vState of New York
Office of the Secretary of State, ss:
I have compared the preceding with the original law on file in this office,
and do hereby certify that the same is a correct transcript therefrom, and
of the whole of said original law.
Given under my hand and seal of office of the Secretary of State, at
the City of Albany, this seventh day of June, in the year one thousand nine
hundred and fifteen.
C. W. TAFT,
Second Deputy Secretary of State.
â€” 59 â€”
CHAPTER 16, LAWS OF 1914
TO AMEND THE INSURANCE LAW, IN RELATION TO THE
APPROVAL OF PREMIUM RATES OF CORPORATIONS AND
ASSOCIATIONS TRANSACTING THE BUSINESS OF WORKMEN'S
The People of the State of New York, represented in Senate and Assembly,
do enact as follows:
Section 1. Article one of chapter thirty-three of the laws of nineteen
hundred and nine, entitled "An act in relation to insurance corporations,
constituting chapter twenty-eight of the consolidated laws," is hereby amended
by adding at the end thereof a new section, to be section sixty-seven, to
read as follows:
Sec. 67. Approval of premium rates. Every insurance corporation or
association, except the state insurance fund as administered by the state
workmen's compensation commission, authorized to transact business in this
state, which insures employers against liability for compensation under the
workmen's compensation law, shall file with the superintendent of insurance
its classification of risks and premiums relating thereto, and any subsequent
proposed classification of risks and premiums, together with basis rates and
schedides, if a system of schedule rating be in use, none of which shall take
effect until the superintendent of insurance shall have approved the same
as adequate for the risks to which they respectively apply. The superintendent
of insurance may withdraw his approval of any jiremium rate or schedule
made by any insurance cori)oration or association if, in his judgment, such
premium rate or schedule is inadequate to provide the necessary reserves.
Sec. 2. This act shall take effect innuediately.
Approved by Governor, March 5, 1914.
â€” 60 â€”
CHAPTER 832, LAWS OF 1913
AS AMENDED BY CHAPTER 50G, LAWS OF 1915, AND BY
CHAPTER 393, LAWS OF 1916
TO AMEND THE INSURANCE LAW, IN RELATION TO THE
CREATION OF MUTUAL COMPANIES TO INSURE EMPLOYERS
AGAINST LOSS, DAMAGE OR COMPENSATION RESULTING
FROM INJURIES SUFFERED BY EMPLOYEES OR OTHER
PERSONS FOR WHICH THE PERSON INJURED IS LIABLE.
The people of the State of New York, represented in Senate and Assembly,
do enact as follows:
Section 1. Chapter thirty-three of the laws of nineteen hundred and nine,
entitled "An act in relation to insurance corporations, constituting chapter
twenty-eight of the consolidated laws," amended by Chapter 832, Laws of
1913, is further amended by Chapter 506, Laws of 1915, to read as follows:
Mutual Empioykrs' Liability and Workmen's Compensation Corporations
Section 185. Incorporation.
18G. Completion of organization.
187. Directors and officers.
191. Reserves; suspension; cancellation and reinstatement of cer-
192. Reports to and examinations by superintendent.
193. Prevention of accidents.
194. Authorization of foreign mutual insurance corporations.
Sec. 185. Incorporation. Thirteen or more persons may become a cor-
poration for the purpose of insuring on the mutual plan against loss or
damage resulting from accident to or injury suffered by an employee or
other person and for which the person insured is liable, or the liability of
the employer to pay compensation to his employees, or the compensation of
employees under any workmen's compensation law, or against loss or damage
caused by a truck, wagon or other vehicle propelled by steam, gas, gasoline,
electric, mechanical or other power or drawn by horses or mules, used in
trade or manufacture and owned by any such person to the property of
another for which loss or damage the person insured is liable, by making
and filing in the office of the superintendent of insurance a certificate to be
signed by each of them, stating their intention to form a corporation for the
])ur[)ose named, and setting forth a copy of the charter which they propose
to adopt, which shall state the name of the proposed corporation, the place
where it is to be located, the mode and manner in which its corporate powers
are to be exercised, the number of directors, the manner of electing its
directors and officers, the time of such elections, the manner of filling vacan-
cies, the names and post office addresses of the directors who will serve until
the first annual meeting of such corporation, and such further particulars
as may be necessary to explain and make manifest the objects and purposes
of the corporation. Such certificate shall be proved or acknowledged and
â€” 61 â€”
recorded in a book kept for that purpose by the superintendent of insurance
and a certified copy thereof shall be delivered to the persons executing the
Sec. 186. [As amended by Chapter 506, Laws of 1915.] Completion of
organization. Upon receipt of a certified copy of the certificate of incor-
poration from the superintendent of insurance, the persons signing such
certificate may open books to receive applications for membership therein.
No such corporation shall transact any business of insurance unless the
annual premium cost on the insurance applied for shall be not less than
twenty-five thousand dollars at the minimum annual rates approved by the
superintendent of insurance and until at least forty employers employing
not less than twenty-five hundred employees; or thirty employers employing
not less than five thousand employees; or twenty employers employing not
less than seven thousand five hundred employees; or ten employers employing
not less than ten thousand employees, have become members of such corpora-
tion and applied for and agreed to take insurance therein, covering the
liability of such employers to their employees for accidents to or injuries
suffered by such employee nor until the facts specified in this section have
been certified under oath by at least three of the persons signing the original
certificate, to the superintendent of insurance, and the superintendent of
insurance has issued a license to such corporation authorizing such corpora-
tion to begin writing the insurance specified in this article. The superintendent
of insurance must be satisfied that the membership list of the corporation is
genuine, and that every member thereof will take the policies as agreed by
him within thirty days of the granting of the license to the corporation by
the superintendent of insurance to issue policies. If at any time the number
of members or the number of employees who are employed by the members
of the corporation falls below the number required by this section, no further
policies shall be issued by the corporation until other employers have made
bona fide applications for insurance therein, who, together with the existing
members, amount to not less than forty employers who employ not less than
twenty-five hundred employees, or thirty employers who employ not less than
five thousand employees, or twenty employers who employ not less than seven
thousand five hundred employees, or ten employers who employ not less than
ten thousand employees, and in the event that such applications for insurance
shall not be obtained within a reasonable time, to be fixed by the superintend-
ent of insurance, such superintendent may take the proceedings against such
corporation under section sixty-three of this chapter to the same effect as
if clause h of subdivision one of such section was specifically applicable to
corporations organized under this article.
The members of the corporation shall be policyholders therein, and when
any member ceases to be a policyholder he shall cease, at the same time, to
be a member of the corporation. A corporation, partnership, association or
joint-stock company may become a member of such insurance corporation
and may authorize another person to represent it in such insurance cor-
poration, and such representative shall have all the rights of any individual
member. Any person acting as employer in the capacity of a trustee may
insure in such corporation and as such trustee may assume the liabilities and
be entitled to the rights of a member, but shall not be personally liable upon
such contract of insurance.
Such corporation may borrow money or assume liability in a sum sufficient
to defray the reasonable expenses of its organization.
Sec. 187. Directors and officers. Any such corporation shall have not
â€” 62 â€”
less than thirteen directors, and such officers as shall be provided in the
certificate of incorporation or by the by-laws made by the members. The
directors shall be elected annually by the votes of the members. All except
two of the directors of the corporation elected after the organization of the
corporation is completed and it is authorized to begin to issue insurance
policies shall be members of the corporation. All the officers except the
secretary, assistant secretary and the actuar}^ must be members of the board
Sec. 188. [As amended by Chapter 506, Laws of 1915.] Meetings; basis
of riglit to vote. At all meetings of the members of the corporation each
member shall have one vote and one additional vote for every five hundred
cm})loyees or major fraction thereof, covered by the policy held by such
member in the corporation, provided that no member shall have more than
twenty votes. The number of votes of a member shall be determined by the
average number of employees at work and covered by said member's policy
in the corporation during the last six months from a date not more than ten
days immediately prior to the date of any such meeting. Before any member
shall be permitted to cast more than one vote at any meeting of members he
shall file with the secretary an affidavit showing the average number of
employees at work during the preceding six months covered by the employer's
l)olicy of insurance.
Sec. 189. Assessments. The corporation may in its by-laws and policies
fix the contingent mutual liability of the members for the payment of losses
and expenses not provided for by its cash funds; but such contingent lia-
bility of a member shall not be less than an amount equal to and in addition
to the cash premium written in the policy. If the corporation is not possessed
of cash funds above its unearned premium sufficient for the paj^ment of
incurred losses and expenses, it shall make an assessment for the amount
needed to pay such losses and expenses upon the members liable to assess-
ment therefor, in proportion to their several liability. Every member shall
be liable to pay and shall pay his proportionate part of any assessment which
may be laid by the corporation in accordance with law and his contract, on
account of losses and expenses incurred while he was a member, if he is
notified of such assessment within one year after the expiration of his policy.
All assessments shall be based upon present values of all future payments,
and all proposed premium assessments shall be filed in the insurance depart-
ment and shall not take effect until approved by the superintendent of
insurance, after such investigation as he may deem necessary. All funds
of the corporation and the contingent liability of the members thereof shall
be available for the payment of any claim against the corporation.
Sec. 190. [As amended by Chapter 393, Laws of 1916.] Dividends. The
board of directors may, from time to time, fix and determine the amount to
be paid as a dividend upon policies expiring during each year after retaining
sufficient sums to pay all the compensation and other policy obligations which
may be payable on account of the injuries sustained and expenses incurred.
Such dividend shall not take effect nor be distributed until approved by the
superintendent of insurance after such investigation as he may deem necessary.
Any such corporation may hold cash assets in excess of its liabilities, but
such excess shall be limited to one hundred per centum of its reserves for
losses and expenses incurred, and may be used from time to time in payment
of losses, dividends and expenses.
Sec. 191. [As amended by Chapter 506, Laws of 1915.] Reserves; sus-
pension; cancellation and reinstatement of certificate. Such corporation shall
- 63 â€”
be required to maintain the same reserves for the protection of policyholders
and emplo3^ees who may have a right of action directly against such cor-
poration as are required to be maintained by stock insurance corporations in
relation to the same class of insurance, except that reserves for liability for
insurance of compensation under the workmen's compensation law shall be
prescribed by the superintendent of insurance, and the superintendent of
insurance may suspend or cancel the certificate issued by him authorizing
said corporation to transact such insurance business at any time when in the
judgment of the superintendent of insurance the reserves of said corporation
are insuflScient to insure and secure the payment of its policy obligations,
and the superintendent of insurance may reinstate or renew said certificate
whenever by assessment or otherwise said reserves have been increased to
a sum sufficient in the judgment of the superintendent of insurance to insure
and secure the payment of the policy obligations of such corporation.
Sec. 192. Reports to and examinations by superintendent of insurance.
Every such corporation shall make reports to the superintendent of insurance
at the same times and in the same manner as are required from stock insur-
ance companies transacting the same kind of business, and the superintendent
of insurance may examine into the affairs of such corporation at any time,
either personally or by any duly authorized examiner appointed by him,
and the superintendent of insurance must make such an examination into the
affairs of said corporation at least once in every two years.
Sec. 193. Prevention of accidents. The board of directors shall make
and enforce reasonable rules and regulations not in conflict with the laws
of the state for the prevention of accidents to the employees on the premises
of members, and for this purpose the inspectors of the corporation shall have
free access to all such premises during regular working hours. The policy
of any member neglecting to provide suitable safety appliances as provided
by law or as required by the board of directors may be canceled and termin-
ated by the board of directors after giving to such member notice of can-
cellation ten days prior to its becoming effective.
Sec. 194. [As amended by Chapter 393, Laws of 1916.] Authorization
of foreign mutual insurance corporations. After January first, nineteen
hundred and seventeen, the superintendent of insurance may, in his discretion,
issue a certificate of authority to a mutual corporation organized under the
laws of another state to do such insurance in this state; provided that, in no
event, shall authority be given to any such mutual corporation to do other
kinds of business than those specified in this article. Such corporation shall
be required to maintain the same reserves for the protection of members
and employees as are required for domstic corporations authorized to transact
the same kind of insurance, and shall at all times have and maintain a surplus
over and above all liabilities, including unearned premiums and loss reserves,
of not less than one hundred thousand dollars. If any such corporation
shall not at all times have and maintain the surplus and reserves hereby
required, the superintendent of insurance may, at any time, in his discretion,
revoke its certificate of authority to do business in this state.
Sec. 2. This act shall take effect immediately.
Approved December 23, 1913.
UNIVERSITY OF CALIFORNIA LIBRARY
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