surplus is ascertained for the purposes of such dividend upon the basis of the unearned premium reserve being charged at a sum equal to one hundred per centum of the unearned portion of the gross premiums charged to policyholders for the policies in force from their dates of issue. § 2. This act shall take effect immediately. Chap. 390 AN ACT to amend the insurance law, in relation to mutual automobile fire insurance corporations. Became a law May 5, 1919, with the approval of the Governor. Passed, three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows: Section 1. Sections three hundred and twenty-one, three hundred and twenty-four and three hundred and twenty-five 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," as added by chapter fourteen of the laws of nineteen hundred and sixteen, are hereby amended to read as follows: § 321. Completion of organization. Upon receipt from the superintendent of insurance of a certified copy of the declaration of intention to form a corporation, the persons signing such declaration may open books to receive applications for membership therein. No such corporations shall issue any policies of insurance unless, and until, the persons signing such declaration shall have previously published once a week, for at least two successive weeks, a notice of their intention to form such a corporation in a public newspaper in the county where its principal office is to be located, nor until at least one thousand persons owning not less than one thousand automobiles have agreed to become members of such corporation, and have applied for, and agreed to take insurance therein, covering one or more of the kinds of insurance specified in section three hundred and twenty; nor until such persons have paid into the corporation at least five dollars each, amounting in the aggregate to at least five thousand dollars, as evidence of their good faith, such amounts to be credited against such members' first year's premiums; nor unless the annual premium cost of the insurance thus agreed to be taken shall be not less than forty thousand dollars at the rates charged by the company, nor until the facts specified in this section have been certified under oath to the superintendent of insurance by at least three of the persons signing the original certificate and the superintendent of insurance has issued a certificate of authority to such corporation, authorizing it to begin writing the insurance specified in this article; nor until the superintendent of insurance shall be satisfied by an examination of the corporation or otherwise that the applications for membership are bona fide, which applications shall state that the applicants agree to accept and take the policies of insurance referred to therein within a period of three months from the date of the issuance to the corporation by the superintendent of insurance of a certificate of authority to transact the business of insurance specified in this article. If at any time it shall appear from an examination of such corporation, or from any statement filed by it, that the premium cost of the insurance on existing policies falls below forty thousand dollars, the superintendent of insurance shall issue an order directing the corporation, within a period of ninety days thereafter, to secure bona fide applications for insurance in the corporation, the premium cost of which insurance, together with the premium cost of existing policies, shall be not less than forty thousand dollars. In the event that such applications for insurance shall not be obtained within such period, the superintendent of insurance may, in his discretion, take the proceedings for the liquidation of such corporation under section sixty-three of this chapter. The members of the corporation shall be policyholders therein, and when any member shall cease 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 any person to represent it in such insurance corporation, and such representative shall have all the rights of any individual member; but neither the representative nor the said corporation, partnership, association or joint stock company shall be subject to any greater liability than as if an individual member. Such corporation may borrow, or agree to repay, any reasonable sum or sums of money, not exceeding five thousand dollars, used to defray the expenses of its organization, or any sum or sums of money deemed necessary to be provided for the purposes of enabling it to comply with any requirement of the law. Any director, officer or member of such corporation, or any other person, firm or corporation, may loan or advance to such corporation any such sum or sums of money, upon an agreement that the same with interest at a rate not to exceed six per centum per annum shall be repaid only out of surplus earnings or profits of such corporation with the approval of the superintendent of insurance whenever, in his judgment, the financial condition of the corporation warrants it, except that such approval shall not be withheld if after such repayment shall be made, such corporation shall have and be in possession of a surplus equal to ten per centum or more of its gross annual premium income. Such surplus, however, shall be ascertained for the purposes of such repayment, upon the basis of the unearned premium reserve being charged at a sum equal to one hundred per centum of the unearned portion of the gross premiums charged to policyholders for the policies in force from their dates of issue. Any such sum or sums shall not form a part of the legal liabilities of the corporation, but until repaid all statements filed with the superintendent of insurance shall show the amount thereof. Such corporation may classify the risks insured therein at the time of the insurance and issue policies under different rates. 8324. Assets; liabilities; reserves; suspension; cancellation and reinstatement of certificate; expenses. When an examination is made by the authority of the superintendent of insurance into the affairs of any such corporation, or any such corporation renders a statement to the insurance department, the superintendent shall allow as assets only such investments as are authorized by the existing laws of this state in relation to stock insurance companies at the date of such examination or of rendering such statement, but unpaid premiums on policies or renewals written within three months shall be admitted as available resources. In estimating its liabilities for the first five years after such corporation has commenced the business of writing insurance, there shall be charged a sum equal to eighty per centum of the unearned portion of the gross premiums charged to its policyholders for the policies in force from their dates of issue. After such five-year period such liability shall be computed at the full one hundred per centum of the unearned portion of the gross premiums so charged. In all other respects, such corporation shall be required to maintain the same reserves for the protection of policyholders, and others who may have a right of action directly against such corporation, as are required to be maintained by stock insurance corporations in relation to the same class of insurance. The superintendent of insurance may suspend or cancel the certificate issued by him, authorizing such corporation to transact such insurance business, at any time, when the assets of such corporation are insufficient to insure and secure the payment of its policy and other obligations; and the superintendent of insurance may reinstate, or renew, said certificate whenever, by assessment, or otherwise, said assets have been increased to a sum sufficient to insure and secure the payment of the policy and other obligations of such corporation. The expenses of management of such corporation shall not exceed in any one calendar year thirty-five per centum of its premium income in such year, but the expenses of management shall not be held to include taxes and expenses incurred in the investigation, adjustment and settlement of claims. 325. Dividends. The board of directors may from time to time fix and determine the amount to be declared and paid as a dividend, upon policies expiring during each year after retaining sufficient sums to pay all outstanding policy and other obligations. Such dividends shall not take effect or be distributed until approved by the superintendent of insurance, after such investigation as he may deem necessary, but in no event shall such dividends be declared or paid during the first five years after the corporation has been authorized to transact business, unless its surplus is ascertained for the purposes of such dividend upon the basis of the unearned premium reserve being charged at a sum equal to one hundred per centum of the unearned portion of the gross premiums charged to policyholders for the policies in force from their dates of issue. § 2. This act shall take effect immediately. Chap. 391 AN ACT to amend the insurance law, in relation to the powers of casualty insurance corporations. Became a law May 5, 1919, with the approval of the Governor. Passed, three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows: Section 1. Subdivision nine of section seventy 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," as last amended by chapter two hundred and four of the laws of nineteen hundred and fourteen, is hereby amended to read as follows: 9. Against loss or damage to automobiles and airplanes, seaplanes, dirigibles or other aircraft (except loss or damage by fire, or while being transported in any conveyance by land or water), including loss by legal liability for damage to property resulting from the maintenance and use of automobiles and airplanes, seaplanes, dirigibles or other aircraft. 2. This act shall take effect immediately. Chap. 392 AN ACT to amend the insurance law, in relation to the powers of marine insurance corporations Became a law May 5, 1919, with the approval of the Governor. Passec, three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows: Section 1. Section one hundred and fifty of chapter thirtythree of the laws of nineteen hundred and nine, entitled "An act |