299.050 Guaranty fund -- Creation -- Investments -- Deposit of securities -- Use of

318 words·~1 min read·/ky/299-050

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

fund -- Rights of holders of certificates.

(1)The guaranty fund required by KRS 299.040 may be raised by the issue and sale of

guaranty fund certificates in denomination of not less than five dollars ($5) nor

more than one thousand dollars ($1,000) each, to be sold for not less than the par

value thereof, which shall be fully paid in when issued. The sum realized from the

sale of the certificates shall be invested in securities in which insurance companies

are allowed by law to invest their capital or funds, and the securities shall be

deposited with the custodian of insurance securities, to be held in trust for the

benefit and protection of the members or policyholders of the company.

(2)The holders of guaranty fund certificates shall be entitled to receive annual

dividends not exceeding eight percent (8%) but dividends shall be payable only out

of the company's accumulated surplus fund, and no surplus fund shall be deemed to

exist for the purpose of paying dividends unless the company's emergency fund is

intact. Guaranty fund certificates shall be issued with a proviso thereto specifying

that the company reserves the right at any dividend-paying period to redeem the

certificates at their par value, but the company may use only its surplus funds to

redeem guaranty fund certificates, and no part of the emergency fund shall be used

for that purpose.

(3)The guaranty fund certificates shall contain a printed notice giving the fixed date of

the annual meeting of the members or policyholders of the company, and each

certificate issued shall entitle the holder to one

(1)vote on any business matter at

any meeting of the members or policyholders, but the company shall only issue

guaranty fund certificates in such denomination and number that the total votes

represented by all such certificates shall not exceed one-third (1/3) of the total votes

of all members or policyholders.