seal of the state, andattach thereto copies of all papers so filed with the secretary of state,and the same shall be recorded in the office of the secretary of state,and copies thereof filed in the office of the commissioner, and suchcorporation, association, or society shall thereupon be deemed to bereincorporated and reorganized under the provisions of this chapter.It shall not be obligatory upon any such existing corporation,association or society to incorporate or reincorporate under thischapter, and any such domestic corporation, association, or societymay continue to exercise all the rights, powers, and privileges notinconsistent with this chapter, pursuant to its articles of incorporationor association, the same as if incorporated or reincorporated underthis chapter.
(Formerly: Acts 1897, c.195, s.5.) As amended by P.L.252-1985,SEC.279.
IC 27-8-3-6
Application of chapter to assessment plan companies; exceptions
Sec. 6. Any incorporation, association or society organized toinsure lives, which provides for the payment of policy claims, or theaccumulation of reserve or emergency funds, and the expenses of themanagement and prosecution of the business by payments to be madeeither at periods named in the contract or upon assessments asrequired, by persons holding similar contracts, and wherein theinsured's liability to contribute to the payment of policy claimsaccrued or to accrue is not limited to a fixed sum, shall be deemed tobe engaged in the business of life insurance upon the assessmentplan, and shall be subject only to the provisions of this chapter.However, nothing contained in this chapter shall be construed asapplicable to any association of religious or secret societies, or to anyclass of mechanics, express, telegraph or railroad employees, orveterans described in IC 10-17-5-2 or IC 10-17-5-1 formed for themutual benefit of the members thereof and their families exclusively,or to any secret or fraternal societies, lodges or councils that may beorganized, or that are now organized and doing business in this state,which conduct their business and secure members on the lodgesystem exclusively, having ritualistic work and ceremonies in theirsocieties, lodges or councils, and which are under the supervision ofthe grand or supreme body, nor to any association organized solelyfor benevolent purposes and not for profit.
(Formerly: Acts 1897, c.195, s.6.) As amended by Acts 1980, P.L.38,
SEC.17; P.L.2-2003, SEC.69.
IC 27-8-3-7
Accumulation of reserve or emergency fund; investment;additional funds; use of excess
Sec. 7. Every such life insurance corporation, association, orsociety shall accumulate and maintain a reserve or emergency fundequal to such sum as might be realized from one (1) assessment on,or periodical payment by, policy or certificate holders thereof, and,in no event, less than the amount of its maximum policy orcertificate. Such fund, if not already accumulated, shall beaccumulated by every such corporation, association, or societyexisting on March 9, 1897, by September 9, 1897, and by everycorporation, association, or society formed under this chapter afterMarch 9, 1897, within six (6) months from the date of itsincorporation or organization, and shall be held as a trust fund for thepurposes for which such fund was created or accumulated. In casesuch fund or any portion thereof shall have been used by thecorporation, association, or society for the purpose or purposes forwhich the same was created or accumulated and the amount thereofthereby reduced to less than the amount of one (1) death assessmentor periodical payment, the amount of such reduction below theamount of one (1) death assessment or periodical payment shall bemade up and restored to said fund within six (6) months thereafter.Such fund may be held in cash or invested in the same class ofsecurities required by law for the investment of funds by insurancecorporations; and nothing contained in this chapter shall prevent thecreation and accumulation of other funds in excess of the amountrequired in this chapter to provide for the purposes of suchcorporation, association, or society. If such fund is in excess of theamount of one (1) death assessment or periodical payment upon allcertificate or policyholders and not less than the sum of fiftythousand dollars ($50,000), the excess or any portion thereof may beused in the reduction of assessment or periodical payments by policyor certificate holders by ratable cash dividends or credits, or in suchother equitable division or apportionment thereof as its bylaws orrules may provide, and such use shall not be deemed or construed tomean a profit received by members within the meaning of the statutesof this state, or the pro rata excess on any policy or certificateterminated by death or surrender may be refunded to the holder orbeneficiary, as may be provided for in said policy or contract;provided, that nothing contained in this chapter shall be construed topermit any contract promising any fixed cash payment to any livingcertificate or policyholder excepting in the contingency of physicaldisability.
(Formerly: Acts 1897, c.195, s.7.) As amended by P.L.252-1985,SEC.280.
IC 27-8-3-8
Assignment of policy to person without insurable interest void Sec. 8. No corporation, association or society doing business oflife insurance under this chapter shall issue any policy of lifeinsurance in which the beneficiary named has no insurable interest.Any assignment of the policy or certificate to a person having noinsurable interest in the insured life, except as security for actualdebt, with remainder over to the beneficiary or to the estate of theinsured, shall render such a policy or certificate void.
(Formerly: Acts 1897, c.195, s.8; Acts 1971, P.L.391, SEC.1.)
IC 27-8-3-9
Annual report; failure to file report and pay fees; suspension fromdoing business
Sec. 9. Every such life insurance corporation, association, orsociety doing business under this chapter shall, on or before March1 in each year, make and file with the insurance commissioner areport of its affairs and operations during the year ending onDecember 31 immediately preceding, which report shall be in lieu ofall other reports required by this title and shall be in such form as thecommissioner may require. Such report shall be verified by such ofthe officers of the corporation, association, or society as thecommissioner may require. Any corporation, association, or societyrefusing or neglecting to make such report, or to make payment ofany of the fees required by law, shall, upon the order of thecommissioner, cease to do business in this state until such report andpayment shall be made and until the costs of such action be paid.
(Formerly: Acts 1897, c.195, s.9.) As amended by P.L.252-1985,SEC.281.
IC 27-8-3-10
Accident insurance business on assessment plan
Sec. 10. Any corporation, association, or society organized toinsure against the contingency of death or physical disability of theassured thereunder resulting from accidental injuries, and whichprovides for the payment of policy claims, the accumulation ofreserve or emergency funds and the expenses of the management andprosecution of the business, by payments to be made, either atperiods named in the contract or upon assessments as required bypersons holding similar contracts, and where the assured's liability tocontribute to the payment of benefits accrued or to accrue is notlimited to a fixed sum, shall be deemed to be engaged in the businessof accident insurance upon the assessment plan, and the businessinvolving the issuance of such contracts shall be carried on in thisstate only by duly organized and authorized corporations,associations, or societies, which shall be subject only to theprovisions and requirements of this chapter.
(Formerly: Acts 1897, c.195, s.10.) As amended by P.L.252-1985,SEC.282.
IC 27-8-3-11
Reserve emergency fund Sec. 11. Every such accident insurance corporation, association,or society shall accumulate and maintain a reserve emergency fundof at least two thousand dollars ($2,000). Such fund, if not alreadyaccumulated, shall be accumulated by every such corporation,association, or society existing on March 9, 1897, by September 9,1897, and by every corporation, association, or society organizedunder this chapter within six (6) months of the completion of itsorganization and the receipt of its certificate of authority to transactbusiness in this state, and every corporation, association, or societysubject to the provisions of this chapter shall add to such emergencyfund thereafter two and one-half percent (2 1/2%) of the amountrealized from every premium, assessment, or periodical call untilsuch fund shall be equal to the amount of two dollars ($2) for everyfive thousand dollars ($5,000) of insurance in force. Such emergencyfund, or any part thereof, may be used for the payment of death andindemnity claims; provided, that if the amount of such fund bethereby reduced below the amount contemplated in this chapter, theamount by which such fund is reduced be made up and restoredwithin six (6) months thereafter. Such fund may be held in cash orinvested in the same class of securities required by law for theinvestment of funds by insurance corporations, and nothingcontained in this chapter shall prevent the creation and accumulationof other funds in excess of the amount required in this chapter toprovide for the purposes of such corporation, association, or society.
(Formerly: Acts 1897, c.195, s.11.) As amended by P.L.252-1985,SEC.283.
IC 27-8-3-12
Report of affairs and operations; suspension for failure to file
Sec. 12. (a) Every such accident insurance corporation,association, or society doing business under this chapter shall, on orbefore March 1 in each year, make and file with the insurancecommissioner a report of its affairs and operations during the yearending on December 31 immediately preceding, which report shallbe in lieu of all other reports required by this title and shall beverified by such officers of the corporation, association or society, asthe commissioner may require, and shall contain answers to thefollowing questions:
(1) First, what number of certificates or policies were issuedduring the year or applicants admitted?
(2) Second, what was the amount of death indemnity affectedthereby?
(3) Third, what number of death losses were incurred?
(4) Fourth, what number of death losses were paid and amountthereof?
(5) Fifth, what were the total number of indemnity claims paidand amount thereof?
(6) Sixth, what were the number of death and number ofindemnity claims unpaid?
(7) Seventh, does the corporation, association, or society charge
annual dues or membership fee? If so, how much?
(8) Eighth, what was the total amount received and whetherfrom assessment, annual dues, membership fees, or othersources, and the disposition thereof?
(9) Ninth, does corporation, association, or society use moneysreceived for payment of claims to pay expenses, in whole or inpart? And, if so, state the amount used.
(10) Tenth, what is the amount of the emergency fund and howinvested?
(11) Eleventh, if organized under the laws of this state, statesuch fact and the date of organization.
(12) Twelfth, what were the number of policies in force anddeath insurance in force at the beginning of the year, and suchother information as may be required by the superintendent ofinsurance?
(b) Any corporation, association, or society refusing or neglectingto make such report or to make payment of any one of the feesrequired by this chapter shall, upon the order of the insurancecommissioner, cease to do business in this state until such report andpayment shall be made and until the costs of such action be paid.
(Formerly: Acts 1897, c.195, s.12.) As amended by P.L.252-1985,SEC.284.
IC 27-8-3-13
Authority to deposit securities; investment of reserve funds
Sec. 13. This chapter shall not be construed to limit theaccumulation of a reserve or emergency fund by any corporation,association, or society subject to the provisions of this chapter. Anysuch corporation, association, or society may, in its discretion,through its officers or directors, deposit with the insurancecommissioner such securities and for such amounts as may beapproved by him, and, when so deposited, shall be retained by himfor the purposes described in this chapter. All other investments ofreserve funds shall be made in the same class of securities as areallowed by law for the investment of funds by insurancecorporations.
(Formerly: Acts 1897, c.195, s.13.) As amended by P.L.252-1985,SEC.285.
IC 27-8-3-14
Specification of amount payable upon particular contingency;obligation for payment; suspension of right to issue new policiesuntil payment made
Sec. 14. Every policy or certificate issued after March 9, 1897, byany corporation, association, or society doing business under thischapter and promising payment to be made upon a contingency ofdeath or physical disability shall specify the sum of money which itpromises to pay under such contingency, and the number of daysafter satisfactory proof of the happening thereof on which suchpayment shall be made. Upon the occurrence of such contingency,
unless the contract shall have been avoided by fraud, or by breach ofits conditions, the corporation, association, or society shall beobligated to the beneficiary for such payment, at the time and to theamount specified in the policy or certificate. If such corporation,association, or society shall refuse or fail to make such payment forsixty (60) days after final judgment has been obtained against suchclaim, the insurance commissioner shall notify the corporation,association, or society not to issue any new policies or certificatesuntil such indebtedness is fully paid; and no officer or agent of thecorporation, association, or society shall make, sign, or issue anypolicy or certificate of insurance while such notice is in force.
(Formerly: Acts 1897, c.195, s.14.) As amended by P.L.252-1985,SEC.286.
IC 27-8-3-15
Transfer or reinsurance of risks; approval; notice of preference fortransfer to different corporation
Sec. 15. No such corporation, association or society, organizedunder the laws of this state, shall transfer its risks to, or reinsure themin any other corporation, association or society unless the contract oftransfer or reinsurance is first submitted to and approved by atwo-thirds (2/3) vote of a meeting of the insured, called to considerthe same, of which meeting, a written or printed notice shall bemailed to each member, certificate or policyholder, at least thirty(30) days before the day fixed for such meeting. If such transfer orreinsurance shall be approved, every member, certificate orpolicyholder of the corporation, association or society, who shall filewith the secretary thereof, within ten (10) days after the meeting, awritten notice of his preference to be transferred to some othercorporation, association or society, than that named in the contract,shall be accorded all the rights and privileges, if any, in aid of suchtransfer as would have been accorded under the terms of suchcontract had he been transferred to the corporation, association orsociety named therein. No such corporation, association or society,organized under the laws of this state, shall transfer its risks orassets, or any part thereof, to, or reinsure its risks, or any partthereof, in any insurance corporation, association or society of anyother state or country which is not at the time of such transfer orreinsurance authorized to do business in this state under the lawsthereof.
(Formerly: Acts 1897, c.195, s.15.)
IC 27-8-3-16
Examination at request of corporation; certificate of results;expense
Sec. 16. The insurance commissioner shall, at the request of anycorporation, association, or society doing business under theprovisions of this chapter in this state on the assessment plan, makean examination of such corporation, association, or society, and shallfurnish a certificate of the results of such examination, showing all
its assets and how invested, and such other particulars as may bedeemed necessary to show the character and condition of saidcorporation, association, or society, and the necessary expense ofsaid examination shall be paid by the corporation, association, orsociety requesting it.
(Formerly: Acts 1897, c.195, s.16.) As amended by P.L.252-1985,SEC.287.
IC 27-8-3-17
Visitation and inspection; insolvency or improper businesspractices; report; order to show cause for termination of business
Sec. 17. All corporations, associations, and societies to which thischapter is applicable, with their books, papers, and vouchers, shall besubject to visitation and inspection by the insurance commissioner orsuch person as he may designate, at the expense of said association.The commissioner may address any inquiries to such corporation,association, or society, in relation to its doings or condition, or anyother matter connected with its transactions relative to the businesscontemplated by this chapter. All officers of such corporation,association, or society shall promptly reply in writing to all suchinquiries, under the oath of its president, secretary, or other officers,if required. When the commissioner on investigation, shall besatisfied that any corporation, association, or society, organizedunder the laws of this state, doing business in this state of thecharacter defined in this chapter, is insolvent because of matureddeath claims or other obligations due and unpaid, exceeding its assetsand death assessments or periodical payments, called or in processof collection, or has exceeded its powers, failed to comply with anyprovision of law, or is conducting business fraudulently, he shallreport the facts to the attorney general, who, if he shall be of theopinion that the facts require such action, may thereupon apply toany court having jurisdiction thereof, within the county in which theprincipal office of such corporation, association, or society in thisstate is located, for an order requiring the officers of suchcorporation, association, or society to show cause, at a reasonabletime and place within such county, why such corporation,association, or society should not be restrained from continuing totransact business, with power to the court to adjourn the hearingthereon from time to time, not exceeding sixty (60) days in all.
(Formerly: Acts 1897, c.195, s.17.) As amended by P.L.252-1985,SEC.288.
IC 27-8-3-18
Attorney general; exclusive power to apply for accounting,injunction, or receivership
Sec. 18. No order, judgment, or decree providing for anaccounting or enjoining, restraining, or interfering with theprosecution of the business of any domestic insurance corporation,association, or society subject to the provisions of this chapter, orappointing a temporary or permanent receiver thereof, shall be made
or granted otherwise than upon the application of the attorneygeneral on his own motion, or after his approval of a request inwriting thereof by the insurance commissioner, except in an actionby a judgment creditor or in proceedings supplementary to execution.
(Formerly: Acts 1897, c.195, s.18.) As amended by P.L.252-1985,SEC.289.
IC 27-8-3-19
Foreign corporations; requirements for authority to do business;revocation of authority; retaliation clause
Sec. 19. Any corporation, association, or society organized underthe authority of another state or government to issue, or which isengaged in the business of issuing, policies or certificates of life oraccident or life and accident insurance, and for the payment of totaland permanent disability claims to living members on the assessmentplan, as a condition precedent to transacting business in this state,shall deposit with the insurance commissioner:
(1) a certified copy of its articles of incorporation orassociation;
(2) a certified copy of a vote or resolution of the board ofdirectors of said company consenting that service of process inany suit against such company may be served upon anindividual resident of Indiana, a corporate resident of Indiana,or an authorized Indiana insurer, appointed by the company asthe company's agent for service of process, with like effect asif such company was chartered, organized, or incorporated inthe state of Indiana, and agreeing that any process served uponsuch agent shall be of the same legal force and validity as ifserved upon said company, and agreeing that such service maybe so made with such effect while any liability remainsoutstanding against such company in this state;
(3) a statement, under oath of its president and secretary, in theform by the commissioner required, of its business for thepreceding year;
(4) a certificate, under oath of its president and secretary, thatit is paying, and for the twelve (12) months then next preceding,has paid, the maximum amount named in its policies orcertificates in full;
(5) a certificate from the proper authority in its home state thatcorporations, associations or societies of this state, engagedaccording to the provisions of this chapter in life or accident, orlife and accident insurance, and for the payment of total andpermanent disability claims to living members upon theassessment plan, are legally entitled to do business in suchstate;
(6) a copy of its policy or certificate, application, and bylaws,which must show that the insured's liability to contribute to thepayments of benefits is not limited to the payment of a fixedperiodical sum; and
(7) evidence satisfactory to the commissioner that the
corporation, association, or society accumulates a fund equal inamount to that required of similar corporations, associations, orsocieties of this state and that such accumulation is permitted bythe law of the corporation, association, or society and is for thebenefit of policy or certificate-holders only, and is invested insecurities authorized under the law of its incorporation orassociation.
The insurance commissioner shall thereupon issue or renew theauthority of such corporation, association, or society to do businessin this state, and such authority shall be revoked whenever thecommissioner, on investigation, is satisfied that such corporation,association, or society is not paying the maximum amount named inits policies or certificates in full. Upon such revocation, thecommissioner shall cause notice thereof to be published in anewspaper of general circulation, published in the city ofIndianapolis, Indiana, and no new business shall be thereafter doneby its agents in this state. If any such corporation, association, orsociety is authorized by the law under which it is incorporated toissue contracts of insurance not contemplated in this chapter, it shallnevertheless be permitted to transact in this state the character ofbusiness authorized by this chapter upon complying in all otherrespects with the requirements thereof and filing with thecommissioner an agreement duly executed by the proper officers thatsuch corporation, association, or society will not enter into or issuewithin this state any contract of insurance, policy, or agreement notauthorized by this chapter. Upon a breach of such agreement by anysuch corporation, association, or society, the commissioner shallforthwith revoke and cancel its authority to transact business in thisstate. When any other state or country shall impose any obligationupon any such corporation, association, or society of this state, thelike obligation shall be imposed upon similar corporations,associations, or societies and their agents of such state or countrydoing business in this state. If the laws of such state where suchcorporation, association, or society is organized will not admitcorporations, associations, or societies organized in this state, ordoing business under this chapter, to do business in such state, thensuch corporations, associations, or societies shall not be admitted todo business in this state.
(Formerly: Acts 1897, c.195, s.19.) As amended by P.L.252-1985,SEC.290; P.L.268-1999, SEC.19.
IC 27-8-3-20
Foreign corporations; service of process
Sec. 20. All processes in any action or proceeding against anyforeign corporation, association, or society doing business in thisstate under the provisions of this chapter may be served upon anindividual resident of Indiana, a corporate resident of Indiana, or anauthorized Indiana insurer, appointed by the corporation, association,or society as its agent for service of process, and any lawful processagainst it which is served on the agent shall be of the same legal
force and validity as if served on the corporation, association, orsociety, and this provision shall continue in force so long as anyliability remains outstanding against the corporation, association, orsociety in this state, service upon such agent shall be deemedsufficient service upon the principal. When legal process against anysuch corporation, association, or society is served upon such agent,the agent shall immediately notify the corporation, association, orsociety of such service by registered letter, prepaid, directed to itssecretary, or, in case of a corporation, association or society of aforeign country, to the resident manager, if any, in this country, andshall, within two (2) days after such service, forward in the samemanner a copy of the process served on the agent to such secretaryor manager, or to any person previously designated by thecorporation, association, or society, in writing. The agent shall keepa record of all processes served upon the agent which record shallshow the day and hour when such service was made.
(Formerly: Acts 1897, c.195, s.20.) As amended by P.L.252-1985,SEC.291; P.L.130-1994, SEC.42; P.L.116-1994, SEC.58;P.L.268-1999, SEC.20.
IC 27-8-3-21
Fraudulent representations; offenses
Sec. 21. A person who knowingly makes a false or fraudulentstatement or representation in or with reference to any application forinsurance, or for the purpose of obtaining any money or benefit in orto any corporation, association, or society transacting business underthis chapter, commits a Class A misdemeanor.
(Formerly: Acts 1897, c.195, s.21.) As amended by Acts 1978, P.L.2,SEC.2726.
IC 27-8-3-22
Eligible beneficiaries; change of beneficiary
Sec. 22. Any member of such corporation, association or societymay name as his payee or beneficiary any person or persons, naturalor artificial, permitted by the by-laws of such corporations,associations or society, or, if the by-laws thereof permit, theinsurance of such member may be made payable to his estate. Anymember of such corporation, association or society, naming as hispayee or beneficiary any such person or persons, may make suchdesignation either revocable or irrevocable, and the option which heelects to exercise shall be set out in and be made a part of hisapplication for a certificate or policy of insurance. When the right ofrevocation has been reserved, or in case of the death of any payee orbeneficiary under either a revocable or an irrevocable designation,the insured, subject to any existing assignment of the policy, maydesignate a new payee or beneficiary, with or without reserving theright of revocation, by filing written notice thereof at the home officeof the corporation, association or society, accompanied by the policyfor suitable endorsement thereon. No person who shall have beendesignated as a payee or beneficiary by the insured shall have or
obtain any vested interest in the death benefits which may accrue inthe event of the death of the insured until such death benefits shallhave become due and payable upon the death of the insured.
(Formerly: Acts 1897, c.195, s.22; Acts 1923, c.185, s.1.)
IC 27-8-3-23
Exemption of benefits and premiums from judicial process
Sec. 23. (a) As used in this section, "premium" includes anydeposit or contribution.
(b) The money or benefit provided or rendered by anycorporation, association, or society authorized to do business underthis chapter shall not be liable to attachment by garnishee or otherprocess, and shall not be seized, taken, appropriated, or applied byany legal or equitable process, nor by any operation of law, to payany debt or liability of a policy or certificate holder or anybeneficiary named therein.
(c) A premium paid for an individual life insurance policy thatnames as a beneficiary, or is legally assigned to, a spouse, child, orrelative who is dependent upon the policy owner is not exempt fromthe claims of the creditors of the policy owner if the premium is paid:
(1) not more than one (1) year before the date of the filing of avoluntary or involuntary bankruptcy petition by; or
(2) to defraud the creditors of;
the policy owner.
(d) The insurer issuing the policy is discharged from all liabilityby payment of the proceeds and avails of the policy (as defined inIC 27-1-12-14(b)) in accordance with the terms of the policy unless,before payment, the insurer has received at the insurer's home office,written notice by or on behalf of a creditor of the policy owner thatspecifies the amount claimed against the policy owner.
(Formerly: Acts 1897, c.195, s.23.) As amended by P.L.252-1985,SEC.292; P.L.253-1995, SEC.4.
IC 27-8-3-24
Violations; revocation of power to do business
Sec. 24. An officer or agent of any corporation, association, orsociety subject to this chapter who fails to comply with this chapter,knowingly makes in any report or statement any false or fraudulentstatement, or refuses to permit the insurance commissioner or anyexaminer duly authorized by him for the purpose to makeexamination of its condition and business, books, papers, andvouchers commits a Class C infraction. A person who fails to complywith or violates this chapter commits a Class C infraction. If anexamination of the condition and business of any such corporation,association, or society transacting business in this state is preventedby an offense under this section, the insurance commissioner shallrevoke the certificate of authority issued to such corporation,association, or society, and it is unlawful for it to do business in thisstate until it has submitted to an examination, and the insurancecommissioner has issued to it a new certificate of authority
authorizing it to continue business in this state.
(Formerly: Acts 1897, c.195, s.24.) As amended by Acts 1978, P.L.2,SEC.2727.
IC 27-8-3-25
Fees
Sec. 25. The fees to be paid by each such corporation, association,or society to the insurance commissioner for the authority to suchcorporation, association, or society, and its insurance producersunder the license granted by him to each corporation, association, orsociety, to transact business in the state of Indiana shall be asfollows:
For filing copy of charter or articles of incorporation,twenty-five dollars ($25).
For filing each annual statement, twenty dollars ($20).
For issuing certificate of authority or license to company,corporation, association or society, one dollar ($1).
For issuing license to each insurance producer, one dollar ($1).
For affixing seal and certifying to any paper, one dollar ($1).
For renewal of license, each such corporation, association, orsociety shall file with the commissioner its annual statement,for which it shall pay the sum of twenty dollars ($20).
For the privilege of transacting business in this state, a foreign oralien company, association, or society, admitted and licensed underthis chapter, shall pay an annual tax upon premiums or assessmentsderived from business written within this state, such tax to be asdefined and determined under IC 27-1-18-2, which is declared to beapplicable in its terms and provisions to such a company, association,or society; provided also, that when any other state or country shallimpose any obligations in excess of those imposed by this chapterupon any such corporation, association, or society of this state, a likeobligation shall be imposed on similar corporations and their agentsof such state or country doing business in this state; and providedalso, that such corporation, association, or society, in transactingbusiness in this state, shall be subject only to the provisions of thischapter.
(Formerly: Acts 1897, c.195, s.25; Acts 1955, c.55, s.1.) As amendedby P.L.252-1985, SEC.293; P.L.178-2003, SEC.59.
IC 27-8-3-26
Exempt organizations
Sec. 26. Nothing contained in sections one through twenty-five ofthis chapter shall be construed to apply to secret or fraternalsocieties, lodges or councils that are now organized, or that mayhereafter be organized, which conduct their business and securemembers on the lodge system, exclusively, having ritualistic workand ceremonies in their societies, lodges or councils, and which areunder the supervision of a grand or supreme body, nor to anyassociation organized solely for benevolent purposes and not forprofit; nor to any association of religious or secret societies, nor to
any class of mechanics, express, telegraph or railroad employees orveterans described in IC 10-17-5-2 or IC 10-17-5-1 or any existingsocieties now doing business and formed for the mutual benefit ofthe members thereof and their families exclusively.
(Formerly: Acts 1897, c.195, s.26.) As amended by Acts 1980,P.L.38, SEC.18; P.L.2-2003, SEC.70.
IC 27-8-3-27
Legal reserves; compulsory deposits; filing of forms; exceptions
Sec. 27. (a) Notwithstanding any of the provisions of sections 1through 26 of this chapter, every corporation or associationorganized and operating under the provisions of this chapter shall onor before July 1, 1970, comply with the provisions of IC 27-1 relativeto the maintenance of legal reserves required on all life insurance andhealth and accident insurance policies issued in this state, andrelative to compulsory deposit of assets by life insurance companies,and relative to filing of forms, with particular reference to but notlimited to IC 27-1-12-9 through IC 27-1-12-13, IC 27-1-13-8, andIC 27-1-20-1 through IC 27-1-20-11.
(b) Provided, that this section shall not apply to any corporationor association that has prior to July 1, 1970, reorganized andaccepted the provisions of IC 27-1, as provided in IC 27-1-11. Norshall this section apply to any insurance policies issued or sold priorto July 1, 1970, or prior to any such reorganization under IC 27-1,whichever occurs earlier.
(c) Provided, further, that with respect to insurance policies issuedby any corporation or association on a pure assessment basis, nopremiums having been collected in advance, which corporation orassociation is incorporated and operating under this chapter as ofAugust 18, 1969, and which has had in force between August 18,1964, and August 18, 1969, insurance policies covering not less thanfifteen thousand (15,000) members, such company or associationshall maintain, beginning January 1, 1971, a legal reserve on its lifeassessment business on the basis of monthly renewable terminsurance, and said monthly unearned premium reserve shall becalculated at one dollar and thirty cents ($1.30) per member.
(d) Such legal reserve shall be deposited with the insurancedepartment under compulsory deposit provisions referred to insubsection (a).
(Formerly: Acts 1897, c.195, s.26a; Acts 1969, c.236, s.1.) Asamended by P.L.252-1985, SEC.294.