Insurance laws of the State of Georgia, 1915

INSURANCE LAWS
OF THE.
STATE OF GEORGIA
IN FORCE TO AUCUST, 1915
I WM. A. WRIGHT COMPTROLLER-GENERAL AND INSURANCE COMMI5510 ER

I

ATLANTA, GA. CRAS. P. BYRD, STATE PRIXTER
1914

A ACT

To reo-ulate the busine s of Insurance in this State, and for other purpose .

ection 1.

Be it enacted by the Gene~al Assembly

Comptroller General shall

of

the

State

of

Georgia,

That

from

and

after

the

be IDsurance Commis-

sioner.

1'a . age of thi Act, the Comptroller-General of thi

f tate shall be the Insurance Commissioner of this

tate and shall be charged with the execution of the

law of this State regulating the business of Insur-

ance in the State of Georgia.

ec. 2.

Be it further

enacted,

That it shall not be

Home and foreign iD-

lawful

for

any

insurance

company

chartered

by

surance com panles must

tbi

tate

or

other

State,

or

foreign

government,

be licensed by Insur-

ance Com-

to tran act any bu ine s of in urance in this State missioner.

without fir t procuring a license from the Insurance

Commi ioner of thi tate, and before said Com-

mi ioner shall is ue uch license, uch in urance

company must fully comply with all the provisions

of thi Act, and file with aid Insurance Commi -

ioner a tatement, under oath of its President

and ecretary, specifying: First. The name and

locality of the company. Second. The condition of

uch company, on the thirty-first day of December Annuai re-

then

next preceding,

exhibiting

the

following

facts

port of con dltlon of

compan.

and items in the following form, namely: First.

The amount of capital stock of the company and

what part of the same has been paid up in cash, and

what part is in notes of the stockholders, and how

uch notes are secured. Second. The property or

a- et held by the company, specifying:

4

INSURANCE LAWS.

Contents of annual reo

1. The value, or as near as may be, of the real

port.

estate held by uch company; if encumbered, to what

amount.

2. The amount of cash on hand and deposited in banks to t~e credit of the company.

3. The amount of cash in the hands of agents, and in the course of transmission.

4. The amount of loans secured by bonds and mortgages on real estate.

5. The amount of other loans and how secured.

6. The amount of stocks of this State, of other States in the United States, and of any other stock owned by the company, specifying the amount, number of shares and par and market value of each kind of stock.

7. The amount of interest actually due and unpaid.

8. The amount of premium notes on hand upon which policies have been issued.

9. The amount of any and all other assets, both real and personal, not covered by or included hereinbefore.

Third. The liabilities of the company specifying:

1. The amount of losses due and yet unpaid.

2. The amount of claims for losses resisted by the company.

3. The amount of losses not yet due, including those reported to the company, on which no action has yet been taken.

INSURANCE LAWS.

5

4. The amount of dividends declared and due and remaining unpaid.
5. The amount of di.vidends declared, but not yet due.
6. The amounl of money borrowed. 7. The amoun.t of all other claims against the company. 8. The amount of reserve for reinsurance. Fourth. The income of the company during the preceding year, specifying: 1. The amount of cash premiums received. 2. The amount of notes received for premiums. 3. The amount of interest money received. 4. The amount of income received from other sources. Fifth. The expenditures during the preceding year specifying: 1. The amount of losses paid during the year. 2. The amount of dividends paid during the year. 3. The amount of expenses paid during the year, including fees and commiss~on to agents and officers of the company. 4. The amolint paid in taxes. 5. The amount of all other payments and expenditures. 6. The greatest amount insured in anyone risk and the total amount of insurance outstanding. 7. A certified copy of the Act incorporating the company.

6

INSURANCE LAWS.

Amount of capital stock

Sec. 3. Be it further enacted, That no insurance

required of home and

company of whatever class, except such companies

foreign fire. marine. in land. Ufe.

as have already been chartered by this State, Ma-

accident, live stock.

sonic, Odd Fellows, religious and mutual aid societies

and steam boiler Insur.

and

co-operative

or

assessment

life

insurance

com-

ance com

panles. and' how In

panies,

shall

be

allowed

to

transact

any business

of

vested. insurance in this State, unless possessed of at least

one hundred thousand dollars of actual cash capital

paid up, or assets and invested in 'bonds or stocks,

estimated at their actual market value at the date of

the statement required by section second of this Act,

or in mortgages on real estate worth double the

amount for which the same is mortgaged. Upon fil-

ing such statement, the Insurance Commissioner,

when satisfied that it is correct, and that the com-

pany has fully complied with the laws regulating the

business of insurance in this State, hall issue

license to said company to transact business in this

State. Said statement and license must be renewed

annually on the first day of January, or within sixty

days thereafter, and must show the condition of

said company on the thirty-first day of the preced-

ing December.



All Insuran In addition to this statement above required, all

ance com

panles reo qulred to

companies, including co-operativ~ or assessment-

make semi annual

life

insurance

companies

doing

business

in

this

statements to the

State, shall, through their chief officer or agent,

Governor.

residing in this State, make to the Governor of the

State semi-annual statements on the first day of

January and July of each year, or within sixty

days thereafter, which statement shall contain a full

/

INSURANCE LAWS.

7

and exact report of their condition on the thirtieth

day of June and the thirty-first day of December

then next preceding, said statement to be made in

accordance

with

the

terms

and

conditions

set

forth

Must be publlshed.

and required under the second section of this Act,

which shall be sworn to by the officer or agent mak-

ing the same. That at the time of making such

report to the Governor each company shall publish,

at its own expense, a duplicate thereof in a news-

paper of general circulation published in this State.

That should anyone of such insurance companies

fail or refuse to make said statement to the Gov- Penalty for

failure to

ernor,

it shall, by such failure

or refusal,

forfeit

its

make semi annual state

right to do business in this State until the first of ment.

January of the next year, and on such failure or

refusal the Insurance Commissioner shall recall and

cancel the license of such delinquent company.

Sec. 4.

Be it further enacted, That all fire, marine

Deposit of $10.000 re-

and

inland

insurance

companies

chartered

by

other

quired of foreign fire,

States

or foreign

governments

shall

be

required

to

marine and Insurance

companies.

deposit with the Treasurer of this State bonds of

the United States, or bonds of this State, which, ac-

cording to the Acts and resolutions of the General

Assembly, are valid, and which amount, according to

their face value, to ten thousand dollars, which

bonds shall be receipted for by the State Treasurer,

and especially deposited by him in the. vaults of the

Treasury, and whenever such company ceases to do

business in this State, and has settled up all claims

against it, as hereinafter provided, said bonds shaH

be delivered up to the proper party on presentation

8

I SURANCE LAws.

of the Treasurer's receipt. While said bonds are so deposited, the owner of the same shall, subject to the notices hereinafter provided for or given, be entitled to collect the coupons -and use them. For the bonds so deposited the faith of the State is pledged that they shall be. returned to the parties entitled to receive them, or disposed of as hereinafter provided.

"Where loss That whenever any loss insured against occurs,

occurs, In-

sured may give notice

the insured, in order to secure his recovery, may

to Treasurer. give notice to the State Treasurer of the pendency

of said loss and of the amount claimed, after which

time the State Treasurer shall be 'bound to retain,

subject to the order of the court trying any suit that

may be brought for the recovery of such loss, a suf-

ficient amount to pay the judgment in said case, in

the event of recovery; when such suit is ended, and

the amount ascertained for which said party sued

may be liable is not paid in ten days, then said plain-

tiff .may :file an application with the judge of the

Superior Court of the county where_ the case was

tried for a receiver to take charge of so many bonds

as shall be necessary to satisfy the aforesaid judg-

ment.

When reo

When said receiver is appointed by the judge, who

celver may

be appoint ed, and his

shall always require bond and security of him for

duties.

the faithful performance of his duty, said State

Treasurer, on his application, shall deliver to him

bonds sufficient in their market value, if in his cus-

tody to satisfy said judgment. Said receiver's re-

ceipts shall be a complete discharge to said Treas-

9

urer and the State of Georgia. Then said receiver shall apply to the judge of said Superior ourt for an order of sale and in pur uance of said order sell said bonds. After deducting such expen e and commis ions as shall be allowed by said judge he shall pay over to the plaintiff or his attorney a sufficient amount to satisfy the said judgment, and if there remains any residue in the hands of such receiver, he shall pay over the same, to the agent of the company, taking his receipts for the same, which shall be filed and recorded with the other papers in the case.

If

there

are

'Conflicting

claims,

then

the

State

When there are conflIct-

Treasurer

shall deliver

over to

the

receivers,

in

the

ing

claJms.
,

order of their applications, the aforesaid bonds and

if there is any contest between creditors which can

not be settled in this mode, then the party not receiv-

ing sufficient bonds through the receiver appointed

in his behalf, may become a party to the other case

and make known his claim to the other receiver by

making affidavit of the claim and filing the same

with him, and then the receiver shall report such

claim to the judge of the Superior Court appointing

him, who shall by order providE.l for a bill of inter-

pleader, as in cases of equity.

When any company desires to withdraw from the When a

State

and

will

satisfy

the

Commissioner

that

all

company wishes 10

withdraw

suits

pending

against

such

party

and

of

which

no

from tbe State,

notice has been given, have been fully satisfied" or

whenever no notice of claim has been given, and

when rights under existing policies have been satis-

10

INSURANCE LAWS.

fied and released, as the provisions of this Act require, then said Treasurer shall return to said party the bonds so deposited upon order from said Commissioner.

"'Where bonds deposited

Whenever, by means of the prOVISIOns of this

.are reduced Treasurer

Act, the amount of bonds so deposited are reduced,

-shall notify -Insurance

said

Treasurer

shall

at

once

notify

the

Insurance

Commls

:sloner.

Commissioner in writing, who shall give notice to

the company depositing, and require more bonds to

be deposited so as always to maintain the original

amount, and if the company so notified by the Insur-

ance Commissioner fails to comply within thirty

days, the license to do business in this State shall be

,

revoked and said Insurance Commissioner shall, at

the same time, give notice by publication in a news-

paper published at the capital of the fact of such

failure and revocation of license, the cost of which

publication shall be paid by the company failing to

comply with the provisions of this Act; and when

any company having made the deposit required by

this Act has existing policies on property of citizens

.()f this State on which no losses have accrued, and

which company wishes to withdraw its deposits, be

fore being allowed to do so, said company shall take

up and satisfy said policies and give notice of its

intention to withdraw from the State, and of the

fact that it has satisfied all losses and the claims of

the policyholders above designated, which notice

shall be published once a week for two months in a

newspaper to be designated by the Insurance Com-

missioner of the State, and at the expense of said

INSURANCE LAWS.

11

company; and it is hereby provided that any claims of the citizens of this State must-whether for losses or on existing policies where no losses haye occurred -be fully settled before said deposits shall be withdrawn.

,Sec. 5. Be it further enacted, That all life and

accident insurance companies chartered by other

States of the United States, or foreign governments,

shall show by a certificate from the officer having

supervision of the insurance department in the

State in which they are chartered, or elect to make

their deposit, that they have deposited not less than

Life companle's shall

one hundred thousand dollars, in such securities

as

furnish cer tiflcate of

may be deemed by such officer as equivalent to

cash,

Insurance Commis-

sioner where

subject

to

his

order

as

a

guarantee

fund

for

the

chartered that they

security of policyholders of said companies.

have rleposl. ted $100,000.

All

such

companies

chartered

by

the

State

of

Home life companies

Georgia

shall,

before

doing

business

in

this

State,

shall deposit.

deposit with the Insurance Commissioner of this

State, or with some strong corporation which may

be approved by him, one hundred thousand dollars,

in such securities as may be deemed by him equiva-

lent to cash, to be subject to his order as a guaran-

tee fund for

the security of the policyholders of the

Amended Act aD

by

proved
company making such deposit; all interest and divi- August 2!.

1905.

dends arising from such securities to be paid when

due to the company so depositing them. Any such

securities as may be needed by the company may

be taken from said Insurance Commissioner or cor-

poration at any time by replacing them with other

securities equally acceptable to the Tn.$;urance Com-

12

INSURANCE LAWS.

missioner, wIlose certificate for tIle same shall be furnished to the company.

surance CommIssioner may Investigate the altalrs of any Insurance .company.

Sec. 6. Be it further enacted, That it shall be the duty of the Insurance Commissioner, whenever he shall deem it expedient so to do, and he is hereby empowered, either in person or by an expert exami-

ner by him appointed, to investigate the affairs of

any insurance company doing business in this State;

to require free access to all books and papers of any

~ompany, or the agents thereof; to summon and ex-

amine under oath any person in this State relative

to the affairs and condition of said company; for

probable cause to visit at its principal office where-

ever it may be, any insurance company not of the

State in which the substantial requirements of this

Act, as to valuations of policies of life and accident

insurance companies, and calculations for the rein-

surance reserve on fire, marine and inland insurance

companies, are not in force and doing business in

this State, for the purpose of investigating its af-

fairs and condition, and revoke its authority to do

business in this State, if said company refuses to

permit the examination. All expense incurred in

the investigation of said companies shall be paid hy

the companies so examined.

Tnsurance Commls.

Sec. 7. Be it further enacted, That for every fire

sloner shall calculate reo

insurance

company

doing

business

in

this

State~

the

Insurance

reserve (or unexpired

Insurance Commissioner shall calculate, or cause to

fire risks. be calculated, the reinsurance reserve for unexpired

fire risk.:; by ta~g fifty per centum of the premium

INSURANCE LA.ws.

13

received on all policies that are written for the period of one year or less, and according to the New York percentage table for calculating reinsurance Dn all premiums received that have more than one year to run, and in marine and inland insurance he -shall charge all the premiums received on unexpired risks as reinsurance reserve. Having charged against the company the' reinsurance reserve as .above determined for fire, marine and inland insurance, and adding thereto all other debts and claims against the company, he shall, in case he :finds the capital stock of the company impaired, give notice to said company to make good its whole capital stock within ninety days, and if this is not done, he shall require the company to cease to do new business within this State, and shall thereupon 'in case the company is organized under authority of ihis State, immediately institute legal proceedings as hereinbefore required by the provisions of this Act.

Any such insurance company receiving 'the afore-

Insurance companies

shall call

said notice

of the

Insurance

Commi

sioner

to

make

upon stock holders.

-good its whole capital stock within ninety days, shall when.

forthwith call upon its stockholders for such

:amounts as will make its capital equal to the amount

fixed by the charter of said company.

In

the

case

of

companies

chartered

by

other

When Ins. Com. shall

'Rtatfils

or

foreign

governments,

the

Insurance

Cow-

accept caJ culll ttons 01

mis

ioner

of

this

State

shall

accept

calculations

of

reserve made by

other Ins.

ihe reinsurance reserve made by the Insurance Cum'rs.

Commissioner of the State in which they are char-

tered, when such calculations are made and fur-

14

INSURANCE LAws.

nished to the Insurance Commissioner of this State by the first of March in each and every year.

When Ins. Company Is

Whenever the Insurance Commissioner ~hall

Insolvent or fraudulentlY

have reason

to believe from an examination into the

conducted.

affairs of a company, that any insurance company

of thi'S State is insolvent or fraudulently conducted,

or that its assets are not sufficient for carrying on

bu iness, or during any non-compliance with the

provisions of this Act, he shall communicate the

fact to the Attorney-General, whose duty it shall

then become to apply to a judge of the Superior

Court of this State for an order requiring said com-

pany to show cause why their business should not

be closed, and the judge hall thereupon hear the

allega tions and proofs of the respective 'Parties

. If it appears to the satisfaction of said judge that

such company is inSOlvent, or that the interests of

the public so require, the said judge shall decree a

dissolution of such corporation and a distribution

of its assets; but in case it shall appear to said

judge that said company is able and has complied'

with the provisions of this Act, and that it is not in.

solvent, a decree sball be entered annulling the ac-

tion of the Insurance Commissioner in the premises~

and authorizing the company to resume business.

Ins. Com'r shall calcu-

Sec. 8. Be it further enacted, That the Insur-

late net value of

ance Commissioner shall, as soon as practicable, in

pollcles,

when.

each alternate year, calculate, or cause to be calcu-

lated, the net value, on the 31st day of December of

the previous year, of all the policies in force on that

day in each life insurance company chartered h~~

INSURANCE LAWS.

15

this State, and in every other life insurance company doing business in this State, that shall fail to furnish him, as hereinafter provided, a certificate of the Insurance Commissioner of the -State b:r whose authority the company was authorized, or b~J the State in which it may elect to have its policies valued, and its deposit made, giving the net value bf an policies in force in the company on the 31st day of December of the preceding year, which calculation of the net value of each policy shall be based upon the American experience or actuaries' table 'Of mortality, and four per cent. interest per annum; provided, that where any life company shall have .a cash capital of not less than one hundred thousand dollars, fully paid up and safely invested, the reserve to provide for the liabilities on all policies 'Of such company, not participating in the profits of the company, shall be computed by the American or actuaries' table of mortality, with interest at not less than three nor more than six per cent. per anl~um, in the discretion of the Commissioner, and with reference to the rates of premiums charged by such company. The net value of a policy at any time shall be taken to be the single net premium which will at that time effect the insurance, less the value at that time of the future net premiums called for by the table of mortality and rate of interest designated.

In case it is found that any life company doing Where a

company \s

an business in this State has not on hand the net value

below standard

of

'Of its policies in force after other debts of the legal safety.

16

L"SU:RAlii CE LA\VS.

company and claims against it, exclusive of capital stock, have been provided for, it shall be' the duty of the Insurance Commissioner to publish the fact that the then existing condition of affair of the company is below the standard of legal safety established by this State, and he shall require the company at once to cease doing new business; and it i hereby madethe duty of the Insurance ommi ioner, after having determined as above the amount of the net value of all policies in force to see that the company has that amount in safe legal securities after all debts and claims against it, exclusive of capital stock, have been provided for.

"nen valu
atlons made

He shall accept the valuations made by the In ur-

b)' Commls

sloners of other States

ance

Commissioner

of the

State under whose author-

shall be accepted.

ity a life insurance company is chartered, when

such valuations have been made on the basis men-

tioned above; p1'ovided, the company shall furnish

to the Insurance Commissioner of this State, on or

before the fir t day of March in each and .every al-

ternate year, a certificate from the In urance Com-

missioner of uch State etting forth the value, cal-

culated on the dates designated above, of all the poli-

cies in force in the company on the previous 31 t

of December, and stating that after all the other

debts of the company and claims again t it at that

time were provided for, the company had in safe e-

curitie an amount equal to the net value of all it~

policies in force, and that said company is entitled

to do busine in its own tate; and every company

doing bu ine in the State during the year for

IN SURANCE LAWS.

17

which the statement is made, that fails to furnish promptly the certificate.aforesaid, shall be required to make full detailed list of policies and securities held or owned by the company to the Insurance Commissioner of this State, and shall be Hable for all charges and expenses consequent upon not having furnished said certificate.

It shall .be the duty of the Commissioner, after he

When Ins. Commis

has notified a life insurance

company chartered by

sloner shall make rigid

examlna

this State to cease doing new business until the net

tlon into atralrs of

value of its policies in force is equal to that called company.

for by the standard of safety established by the

State, at once to cause a rigid examination into the

affairs of such company. In case it should appear

that there is no fraud, or gross incompetency or

recklessness shown to exist in the management, he

may upon publishing the facts in the case, permit

such company to continue its business for one year,

provided there is in his opinion, reason to believe

that the company may be able to re-establish the legal

net value of all its policies in force. At the end of

the year named above, he may renew the permis-

sion, in case, on examination, he is satisfied that the

company is likely to retrieve its affairs.

Whenever the Insurance Commissioner shall have reason to believe that any insurance company of this State is insolvent or fraudulently conducted, or that its assets are not sufficient for conducting the business of the company, or during any non-compliance with the provisions of this Act, his duty shall be as prescribe~ in Section 7 of this Act.

18

INSURANCE LAWS.

neflnlng who are In-

Sec. 9. Be it further enacted, That any person

surance agents.

who solicits in behalf of any insurance company, or

agent of the same, incorporated by the laws of this

or any other State, or foreign government, or who

takes or transmits, other than for himself any appli.

cation for insurance, or any policy of insurance to

or from such company, or agent of the same, or who

advertises or otherwise gives notice that he will re-

ceive or transmit the same, or who shall receive or

deliver a policy of insurance of any such company,

or who shall examine, inspect any risk at any time,

or receive or collect or transmit any premiums of

insurance, or make or forward any diagram of any

building or buildings, or do or perform any other

act or thing in the making or consummating of any

contract of insurance for or with any such insurance

company other than for himself, or who shall exam-

ine into or adjust or aid in adjusting any loss for or

in behalf of any such company, whether any of such

acts shall be done at the instance or request or by the

emplOYment of such insurance company, or of or by

any broker or other person, shall be held to be the

agent of the company for which the act is done or

the risk is taken.

Agents, per-ally for

Any person who shall do or perform any of the

acting wIth-

out Ity.

author-

acts or things mentioned for any insurance company

or agent of said company without such company hav-

ing first received a certificate of authority from the

Insurance Commissioner of this State, as required

by law, shall be guilty of a misdemeanor, and on con-

viction in any court of competent jurisdiction, shall

INSURANCE LAWS.

19

be punished as provided by Section 4310 of the Oode of Georgia, and shall also pay a sum equal to the State, county and municipal taxes and licenses required to be paid by insurance companies legally doing business in this State; and it is hereby made the duty of the Insurance Oommissioner to see that all violators of the provisions of this section are prosecuted.

An.sr p~rson who shall do any of the acts men tioned

When arjusters are

in this Section shall also be personally liable to thl not liable.

holder of any policy of insurance in respect of which

such act ~as done, for any loss covered by the same;

provided, that the penalties provided for in this Sec-

tion shall not apply to adjusters of unauthorized in-

surance companies from whom citizens of this State

have purchased insurance for themselves as provided

for in this Section, whenever the person or persons Arnemled by

Act ap

purchasing said insurance

shall immediately -notify

proved De cember 23,

the Insurance Oommissioner, giving the names and 1800.

locality of each company in which they have policies,

and at the same time pay to said Insurance Oommis-

sioner the same license fees and taxes for each com-

pany as are now or may hereafter be required of

fire insurance companies authorized to do business

by the laws of this State. And when the license fees

for any company have been paid in anyone year by

any person or persons who have purchased insurance

from that company, then and in that case any person

or persons purchasing insurance from said company

thereafter shall not be liable for the license fees of

said company during the said year, but only for such

20

INSURANCE LAWS.

taxes on premiums as may be required from time to time of insurance companies authorized to do business in this State.

Sec. 10. Be it further enacted, That any insurance

Shall file

wllh Insur ance Com.

company not incorporated or qrganized under the

IIllsslone~ a. power of at

laws

of

this

State,

desiring

to

transact

business

in

lorne)'.

this State, shall file with the Insurance Commissioner

of this State a written instrument or power of attor-

ney, duly signed and sealed, appointing and author-

izing some person, who shall be a resident of this

State, to acknowledge or receive service of process,

and upon whom process may be served for and in be-

half of such company in all proceedings that may be

instituted against such 'company in any court of this

State, or an.y court of the United States in.this State,

and consenting that service of process upon any

agent or attorney appointed under the provisions of

this SMtion shall be taken and held to be as valid as

if served upon the company; and such instrument

shall further provide that the authority of such attor-

ney shall continue until revocation of his appoint-

ment is made by such company by filing a similar in-

strument with said Insurance Commissioner, where-

by another person shall be appointed as such attor-

ney; 'provided, however, that the provisions of this

Section shall not be construed to alter or amend the

laws now of force in this State relative 1.0 Lrmging

suits ,and serving process on foreign corporati?m

doing business in this State.

If an attorney so appointed shall absent himself from this State, or his usual place of business or

INSURANCE LAWS.

21

abode, or shall secrete himself,

so

that process may

When Ins. CommIs-

not be served upon him,

or

shall

have

become dis-

sioner may appoint an

attorney.

qualified from any cause whatever, or shall die, the

Insurance Commissioner shall immediately appoint

an attorney for service for such company, of which

appointment notice in writing shall be immediately

given by said Insurance Commissioner to such

appointee, and also be sent to the company by mail,

or to its general agent or manager, which appoint-

ment shall be as valid as if made by the comJ?any,

and shall continue in force until such absent agent or

attorney shall return and give to said Insurance

Commissioner written notice thereof, or until the

company shall have made another appointment in

the manner above prescribed. Service of process as

aforesaid, issued by any such court as aforesaid

upon any such attorney appointed by the company,

or by the Insurance Commissioner, shall be valid and

binding and be deemed personal service upon such

company so long as it shall have any obligations or

liabilities outstanding in this State, although such

company may have withdrawn, been excluded from,

or ceased to do business in this State. If any com-

pany shall fail, neglect or refuse to appoint and

maintain within the State such attorney or agent, it

shall forfeit the right to do or continue business in

this State.

Sec. 11. Be it further enacted, That no person shall act as an agent in this State of any insurance (ompany of this or any other State, or foreign governli...:,nl., doing a business in any manner, until said

22

INSURANCE LAWS.

company has fully complied with the provisions of

this Act, and received from the Insurance Commis-

. sioner certificates of authority for itself and its

agents to transact business in this State. The fees

of the Insurance Commissioner shall be as follows:

~~::ng~ In For filing certified copy of charter, $20.00; for ex-
~~~~.IS- amination of annual statement, $20.00, and for certifi-

cates of authority or license to agents, $3.00 each,

one-fifth of which shall be paid to the Commissioner

in full compensation for services in executing the

AAmctenodfed by provisions of this Act.

In addition to the payment

fg~f.1st 16, of the above fees, each of the said companies shall

make a report to the Commissioner on the first day

of May of each year, or within sixty days thereafter,

under oath of the President or Secretary thereof,

Amended by showing the entire amount of premium receipts of ~~~.o~g. every character and description (deducting returned
J 912.
premiums on cancelled policies) of said companies

in this State during the year or fractional part of

the year ending the 30th day of April next preceding,

whether said premiums were received in money or

in notes, credits or any substitute for money, to be

taxed as may be provided by law from time to time.

Sec. 12. Be it further enacted, That every local insurance agent, or firm, doing business in this State, shall pay a tax of ten dollars for each county in which they shall solicit business, and every agent of a matrimonial, natal or nuptial company, or traveling special or general agent of life, fire, accident or other insurance company doing business in this B~tp.. shall pay a tax of fifty dollars, which said

INSURANCE LAWS.

23

agent must pay before he or they shall be authorized

to act as an agent for any of their companies. Said

tax

shall be

paid by

said agent

to

the

Comptroller-

Amended by General Tax

General, and shall be in addition to the license fee Act.

required of insurance companies by the Act ap-

proved October 24, 1887. The receipts of the Comp-

troller-General for the payment of this tax, together

with his certmcate, as provided by said Act. ap-

proved October 24, 1887, shall constitute the license

for said agents to transact business for their com-

panies as designated by said certificates; p1"ovided,

this tax shall not be required of agents of assessment

life insurance companies or mutual aid societies.

Sec. 13.

Be it further enacted, That whenever the

Where States

other reo

existing laws of any other State of the United S'tates

quire larger deposIts

than thIs

shall require of insurance companies chartered by State.

this State, and having agencies in such other State,

or of the agents thereof, any deposit of securities in

such State for the protection of policyholders or

otherwise, or any payment or penalties, certificates

of authority, license fees or otherwise, greater than

the amounts required for such purposes from similar

companies of other States by the then existing laws

of this State, then, and in every such case, all com-

panies of such State, establishing or having hereto-

fore established an agency or agencies in this State,

shall be and are hereby required to make the same

deposit, for a like purpose, with the Insurance Com-

missioner of this State, and to pay to said Commis-

sioner for penalties, certmcates of authority, license

fees or otherwise, an amount equal to the amount of

24

INSURANCE LAWS.

such charges imposed by the laws of such State upon companies of this State and the agents thereof.

oArssCeoss-Ompeenrta- Sec, 14. Be it further enacted, That it shall not ~::le;.om- be lawful for any corporation or association organ-
ized under the laws of this or any other States of the United States for the purpose of furnishing life inAmended by demnity or insurance upon the assessment plan by ~;~v:g- its agents, to do any business in this State until such A19u0g5u. st 23, corporatI' on or assoc.latl'On sha11 depos.lt W.Ith the Insurance Commissioner of this State a certified copy of its charter or articles of incorporation, a copy of its statement of business for the year ending on the thirty-first day of the next preceding December, sworn to by the President or Secretary or like officers thereof, setting forth the number and amount of certificates of membership or policies in force and a detailed account of its expenditures, income, assets and liabilities, and also a certificate sworn to by the President and Secretary or like officers thereof, setting forth that it has paid and has the ability to pay its certificates or policies to the full limit named therein; that its certificates or policies are payable only to beneficiaries having a legal insurable interest in the life of the member or insured; that an ordinary asses ment upon its members is sufficient to pay its maximum certificates of membership or policy, theretofore or thereafter to be issued, to the full amount or limit named therein; a certificate from the In urance Commissioner or other like officer, charg d with the duty of executing or enforcing the execution of the insurance laws of its home State,_

INSURANCE LAws.

25

certifying that itis legally entitled to do business in said home State; a copy of the application for membership or insurance, and of each form thereof, if more than one form used; a copy of the Constitution and by-laws, of each and every addition thereof, which must show that all indemnities to beneficiaries .are in the main provided for by assessments upon all surviving members. .And whenever said company shall fail to pay a valid claim to the full limit named in any policy issued by them to any resident of this
tate, the Insurance Commissioner shall revoke their ~uthority to do business ~n this State.

ec. 15.

Be it further

enacted, That after author-

Agents, how

izing such corporation or association to do business llcensed.

in this State, as provided in this Act, the Insurance

Commissioner shall issue license to agents thereof

to be designated by the corporation or association,

'Or a general agent thereof, authorizing them to act

~s such agents during the year for which said com-

pany is licensed; but such license must be renewed

annually.

Sec. 16. Be it further enacted, That any agent, ~~ft~r~~gon physician or other person who shall knowingly se ~~IT,~~1 -cure, or cause to be secured, a certificate of member- .ethdegIer. knowlship on any person without his knowledge or consent, or by any means of misrepresentation, false, fraudulent or untrue statements, be instrumental in securing a certificate of membership on any aged or infirm person, or in restoring to membership any person not in an insurable condition, shall be deemed guilty of a misdemeanor, and upon conviction thereof shall be

26

INSURANCE LAws.

fined in a sum of not less than one hundred dollars nor more than one thousand dollars, or be imprisoned in a county jail not less than thirty days, nor more than one year, or both, in the discretion of the Court, and said certificate or renewal so secured shall be absolutely void.

Annual

Sec. 17. Be it further enacted, That every corpo-

statements.

how etc.

verified.

ration

or association which may be

doing business in

this State under the provisions of this Act shall, on

or before the first day of March in each year after

it commences to do business in this State, make and

file with the Insurance Commissioner of the State a

report of its affair and operation~ during the year

ending the 31st day of December next preceding..

Such annual report shall be made upon blank forms

to be provided and furnished by the Insurance Com-

mi sioner, and shall be verified under oath of the

President or Secretary, or other like officers, and

shall be published, or the substance thereof, in the

annual report of said Insurance Commissioner.

Fees and

Sec. 1. Be it further enacted, That there shaH

tlUes.

be paid to the Insurance Commissioner by each cor-

poration or association when it is authorized to do

business in this State under the provisions of this

ATmended by Act, the arne fees a required by Section 11 of this

ax Act.

1909.

Act, together with all such subsequent fees as are

prescribed under said Section 11. In addition to the
.foregoing fees, every such corporation or association shall, on or before the first day of July of each

year, report, under oath of its President and Secre-

tary, or other like officer, to the Insurance Commis-

INSURANCE LAWS.

27

sioner the gross amount received on business done in the State during the year ending the 30th of April next preceding, and shall at the same time pay into the treasury of this State a tax of one dollar upon -each one hundred dollars of such gross amounts so received by said association or corporation; provided, however, that if such corporation should at any time be the owner of any real or personal prop-erty situated in this State, such property shall not be exempt from taxation by reason of the provisions of this Section.

Sec. 19.

Be it further

enacted,

That if

such

cor-

Failure to file annual

poration or association

shall at any time fail

or

re-

report or pay taxes,

iu e to make the annual report, or to pay the tax on penalty.

the gross amount received, a hereinbefore provided,

the Insurance Commissioner shall forthwith suspend

or revoke all authority to such corporation or aSSG-

ciation and all its agents to do business in this State,

.and shall publish such revocation in some newspaper

published in this State, and may proceed to collect

whatever sum of money may be due or owing on

account of such tax by suit or action, in the name of

the State of Georgia, against such corporation or

association.

Sec. 20. Be it further enacted, That nothing in Fraternal,

secret or In

tbis Act contained shall apply to or be construed to

dustrial societies.

require any fraternal or secret or industrial societies, Amended by

'or other

associations

exempt by law,

now

organized

Act ap proved De-

'or to be organized in this State, to pay any license

cember 17,
1900.

fee or tax, or to make or file reports with the Insur-

Amended by Act ap-

.ance

Commissioner,

or

to

prevent

the

same

from

proved Aug.
19, 1912.

28

INSURANCE LAWS.

doing bu ine in this State, when the money, benefit, charity or relief is payable by the grand or supreme body of the same, and is derived from assessments on subordinate lodges, councils, or other bodies of their members.

Fidelity in surance reo

ec. 21. Be it further enacted, That any corpora-

Qulrements, amount of

tion now or hereafter organized under the laws of

capital, etc.

this State for the purpose of transacting the busi-

ness of fidelity insurance, shall be licen ed to tran-

sact busines upon compliance with all the require-

Amended by ments in this Act prescribed with reference to life

Act ap proved De

insurance companies organized under the law of

cember 24,
1896.

the Stat~,

0 far a

the same may be applicable t(}

such fidelity insurance company. Any fidelity insur-

Amended by ance company incorporated and organized under the
Act ap-
proved Aug. laws of any other State of the United States, or-
16, 1912.
foreign governments, and which has paid-up capital

of not less than two hundred and fifty thousand dol-

lar , may be licensed to transact business in this.

State upon compliance with all the requirements pre-

scribed by this Act, so far as the same may be appli-

cable for license to foreign life insurance companies.

to transact bu iness in this State.

Live stock and steam

Sec. 22. Be it fmther enacted, That all live tock

boiler reo qulrements,

and steam boiler insurance companies chartered by

etc.

this State or other States of the United States or-

Amended by Act ap.

foreign

governments,

and

doing

business

in

this

proved De cember 14,

State, shall be subject to all the requirements of this.

1895.

Act in relation to life insurance companies, except

the requirements in relation to the valuation ot

policies.

INSURANCE LAWS.

29

Sec. 23. Be it further enacted, That the Insurance Oaths Insur-

ance Com

Commissioner,

and

such

person

or

persons

as

may

missioner may admln

be appointed by him to make inspection, are hereby Ister.

authorized to administer any and all oaths to parties

and witnesses, as required under the provisions of

this Act.

Sec. 24. Be it further enacted by the authority afore aid, That all laws and parts of laws in conflict with this Act be, and the same are, hereby repealed.
Approved October 24, 1887.

30

INSURANCE LAws.

AN ACT

Defining a contract of fidelity insurance, to provide for incorporated fidelity insurance companies and other companies doing a fidelity insurance bu i nes in thi State, becoming sureties on bonds required by law to be taken j and to make said companies liable on such bonds as individuals are on all of said bonds, and for other purposes in that beJ;1alf.

Section 1. Be it enacted by the General Assembly of Georgia, That from and after the passage of this Act, that the contract of fidelity insurance contemplated by this Act i one whereby a fidelity insurance company or such other corporation or company as may be doing a fidelity insurance business in this State for a tipulated sum of money or premium, insures against loss caused by the defalcation, default, neglect or dishonesty of tru tees, officer of the law, officers of court, agents or other employees, and such other persons as may be required to give bond, or guarantee the performance of all such bonds or other obligations in favor of the in ured as individual now do under the law who ign the bonds of all such per on a uretie..

Amount of capital reo qulred.

Sec. 2. Be it further enacted, That any fidelity in urance company, or uch other corporation or company as may do fidelity insurance business in this State, incorporated and organized under the law of thi State or any other State of the United
tate, or any foreiO'n tate for the purpo e of tran actinO' bu ine of fidelity in urance, which has

INSURANCE LAWS.

31

a paid-up capital of not less than two hundred and

fifty thousand dollars, and which shall have complied

with all requirements of law for license to and the

transaction of business by such companies in this

State, may, upon proper proof thereof, and upon

production of evidence of solvency and credit satis-

factory to the judge, head of department, or other

officer or officers in thi State autborized to approve

and accept bonds, be accepted as surety upon the

bond of any person, company or corporation re-

quired by the laws of this State. to execute bonds, in

lieu of any surety or ureties, as now required by

law; any such fidelity in urance company or other

companies in tbi State, doing a fidelity insurance

busine s, may be released from their liability on

such bond, on the same terms and conditions ~s are

by law pre cribed for the release of individuals, it

being tbe true intent and meaning of the provisions

of this Act to enable the companies and corporations

doing a fidelity in urance busine to become the

urety on all uch bonds required by law to be taken

with all the rights and subject to all the liabilities

of individuals.

Sec. 3.

Be

it ,further

enacted,

That

any

fidelity

Estopped from deny.

in urance company, or

uch

other

corporation

or

Ing corpo rate power

to execute.

company as may be doing a fidelity insurance busi-

ne in thi State, wbich shall execute any bond or

surety under the provi ions of this Act, shall be

e topped in any proceeding to enforce the liability

which it hall have a umed or incurred to deny its

corporate power to execute uch instrument or as

:mme such liability.

32

INSURANCE LAWS.

How sued and how to

Sec. 4. Be it further enacted, That in the event

perfect service.

any such fidelity insurance company, or other corpo-

ration or company doing a fidelity insurance busi-

ness in this State, shall become surety on any of the

bonds or obligations mentioned in this Act, such cor-

poration or company shall be subject to be sued on

such bonds or obligations in the county of the resi-

dence of the principal on such bond or obligation

and service may be perfected on said corporation or

company as is prescribed for service on fire insur-

ance companies doing business in this State; pro-

vided, that said companies, before beginning busi-

ness in this State, or signing any bond, shall obtain

Amended by a license from the Oomptroller-General, which license
Act of Aug.
19. 1912. shall be revoked if said companies, as to any bond,

as to business in this State, shall begin suit in the

United States Oourt, or remove, or cause to be re-

moved, any suit thereto.

Sec. 5. Be it further enacted, That all laws and parts of laws in conflict with this Act be,' and the same are, hereby repealed.

Approved October 21, 1 7.

INSURANCE LAWS.

33

TAXATIO .

Ba is and Rate-Return and Collection.

Tax Act

of 1887-All home and foreign

insurance

Tax of one per cent. on

companies doing business in this State, shall pay one premiums.

br per cent. on all premiums in money, or otherwise, Amended

Tax Act 0

received by them.

1909

ection 6 of the General Tax Act of 1909, im po iug taxes for the years 1910 and 1911.
Be it further enacted by the authority aforesaid, That all foreign and home insurance companies, doin 0" business in this State hall pay one per centum on all premiQms, in money or otherwi e, received by them, upon the gross receipts of such insurance companie on business done in the State for the year. Provided, this shall not include return premiums on cancelled policies.

(2.) Be it further enacted by the authority aforeaid That every fire in urance company and life inurance company incorporated under the laws of this tate and doing business on the legal reserve p]an~ hall be required to return for taxation all of its real estate a other real estate is returned, and all of the personal property owned by such company shall be returned as other personal proper,ty is returned for taxation, and the value of the personal property owned by it shall be ascertained in the following manner:

From the total value of the assets held by the company both real and personal, shall be deducted the

34

INSURANCE LAWS.

asses ed value of all the real estate owned by the company in this State; the non-taxable bonds deposited by the company with the State Treasurer and the amount of the reserve or net value of its policies required by law to be held by the company for its policyholders and which belong to such policyholders; the remainder shall be the value of the personal property owned by and taxable against such company.

(3.) Be it further enacted by the authority afore said, That whenever any insurance company, doing business in this State, shall make it appear by proof satisfactory to the Insurance Commi~sioner that one-fourth in amount of its total assets are invested in any or all of the foliowing securities or property, to-wit: Bonds of this State or of any county ol' municipality of this State, .property situated in this State and taxable therein, loans secured by liens 011 real estate situated in this State, or policy loans secured by insurance policies issued by such company on lives of persons resident in this State, then the premium tax levied by the first paragraph of this Section, shall be abated or reduced to one-half of one per centum upon the gross receipts of such company, and if the amounts so invested by any such company shall be as much as three-fourths of the total assets of such company, then said premium tax shall be abated or reduced to one-tenth of one per centum upon such gross receipts of such company.

General Tax A~t of 1909, approved Aug. 16, 1909.

INSURA~CE LAWS.

35

~ 29.

Payments

must

be

made

in

the

funds

in

Payment, how made.

which taxes may be paid at the State Treasury, free

of any expense to the State.

79.

If

any

corporation,

comp&ny,

person,

Ins. Com'r to Issue ft.

agency or institution, who are required to make their

fa. against delinquent

corpora tlons.

return to the Insurance Commissioner, shall fail to

return the taxable property or pecifics, or pay an-

nually the taxes for which they are liable to the State

Trea urer:, the Insurance Commis ioner shall issue

aO'ainst them an execution for the amount of taxes

due, according to law, together with the costs and

penaltie

4. When there is no return by which to a sess

the tax, the Insurance Commi ioner shall, from the '\\here no

return, Ins.

be

t information he can procure, as

ess in his discre-

Com'r to assess.

tion.

); 5. The execution issued by the Insurance Com-

FI. fa.

ml

ioner again t any company

hall be directed to

against a company.

all and

ingular the sheriffs and other lawful officers

how dl rected.

of the State, with directions to levy the same on the

I roperty of the corporation or company, with power

to issue .and serve garnishment upon the debtors of

the corporation.

~ 6. The executions against agents of foreign

Fl. fa. VB.

institutions,

as

aforesaid,

shall be

against

the prin-

agents of foreign com

cipal agent or his successor, and shall authorize the panles.

officer to levy on all the property of the agency, to

eize its money, notes or other effects.

::;2 50. InS'ltrance companies shall pay damages ~chen. [The several insurance companies of this

36

INSURANCE LAWS.

State, and foreign iIisurance companies doing business in this State, in all cases when a loss occurs, anu they refuse to pay the same within sixty days after a demand shall have been made by the holder of the policy on which said loss occurred, shall be liable to pay the holder of said policy, in addition to the loss,
not more than twenty-five per cent. on the liabilities
of said company for said loss; al 0, all rea onabl attorney's fee for the pro ecution of the ca e against said company; p'fovided, it shall be made to appear to the jury trying the same that the refusal of the company to pay said loss was in bad faith.]

INSURANCE LAWS.

37

AN ACT
To amend Section 3408 of the Code of Georgia with reference to the venue of suits against Insurance Companies having more than one place of business in this State, and for other purposes.
Section 1. Be it enacted by the General Assembly of the State of Georgia, That from and after the passage of this Act, Section 3408 of the Code of Georgia be, and the same is, hereby amended by adding in the seventh line thereof, between the words "business" and "was," the words "or in any county where such agency or place of doing business," so that said Section, as amended, will read as follows, to-wit: Whenever any person may have any claims or demand upon any insurance company having agencies, or more than one place Of business, it shall be lawful for such person or persons to institute suit against said insurance company within the county where the principal office of such company is located or in any county where said insurance company may have an agency or place of doing business, or in any county where such agency or place of doing business was located at the time the cause of action accrued, or the contract was made, out of which said cause of action arose.

38

INSURANCE LAWS.

AN ACT

To prescribe the manner and mode of making returns by insurance companies, and for other purposes.

f.re:~1:n~f Section 1. Be it enacted by the General Assembly

~~st~~lon of the State of Georgia, That from and after the

name of

agent.

first of May, 1882, insurance companies doing busi-

Amended by ness in this State, in making their returns to the

Cg t9l\.Au . 19,

Comptroller-General

for

purpose

of

taxation,

shall

give the name of each agent acting for such company,

and post-office address of the same; the aggregate

amount of risks underwritten in this State during

the tax year hereinafter provided; the amount of

premiums received, and the los.ses paid and unpaid

by agencies.

Returns must be

Sec. 2. Be it further enacted by the authority

made by July 1st and

aforesaid,

That

the

returns

provided

for

in

the

pre-"

tax paid. ceding Section shall be made by the president or some

Amended by Act Aug, 19,

other

duly

authorized

officer

of

the

company,

duly

1912.

sworn to, and shall be forwarded to the Comptroller-

General on or before July 1st of each year; and at

time of making such returns the amount of tax due

by said company upon premium receipts or other-

wise shall be forwarded to the Treasurer of this

State.

Returns

Sec. 3. Be it further enacted by the authority

made from

~~;u I:Jt~~ aforesaid, That the returns hereinbefore required to

be made to the Comptroller-General shall embrace

Amended by Act Aug. 19,

the

p e n.o d

f
0

tI.me

commenc.mg

May

1st

and endm' 2'

1912.

~

INSURANCE LAWS.

39

with April 30th next preceding the date of the return

Company must notify

made, and

companies making

the

same must notify

Compo Gen. ot name ot

attorney

i? the

Comptroller-General

or

officer

or

agent

in

this

against whom pro-

State against whom legal proce s shall issue

case

cess must Issue.

it becomes necessary for the Comptroller to issue

Amended by

fl.. fa. against said companies for any violation of the

Act Aug. 19, 1912.

laws in this State governing insurance 'companies, or

for the non-payment of taxes due by them.

Sec. 4. Be it further enacted by the authority aforesaid, That all laws and parts of laws in conflict with this Act be, and the same are. hereby repealed.

40

INSURANCE LAWS.

.AN AOT

To amend the third paragraph of Section 9 of an Act entitled an Act to regulate the business of insurance in this State, approved October 24, 1887, and for other purposes.

Par. I ot
Sec. II amended.

Section 1. Be it enacted by the General Assembly of Georgia, an,d it is hereby enacted by the authority of the same, That the third paragraph of Section 9 of an Act entitled an Act to regulate the 'business of insurance in this State, approved October 24, 1887, be, and the same is, hereby amended by inserting in the third line of said paragraph, after the word" adjusters," the words "or inspectors," and to add at the close of said paragraph the following words: H'provided, further, that it shall not be lawful for the said inspectors to solicit business for their companies," so that, thus amended, said paragraph shall read as follows:

Paragraph "Any person who shall do any of the acts menas amended. tioned in this Section shall also be personally liable
to the holder of any policy of insurance, in respect of which uch act was done, for any loss covered by the same; provided, that the penalties provided for in this Section shall not apply to adjusters or inspectors of unauthorized insurance companies from whom the citizens of this State have purchased insurance for themselves as provided for in this Section, whenever the person or persons purchasing said insurance shall immediately notify the Insurance Oommissioner, giving the name and locality of said

INSURANCE LAWS.

41

'Company in which they have policies, and at the same time pay to said Insurance Commissioner the same licenses, fees and taxes for each company as are now or may hereafter be required of :fire insurance companies authorized to do business by the laws of this State; and when the license fees for any company have been paid in anyone year by any person or persons who have purchased insurance from said company, then, in that case, any person or persons purchasing insurance from said company thereafter shall not be liable for the license fees of said company during the said year, but only for such taxes on premiums as may be require~ from time to time of insurance companies authorized to do business in this State; provided, further, that it shall not be lawful for said inspectors to solicit business for their companies. "

Sec. 2. Be it further enacted by the authority aforesaid, That all laws and parts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved December 23, 1890.

42

INSURANCE LAWS.

AN ACT

To prevent combinations or pools of insurance companies or their agents, tending to dereat or lessen competition in the business of insurance in the Stat.e of Georgia.

Unlawful for com panles or agents to make or maintain contracts, etc., atrect. Ing compe .tltlon.

Section 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby enacted by authority of the same, That from and after the passage of this Act it hall be unlawful for any insur. ance company or companies, authorized to do busi.

ness in this State, or the agent or agents thereof to

make, maintain or enter into any contract, agree-

ment, pool, or other arrangement, with any other

insurance company, or companies, licensed to do

business in this State, or the agent or agents thereof,

for the purpose of, or that may have the tendency

or effect of, preventing or lessening competition in

the bu ine s of insurance transacted in this State.

And. when it hall be made to appear to tne CommIs-

sioner of Insurance, that any company or companies,

agent or agents, have entered into any such contract,

agreement, pool or other arrangement, thereupon

Revocation of llcense.

said Commissioner hall revoke the license issued to

such company or companies, and the same shall not

be re-issued, until the president or chief officer of

such company or companies shall :file an affidavit with

said ommissioner stating that such contracts, agree-

ments, pools, or other arrangements, have been an-

nulled and made void; provided, that nothing in this

Act shall be so construed as to prevent any insurance

INSURANCE LAws.

43

company,

legally

authorized

to

transact business

in

Surveys, inspections,

this State, from separately surveying, inspecting or etc.

examining the premises to be insured by and with

the consent of the owner, for the purpose of bringing

about improvements in fire protection, so as to lessen

the cost of insurance by reducing ra te8.

Sec. 2.

Be

it

further

enacted

by. the

authority

Complaint by citizens.

aforesaid, That any citizen of this State (whose rates

of insurance have been increased, or who has been

refused insurance at reasonable rates) shall have the

right to file a written complaint, under oath, to the

best of his knowledge and belief, with the Insurance

Commissioner, charging any company or companies

authorized to do bu~iness in thi State with a viola-

tion of the preceding Sections of this Act, and that

thereupon it shall be the duty of the said Insurance

Commissioner

to

issue

a

citation

addressed

to

the

Citation to company

company or companies against whom said complaint

complained against.

is made, requiring it or them to be and appear before

said Insurance Commissioner at a specified time and

place to be fixed by said In urance Commi sioner,

not less than twenty nor more than forty days from

the date of the filing of such complaint, and show

cau e why its or their license or licenses should not

be revoked as provided by the first Section thereof j

and it is f'urther p1'ovided, that said cihtion shall be

served not less than ten days from the date of filing

said complaint by the sheriffs or constables of said

State, in the same manner as provided by law for the

service of process upon insurance companie .

44

INSURANCE LAWS.

PtoractaUuce. aa Sec. 3. Be it furth~r enacted by the authority many. etc. aforesaid, That for the purpose of the provision of

this Act, the Insurance Commissioner shall have

power to administer oaths, issue subprenas for wit-

nesses, hear testimony, issue commissions for taking

testimony by interrogatories, and the party or par-

ties complaining, and the company or companies de-

fending shall have the right to serve notice for the

production of books and papers; and all to be done

under the same rules as now provided by law for

Forum. Fee-.

civil action in the Superior Court. The County in which Insurance Commissioner shall
fix the hearing shall be, as to this Act, the loci forum

of said hearing or trial. The costs and fees for the

sheriff or cOJ?stable, witnesses, and the commission-

ers taking interrogatories, shall be the same as now

provided by law for similar service in the Superior

Courts of this State, the same to be taxed against

and paid by the party or parties cast in said suit,

and against who said Insurance Commissioner

shall find; for which costs said Insurance Commis-

sioner is hereby authorized to issue executions, the

same to be levied and collected as executions from

the courts of this State.

Sec. 4. Be it further enacted -by the authority aforesaid, That all laws and parts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved f)etober 21, 1891.

INSURANCE LAWS.

45

METHOD OF INCORPORATTNG INSURANCE COMPANIES.

No. 301.
A bill to be entitled an Act to carry into effect Article 3, Section 7, Paragraph 18, of the Constitution of the State, as amended, in so far as the same reo lates to the issuing and granting corporate powers and privileges to insurance companies by the Secretary of State, to define the powers and liabilities of such companies, to regulate the same, and for other purposes.
Section 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby enacted by the authority of the same, That from and after the passage of this Act all corporate powers and privileges to insurance companies in this State, shall be issued and granted by the Secretary of State, upon the terms, liabilities, restrictions .and subject to all the provisions of this Act and the laws and Consti tution of this State. If from any cause the Secretary Df State should be disqualified from issuing and granting said powers to any insurance company, then in that case the duties required by this Act to be performed by the Secretary of State shall be done and performed by the Comptroller-General of this State.
Sec. 2. Be it further enacted, That any number of persons not less than five may form a company, but before receiving a certificate of incorporation under this Ant, shall first file a petition in writing,

46

INSURANCE LAWS.

addressed to the Secretary of State, in which petition shall be stated the name and residence of each of the persons desiring to form said corporation; the name of the insurance company they desire to have incorporated; the kind or kinds of insurance they propose to carry out; the amount of the proposed capital stock of said company; t.he number of sh:L es of the capital stock each of the petitioners agrees to take; that they do in good faith intend to go forward without delay to raise the capital stock and organize said company; a request to be incorporated under the laws of the State; that they have given thirty days' notice of their intention to apply for said charter by the publication of said petition in the newspaper puqlishing the legal adverti ements of the county where the principal office of said company is to be located, once a week for four weeks before the filing of aid petition. There shall be annexed to said petition an affidavit made by at least two of the persons forming aid company, th"at the names subscribed' are the genuine signatl.ues of the p'ersons named therein; and that the facts stated in the petition are true. Said petition thus worn to shall be filed in the office. of the Secretary of.State, who shan eiJ.dorse thereon the date of the filing and record the same in a book to be kept. by him for that purpose.

Sec. 3. Be it further enacted, That when said petition has been filed in the office of Secretary of State, he shall issue to said company, under the great eal of tbe State,the following form of 'certificate, to-wit ~ To all to whom these presents may come, greeting:

INSURANCE LAW::i.

47

Whereas, In pursuance of an Act of the General

A sembly of the State of Georgia, approved

,

1 , and (naming the person who signed the peti-

tion) having filed in the office of Secretary of State

a certain petition seeking the formation of a corpora-

tion to be known as (insert name), with a capital

tock of $

, for the purpose of organizing and

running (kind or kinds) insurance company, and

have complied with the statutes in such cases made

and provided; therefore, the State of Georgia hereb,.

grants unto the above named persons, their succes-

or and assigns, full authority by and under the

same name of (in ert name), to exercise the powers

and privilege of a corporation for the purpose above

tated, subject to the provi ions of the onstitution

of this State, and all laws, rules, and regulations

governing in urance companies of force at the date

of this certificate, or that may hereafter become of

force either by Constitutional or statute laws, or by

any rule or regulations of the Insurance Commis-

sioner of this State, or otherwise, which govern in-

surance companies in this State. In witness whereof,

these presents have. been signed by the Secretary of

State (or, when he is disqualified by the Comptroller-

General), and to which is annexed the great eal of

the tate at Atlanta, Georgia, this

day of

,

18 . Thereafter the persons who sigried said peti-

tion, and all persons who shall become stockholders

in said company, shall be a corporation by the name

specified in said petition and certificate, and shall

possess the powers and privileges and be subject to -

the provision contained in this Act. Before the

48

INSURANCE LAWS.

Secretary, or when disqualified, the ComptrollerGeneral, shall issue said certificate, the petitioners shall pay to the Treasurer of the State a fee of one hundred dollars.
ec.4. Be it further enacted, That any certificate or a duplicate thereof, issued under this Act, hall be p1-im,a facie evidence of the exi tence of uch corporation in all courts and place in this State; that when such certificate has been i sued, the persons named therein, in ca e they have not taken the whole capital stock, may open books of subscription to fill up the capital tock of the company in such places, and after giving uch notice a they may deem expe dient, they may from time to time receive ubscriptions until the whole capital stock is sub cribed. The capital stock of aid company shall be divided into shares of one hundred dollars each, (see Section 2201, Code 1910,) and shall not be less than one hundred thousand dollars for each class of insurance to be engaged in; and no insurance company chartered under this Act hall commence the insurance business until at lea t this amount for each cla of in urance to be engaged in is paid in ca h, or invested in bonds of the United State, of thi tate. or the cities or counties of this State, estimated at their cash market value, this amount, or in morto-ages in real estate in twice the amount-for which the same is mortgaged-which investment must be approved by the Secretary of State, or, when he is disqualified, by the Comptroller-General. When bonds of the citie or counties of this State are inve ted in, the Secretary of State, or Comptroller-

INSURANCE LAWS.

49

General, as the case may be, shall require an opinion from the Attorney-General of the State that the bonds are good, legal, and valid bonds before approving the investment.

Sec. 5. Be it further enacted, That when the amount of the capital stock has been subscribed, the per ons named in said certificate of incorporation. are authorized to call a meeting of the stockholdersfor the purpose of organization, of which meeting every subscribing stockholder shall have ten days' notice personally, or by depositing said notice in the postoffice, postage paid, directed to him at the postoffice nearest his usual place of residence. At said meeting there shall be elected a Board of Directorsof not less than five or more than fifteen, to manage the affairs of said company, said directors to be chosen by a majority vote of the stockholders, each share of stock being entitled to one vote; said election to be governed by such by-laws as said company may prescribe, the persons elected as directors to> continue in office until others are elected to fill their places. No person shall be elected a director unless he be a stockholder, owning stock in his own name or a trustee or personal representative, and who isqualified to vote at the election at which he is chosen. If for any reason the election is not held at the time appointed, the same may be held at any time there after on a notice to all stockholders of ten days; butat any meeting of the stockholders or their legal representatives, the notice may be waived and an election held at once. The directors, when elected, shaH

.50

INSURANCE LAWS.

elect from their number a President, Vice-President -or Vice-Presidents, Secretary and Treasurer, and such other officers and agents as they may deem necessary. The regular elections for directors shall be .annually, at such time and place as may be prescribed by the by-laws of said company. All meetings of directors of said company shall be held in this Sta teo A majority of said directors shall be bona fide residents of Georgia.

Sec. 6. Be it further enacted, That said insurance -company shall not begin business until at least one hundred thousand dollars of the capital stock has been paid in; that the directors may require the sub-
cribers to the capital tock to pay the amount variou ly sub cribed by them in such installments as they may deem proper, which sums they may lend, as provided for elsewhere in this Act, until the company is ready to engage regularly in its business. If any subscriber shall neglect to pay any installment, as required by resolution of the Board of Directors, the aid Board shall declare his stock forfeited, as well as all previous payments thereon, to the use of the company; but they shall not so declare it forfeited until they have served notice in writing on him personally, or by depositing said notice in the -postoffice, postage paid, directed to him at the postoffice nearest his usual place of residence, stating he
'IS required to make such payment at the time and
place expressed in such notice, and if he fails to make the same, his stock and all previous payments thereon will be forfeited for the u e of the company,

INSURANCE LAws.

51

which n-qtice must be served at least sixty days previous to the day on which such payment is required to be made.
Sec. 7. Be it further enacted by the authority aforesaid, That the stock in said insurance company shall be deemed personal and shall be transferable in the manner prescribed by the by-laws of the company; and no share shall be transferable until all previous calls thereon shall have been fully paid in.
Sec. 8. Be it further enacted, That all the powers. and privileges and said certificate of incorporation of said insurance company shall cease and determine at the expiration of two years from the date of said certificate, if at the expiration of said two years, said company has not organized and commenced business. The right, powers, and privileges granted said corporation shall not contmue for a longer period than' fifty years, unless the same be continued by the laws of force at the expiration of said fifty years.
Sec. 9. Be it further enacted, That every life insurance company incorporated under this law shall have the power to insure the lives of all persons who apply for insurance therein, stand the necessary examinations, and comply with such laws as may hereafter be enacted, and with such reasonable requirements as the ditectors of such company may establish and to make any and every insurance appertaining to or connected with life risks.
Sec. 10. .Be it further enacted, That any :fire insurance companies incorporated under this law shall

52

INSURANCE LAWS.

have authority to insure against any loss by fire on all kinds of property, either real, personal or mixed; also against all the hazards of the ocean or inland navigation, and transportation of every kind, and is hereby granted the power, rights and privileges to insure any and all classes of property that is now allowed to be insured by any of the laws of this State, or that may hereafter be allowed to be insured by any of the laws of"this State, and may do any and all things that are necessary for the purpose of carrying on a fire insurance company, not in conflict with the laws of tbis State or of the United States.

Sec. 11. Be it further enacted, That accident insurance companies chartered under tbis Act shaH have authority to insure persons against accident, loss of life, or personal injury; to provide a weekly indet:nnity to its members in case of accident, and shall have all the usual and ordinary powers incident under the law and custom of accident insurance, which are not in conflict with the Constitution and laws of this State and the United States.

Sec. 12. Be it further enacted, rrhat live stock insurance companies, organized under this law, shall have the right and power to insure against loss arising from the death of or injury t . domestic animal~. and shall have all the usual and ordinary powers inddent to the live-stock insurance business whic} are not in conflict with the laws and Constitr.Lion 01 thi~ State or of the United States.

INSURANCE LAws.

53

Sec. 13. Be it further enacted, That contracts for insurance to be entered into by companies organized under this Act shall not be binding unless evidenced by a policy of insurance in writing or print, or both; and the liability of said company, in case of loss sustained by any policyholder, shall be governed by the terms, stipulations, and conditions appearing upon the face of the policy. No policy or other contract of said corporation shall be binding except it be signed by the President or Vice-President and Secretary or Assistant Secretary of the company.

Sec. 14. Be it further enacted, That the Board of ,Directors of any company organized under this law may declare dividends out of the earnings of said eorporation; provided, no dividend shall be declared until the earnings are sufficient to pay the same, after deducting all expenses and losses, and after providing for such reserve as may be provided for by law.

Sec. 15. Be it further enacted, That corporations formed under this law are hereby empowered to issue stock dividends in lieu of money dividends; provided, that the Board of Directors shall decide to. do so, and thereby add to the capital stock not to exceed the highest limits of the capital stock of their eharter.

Sec. 16. Be it further enacted, That the Board of Directors of any company organized under this law may, after providing for such reserve as may be required by law, by a majority vote give the holders

54

INSURANCE LAWS.

of policies of said company, on any particular line or class of insurance, the right to participate in the net profits of such company to such an extent, in such manner, and upon such terms as the Board of Directors may agree, the same to be plainly stipulated on the face of the policy; and unless it be stipulated on the face of the policy that the policyholder has the right to participate, it shall not be lawful for any policyholder to participate therein in any of the profits of such company. If the incorporators of any stock company see proper they may embrace this principle in their charter, stating therein the average amount of dividends the stockholders shall receive on the face value of their stock, in which case all net profits above this dividend and the reserve shall be paid as a dividend to all the policyholders.
Sec. 17. Be it further enacted, That every corporation organized under this Act shall have authority to invest its money in and make loans on any: bonds of this State, or the United States, or of the cities or counties of this State, and to make loans on real estate in this State to one-half the value thereof,
Sec. 18. Any company organized under this Act may own for its own use, as a permanent investment, a building for the transaction of its business in the city where the principal office is located or at any place where it may have a branch office or agency, and may sen and dispose of the same at pleasure. It may also buy, own, and sell any realty that may be necessary for the protection of any loan it may make.

INSURANCE' LAWS.

55

Sec. 19. Be it further enacted, That any company organized under this Act shall have the right to reinsure any or all its risks; and every company incorporated under this Act shall provide for such reserve as may be required by law.

Sec. 20. Be it further enacted, That stockholders in corporations organized under this Act shall be individually liable to the extent of his or her unpaid subscription to the capital tock, and for no greater amount.

Sec. 21. Be it further enacted That the preceding Sections of this Act, in 0 far as they are applicable, be applied to the formation of mutual or cooperative fire, life, or accident Insurance companies, but applicants for this class of insurance shall not be required in their petition to set out the amount of the proposed capital stock or the number of shares of the same; nor shall it be necessary for the Secretary of State to incorporate in his certificate of incorporation any reference to the capital stock of said company.

Sec. 22. Be it further enacted, That all laws and parts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved December 18, 1893.

. 56

INSURANCE LAWS

INSURA OE OOMPANIES TO PAY.FULL AMOUNT OF LOSS UP TO AMOUNT STATED IN POLIOY.

No. 15.

An Act to compel insurance companies to pay the full amount of loss sustained upon property covered by policies of insurance up to the amount expressed in the policies, notwithstanding any stipulations in such policies to the contrary.
Section 1. Be it enacted by the General Assembly of the State of Georgia, and by authority of the same, That from and after the passage of this Act all insurance companies issuing policies on property in this State shall pay to their policyholders the full amount of loss sustained upon the property insured by them; provided, said amount of loss does not ex- ceed the amount of insurance expressed in the policy,. and that all stipulations in such policies to the contrary shall be null and void; provided, that in cases of losses on stocks of goods and merchandise and other species of personal property changing in specifics and quantity by the usual custom of trade only the actual value of the property at the time of loss. may be recovered; provided, the loss does not exceed the amount expressed in the policy.
Sec. 2. Be it enacted by the authority aforesaid,. That all laws and parts of laws in conflict with this Act be, and are, hereby repealed.
Approved November 23, 1895.

INSURANCE LAWS.

57

LIVE STOCK COMPAmES, ACT OF DECEMBER 18, 1893, AS TO METHOD OF I CORPORATION MADE APPLICABLE TO.
No. 120.
An Act to amend Section 21 of an Act approved ~e cember 18, 1893, which ~ela tes to the issuing and granting corporate powers and privileges to insurance companies by the Secretary of State, to define the powers and liabilities of such companies, to regulate the same, and for other purposes, by making the same apply to "live stock" companies.
Section 1. Be it enacted by the General Assembly of Georgia, and it is hereby enacted by authority of the same, That Section 21 of an Act approved December 18, 1893, which relates to the issuing and granting corporate powers and privileges to in urance companies by the Secretary of State, to define the powers and liabilities of such companies, to regulate same, and for other purposes, be, and the same is, hereby amended by inserting in said Section after the word "life," in the third line thereof, and before the word" or," the words" live stock" so that said Section, when amended, shall read as follows:
Section XXI. Be it further enacted, That the preceding Sections of this Act, in so far as they are applicable, be applied to the formation of mutual or co-operative fire, life, live stock, or accident insurance companies, but applicants for this class of insurance shall not be required in their petition to set

58

INSUltANCE LAWS.

out .the amount of the proposed capital stock or the number of shares of the same, nor shall it be necessary for the Secretary of State to incorporate in his certificate of incorporation any reference to the capital stock of said company.

Sec. 2. Be it further enacted, That all laws and pa'rts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved December 14, 1895.

INSURA.NCE LA.WS.

59

GUARANTEE, ETC., COMPA IES :M:AY BEOME SURETY ON BO DS OF CITY, COU TY A JD STATE OFFICERS.

An Act to authorize solvent Guarantee Companies, Surety Companies, Fidelity Insurance Complmies, and Fidelity and Deposit Companies to become surety upon attachment bond and upon the bonds of city, county and State officers, and providing remedies against such bonds, and for other purposes.

ection 1. Be it enacted by the General Assembly of the State of Georgia, That from and after the passage of this Act, solvent Guarantee ompanies, Surety Companies, Fidelity Insurance Companies, and Fidelity and Deposit Companies incorporated and organized under the laws of this State or any other State of the United States for the purpose of transacting business of fidelity insurance, which have a paid-up capital of $250,000, and which shall have complied with all of the requirements of law as to license required by the State, may, upon proper pr<;>of thereof and upon production of evidence of solvency, be accepted upon the bonds of all city, . eounty and State officers of this State, and the various officers of this State whose duty it is to approve the sureties upon such bonds are hereby authorized to accept such company or companies as one of the sureties or the only surety upon such bonds as the solvency of such company may warrant; provided, no company shall be relieved of its liability upon any

60

INSURANCE LAWS.

such bond by reason of the fact that the books and accounts of the principal have been examined and approved a conect by the proper authorities when in fact there has been a breach of said bond and a loss accruing from such breach.
Sec. 2. Be it further enacted, That such companies may be taken as the sole surety upon all attachment bonds, whether such companies have or do not have real estate in this State.
Sec. 3. Be it further enacted, That in case of default upon any bond upon which such companies are sureties, then the city, county and State authorities shall have all the remedies against the principal and sureties upon said bonds as are now provided by
law, including the right to issue ft. las. instanter, as
now provided by law. Be it further enacted, That all companies herein described, chartere~ by this State or other States or foreign governments, now doing business in this State or hereafter doing business in this State, which offers or undertakes to become security upon any bond required by law of city, county or State officers before being accepted a surety thereon, shall be required to deposit with the Treasurer of this State bonds of the United States, or bonds of this State, which, according to the Acts and resolutions of the General Assembly, are valid, and which amount, according to their face value, to twenty-five thousand dollars, which bonds shall be receipted for by the State Treasurer, and especially deposited by him in the vaults of the Treasury. And whenever such company ceases to do busine s in this State, and has settled up all claims.

INSURANCE LAws.

61

a~ainst it, 'as hereinafter provided, and have been released from all the bonds upon which they have been taken, said bonds shall be delivered up to the proper party on presentation of the Treasurer's receipt. While said bonds are so deposited, the owner of the same shall-subject to the notices provided for or given-be entitled to collect the coupons and use them. For the bonds so deposited the faith of , the State is pledged that they shall be returned to the parties entitled to receive them, or disposed of as hereinafter provided. . That whenever any loss insured against occurs, the in ured, in order to secure his recovery, may give notice to the State Treasurer of the pendency of said loss and of the amount claimed, after which time the State Trea urer shall be bound to retain, subject to the order of the court trying any suit that may be brought for the recovery of such loss, a sufficient amount to pay the judgment in aid case, in the event of recovery. When suit is ended, and the amount a certained for which said party sued may be liable is not paid in ten days, then said plaintiff may :file an application with the judge of the Superior ourt of the county where the ca e was tried, for a receiver to take charge of so many bonds as shall be neces sary to satisfy the aforesaid judgment.
When the said receiver is appointed by the judge. who shall always require bond and security of him for the faithful performance of his duty, said State Trp'lsurer, on his application, shall deliver to him bondR sufficient in their market value, if in his custody, to satisfy said judgment.

62

IN-SURA CE LAWS.

Said receiver's receipt shall be a complete discharge to aid Treasurer and the State of Georgia. Then said receiver shall apply to the judge of said'
uperior Court for an order of sale, and in pursuance of said order sell said bonds. After deducting such expenses and commissions as shall be allowed by aid judge, he shall pay to the plaintiff or his attorney a sufficient amount to satisfy the said judgment, and if there r~mains any residue in the hands of such receiver, he shall pay over the same to the :agent of the company, taking his receipt for the same, which hall be filed and recorded with the other papers in the case.
If there are conflicting claims, then the State Trea urer shall deliver over to the receivers, in the order of their application, the aforesaid bonds, and if there is any contest between creditors which cannot be settled in this mode, then the party not receiving sufficient bonds through the receiver appointed in hi behalf, may become a party to the other case, and make known his claim to the other receiver by mak. ing affidavit of the claim and filing the same with bim, and then the receiver shall report such claim to the judge of the Superior Court appointing him, who ball by order provide for a bill of interpleader, as in ca es of equity.
When any company desires to withdraw from the State, and will satisfy the Insurance Commissioner that all suits pending against such party, and of which no notice has been given, have been fully satisfied, or whenever no notice of claim has been

INSURANCE LAws.

63

given, and when such companies have been released from all bonds theretofore given by them, then the said Treasurer shall return to said party the bonds so deposited upon order from the said Insurance Commissioner.
"Whenever, by means of the provisions of this Act, the amount of bonds so deposited are reduced, said Treasurer shall at once notify the Insurance Commissioner in writing, who will give notice to the company depositing, and require more bonds to be de posited, so as to always maintain the original amount, and if the company so notified by the Insur8nce Commissioner fails to comply within thirty day, the right of the company to do business in the State shall be revoked, and said Insurance Commissioner hall at the same time, give notice by publication in a newspaper publishe~ at the capital of the fact of such failure and revocation of license, and shall mail a written or printed notice to the several Ordinaries of this State, the cost of which publication shall be paid by the company failing to comply with the provi ions of this Act, and when any company having made the deposit required by this Act has a sumed any liability by suretyship or otherwise, on which no losses have accrued, and which company wishes to withdraw its deposits, before being allowed to do so, said company shall have itself released from such obligation, whether suretyship or otherwise, and give notice of its intention to withdraw from this State, and of the fact it has satisfied all losse and claims against it, and has been released from all obligations a sumed by it, which notice shan

64

INSURANCE LAWS.

be published in a newspaper to be designated by the Insurance Commissioner of the State, and at the expense of said company; and it is hereby provided that any claims of the citizens of this State must, whether for losses accrued or upon obligations thereinbefore assumed by said company (where no losses have accrued), be fully settled before said deposits shall be withdrawn.

Sec. 4. Be it further enacted, That all laws and parts of laws in conflict with this Act be, and the arne are, hereby repealed.

Approved December 24, 1896.

INSURANCE LAWS.

65

MAKIN G CERTAI BU II ESS UNLAWFUL.

An Act making it unlawful for Fire In urance ompanie not incorporated by the laws of the State of Georgia, but legally licensed to transact the busines "of fire insurance therein, and doing busine s therein through regularly commissioned and licen ed agents, to place or cause to be placed insurance again t 10 s by fire on property in this State except through agents located in the State legally authorized and licensed to write policies of insurance therein, and prescribing penalties for violation of same; also, to prescribe further condition to be complied With by Fire Insurance Com-" panies before receiving licen es to do business in this State.
Section 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby enacted by authority of the arne, That Fire Insurance Companie not incorporated by the laws of the tate of Georgia, but legally authorized to do bu iness in this State through regularly commissioned and licensed aO'ents locat d in this State, hall not make contracts of fire in urance on property herein, save through agents of uch companies regularly commi ioned and licensed to write policies of fire insurance in Georgia; provided, however, that this Act shall not apply to property of railroad companies and other common carriers.
Sec. 2. Be it further enacted, That before issuing certificates of license to any Fire Insurance Com-

G6

I "SURANCE LAWS.

pany to transact the business of fire insurance in this State, the Insurance Commissioner shall require in any case, in addition to requirements already provided for by law, that each and every such Fire Insurance Company shall file with him the affidavit of it president or other chief officer that it has not violated any of the provision of this Act for the space of twelve month la t pa t, and that they accept the terms and obligation of this Act as a part of the consideration of their license.

Sec. 3. Be it further enacted, That complaint be-

ing filed by any citizen of this State that any com-

pany authorized to do business in this State has vio-

lated any of the provisions of this Act, the omp-

Amended by Act of Aug.

troller-General

shall

diligently

investigate

the

mat-

19, 1912. ter, and if necessary examine by himself or his

accredited representative at the head offices located

in the United States of America, and also such other

offices or agents of such companies as may be deemeq

proper, all books, records, and papers of the same,

and also the officers thereof under oath as to .such

alleged violation.or violation ; provided, that before

making such examinations the omptroller-General

shall require the party or partie making complaint

to file with him a good and sufficient bond to cover

any expen es or cost that may be neces ary in mak-

ing such examination, and in the event that the in-

surance company be found not guilty of a violation

of this Act, then said bond shall be responsible for all

the expense incurred by reason of said investigation.

But hould said company be found guilty of a viola-

INSURANCE LAW .

67

tion of this Act, then aid company hall be responsible for the expense thereof.

Sec. 4" Be it further enacted, That any fire insurance company violating any provi ion of this Act, or refu inC)" to submit to the aforesaid examination when reque ted, shall forfeit their right to do bu ine in tbi tate for the next twelve (12) months thereafter, and the In urance ommissioner shall immediately revoke the license already issued to said fire in urance company to do business in this State.

Sec. 5. Be it further enacted, That if any ucb

company hall fail or refuse to pay such expenses

of examination upon the pre

entation of a bill there-

Amended by Act Aug. 19.

1912.
for by the Comptroller-General, that the said Comp-

trolJer-Gen ral may is ue his fi. fa. against such com-

pany therefor, to be collected out of the property of

aid company or it deposit with the State Treas-

urer, in the same manner as judgments against in-

surance companies not chartered by this State but

doing bu ine s herein, and collected. If any com-
pany disputes the amount of uch bill and ft. fa. it

may conte t uch amount and its liability therefor by

affidavit of illegality returnable to the Superior

Court of Fulton county in the arne manner a Comp-

troller-General's executions for railroad county

taxes can be contested.

Sec. 6. Be it further enacted, That this Act shall go into effect as soon as approved, and all laws and parts f laws in conflict therewith are hereby repealed.

Approved December 24, 1896.

68

INSURA CE LAWS.

AN ACT

TO PROVIDE FOR LICE SI G MUTUAL I SURA CE CO {PA IE , I SURI G AGAINST LOSS BY BURGLARY, .ET.

0.385.

An Act to provide for the admission and license to do bu iness in this tate of any insurance company organized and incorporated on the mutual plan under the laws of this State or any other State of the United States, for the purpose of 4J.suring against 10 s or damage resulting from burglary, robbery, or attempt thereat, and insuring against the loss of money and securities in cour e of transportation when shipped by registered mail, and for other purposes.

Mutual Companies

Section 1. Be it enacted by the General Assembly

Insuring against bur-

of Georgia, and it is hereby enacted by the authority

glan', etc., licensed.

aforesaid, That any insurance company organized

and incorporated on the mutual plan under the laws

of this State and any other tate of the United States

for the purpose of insuring against loss or damage

resulting from burglary and robbery or attempt

thereat, and insuring against the 10 of mo:n,.ey and

secuTities in course of tran portation when shipped

by registered mail, shall be admitted and licen ed to

do busine s in this State a hereinafter provided.

INsURAN E LAw.

69

Sec. 2. Be it further enacted by the authority aforesaid, That before any such company shall be permitted and licensed to transact business in this State it shall have in force five hundred (500) or more po.licies on which the premiums shall have been paid in cash, or shall be evidenced by the written contracts of the policyholders, on which not Ie than one-fifth (lh) of the amount shall have been paid in cash, and the ca h and net face value of contracts for premiums on hand shall amount to a sum of not less than fifty thousand ($50,000) dollars. The premium contracts so held shall constitute a part of the assets of the company.

Sec. 3. Be it further enacted by the authority

Shall file

aforesaid,

That

every

such

company,

a

sociation

or

copy charter and state.

partnership

hall

file

in

the

office

of

the

Commis-

ment with Insurance

sioner of In

urance

a

certified copy

of their

charter

Commls sioner.

or deed of settlement, together with a statement

under oath of the president and vice-president and

secretary of the company for which he or they may

act, stating the name of the company and place where

located, a detailed statement of it as et showing

the number of policyholders, aggregate amount of

premium contracts, the amount of cash on hand, in

bank or in the hand of agents, the amount of real

estate and how the same is incumbered by mortgage,

the number of shares of stock of every kind owned

by the company, the par and market value of the

same, amount loaned on bond and mortgao-e, the

amount loaned on other securitie , stating the kind

and the amount loaned on each, and the e timated

Impaired reserve. Agents.

70

INSURANCE LAws.

value of the whole amount of such securities, and any other asset or property of the company, also stating the indebtedness of the company, the amount of losses adjusted and unpaid, the amount incurred and in proces of adjustment, the amount resisted by the company as illegal and fraudulent, and all other claim existing against the company, also a copy of the last annual report, if any, made under any law of the State by which uch company was incorporated; and no agent shall be allowed to transact busine for any such company whose reinsurance reserve a required in this Act is impaired to the extent of twenty per cent. thereof while such deficiency shall continue. or shall it be lawful for any agent or agents to act for any company or companies referred to in this Act, directly or indirectly, in taking risks or transacting the business of burglary and robbery insurance or the insurance of the safe shipping of money and ecurities by registered mail in this tate, without procuring from the Commissioner of Insurance a certificate of authority, stating that uch company has complied with all the requirement of thi Act which apply to such companies, and the name of the attorney appointed to act for the company.

Business

Sec. 4. Be it further enacted by the authority

confined to certain 11nes

aforesaid,

That

any

company permitted

and

licensed

and persons.

to transact bu iness in this tate under this Act shall

confine its line of bu iness to that tated in the first

SectioD; of this ct, and shall confine its business in

this State to banks bankers, loan companies and

INSURANCE LAWS.

71

county.treasurers, and shall not issue any policy or policies to any persons, firms or corporations in this State other than banks, bankers, loan companies and county treasurers. Every such company shall set aside a re-insurance reserve of fifty per cent. of its premiums, whether collected in cash or represented Reserve. by obligations of the policyholders, as written in its policies; this reinsurance reserve to be maintained so long as the risk is in force.

Sec. 5.

Be

it

further

enacted

by

the

authority

Liability of policy-

aforesaid, That policyholders of any company per- holders.

mitted to transact business in this State under this

Act shall be held liable to pay the membership fee

and prerpium on their insurance as paid or con-

tracted to be paid at the time the policy is taken out

or the risk begins, and shall not be held liable for

any other or further assessments or claims on the

part of the company or its policyholders. The mem-

ber hip fee and premium agreed upon may be col-

lected in cash at the time the policy is issued, or evi-

denced by a written obligation of the policyholder

as may be agreed upon by the company and the

policyholder. Such payment or obligation shall be

the limit of the liability of the policyholder to the

company for premium on their insurance.

Sec. 6. Be it further enacted by the authority, aforesaid, That it shall not be lawful for any insur~ ance company, association or partnership incorporated by or organized under the laws of any other State of the United States, for any of the purposes specified in this Act, directly or indirectly, to take

72

INSURANCE LAWS.

Shall appoint attorney. Service ot process.

risks or to transact any business of insurance in this State, by any agent or agents in this State, until it shall first appoint an attorney in this State, on whom process of law can be served, and file in the office of the Insurance Commissioner a written instrument, duly signed and ealed, certifying such appointment, which shall continue until another attorney be substituted, and any process issued by any court of record in this State, and erved upon such attorney by the proper officer of the county in which such attorney may reside or may be found, shall be deemed a sufficient service of process upon such company, but service of process upon such company may also be made in any other manner provided by law.

Annual statements.

Sec. 7. Be it further enacted by the authority

aforesaid, That the statement and evidences of mem-

ber hip, assets and investments required by Section

three (3) of this Act, shall be renewed from year to

year in such manner and form as may be required by

said Insurance Commi sioner, with an additional

statement of the amount of premiums received in

this State during the preceding year, so long as such

agent continue, and the aid In urance Commis-

sioner, on being satisfied that the membership, assets,

securities and in-yestment remain secure, as here-

inbefore mentioned, shall furni h a renewal of the

certificate as aforesaid, upon the payment to the

State at the time of filing the tatement here pro-

Penalty tor violation.

vided for and a fee of $5.00 for each corporation, and

$25.00 for each foreign corporation. Any violation

INSURANCE LAWS.

73

of any of the provisions of this Act shall subject the party violating the same to a penalty of not less than one hundred dollars ($100) or more than :five hundred dollars ($500).

Sec. 8. Be it further enacted by the authority aforesaid, That all laws and parts of laws be, and the same are, hereby repealed.

Approved December 21, 1897.

74

INSURANCE LAws.

AT

Requiring corporation doing Life Insurance business in the State of Georgia, upon the a essment plan, to print on all their policies, or benefit certifi. cates, the words" This contract is issued upon the assessment plan" and also to print the word "assessment plan" upon every application, circular, card, adverti ement, and other printed documents.
ection 1. Be it enacted by the General ssembly Qf Georgia, That from and after the passage of this Act, every policy or certificate is ued to a resident of the State of Georgia by any corporation transacting therein the busine s of life insurance upon the a esment plan, or admitted into this State under the a essment law of Georgia, hall prmt in bold type (in red ink) in every policy, or certificate, issued upon the life or lives of the citizens of Georgia, making one of the principal line near the top tbereof the words "Issued upon the asses ment plan," and the words" a e sment plan" hall be printed conpicuously (in red ink) in or upon every application, circular, card, adverti ement and other printed document is ued, circulated or caused to be circulated, by uch corporation within the tate.
Sec. 2. Be it further enacted, That if any such corporation, or a sociation, hall at any time fail or refu e to comply with the foregoing provisions of Section 1 of this ct, the In Ul'ance Commissioner 'hall forthwith suspend or revoke all authority to

INSURANCE LAws.

75

such corporation or association and all its agents to do business in this State, and shall publish such revocation in some newspaper published in this State. Amended ovember 5, 1901, by adding the following proviso: Provided, that said Act shall apply only to such corporations or associations as shall write or issue policies or certificates on the post mortem assessment plan, and shall not apply to such corporations as shall only issue policies under which the premium are stipulated, and made payable at :fixed periods in advance.

ec. 3. Be it fq.rther enacted, That all laws and parts of laws in conflict with this Act be, and the. ame are, hereby repealed.

76

INS RANCE LAw.

INSURA E, REGULATI G BUSINESS OF.

o. 349.

An Act to amend the laws of this State, regulating the business of insurance, to modify the provi ion. of Sections 2035, 2045 and 2048 of the Code of this State, so as to reduce the amount of bonds required to be deposited by fire, marine and inland insurance companies, chartered by other States or foreign government ; to require the restitution to the depo itor of certain bonds heretofore deposited under exi ting laws, to empower the In urance Commissioner, under certain circumstances, to suspend, revoke and restore the licen e of any uch company, and generally to amend the insurance laws of aid State as to more fully protect the interests of the citizens and property owners thereof, and for other purposes.

Section 1. Be it enacted by the General Assembly of Georgia, and it is hereby enacted by authority of the same, That from and after the pa age of thi Act, the law regulating the bu iness of in urance in this tate be amended in the following particulars, to-wit: That Section two thou and and thirty-five of the Code of this State be, and is, hereby amended, by striking therefrom the word" twenty" occurring in the sixth line of said Section, and by adding at the conclusion of said Section the words following: "and it shall be the duty of the Treasurer of this State, upon demand therefor, to deliver to the depo itor

INSURANCE LAws.

77

thereof, or to the person lawfully authorized to receive them, all bonds deposited by it under laws heretofore existing in excess of the sum of ten thousand dollars," so that said Section when amended shall read as follows: "All fire, marine, and inland insurance companies chartered by other States or foreign governments shall be required to deposit with the Treasurer of this State, bonds of the United States or bonds of this State, which, according to the Acts and resolutions of the General Assembly are valid, and which amount, according to their face value to ten thousand dollar, which bonds shall be receipted for by the State Treasurer, and especially deposited by him in the vaults of the treasury, and whenever such company ceases to do business in this State, and has settled up an claims again t it as hereinafter provided, said bonds shall be delivered up to the proper party on presentation of the Treasurer's receipt. While said bonds are so deposited, the owners of the same hall, subject to the notices hereinafter provided for or given, be entitled to collect the coupons and use them. For the bonds so deposited, the faith of the State is pledged that they shan be returned to the parties entitled to receive them, or di posed of as hereinafter provided, and it hall be the duty of the Treasurer of this State, upon demand therefor, to deliver to the depositors thereof, or to the person lawfully authorized to receive the same, all bonds deposited by it or him, under law heretofore existing in excess of the sum of ten thou and dollars."

7

INsURA CE LAWS.

ec. 2. Be it further enacted, That Section two thousand and forty-five of the Code be, and the same is, hereby amended, by striking therefrom all the word following the word "twenty per cent.," occurring in the fourteenth line of said ection, and by substituting for the words so stricken the words following, to-wit: "the Insurance Commissioner shall suspend the license issued to said company and require the company to cease to do new business within this State, and give notice to said company to make good its whole capital stock within ninety (90) days and if this is not done he shall revoke the license of such company and debar the same from doing business in this State.

Sec. 3. Be it further enacted, That Section two thou and and forty-eight of the Code be, and the same is, hereby amended, by striking therefrom all the words thereof, following the word "business," occurring in the fifth line thereof, and by the substitution for the words so stricken the words following, to-wit: "as contemplated by the laws of this State, he shall revoke the license of such company and require said company to cease to do business in this State, giving public notice of such revocation of authority. Any insurance company which has been suspended or which has had its license revoked may be reinstated upon howing that its condition is suchas to authorize it to do business in this State, and the Insurance Commissioner may reinstate such com pany whenever it makes such showing.

INSURANCE LAWS.

79

ec. 4. Be it further enacted, That all law and part of laws in conflict with this Act be, and the ame are hereby repealed.

Approved December 20 1 99.

o

I SURANCE LAws.

FI ATER JAL BENEFICIARY ORDERS DEFIr ED, ETC.

No. 105.'

An Act to define and regulate fraternal beneficiary orders, associations or societies in the tate of Georgia, to provide penalties, and for other pur-
poses.

Section 1. Be it enacted by the General Assembly of Georgia, That a fraternal beneficiary order, association or society is hereby defined to be a corporation, society or voluntary a sociation which has no capital stock, but is formed or organized and carried on for the benefit of its members and their beneficiaries, and having a representative form of government and a lodge system, with ritualistic form of work for the meeting of its lodges, chapters, councils, or other designated subordinate bodie ,and the benefits, insurance, charity or relief shall be payable by a grand or supreme body of the same, excepting sick benefits, which may al 0 be paid by local or subordinate bodie. uch grand or supreme bodies may be composed of its officers, incorporators, representative elected by local, di triet or grand bodie, past officers and standing committee. Such orders or associations may make a constitution, by-laws, rules and regulations consistent with the existing laws of the tate, for the government of all nuder its authority, for the management of it propertip and the due and orderly conduct of it~ nff~irs.

INSURANCE LAWS.

1

Such order or as ociations may make provision for the paYment of benefits in case of death, sickness, temporary or permanent physical disability, either a the re ult of disease, accident or old age; provided] the period of life at which payment for old age commences shall not be under seventy years. AJJ.y such order or a sociation may also accumulate, maintain, apply or di bur e among its membership a reserve, emergency, or other fund , as may be provided in its con titution and laws; provided] however] that no profit or gain shall be added to the paYments made by a member.
The fund from which the paYment of benefits hall be made, and the funds from which the expenses shall be defrayed, shall be derived from assessments, dues or other payments collected from its members, a may be provided by the constitution or by-laws of uch order or a sociation. PaYment of death benefits shall be to families, heirs, blood relatives, affianced hu band or affianced wife of, or to persons dependent upon the member, as may be designated by the member.
Such orders or as ociations shall be governed by this Act, and shall be exempt from the provision of the insurance laws of this State, and no law hereafter pa ed hall apply to fraternal beneficiary orders or a sociations, unless it is expre sly desiO'nated therein.
Sec. 2. Be it further enacted, That any fraternal b neficiary order, a. ociation or ociety of this or any" other State, di trict, province or territory, now having members, or any lodge, chapter, conn.:,'l or

2

I SURANCE LAW.

subordinate branch duly establi hed and organized in thi State, may continue it operations and busi. ne s in till State; provided, that it hereafter complies with the provisions of thi Act regulating annual report , and the de ignation of the In urance Commi ioner as the person upon whom process may be erved as hereinafter provided.
Sec. 3. Any fraternal beneficiary order, association or ociety coming within the de cription as set forth in Section one of this Act, organized under tbe laws of any other State,' province, di trict or territory, not now having lodge, councils, or other bodies, or members in this State, shall'be permitted to do bu ine within thi tate when it shall have filed with the Insurance Commi sioner a certificate from the official in charge of in urance matt l' in its home
tate of incorporation that it is authorized to tran act busine s therein as a fraternal beneficiary order or as ociation, al 0 a duly certified copy of it charter and article of association, and a copy of it constitution and law, certified to by its ecretary or corre ponding officer, too-ether with the appointment of the Insurance Commi ioner as the person upon whom legal proces may be erved as hereinafter provided.
Sec. 4. Every uch corporation, ociety, order or association doing bu iness in this tate shall, on or before tbe fir t day of March each year, make and file with tbe Insurance Commis ioner a report of it affiairs and operations durino the year ending the thirty-fir t day of December immediately preceding,

INSURANCE LAWS.

<;3

which annual report shall-be in lieu of all other reports required by any other law. Such reports shall be made on blanks provided by the Insurance ommissioner, and shall be verified under oath by the duly authorized officers 'of any such order, and shall be published, or the substance thereof, in the annual report of the Insurance Commissioner under a separate head, entitled "Fraternal Beneficiary Societies. "

Sec. 5. Each such corporation, society or association now doing, or hereafter admitted to do business in this State, and not having its principal office within this State, and not ,being organized under the laws of this State, may be served with each and all processes of law, whether mesne or final, in any action or special proceedings against said corporation, society or association as follows: The party in whose favor suit is being brought, through his attorney-atlaw shall notify in wTiting the Insurance Commissioner of Georgia of his intention to ,bring such suit or action, and request the said Insurance Commissioner to appoint some resident of the county of the residence of said plaintiff in said case, and it shall be the duty of the Insurance Commissioner immediately to appoint some resident of said county to accept service of process in all cases in the name of. the said corporation, society or association; and the said service, when so made, shall be deemed and held and accepted by said corporation, society or association to be legal personal service and binding, the ame as if made upon any agent or officer of said society or

84

INSURANCE LAWS.

corporation; provided, that the said party or his attorney hall, twenty days before the appearance term for said uit or action, cause to be sent to the In urance ommi sioner a copy of the petition. When such service has been made upon such attorney for ervice on any such corporation, society or as ocia tion, and copy of same has been forwarded to said Commi sioner as hereinbefore provided, it shall be the duty of said In urance Commissioner immediately to notify the aid corporation, ociety or association of such service by letter, enclosing copy of aid petition, together with process filed in aid ca e, prepaid and directed to the ecretary or its corre ponding officer.
The Insurance ommissioner shall keep a record of all uch attorneys appointed for such service, together with the record of when any such petitions with process were received by him in any case, and forwarded to any such corporation, society or association.
Sec. 6. The Insurance Commissioner shall, without undue delay, upon the application of any order, society or as ociation having the right to do busine s in this State as provided by this Act, issue a permit in writinO" authorizing it to do busine s within the State, for which certificate, and all proceedinO"s in connection therewith,. such association shall pay to said Insurance Commis ioner a fee of ten dollars. This fee shall be paid annually thereafter in advance.
Sec. 7. Any such order, association or society refusinO" or neglectin2;' to make the report to the Insur-

INSURANCE LAWS.

85

ance Commissioner as provided in this Act, shall be excluded from doing business within this State, and the Insurance Commissioner shall at once recall and cancel their license. Any officer, agent or person acting for any order, or subordinate body thereof, within this State, while it shall be prohibited from doing business pursuant to this Act, shall be deemed guilty of a misdemeanor, and on conviction thereof shall be punished by a fine of not less than twenty-five dollars nor more than one hundred dollars.

Sec. 8. Any person who shall act within this State as an officer, agent or otherwise for any such fraternal beneficiary order in soliciting' or procuring new business or members, which shall have neglected or refused to comply with this Act, shall 'be subject to the penalty provided in the last preceding Section for the misdemeanor therein specified.

Sec. 9. All laws and parts of laws in conflict with or inconsistent with this Act be, and the same are, hereby repealed, and nothing in this Act shall be held to affect or apply to grand or subordinate lodges of Masons, Knights of Pythias, Odd Fellows, Red Men, Junior Order American Mechanics, or similar orders that do not have as their principal object the issuance of benefit certificates to members.

Sec. 10. This Act shall be in force and effect from and after its passage.

Approved December 17, 1900.

86

INSURANCE LAws.

I SURA CE COMPANIES, DEPOSITS OF REGISTRATION OF.

No. 108.

An Act to authorize and require all insurance and fidelity and deposit companies and fidelity or surety companies that may now have bonds deposited in the Sta.te Treasury, or that may here after be placed there, to have same registered.
Section 1. Be it enacted by the General Assembly of Georgia, and it is hereby enacted by the authority of the same, That all insurance and fidelity and deposit companie and fidelity or surety companies which may now have coupon bond deposited in the Treasury, be required to substitute registered bonds for the arne on or before January 1, 1901.
Sec. 2. And be it further enacted, That all such companie makinO' deposits after January 1, 1901, be required to furnish registered bonds.
pproved December 17, 1900.

INSURANCE LAWS.

87

INSURANCE CaMPA ITES, CA.PITAL STOCK OF, I.r CREASED OR DECREASED.

.1. o. 153.

An Act to authorize any fire insurance company, organized under the laws of this State, to inqrease or decrease its capital stock, and for other purposes.

Section 1. The General Assembly of Georgia hereby enacts, That the capital stock of any fire insurance company organized under the laws of this State, whether incorporated by special Act of the General Assembly or by the Secretary of ~tate under the general law, may be increased to such an amount as may be desired by the stockholders of such company, or said capital stock may be decreased to any sum, not Ie s than one hundred thousand dollars as may be desired by stockholders of such company, at a meeting of such stockholders, called for the special purpo e by order of the board of directors of such company, of which meeting notice shall be given to each stockholder (or in case of death to his legal representatives or heirs at law), personally
Or by mail, addre sed to his last known residence, at
least thirty days previou to such special meeting, and such increase or decrease shall be made in such manner as shall have been determined by the stock~ holders at such meeting, it requiring the vote of a majority in amount of the entire capital stock of ,neh company to allthorize snch increa e or decrea. e,

88

INSURANCE LAWS.

and the manner of effecting same. If at such meeting of the stockholders, holding the majority in amount of such capital stock, vote for such increase or decrease, the proceedings of the meeting must be reduced to writing and .entered upon the books or minutes of the company and a copy thereof verified by the president or secretary thereof shall be filed and recorded in the office of the Secretary of State and when so filed and recorded, shall become an amendment to the charter of said company, and a certified copy thereof sh~ll be evidence of all facts therein contained, in all courts of this State, without further proof; p1"ovided, such increase or decrease shall be approved by the Comptroller-General as GXofficio Insurance Commissioner of this State to be evidenced by endorsing his approval on the said verified copy of such proceedings of said stockholder , which endorsement shall be recorded in the office of the Secretary of State, togetheT with said verified copy, and become a part thereof.

Sec. 2. Be it further enacted, rrhat all laws and parts of laws in conflict ,with this Act be, and the same are, hereby repealed.

A pproved December 18, 1900.

INSURANCE LAWS.

89

LIFE INSURA CE COMPAlES 0 ASSESSME T PLAN.

0.176.

An Act to authorize insurance companies, chartered to do a life insurance busine s upon the assessment plan, to hereafter do a general life insurance business in Georgia, upon complying with the terms of this Act, to prescribe laws regulating the same, and for other purposes.

Section 1. Be it enacted by the General Assembly of Georgia, That any corporation, chartered to do a life insurance business on the assessment plan, and doing busine s in this State, may, if it so desire. by a compliance with this Act, be re-licensed and authorized to tran act a general life insurllnce business in this State, upon :filing with the insurance department of the State all paper and documents and making the payment required under existing law 0 far as the arne are OF may be applicable to such life insurance companies, and all business thereafter transacted by such corporations in this State, shall be done in accordance with and governed by the provisions of the laws of this State relating to life insurance ~ompanies, other than those doing business on the as e ment plan, except as provided in this Act.
Sec. 2. Be it further enacted, That every such corporation, upon complying with the requirements of tbi Act, i hereby authorized to carry out, in O"ood

90

INSURANCE LAws.

faith, its contracts heretofore made with its mem-

bers, but all policies or certrncates of insurance here-

tofore issued by such corporations and now remain-

ing in force, which contain a provision for a payment

other than the premium stipulated therein, and under

which the donation of premium payments is co-equal

with the duration of the contract (endowment poli-

o cies and endowment cert~ficate excepted) shall be

valued and reserve maintained thereon on the basis

of renewable term in urance as fixed by age, in

accordance with the provi ions of Section 8 of an Act

entitled "An Act to regulate the bu iness of insur-

ance of this State, and for other purposes," approved

October 24th, 1887. To the re erve liability deter-

mined as above, the Insurance ommissioner shall

add the determinate contract reserve under any othel'

policies or certificates heretofore i sued and remain-

ing in force, and in the absence of l1ch contract re-

serve shall value them as contract providing imilar

benefits are to be valued under the provisions of aid

Section 8 of the Act of October 24th, 1887; provided,

that under no policy or certrncate shall a greater

,

aggregate reserve liability be charged than is re-

quired by said Section.

Sec. 3. Be it further enacted, That after this Act goes into force, no policy or certificate of life insurance shall be issued by a company licensed under this Act, in this State, unless in compliance with the provisions thereof. All policies of life insurance issued by such corporation under this Act, whether or not they contain a provision for a payment other than

INSURANCE LAws.

91

jlJ.e premium specified therein, shall be valued and the reserve maintained thereon according to the provisions of said Section 8 of the Act of October 24th, 1887, and the nature of the insurance as defined in each policy or contract.

Sec. 4. Be it further enacted, That no laws or parts of laws, which relate to the formation of corporations to transact the business of life insurance upon the assessment plan, or which provide for the regulation of the business of life insurance by such corporations, shall be applicable to companies doing business under this Act, except to the extent of per mitting the carrying out of contracts heretofore made with members; provided, nothing in this Act shall be construed to apply to any fraternal beneficiary order or society operating on the system of lodges, councils or chapters, as defined by the laws of this State regulating such orders or societies.

Sec. 5. All Acts and parts of Acts inconsistent with the provisions of this Act are hereby repealed.

.A pproved December 21, 1900.

92

INSURA. -CE LA.ws.

DEPOSITS BY ASSES ME T LIFE I URANOE OOMPA IES-APPROVED BY STATE TRE SURER.

An Act to amend an Act entitled" An Act to amend Section 2061 of the Oivil Oode of 1 95, relative to the requirements of assessment insurance companie precedent to doing bu iness in thi State, by adding the requirement that a deposit shall be made as security for policyholder," approved December 20, 1901; by providing more lefinitely for the amount of said deposit.

Section 1. Be it enacted by the General A embly of the State of Georgia, and it is hereby enacted by authority of the same, That from and after the passage of this Act, the following words in said Act, towit: "Of insurance which, under the rules and regulations of the company ma1.~ng the deposit, it is authorized to write upon one life; provided, nevertheless, such deposit hall not be Ie s than :five thousand dollars," whenever they occur be, and the same are, hereby stricken, and in 1ieu thereof the following words, to-wit: "Equal to twenty thousand dollars. market value" be, and the same are, hereby in erted, so that said Act and said Section 2061 of the ode, . when amended, hall read a follows: "It hall not be lawful for any corporation or association, organized under the laws of this or other State of the United States for the purpose of furnishing life in. demnity or insurance upon the a essment plan by

,

INSURANCE LAWS.

93

its agent, to do any business in this State until such

corporation or association shall deposit with the In-

surance Commissioner of this State a certified copy

of its charter or articles of incorporation, a copy of

its statement of business for the year ending the thir-

ty-first day of the next preceding December, sworn

to by the president or secretary, or like o~cer there-

of, setting forth the number and amount of certifi-

cate of membership or policies in force, and a de-

tailed account of its expenditures, income, assets and

liabilities, and also a certificate sworn to by the presi- Amended by

dent and

ecretary

or

like

officer

thereof,

setting

Act ap.
proved

August 22,

forth that it has paid and has the ability to pay its 1905.

certificates or policies to the full limit named there-

in; that its certificates or policies are payable only

to beneficiaries having a legal insurable interest in

the life of the member or insured; that an ordinary

a essment upon its members is sufficient to pay its

maximum certificate of membership or policy there~

tofore or thereafter to be issued to the full amount or.

limit named therein; a certificate from the Insurance

Commissioner or other like officer charged with the

duty of executing or enforcing the execution of the

insurance laws of its home State, certifying that it is

legally entitled to do business in said home State;

a copy of the application for membership or insur-

ance, and of each form thereof, if more than one

form is used j a copy of the constitution and by-laws,

and of each and every addition thereto, which must

show that all indemnities to beneficiaries are in the

main provided for by as e ments upon all surviving

94

INSURANCE LAWS.

member. And whenever said company shall fail to pay a valid claim to the full limit named in any policy i ued by them to any resident of this State, the Insurance Commis ioner hall revoke their authority to do business in tbis State; provided, that all such corporations or a ociations organized under the laws of this or any other State or country, shall depo it with the Trea urer of this State sto'cks or bonds approved by that officer in an amount equal to twenty thou and dollar , market value; and hereafter such corporations hall at the time of filing its annual statement, depo it in like ecurities with said treasurer the urn of one thousand dollars on each million dollar of insurance in force on the last day of the la t calendar year a hown by it la t annual statement, until the urn 0 deposited shall be equal to one hundred thou and dollars; provided, however, that indu trial a sociation or a ses ment life ip. urance companies doing business upon the industrial or weekly payment plan, and is uing no policies for an amount greater than five hundred dollars, shall be required to deposit a sum equal to one thousand dollars for each one million dollar in force; and thereafter uch indu trial a ociations or asse sment life insurance companies doing business upon the indu trial or weekly payment plan, and issuing no policy for a greater amount than five hundred dollars, hall be required to deposit a sum not less than one thousand dollars on each million dollars of inurance in force on the last day of the la t calendar year, as shown by its annual statement, until the sum o depo ited hall be equal to one hundred thousand

INSURANCE LAWS.

95

dollars. The security 0 deposited shall be held in tru t for the benefit and protection of, and as security for the policyholders of such corporation or association, their legal representatives and beneficiaries. That corporations or associations organized under the laws of other States or countries shall not be required to ml:!ke such deposit provided} the corporation or as ociation de iring to do business in this tate shall make it appear to the satisfaction of said In urance Commissioner that it has on deposit with the proper State official in the State or country of its incorporation a like amount of securitie as is required under the terms of this Act, and which are held by said authority in trust for the benefit and protection of, and as security for the policyholders of such corporations or associations, their legal repre entatives and beneficiaries. Said securities shall o remain on deposit until it has been made to appear to the atisfaetion of said Insurance Commissioner of thi tate that all the debt and obligations of aid company or association due the citizens of this tate have been discharged, or, in case of nonre ident companies, that, after making depo it, or similar deposit has been made with the proper State official in the tate or country of its corporation, said ecuritie shall be subject to the debt due policyholder and beneficiaries under the same rules and regulations as govern the deposits required to be made by fire insurance companies under the laws of this tate, in so far a the same may be applicable.
ompanies or associations now organized under

96

L SURANCE LAWS.

the assessment life insurance laws of this State shall not be required to make such depo its for and during the year 1901; but said companies may make such deposit during said year if they so elect.

Sec. 2. Be it further enacted by the authority aforesaid, That all laws and parts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved December 18, 1901.

I SURANCE LAws.
A ACT
To amend an Act approved December 24th, 1896, making it unlawful for certain fire insurance companies to place or cau e to be placed in urance against loss by fire on property in this State, except through agents located in this State, and prescribing penalties for a violation of the same, and prescribing further conditions to be complied with by such fire in urance companies before receiving license to do bu iness in this State by making it unlawful for accident, liability or casualty insurance companies, not incorporated by the laws of the State of Georgia, but legally licen ed to transact the busine s of accident, liability or casualty insurance therein, and doing business "through regularly commissioned and licensed agents, to i sue or cause to be i ued, policies of accident, liability or casualty insurance, to any person or corporation resident in the State of Georgia, except through agents located in the State, legally authorized and licensed to write policies of accident, liability or casualty insurance therein, and prescribing penalties for violation of the same; also prescribing further conditions to be complied with by accident liability or ca ualty insurance companies before receiving licen e to do business in this State.
Section 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby enacted by the authority of the same, That the title to said ct be amended by adding at the end thereof the followinO' words, to-wit: And making it unlawful for acci-

9

IN URANCE LAWS.

dent, liability and ca ualty in urance companies, not inc9rporated by the laws of the State of Georgia, but regularly licensed to transact the business of accident, liability or casualty insurance therein and doing busine through regularly licensed and commi sioned agents, to i sue or cau e to be issued policies of accident, liability or ca ualty to any peron or corporation resident in the State of Georgia, except throuo'h agent located in the State, legally authorized and licensed to write policies of accident, liability or casualty insurance therein, and prescribing penalties for violation of the same; and also prescribing further condition to be complied with by accident, liability or casualty in urance companies before receiving license to do bu iness in this State.
So that said title when amended shall read as follows: "An Act making it unlawful for fire insurance companies not incorporated by the laws of the State of Georgia, but legally licensed to tran act the bu iness of fire ,insurance therein, and doing bu iness there through regularly commissioned and licen ed agents, to place or cause to be placed insurance against 10 s by fire on property in thi State, except through agents located in the State, legally authorized and licen ed to write policies of insurance therein, and pre cribing penalties for violation of the same, also to pre cribe further conditions to be complied with by fire insurance companies before receiving license to do bu ines in thi State, and making it unlawful for accident, liability or ca ualty insurance companies not incorporated by the laws of this

INSURANCE LAW

99

State, but regularly licensed to transact the business of accident, liability or casualty insurance therein, and doing busines through regularly licensed and commis ioned agent, to i ue or cau e to be issued policies of accident, liability or casualty in urance to any person or corporation resident in the State of Georgia; except through agent located in the State legally authorized and licensed to write policies of accident, liability or casualty insurance therein, and prescribing penalties for violation of the same, and also prescribing further conditions to be complied with by accident, liability or casualty insurance companies before receiving license to do business in this State. "
Sec. 2. Be it further enacted, That ection 1 of said Act be, and the same is, hereby amended by add-. ing at the end of said Section the following words, towit: "That accident, liability or casualty insurance companies not incorporated by the laws of the State of Georgia, but legally authorized to do business in this State through regularly commissioned and licensed agents located in this tate, shall not is ue any policie of accident, liability or casualty insurance to any person or corporation re ident in said State ave through agents of such companies regularly commissioned and licensed to write policies of accident, liability or casualty in 'urance in Georgia; so that said Section when amended shall read as follows, to-wit:
Be it enacted by the General As. embly of the State of GeorO"ia, and it is hereby enacted by authority of

100

INslffiANCE LAWS.

the same, That fire insurance companies not incorporated by the laws of the State of Georgia, but legally authorized to do business in this State through regularly. commissioned and licensed agents located in this State, shall not make contracts of fire insurance on property herein save through agents of such companies regularly commissioned and licensed to write policies of insurance in Georgia; provided, however, that this Act shall not apply to property of railroad companies and other common carriers. That accident, liability or casualty insurance companies not incorporated by the laws of the State of Georgia, but legally authorized to do business in this State through regularly commissioned and licensed agents located in this State, shall not issue any policy of accident, liability or casualty insurance to any person . or corporation resident in said State, save through agents of such companies regularly commissioned and licensed to write policies of accident, liability or casualty insurance in Georgia.

Sec. 3. Be it further enacted, That section 2 of said Act be amended by in erting between the words "fire" and "insurance" in the second and fifth lines thereof, the following words, to-wit: "accident, liability or casualty," so that said section when amended shall read as follows, to-wit: Be it further enacted, That before issuing certificate OT license to any fire, accident, liability or casualty insurance company to transact business of accident, liability, casualty or fire insurance in this State, the Insurance Commissioner shall require in any case, in addition to re-

INSURANCE LAWS.

101

quirements already provided for by law, that each and every such fire, accident, liability or casualty insurance company shall file with him the affidavit of its president or other chief officer, that it has not violated any of the provisions of this Act, for the space of twelve months last past, and that they accept the terms and obligations 'Of this Act as a part of the consideration of their license.

Sec. 4. Be it further enacted that section 4 of said Act be amended by inserting between the words "fire" and "insurance," in the :first and sixth lines thereof, the words" accident, liability or casualty," S'O that said section when amended shall read as follows: Be it further enacted, That any fire, accident, liability or casualty insurance company violating any provision of this Act, or refusing to submit to the aforesaid examination when required, shall forfeit the right to do business in this State for the next twelve months thereafter, and the Insurance Commissioner shall immediately revoke the license already issued to said fire, accident, liability or casualty insurance company to do business in this State.

Sec. 5. Be it further enacted, That this Act shall go into effect as soon as approved? and all laws and partS' of laws in conflict with the same are hereby repealed.

Approved December, 1901.

102

lNSURA CE LAWS.

IURA CE OMPAlES, S{J1TS AGAIN"ST.

o. 160.

Section 1. Be it enacted by the General Assembly ()f the State of Georgia, and it is hereby enacted by authority of the same, That from and after the passage of t?is Act, that Section 2145 of the Code of 1895 be amended as follows: By striking out the word "agency" in the seventh and eighth lines, and inserting in lieu thereof the word" agent," so that said Section when so amended, will read as follows: "Whenever any person may have any claim or demand upon any insurance company having agencies or more than one place of doing business, it shall be lawful for such person or persons to institute suit against such insurance company within the county where the principal office of such company is located, or in any county where said insurance company may have an agent or place of doing business, or in any county where such agent or place of business was located at the time the cause of action accrued, or the contract was made out of which said cause of action arose.

Sec. 2. Be it further enacted, That all laws and parts of laws in conflict with this Act are hereby repealed.

Approved December 17, 1902.

INSURANCE LAws.

103

INSURANCE COMPANIES, CHARTERS OF.

No. 129.

Section 1. Be it enacted by the General Assembly of Georgia, and it is hereby enacted by authority of the same, That Section 2017, Volume 2 of the Code of 1895, be, and the same is, hereby altered and amended by striking from said Section 2017 all of said Sec. tion after the word "business," in the sixth line, towit: "The rights, powers and privileges granted said corporation shall not continue longer than :fifty years, unless the same be continued by laws of force at the expiration of said :fifty years," so that when said Section is so amended it will read as follows: "That all the powers and privileges and said certificate of incorporation of said insurance company shall cease and determine at the expiration of two years from the date of said certificate; if at the expiration of said two years said company has not organized and commenced business."

Sec. 2. Be it further enacted, That all laws and parts of laws in conflict with tbis Act be, and the same are, hereby repealed.

Approved December 16, 190~.

104

INSURANCE LA\VS.

DEPOSITS BY FOREIGN FIRE I JSURA1~CE COMPA IES.

FACE VALUE OF SECURITIES.

No. 82.

An ct to amend section 2035 of the Code of Georgia 1895, by in erting between the words "valid" and " and" in the si..~th line of said section the words,. "or bonds of any county or municipality in this State which have been validated under the laws of this State," and for other purposes.
Section 1. Be it enacted by the General Assembly of Georgia, and it is hereby enacted by authority of the same, That section 2035 of the Code of Georgia 1895 be, and the same is, hereby amended by inserting between the words "valid" and "and" in the sixth line of said section the words, "or bonds of any county or municipality in this State, which have been validated under the laws of this State," so that said section as amended shall read as follows: "All fire, marine and inland .insurance companies, chartered by other States or foreign government, shall be required to deposit with the Treasurer of this' State, bonds of the United States, or bonds of this State which according to the Acts and resolutions of the General Assembly are valid, or bonds of any county or municipality in this State, which have been validated under the laws of this State, and which amount, according to their face value, to twenty-five thousand dollars, which bonds' shall be receipted for by the

INSURANCE LAWS.

105

State Trea urer, and especially deposited by him in the vaults of the Treasury, and whenever such company cea es to do business in this State, and has ~ettled up all claims against it as hereinafter provided, said bonds shall be delivered up to the prope~ party on presentation of the TreasUl'er's receipt. While aid bonds are so deposited, the owners of the same shall, ubject to the notices hereinafter provided for or given, be entitled to collect the coupons and use them. For the bonds so deposited the faith of the State is pledged that they shall be returned to the parties entitled to receive them, or disposed of a hereinafter provided."

Sec. 2. Be it further enacted, That all laws and parts of laws in conflict herewith be, and the same are, hereby repealed.

Approved August 22, 1905.

106

I SURA CE LAWS.

DEPOSITS BY HOME LIFE INSURANCE COMPANIES MUST BE APPROVED BY I SURANCE COMMISSIO ER.

No. 42.

.An Act to amend Section 2043 of the Code of Georgia, with reference to the deposit required to be made by life insurance companies chartered under the 1aws of Georgia so as to provide that such deposits , hall be made with the State Treasurer instead (If with the Insurance ommlSSlOner.
ection 1. Be it enacted by the General Assembly of the State of Georgia, That Section 2043 of the Code of Georgia be, and the same is, hereby amended by striking the words, "Insurance Commissioner of this State, or with some strong corporation which may be approved by him" in the third and fourth lines of said Section, 'and insert in lieu thereof the words, "Treasurer of this State." Also amend by striking the word" him" in the fifth line of said Section and insert in lieu thereof the words" Insurance Commissioner of this State."
Also amend by striking the words "Insurance Commis ioner or corporation" from the tenth and eleventh lines of said Section and insert in lieu thereof the words "the Treasurer."
Also amend by striking the word "whose" in the thirteenth line of said Section and insert in lieu thereof the words "the Treasurer's," so that said Section when amended shall read as follows:

INSURANCE LAWS.

107

,'All such compani es chartered by the State of Georgia shall before doing business in this State deposit with the Treasurer of this State one hundred thousand dollars, in such securities as may be deemed by the Insurance Commissioner of this State equivalent to cash, to be subject to his order, as a guaran. tee fund for the security of the policyholders of the company making such deposit. All interest and dividends arising from such securities to be paid when due to the company so depositing them. Any uch securities as may be needed by the company may be taken from the Treasurer, at any time, by replacing them with other securities equally acceptable to the Insurance Commissioner. The Treasurer's certificate for the same shall be furnished to. the company."

Sec. 2. Be it enacted further, That all laws and part of laws in conflict with this Act be, and the same are, hereby repealed.

Approved Augu t 22, 1905.

108

INSURANCE LAws.

DEPOSIT BY ASSESS~1:ENT INSURANCE CaMPANIES.-APPROVED BY STATE TREASURER.-MARKET VALUE.
No. 138.

An Act to amend an Act approved December 20, 1901, amending Section 2061 of the Civil Code of 1895, relative to requirements of assessment insurance companies providing more definitely for the amount of deposit.

ection 1. Be it enacted by the General Assembly ()f the State of Georgia, and it is hereby enacted by .authority of the same, That from and after the passage of this' Act, the following words in said Act, towit, "Provided, that all such corporations or associ:ations, organized under the laws of this or any other State or country, shall deposit with the Treasurer of this State stock or bonds approved by that officer in an amount equal to twenty thousand dollars, market value; and hereafter such corporations shall at the time of filing its annual statement, deposit in like 'Securitie with said Treasurer the sum of one thou'Sand dollars on each million dollars of insurance in force on the last day of the last calendar year, as shown by its last annual statement, until the sum so deposited hall be equal to one hundred thousand dollars," be, and the same are, hereby stricken, and in lieu thereof the following words be, and the same are, hereby inserted, to-wit:

INSURA CE LAws.

109

.

Provided, That all such corporations and associa-

tions, organized under the laws of this' or any other

State or country, shall deposit with the Treasurer of

this State stock or bonds approved by that officer in

an amount equal to t enty thousand dollars, par

value, and of not Ie than twenty thou and dollars,

market value; 0 that aid Act and said Section 2061

of the Code, when amended, shall read as follows:

"It shall not be lawfu~ for any'corporation or asso-

ciation, organized under the laws of this or any other

State of the United States for the purpose of furnish-

ing life indemnity or insurance upon the assessment

plan by its agents, to do any business in this State

until uch corporation or association shall deposit

with the In urance Comilli sioner of the State a cer-

tified copy of its charter or article of incorporation,

a copy of its statement of busine for the year end-

ing the thirty-fir t day of the next preceding Decem-

ber, sworn to by the pre ident or secretary, or like

officer thereof, setting forth the number and amount

of certificates of memher hip or policies' in force and

a detailed account of its expenditure , incOIDe, a sets

and liabilities, and also a certificate sworn to by the

pre ident and ecretary or like officer thereof, settinO'

forth that it has paid, and has the ability to pay, it

certificate or policie to the full limit named therein;

that it certificates or policies are payable only to

the beneficiaries having a legal insurable interest in

the life of the member or the insured; that an ordi-

nary asse smelft upon itS' members is sufficient to pay

its maximum certificate of membership or policy

"hE'retofore or thereafter to be issued to the full

110

IN URANCE LAW.

amount or limit named therein, a certificate from the Insurance Commi sioner, or other like officer, charged with the duty of executing or enforcing the execution of insurance laws of its home State, certifying that it is legally entitled to do bu. ine in saia home tate; a copy of the application for membership or insurance and of each form thereof, if more than one form is used; a copy of the constitution and by-law, and of each and every addition thereto, which mu t how that all indemnitie to beneficiaries are in the main provided for by a se ments upon all surviving members. .And whenever aid company hall fail to pay a valid claim to the full limit named in any policy is ued by them to any resident of this
tate, the In mance Commissioner shall revoke their authority to do bu ine s in thi State:
Provided, That all such corporations or association , orO"anized under the laws of this or any other
tate or country, shall deposit with the Trea mer of thi tate tock or bond approved by that officer in an amount equal to twenty thousand dollars, par value, and of not Ie than twenty thou and dollar , market value; provided, hou;eve1', that industrial as ociations or as essment life in 'urance companies doing bu ines on the indu trial or weekly payment plan, and issuing no policies for an amount O"reater than five hundred dollar shall be required to depo it a sum equal to one thou and dollars for each one million dollars in force, and thereafter such indu trial a ociations or a e ment life in urance companie doinO" bu ine s upon the indu trial or w ekly payment plan, and is uing a policy for no

INSURANCE LAWS.

111

greater amount than five hundred dollars, shall be required to Gepo it a sum not Ie s than one thousand dollars in each million dollar of insurance in force on the last day of the la t calendar year, as shown by its annual tatement lmtil the sum 0 deposited hall be equal to one hundred thou 'and dollar. The ecurity so deposited shall be held in trust for the benefit and Iroteetion of, and a security for, the policyholders of uch corporation or a sociation, their legal repre entatives and beneficiarie. That corporation or a sociation organized under the laws of other States or countries hall not be required to make uch depo it, provided the corporation or association desiring to do bu. iness in this State shall make it appear to the satisfaction of aid In urance Commi ioner that it has on depo it with the proper
tate official in the State or country of it incorporation a like amount of securities a i required under the terms of thi Act and which are held by aid authority in trust for the benefit and pr~teetion of, and a ecuritv for, the policyhold rs of such corporation or as ociation , their leo-al repre entatives or beneficiaries. aid securitie hall 0 remain on deposit until it ha been made to appear to the satisfaction of aid Insurance Commi ioner of this State that all the debt and obligation of aid company or as ociation due the citizen of this State have been discharged or, in case of non-re ident companies, that, after makino- deposit or imilar deposit has been made with the proper State officials in the State or country of its corporation, said securitie shall be ubject to the debts due policyholders and beneficia-

112

INSURANCE LAWS.

rie under the same rules and regulations a govern the depo it required to be made by fire' insurance companies under the law of this State, in 0 far as the same may be applicable. Companies or associations now organized under the assessment life insurance laws of thi State shall not be required to make such deposits for and during the year 1901; but said compani,es may make such deposits for and during aid year if they so elect.

Sec. 2. Be it further enacted by the authority aforesaid, That all laws and parts of laws in conflict with thi Act be, and t1e same are, hereby repealed.

Approved August 23, 1905.

INSURANCE LAws.

113

I DUSTRIAL LIFE Ir SURAN CE DEFI ED A~D REGULATED.

o. 59.

An Act to define and regulate the busine s of indu trial life insurance; to provide the manner in which corporations, associations, societies or fraternal orders doing the business of industrial life in urance shall be authorized to do business in this State; to provide for the making of a deposit by uch corporations, a ociations, societies, or fraternal orders as a condition precedent to doing bu ines in this State, and to :fix the amount thereof; and for other purposes.

Section 1. Be it enacted by the General Assembly of Georgia, That industrial life in urance is hereby defined to be that in urance for which the stipulated premiums, advance assessments or dues are regularly payable and collectable weekly or bi-weekly, and the policies or benefit certificates which are for sum of not more than five hundred dollars on a sinale life, and which policie or benefit certificates may provide a weekly benefit for disability, caused by
icknes or accident, not greater than twenty dollars per week.

Sec. 2. Be it further enacted by the authority aforesaid, That all corporations, association, relief organizations, societies or fraternal orders, with or without capital tock, and havino- or not having a rituali tic form of government, whether operatipg

114

INSURANCE LA.WS.

under the present in urance laws as insurance companies, or operating under the laws governing fraternal beneficiary orders, and i suing policies or benefit certificates and conducting their bu iness in the manner and within the meaning and definition set forth in Section 1 of this Act, shall be held and deemed to be doing an industrial life insurance busines , and shall be subject to this ct and all th~ other laws of this State not repugnant to this Act, regulating the business of life, health and accident insurance in this State.
Sec. 3. Be it enacted by the authority aforesaid, That any corporation, as ociation, society or fraternal order organized under the laws of this State, whether organized upon the mutual assessment plan or as a stock company, for the purpose of doing the business of indu trial life insurance, as in this Act defined, shall, before commencing to do business in this State, comply with the laws of this State regulating the manner in which other insurance companies shall be authorized to do business in this State, except that the deposit, required of companies operating upon the plan and according to the manner specified in Sections 1 and 2 of this ct hall be five thousand dollar ,to be made in such ecurities as are required of such other insurance companies as are now required to make a deposit in this State; and such deposit shall be made prior to or on the first day of January, 1906.
Sec. 4. Be it further enacted, That any corporation, association, society or fraternal order, organ-

INSURANCE LAWS.

115

ized under the law of any other State upon the mutual a essment plan, or as a stock company, for the purpo e of doing the bu iness of industrial life inurance, as in thi Act defined, hall be authorized to do busine s in this tate upon complying with the other laws of this State regulating the manner in which foreign insurance companies hall be authorized to do bu iness in thi State, and filing with the Insurance Commi sioner of this State a certificate from the officer having supervi ion of the insurance department of the State under the laws of which such corporation , as ociation, society or fraternal order wa chartered or elects to make its deposit, that such corporation, association, society or fraternal order ha depo ited with said State a sum of not less than fixe thousand dollar in uch ecuritie a are required to be deposited by in urance companies.
Sec. 5. Be it further enacted, That the provisions of thi Act shall, in no way, apply to any company, as ociation, organization or society, which does not collect it premiums or dues weekly or bi-weekly, but any company, association, organization, society or fraternal beneficiary order, with or without a rituali tic form of government, which collects its dues or pI' mium weekly or bi-weekly, and which for purpo e of ecuring business or members, and for collection of premiums, dues or assessments, employs paid agent, collectors or olicitors, shall come under the provi ion, of this Act.
ec. 6. Be it further enacted, That no law, hereafter pa ed, shall be held or deemed to refer to the

116

INSURANCE LAWS.

business of industrial life insurance, unless the same is expressly referred to in said law.

Sec. 7. Be it further enacted, That all laws and parts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved August 22, 1905.

INSURANCE LAWS.

117

I SURANCE POLICIES, HOW ISSUED.

No. 466.

An Act fixing and regulating the manner in which contracts and policies of insurance, whether life or property, shall be issued and made in thiS' State.

Section 1. Be it enacted by the General Assembly Policies of

Insurance

of

the

State

of

Georgia,

and

it

is

hereby

enacted by

must contain entire con

the authority of the same, That from and after the tract.

passage of this Act all life and fire insurance poli-

cies issued upon the life or property of persons with-

in this' State, whether issued by companies organized

under the laws of this State or by foreign companies

doing business in this State which contain any refer-

ence to the application for insurance, or the consti-

tution, by-laws, or other rules of the company, either

as forming part of the policy or contract between

the parties thereto, or having any bearing on said

contract, shall contain or have attached to said

policy a correct copy of 'aid application signed by

the applicant, and of the by-laws referred to, and

unle s so attached and accompanying the policy, no

such constitution or by-laws shall be received in

evidence either as part of the policy or as an inde-

pendent contract in any controversy between the

parties to or interested in the said policy; :501' shall

such application or by-laws' be considered a part of

the policy or contract between such parties.

Sec. 2. Be it further enacted, That all laws and

parts of laws in conflict with this Act be, and the

same are hereby repealed.

Approved August 17, 1906.

118

IURA CE LAWS.

LIFE INSURA CE ON RE ERVE PLAN, DEPOSIT OF SECURITIES FOR POLICIES.

0.472.

.An Act to authorize any life insurance company organized and doing busine s on the legal reserve plan under the laws of this State, to deposit with the Trea urer of the State securities to the amount of the net reserve value of all policies issued by such company as security for the payment of all liabilities arising under the terms of such policies.

et reserve Section 1. Be it enacted by the General sembly

value 01 all

.

10 life
ance

Insu1lcr'les

of the State of GeorgIa, That from

and after the pass-

\~~eres~~ve age of this Act the Insurance Commissioner of this

~~su~~e 01 State shall, as soon a practicable after the filing of

the deposit rt he qi su iSr et adt eI. n

the

annual

statement

of

any

. In

urance

company

01'-

ganized and doing busines on the legal re erve plan

under the law of this State, proceed to a certain the

.net re erve value of ach policy in force on the thir-

ty-fir t day of December immediately preceding upon

the basis of calculation fixed by existing laws of this

State; and hould any company is ue policie based

upon a higher standard, such policy hall be valued

according to such hiO'her . tandard. For the purpose

of making such valuation the Insurance Commis-

sioner may employ a competent actuary to do the

. ame, who shall be paid by the company for which

the ervices are rendered; but nothing in this Act

hall prevent any company from making said valua-

tion herein contemplated which may be received b

INSURANCE LAWS.

119

the Insurance Commissioner upon such proof as he

may determine. The expense of procuring such

proof shall be paid by the company. Upon ascer-

taining, in the manner above provided, the net re-

serve value of all policies in force is ued by any

company, desiring to operate under the provisions

of this Act, the Insurance Commissioner shall notify

such company of the amount thereof, and within

sixty days after: the date of such notification the

officers of such company shall have the right to de-

posit with the Treasurer of this State, for the secur-

ity and benefit of all its policyholders, securities to

an amount which, together with the sum already de-

posited with said Treasurer, and such sums as ma~

be deposited by said company with other States and

governments, by requirement of the laws of such

other States or governments in which said company

is doing business, shall not be less than the amount

of such ascertained valuation of all policies in force.

In case the deposits made with other States and gov-

ernments are by the laws of such States and govern-

ments held as security, first for the policyholders of

such States and governments, then said policyholders

in such other States shall not participate in the secur-

ities held in this State until due allowance or credit

has been given for tbe securitie beld by their own

'states or government, so that all policyholders of Value at de

tbe company sball stand on equal terms"

The securi-

posit, how a.scertalned.

ties sball be sucb as are described in Section 2408

of tbe Code of 1910, or certificates of deposit in any

solvent bank or trust company, or satisfactory evi-

120

INSURA CE LAWS.

dence of ownership of unencumbered improved real e tate as may be lawfully acquired by such company under the provisions of law, at such value as may be determined upon by two disintere ted appraisers residing in the county in which the real e~tate is ituated, such appraisers to be appointed by the Inurance Commissioner of this State. Such real e tate shall not be sold or encumbered unle s securities of equal value as herein required be deposited with the Treasurer of this State in lieu thereof.

Certlflcate of deposit by

Sec. 2. Be it further enacted, That upon the de-

Insurance Cummls.

posit being made by any company as provided in the

sloner.

foregoing section which shall be renewed annually,

the Insurance Commissioner shall issue a certificate

setting forth the corporate name of the company, its

principal office, that it has' fully complied with the

provisions of this Act, stating the amount deposited

and the net reserve value of outstanding policies, and

the table upon which the same is computed, and that

it is ~uthorized to transact the business of life insur-

ance in this State; pTovided, that any such certificate

shall expire on the thirtieth da of May in the year

following its issue. If requested by such company,

the Insurance Commissioner hall furnish such com-

pany with a certificate over hi siO'nature to be at-

tached to or printed on policy i sued by such com-

pany-substance as follows: State of GeorO'ia, In-

surance Department, State Capitol, Atlanta Ga.,

- - - - - , 191--. The net re erve value of poli-

cies i sued by

---Life Insurance Com-

pany of

GMlrgia, is secured

INSURA CE LAWS.

121

by a deposit of acceptable securities in accordance with the compuls'Ory reserve deposit laws of this State, ena~ted in the year 1906. - - - - - - - , Insurance Commissioner.

Sec. 3. Be it further enacted, That upon the fail- Failure to

make de.

ure of any company having once exercised the privi-

posi t, of.

effect

lege of coming under the provisions of this Act to

make the depo it in the time provided herein, the In-

surance Commissioner shall notify such company to

issue no new policies in this State until there shall

have been compliance with said requirements. The

Insurance Commis ioner shall revoke the license of

any company issuing policies after such notice and

before compliance with said requirements.

Sec. 4.

Be it further

enacted,

That

all

companies

Change of securIties

coming within the provisions of this Act shall have deposited.

the right at any time to change their securities on

deposit by substituting for tho~e withdrawn a like

amount in other securities of the character provided

for in this Act, and whenever the net reserve value

of policies out tanding and in force against any com-

pany is' less than the amount of securities then on

deposit with the Treasurer of this State, said com-

pany shall have the right to withdraw such excess j

but at least one hundred thousand dollars shall re-

main on deposit. Companies having on deposit stock

or bonds as' security may collect the dividends and

interest accruing on such deposits, but upon default

by such company to deposit additional security as Dlvldend.'1 called for by the Insurance Commissioner, the State and interellt.

Treasurer shall collect the interest on such security

122

INsulti.NCE LAWS.

as it becomes due and add the same to the securities in his hands belonging to such company.

tf::s~l:,I of Sec. 5. Be it further enacted, That all securities offered for deposit under the provisions of this Act shall be passed upon by the Insurance Commissioner and approved by him before being deposited with the State Treasurer, and before the withdrawal of any securities from the Treasurer by the company, the Insurance Commissioner shall first approve such withdrawal and the substitution of securities therefor.

Sec. 6. Be it further enacted, That all laws and parts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved August 20, 1906.

I SURANCE LAWS.

123

..

I VESTME TS BY INSURANCE COMPANIES.

No. 277.

An Act to amend Section 2026 of the ode of 1895, by striking out all the words thereof, and substi~ tuting in lieu thereof words defining the character of inve tments to be made by insurance companies doing business in this State.

Section 1. Be it enacted by the General Assembly

of the State of Georgia, and it is hereby enacted by

authority of the same, That all the words of Section

2026 of the Code of 1895, which Section provides how

insurance companies organized under the laws of

this State may inve t their money, be stricken and Inve,stmentll

by Insur

in

lieu

thereof

the

following

words

be

substituted:

ance Companies.

"Investments by insurance companies. Every in-

surance company organized under and doing busi-

ness by virtue of the Jaws of this State, shall have

authority to invest its money or assets in and make

loans on bonds of the United States, or of any State,

county or city therein; first lien on improved real

estate in any of the States of the United States, not

exceeding 5Q per centum of the value of such prop-

erty; promissory note amply ecured by pledge of

securities in which such companies are authorized to

invest their funds; loans on their own policies, not

exceeding the reserve thereon; and invest in build-

ings for home office purposes. Provided, however,

That nothing herein contained shall authorize any

such company to invest in any other than this State

124

INSURANCE LAws.

more than the legal reserve value of policies, held in such other State, respectively. Provided, further, That all such investments shall first be approved by the Insurance Commissioner of Georgia, except in the case of loans on policies of the company not exceeding the reserve of the policy at the time of the loan.

Sec. 2. Be it further enacted, That all laws an'd parts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved August 22, 1907.

iNSURANCE LA.WS.

125

AN AOT

To cancel and forfeit the license of foreign fire, life, accident, fidelity, guaranty, .01' other insurance companies doing business in this State, upon certain conditions, and for other purposes.

Section 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby enacted by authority of the same, That from and after the passage of this Act, if any foreign fire, life, accident, fidelity, guaranty, or other insurance company doing business in this State, shall, without the consent of the other party to any suit or proceeding brought against it in any court in this State, remove said suit or proceeding to any federal court it shall be the duty of the Oommissioner of Insurance to forthwith revoke all authority to such company and its agents to do businesS' in.this State and to publish such revocation in some newspaper of general circulation published in this State.

Sec. 2. Be it further enacted that when such license is forfeited as provided in the foregoing section said license may be renewed by the Insurance Oommissioner upon terms to be preS'cribed by him; provided such license shall not be renewed in less than two years from the date of its forfeiture.
Sec. 3. .All Acts and parts of Acts in conflict with this Act be, and the same are, hereby declared to be repealed.
Approved August 16, 1909.

126

INSURAJ.'I"CE LAWS.

FEE FOR FIRE I SURA CE COMPA IES FIXED.

A ACT
To amend section 2059 of Volume 2 of the Code of Georgia, of 1895, :fixing the fees to be charged by the Insurance Commissioner of the State for filing certified copy of charter of insurance companies for examination of the annual statements and for certificates of authority or license to agents, so as to provide for the payment of a license tax of $200 by fire insurance companies', which shall be in lieu of the tax or fees prescribed in said section, to provide for the payment of a portion thereof to the Insurance Commissioner, and for other purposes.
Section 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby enacted by authority of the same, That Section 2059 of Volume 2 of the Code of 1895 be amended by adding after the ,word' ,Article" in the twelth line of said section the following: "Provided, however, that all fire insurance companies doing business in this State shall in lieu of such fees and charges, pay to the Insurance Commissioner one fee of $200.00, and upon paying such fee and having otherwise fully complied with the provisions of this' Article, such fire insurance companies hall be entitled to receive from the Insurance Commissioner certificates of authority for itself and its agents to transact business in this State. Of

I ~SUBA ~CE LAWS.

127

the sum so paid one-fifth thereof shall go to the Commissioner. " So that section 2059 of Volume 2 of the Code of 1895 when so amended shall read as follows: 2059. Company not complying, fees, etc. 0 person shall act as agent in this State of any insurance company of this or any other State or foreign government doing a businesS' in any manner until said company has fully complied with the provisions of this Article, and received from the Insurance Commissioner certificates of authority for itself and it agents to transact business' in this State. The fees of the Insurance Commissioner shall be as follows: For filing certified copy of charter, twenty dollars; for examination of annual statement, twenty dollars; and for certificates of authority or license to agents, three dollarS' each, one-fifth of which hall be paid to the Commissioner in full compensation for services in executing the provisions of this Article. Provided, however, that all fire insurance companies doing business in this State shall in lieu of such fees' and charges, pay to the Insurance Commissioner one fee of $200, and upon paying such fee and having otherwi e fully complied with the provisions of this Article, such fire insurance companies shall be entitled to receive from the Insurance Commissioner certificates of authority for itself, and its 'agents, to transact bUl?iness in this State. Of the sum so paid onefifth thereof shall go to the Commissioner. In addition to the payment of the above fees, each of the aid companies shall make a report to the Commis-
sioner on the fu; t day of May of each year, or within

12

INSURA.NCE LAws.

sixty days thereafter, under oath of the president or secretary thereof, showing the entire amount of premium receiptS' of every character and description (deducting return premiums on cancelled policies) of said companies in this State during the year or fractional part of a year ending the 30th day of April next preceding, whether said premiums were received in money or in notes, cre<Iits or any suostitute for money, to be taxed as may be provided by law from time to time."
Sec. 2. Be it further enacted by the authority aforesaid That all laws and parts of laws in conflict with this' Act be and the same are, hereby repealed.
Approved August 16, 1909.

INSURANCE LAWS.

129

FEES PAID BY'FIRE AND STORM ASSESSMENT INSURANOE OOMPANIES.
o. 311.
An Act to :fix the fees to be paid by local Fire and Storm ssessment Insurance Oompanies doing business in four counties or less, or operated by independent divisions, composed of four counties' or less, in lieu of the fee :fixed in Section No. 2059 of Volume 2 of the Oode of 1895, as amended by Act 9f' the General Assembly, approved August 16, 1909, and for other purposes.
Section 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby. enacted by authority of the same, That Fire and Storm Assessment Insurance Oompanies in the State of Georgia, the business of which is confined to four counties or less, or operated by independent divisions composed of four counties or less', shall pay to the Insurance Oommis ioner a fee of twenty-five dollars, in lieu of two hundred dollars, as now required to be paid, under Section 2059 of the Oode as amended by Act approved August 16, 1909.
Sec. 2. Be it further enacted, That all laws and parts of laws in conflict with this Act be, and the same are, hereby repealed.
Approved .Tuly 28, 1910.

130

INSURANCE LAWS.

AN ACT

To further regulate ca ualty insurance companies, and for other purposes.

FixIng lIa blllty and loss reo serve.

Section 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby enacted by the authority of the same, That from and after the passage of this Act that the indebtedness for outstanding losses under insurance against loss or damage resulting from accident to, or injuries suffered by an employee, or other person and for which insured is liable, and under insurance against loss from liability on account of the death of, or injury to an employee, not caused by the negligence of the employer, shall be determined as follows: Each corporation which write policies covering any of said kinds of insurance shall include in the annual statement required to be filed with the IiI urance Commis ioner a schedule of its experience thereunder in the United States, and foreign countrie , in the ca e of corporations organized in the United State, and in the United States only in the case of corporations
I
organized outside of the United States', giving each calendar year's experience separately, and crediting or charging each item to the year in which the policy to which it relates was written, as follows: (1) The earned premium on all such policies written during the period of ten years immediately preceding the date as of which the statement is made, being the gross premiums on all such policieS', including excess and additional premiums and premiums in course of

INSURANCE LA.ws.

131

collection, less return premiums and premiums on cancelled policies, and less the unearned premiums on policies in force as shown in such annual statement. (2) The amount of all payments of whatsoever nature made by reason or on account of injuries covered by such policies written during said period. This amount shall include medical and surgical attendance, payments to claimants, legal expenses, salarieS' and expenses of investigators, adjusters and field men, rents, stationery, telegraph and telephone charges, postage, salaries and expenses of office employees, home office expenses and all other payments made on account of such injuries, whether such payments are allocated to specific claims or unallocated. (3) The number of suits being defended at the date as of which the statement is made under policies written during said period, except suits in which liability is not dependent upon negligence of the insured and a charge of seven hundred and fifty dollars for each suit. (4) The number of deaths for which the in ured are liable without proof of negligence, covered by policies written during said period and not paid for at the date as of which the statement is made, and a charge of the amount necessary to pay for such deaths. (5) The number of unpaid claims at the date as of which the statement is made on account of non-fatal injuries for which the insured are liable without proof of negligence, covered by policies written during said period, and a charge equal to the preS'ent value of the estimated future payments. (6) The loss ratio determined from the foregoing as to each year separately, using as the

132

INSURANCE LAws.

divisor the earned premiums shown in item (1), and as the dividend the amount of payments shown in item (2) plus the amounts charged in items (3), (4) and (5). (7) The number of suitS' being defended at the date as of which the statement is made under policies written more than ten years prior to such date, except suits in which liability is not dependent upon negligence of the insured; (8) The, number of deaths for which the insured are liable without proof of negligence covered by policies written more than ten years prior to the date as of which the statement i made, and not paid for at such date. (9) The number of unpaid claims at the date as of which the statement is made on account of non-fatal injurie for which the insured are liable without proof of neo'1igence, covered by policies written more than ten years prior to such date. All unallocated payments in item (2) made in a given calendar year, subsequent to the first four years in which a corporation has been issuing policieS' shall be distributed as follows: thirty-five per centum shall be charged to the policies written in that year, forty per centum to the policies written in the precedinO' year, ten per centum to the policies written second ear preceding ten per centum to the policies written in the third year preceding and five per centum to the policie written in the fourth year preceding and such payments made in the first four calendar years in which a corporation has been is'suing such policies shall be distributed as follows: in the first calendar year one hundred per centum shall be charged to the policies written in that year; in the second calendar year

INSURANCE LAWS.

133

:fifty per centum shall be charged to the policies written in that year, and :fifty per centum to the policies written in the preceding year, in the third calendar year forty per centum shall be charged to the policies written in that year, forty per centum to the policies written in the preceding year and twenty per centum to the policies written in the second year preceding, and in the fourth calendar year thirty-five per centum shall be charged to the policies written in that year, forty per centum to the policies written in the preceding year, :fifteen per centum to the policies written in the second year preceding, and ten per centum to the policies written in the third year preceding, and a schedule showing such distribution shall be included in such annual statement. Each such corporation shall be charged with indebtedness for outstanding losses upon such policies determined as follows: (10) For aU suits being defended under policies written more than ten years prior to the date of which the statement is made, except suits in which liability is not dependent upon negligence of the insured, one thousand dollars for each suit. (11) For all suits being defended under policies' written more than five years and less than ten years prior to the date a of which the statement is made, except suits in which liability is not dependent upon negligence of the insured, seven hundred and :fifty dollars for each suit. (12) For all deaths for which the insured are liable without proof of negligence, covered by policies written more than five years prior to the date as of which the statement is made, the amount nece sary to pay for uch death. (13) For all un-

134

INSURANCE LAWS.

paid claims on account of non-fatal lllJuries, for which the insured are liable without proof of negligence, under policies written more than five years prior to the date as of which the statement is made, the present value of the estimated future payments i (14) for the policies written in the five years imme-diately preceding the date as of which the statement is made an amount determined as follows: multiply the earned premiums of each of such five years as shown in item (1) by the loss' ratio ascertained as in item (6) on all the policies written in the first five years of the said ten year period using as the divisor the sum of the earned premiums shown in item (1) for such first five years, and as the dividend the sum of the payments' shown in item (2) for such first five years plus the sum of the charges in items (3), (4) and (5) for such first five years, but the ratio to be used shall in no event be less than fifty per centum at and after December 31, 1911, nor less than fiftyone per centum at and after December 31, 1912, nor less than fifty-two per centum at and after December 31, 1913, nor less' than fifty-three per centum at and after December 31, 1914, nor less than fifty-four per centum at and after December 31, 1915, nor less than fifty-five per centum at and after December 31, 1916, and from the amount so ascertained in each of the' last five years of said ten year period deduct all payments made under policies written in the corresponding years shown in item (2) and the remainder in the case of each year shall be deemed the indebtedness for that year iprovided, however, that if the remainder in the case of any year of the first three years of

INSURANOE LAws.

135

the :five years immediately preceding the date as of which the statement is made shall be less than the sum of the three following items for that year at that date, (a) the number of suits, except suits' in which liability is not dependent upon negligence of the insured, being defended under policies written in that year and a charge of seven hundred and :fifty dollars for each suit; (b) the amount necessary to pay for all deaths for which the insured are liable, without proof of negligence, covered by policies writ ten in that year; and (c) the present value of esti mated unpaid claims on account of non-fatal injuries for which the insured are liable without proof of negligence covered by policies written in that year, then the um of said items (a), (b) and (c) shall be the indebtedness for that year. A corporation which has . been issuing such policies for a period of less than ten years shall nevertheless include in its annual statement a schedule as hereinbefore required for the years in which it shal~ have issued policies and shall be charged with indebtedness determined in the same manner, but in determining the indebtedness for policie written in the :five years immediately preceding the date a of which the statement is made, the minimum ratios hereinbefore prescribed shall be used subject to the same deductions, and provisions as in the case of corporations that have been issuinO' such policies for ten years or more.
Sec. 2. Be it further enacted by the authority afore aid, That all law and parts of laws in conflict with this Act be, and the same are, hereby repealed.
Approved August 22nd, 1913.

136

INSURA CE LAWS.

AN ACT

KNOWN AS HOUSE BILL o. 752. APPROVED UGUST 19, 1912.
An Act to provide for the establishment of a Department of Insurance; to provide officer therefor, tipulate their salarie ; to regulate and control the organization of in urance companies; to prescribe the duties and powers of the Insurance Commissioner; to prohibit discrimination by inurance companies; to prescribe penaltieS' for the violation of the insurance laws of the State; to provide for the general supervi ion by the Insurance Commi ioner of all insurance companie and the sale of tock in such companies and the general management and conduct of uch companies; to require Bonding and Fidelity companies to make deposits, to regulate all foreign and domestic fraternal companies, corporations, orders, associations and beneficiary societies, soliciting bu ine s in thiS' State, to prohibit the issuing of income or guarantee fund certficate , and for other purpo es.

Section 1. Be it enacted by the General Assembly

of Georgia, and it is hereby enacted by authority of

the same, That from and after the passage of this

Act there hall be establi hed in this tate in the

Insurance 'Department

office

of

the

Comptroller-General,

a

Department

established. which shall be called the "Insurance Department of

the State of Georgia," and which shall be charged

with the enforcement of the laws which have been

or may hereafter be pa sed relatinO' to insurance.

INSURANCE LAws.

137

Its chief officer shall be the Comptroller-General,

Insurance

who

shall

be

styled

"Insurance

Commi sioner."

Commls sloner.

Whenever in thi ' Act the designation "Insurance

Commissioner" or "Commissioner" is used, it shall

be held to mean the chief officer of the Insurance

Department of the State of Georgia. The Insurance

Commissioner shall exercise the powers and perform

the duties conferred and imposed upon him by thi

ct or any other law of the State. He may appoint

a

Deputy

In

urance

Commis

ioner

to

a

sist

him

in

Deputy In surance

Commls.

the discharge and performance of his duties, and in sloner.

the event of a vacancy in the office of In urance Com-

missioner, or in his absence or disability for any

reason, the Deputy shall perform all the duties re-

quired of the In urance Commi ioner. The said

Deputy

hall execute a bond with proper

ecurity in

Bond of" Deputy.

the sum of Five Thou and ($5,000) Dollar, said

bond to be approved by the Insurance Commi ioner

and conditioned upon the faithful performance of

his dutie. The said Deputy shall be removable at

the plea ure of the Commis ioner. The In urance

Commi sioner may also appoint a clerk in addition Clerk.

to the one already employed by the Comptroller, and

a

Fire In

pector whose powers and

duties

are here-

Fire Inspec tor.

inafter prescribed. The Commissioner hall have an

official seal of such device as he hall, with the Seal.

approval of the Governor elect. Every certificate

and other document or paper executed by such Insur-

ance Commis ioner in pur uance of any authority

co~erred upon him by law and ealed with the seal

of his office, and all copies of papers certified by him

and authenticated by said sea], shall in all cases be

138

INSUBANCE LAWS.

Records deemed public. Annual reo ports.

evidenced equally and in like manner as oria-inal thereof and shall have the same force and effect a the original would have in any suit or proceeding in any court in this State. 'Ihe office of the III urance Commissioner shall be deemed a public office and the records, books and papers thereof, on file therein, shall be deemed public records of the State, except as may be provided otherwise herein. The Commissioner shall publish and report annually to the Legislature his official transactions, and shall include in such report abstracts of the annual statements of the several insurance companies and bonding and fidelity companies and an exhibit of the financial condition and business transactions of the said coIhpanies as ill closed by official examinations of the same or their annual statements. He hall include therein a statement of receipts and expenditure of the Department for the precedina- year, and such other information and recommendation relative to insurance and in urance laws of the State a - he shall deem proper.

Sec. 2. Be it further enacted by authority afore-

Collection of fees and

said, That the Commi sioner shall collect the charge ,

taxes.

fees and taxes as now provided by law and give

proper receipt therefor, and at the end of every

calendar month, or oftener, in the di cretion of the

Commissioner, shal.l pay into the State Treasury,

all amounts collected by him.

Sec. 3. The Insurance Commi ioner may at any Examination time have the right to examine into the affairs of any
-of Insurance
-companies. insurance company doing business as an a sessment,

INSURANCE LAWS.

139

fraternal, industrial and charitable or otherwise, in thi State, and into the affairs of any company organized under the laws of any other State, having an office in thi State, which company is engaged in or i claiming or adverti ing that it is engaged in organizing or receiving ub criptions for or dispo ing of
tock of, or in any manner aiding or taking part in the formation or bu ine of an insurance company or companie , or which i holdino- capital tock of one or more in urance company or companie for the purpose of controllino' the management 'thereof or a voting trustee or otherwi e. For uch purpose he may appoint a examiners one or more competent Examiners.
persons, not officers of, or connected with, or intere ted in any insurance company, other than a policybolder and upon uch examination, he, his deputy or any examiner authorized by him, may examine under oath, the officers and agents of such company, and all per on deemed to have material information regarding the company' property or. busine . Every such company, its officers and agents, shall produce at the office of the company, where the ame ~{O~o~1Z~on are kept it book and all paper in its pos ession and papers. relatinO' to its' busines , and any other persons may be required to produce any ook or paper in his cu tody relevant to the examination for the in peetion of the Oommis ioner, hi deputies or examinerE whenever required; and the officers and agents of
nch company hall facilitate uch examination and aid the examiners in makino- the ame so far a it
i in their power to do o. Every such examiner xRaemplonretrss.by hall make a full and true report of every examina-

140

I SURANCE LAWS.

tion made by him, verified by his oath, which shall

comprise only facts appearing upon the books,

papers, records or documents of such company, or

as'certained from the testimony sworn to of its officers

or agents. or other persons examined under oath

concerning its affairs, and said report 0 verified

shall be presumptive evidence in any action or pro-

ceeding again t the company, it officer or agents

as to the facts therein stated. The In urance Com-

missioner shall grant a hearing to the Company ex-

Reports made public,

amined before filing

any such report;

and may with-

when.

hold any such report from public inspection for such

time as he m'ay deem proper, not to exceed ixty

days, and may after so filing, if he deems it for the

intere t of the public to do 8'0, publish any uch

report or the result of any uch examination in one

ExamInation of domestic

or

more

newspapers

of

the

State.

It shall be the

companIes. when made.

duty

of

the

In urance

Commissioner

to

examine

every domestic insurance company at least once in

five years. The expense of all examinations of in-

Ul'ance companies now required by law, and the

expen e of all examinations of such companies as

contemplated by this Act, shall be paid by the com-

Exception. panies so examined; provided, this Section shall not

apply to assessment farmers' co-operative fire in ur-

ance companies doing business in this State in not

more than four counties in a division.

Sec. 4. Be it further enacted, it shall be the duty of the Insurance Commissioner to issue license to the in urance companies and agents when they shall have complied with the requirement of the laws of

I "SURANCE LAWS.

141

this State and the rules and regulations prescribed

by the Commissioner so as to entitle them to do business. In each case, license shall be issued under the Licenses.

seal of the Commissioner, authorizing and empower-

ing the person, firm, association or company to trans-

act the kind of business specified in the licen e. Be-

fore an insurance company shall be licensed to trans-

act business in this State, the Insurance Commis-

sioner shall be satisfied by such examination as he

may make or such evidence as he may require that

such company is duly qualified under the laws of

. this State to transact business herein. Sec. 5. Be it further enacted, That whenever it

shall appear to the Insurance Commissioner that a

license already granted to an insurance company,

should be revoked, the Insurance Commi sioner shall,

by

first

giving

such

insurance

company

ten

days

Licenses. how reo

notice, require such company to show cause before voked.

a board to be composed of t.he Insurance Commis-

sioner, the Attorney-General and the Governor of

the State why s'aid license should not be revoked.

Upon the hearing of the said ause, the said Board

may in its discretion revoke uch licen e of any such

insurance company or prescribe the conditions upon

which such insurance company may be allowed to

continue business in Georgia.

Sec. 6. Be it further enacted, That' all pers'Ons

shall be required to procure a license from the De-

Department

of

Insurance

before

soliciting

business

Sollcltol'll license.

in this State, except those agents whose names are

142

INSURANCE LAWS.

furni hed the Insurance Commissioner by some reputable insurance company as its accredited agents.

Requisites to obtain license. Revocation.

Sec. 7. Be it further enacted, That all agent soliciting in urance in the State of Georgia hall, before procuring the licen e from the Department of In urance, make application to the Commissioner and before the aid Commissioner han is ue such license, he shall satisfy him elf that uch agent i authorized by some reputable in urance company to do bu ine in this State and the Commissioner shall be advi ed and convinced a to the moral character and integrit of such applicant for licen e. The licen e of. any soliciting agent may be revoked at any time by the In urance ommi ioner in hi eli cretion.

Sec. 8. Be it further enacted, That it hall be

unlawful for any person, firm or corporation to make

False representation

or cau

e to

be

made

any fraudulent

or

fal

e repre-

unlawful. sentation as to the form, nature and character of

the policy offered for ale and any per on ellinO' a

different form or character of policy from that which

he repre ent him elf a sellin0', or make an other

material misrepre entation a to the benefit accru-

ing under any policy which he sell .01' offer for sale,

hall be deemed guilty of a mi demeanor and pun-

Punilshment. i hed a provided in Section 1065 of the Code of

1910, and any note or other evidence of debt given

in con ideration of said policy hall be nun and void

and any premium paid on uch policy may be recov-

ered by such policyholder in any Court having juri -

diction thereof.

INSURA CE LAws.

143

Sec. 9. Be it further enacted, That the Commis-

sioner shall a.nnually in the month of December fur-

nish to each of the insurance companies authorized

to do business in thiS' State and required to make

annual statements to the Department, two or more

blanks

in

form

approved

by

him

and

adopted

for

Blank forms furnished

such statements.

for reports.

Sec. 10. Be it further enacted, That any director,

officer, . agent or employee of any company who

wilfully and knowingly subscribes, makes or concurs

in

making

any

annual

or

other

statement

required

False state. ments, pun

by law containing any material statement which is Ishment for.

false shall be deemed guilty of a misdemeanor and

punished as provided in Section 1065 of the Code of

1910. It shall be the duty of the Insurance Commis-

sioner to report all such misrepresentations and false

statementS' to the Solicitor-General of the Circuit in

which they occur.

Sec. 11. Be it further enacted, That whoever with-

out justifiable cause neglects upon legal summons

served within this State to appear and testify before

the Commissioner or his examiner in the examination Neglect of

of any company as provided in this Act, and whoever

summons or obstruction

wilfully

and

without

ju

t

cause

obstructs

the

Com-

of Commls sloners, pun

Ishment for.

missioner, his deputy or examiner, in any such ex-

aminations, shall be punished by a fine of not more

than $1,000.00 or by imprisonment for not more than

one year. It shall be the duty of the Insurance Com-

missioner to report any and all such offenses' under

this Section to the Solicitor-General of the Circuit

in which it occurs.

144

INSURA CE LAWS.

ec. 12. Be it further enacted That the In urance

Commi ioner may invoke the aid of any Court of

competent juri diction through injunction or other

proceeding , mandatory or otherwise, to enforce any

Orders, how enforced.

order

made

or

action

taken

in

pursuance

of

the

law, and nothing contained in the insurance law of

thi State shall be con trued to prevent any company

or person affected by any order or action of the

In urance Commis ioner from te ting the 'validity

of same in any Court of competent juri diction.

Rules and regulations.

Sec. 13. Be it further enacted, That the In urance Commi sioner shall ha,e full power and authority to prescribe such additional reasonable rule and reO"ulation 'a he may deem proper for the control and O'overnment of all insurance companies mentioned in this ct. It hall be the duty of uch COIDpanie to comply fully with such rule and reO'ulation before they hall procure any bu ine in thi State, either directly or indirectly, or continue to do bu ine in thi ta teo

Industrial, stock, lite, health or accident companies. how Incor. porated.

Sec. 14.. Be it further enacted, That tock companie. or corporation for the purpo e of doinO' an industrial, life, health or accident insurance busine or for the purpo e of doing either of aid bu ine , may be created under tbe law' of thi tate, with a minimum capital tock of 25,000.00 provided) that the petitioners for uch charter ball comply with the laws of thi State applicable to the incorporation of insurance companie as stout in Section 2394 et sequitor) Chapter 2, Article 4, of the Code of 1910, except that the minimum capital tock may be

INSURANCE LAWS.

145

$25,000.00 and that said company so organized may

do any or all branches of aid bu ine without in-

creasing its capital stock, though it shall have all the

power, rights and privileges conferred upon ilife Rights and powers.
insurance companies under the aforementioned Sec-

tion of the Code, except that it hall not be author-

ized to write ordinary life insurance, nor hall it be

permitted to write any policy whatever exceeding the

amount of $500.00. Before beina- authorized to do

bu iness, the

aid company

hall

depo

it

with

the

Deposit required.

Treasurer of the State of Georgia an amount equal

to 60 per cent. of its capital stock, consi tina- of

United tate bonds tate, county or municipal

bonds.

Sec. 15. Be it further enacted, That any corpora-

tion organized in pursuance of the preceding eetion

may be authorized to

do an ordinary life in urance

Industrial, etc., com

bu

iness by complying with the requirement' of the

panies may do life in

law

applicable to life insurance companie

and

by

surance, when.

filing its certificate with the Secretary of the State

howing that it has made the deposit required for

life insurance companies, has procured a licen e from

the In urance Commis ioner, and ha complied with

the other requirements of life in urance companie .

ec. 16. Be it further enacted, That any mutual,

indu trial, life, health or accident in urance company

now existing under the laws of Georgia, or which Industrial,

may

hereafter be

organized

under

the

laws

of

this

etc., com panles may

State, may become a

stock company by filing

a

cer-

become stock com

panies, how.

tificate with the Secretary of tate, showing that

three-fourths of its out tanding policyholder' have

146

INSURANOE LAWS.

Power and authority. Statement showing agents.

voted in lawful meeting assembled to become a stock company, and that the capital of said company i fixed at not Ie s than $2-,000, and that the other requirements of the laws of thi tate in thi behalf have been complied with; provided, howeve1', that no publication or petition for charter hall be required in uch in tance, except a is hereinafter provided.
Policyholders 'in 'mutual companies may vote by
proxy at meetings held for the aforementioned purpose. Said stock company when organized as aforesaid shall have all the power and authority as though it had been originally organized as a stock corporation. The managing agent of each in urance company in thi State hall on October 1, 1912, and each three months thereafter file with the In urance Commis ioner a statement showing the agent of his company, the amount paid for the licen e of each agent, and the date of it payment, which statement shall be verified by such managing agent.

Compensation of officers.

Sec. 17. Be it further enacted, That the officer of the Insurance Department heretofore mentioned shall be paid the following salaries: The In urance
ommi sioner, $3,000 per annum; the Deputy Insurance Commissioner, who hall be a man of actuarial experience, $3,000 per annum; and the additional Clerk of the Department, $1,500 per annum. All of said sums to be paid out of the State Trea ury as is now provided by law for the payment of salarie of all State House officers, and the said officers of the Insurance Department herein enumerated shall not receive any other fees or compensation whatso-

I SURANCE LAWS.

147

ever. Provided, that in no event shall the salaries paid said officials' exceed the fees received under the provisions of this Act.
Sec. 18. Be it further enacted, That all fee , Fees. taxes, etc.
license taxes and other due and taxe now impo ed by the laws of this State and by thi Act on in urance companie , shall be collected a . now provided by law, and paid into the tate Trea ury a hereinbefore provided.

Sec. 19. Be it further enacted, That no officer,

agent or other person

elling, or negotiatinO'

tock

Comml$lon. on sale of

in any insurance company in this State

hall recei

e

stock llmIted to ten

either directly or indirectly more than ten pel' cent. per cent.

of the ale of any of aid tock. 0 pre ident vice-

president, ecretary, treasurer, or director or any

other executive officer of any in urance company hall Officers pro-

hibited from

participate in the commi

ion

received by any per-

participating in commis_

son selling, negotiating the sale of any tock of any sion.

insurance companies either directly or indirectly,

nor shall any salaried officer of any in urance com-

pany doing busine in this State participate in the

commi ion ari ing from the ale of life in urance

policies or aO'ency contracts of uch companies.

Sec. 20. Be it further enacted, That no insurance

company or in urance agent doing busine in thi

State shall enter into any contract to rebate any

insurance

premium

or

any

part

thereof

of

any

in-

Rebates hibited.

pro-

sured or other per on. 0 person hall sell or offer

for sale in Georo-ia and no in urance company hall

do bu ines in thi tate which ell or offer for Discrimin-

ating con-

ale

to

the

public

any "

pecial contract,"

"bom'd

tracts prohibited.

148

INsURA CE LAWS.

contract" or any other form of policy or contract

whereby any discrimination in any form or character

is allowed to any particular person or per ons; pro-

vided ,howeveT, that until the first day of January,

1915, the provisions of thi Section shall not apply

to any life insurance company now in the proces of

formation under commission from the Secretary of

tate which will do a non-participating busines only.

ABy insurance company violatinG' the provisions of

License reo voked, when.

this

Section shall be

subject

to

have its license

re-

voked as hereinbefore provided. ny person acting

as agent for any in urance company and the party

receiving the benefit of any such rebate or discrimi-

Penalty for violation.

nation in violation of this Section shall be deemed

guilty of the offense of misdemeanor and shall be

puni hed a provided in Section 1065 of the Penal

Code of 1910.

.

Medical ex amlnatlon. What may void contract.

Sec. 21. Be it further enacted, That all insurance companies except companies writing policies of inurance on the industrial plan writing life insurance in thi State, includinG' fraternal orders and all other a sociation , shall be required to have made a strict medical examination of each and every person applying for life insurance. Such per ons hall submit to uch reasonable rules and regulations' as may be prescribed by such insurance companies for the purpose of making such examinations, and after a policy is i ued on the life of such person, the beneficiary of such policy shall be entitled to collect the amolmt of uch policy under the terms of the contract when it matures unless the applicant or beneficiary has

INSURANCE LAW .

149

been guilty of actual fraud or ha made material mi repre entation in procuring uch policy, which misrepre entatrons change the character and nature of the ri k as contemplated in the poli y so i sued by the company. All statements, covenants and representations contained in application for insurance shall never be held or construed to be warranties, but shall be held to be representation only.

Sec. 22. Be it further enacted, That any per on

Observation

or persons'incorporated for

the purpo

e of soliciting

of rules pre requisite to

or writing life in urance in Georgia or for the pur- Ilcense.

po e of offering their stock in said company for sale

to the public before procuring a license for uch

incorporation, shall comply with such rea onable

rule and regulations a the In urance Commis ioner

may in his di cretion pre cribe.

Sec. 23. Be it further na ted, r.Ihat each and

every fire insurance company doing busine in this

State shall adopt and writ

a

tandard or uniform

Standard form of pol

policy, such a

may

be

pre

cribed by

the

Commis-

icy for fire insurance.

sioner, and it shall be unlawful to i ue any other

class of policy in this State; provided, however, that

local as essment fire insurance companies doing busi-

ness in not more than four Counties in a division in Exceptions.

the State of Georo-ia, may i sue and write uch form

of policy as may be prescribed by the Commi sioner.

Sec. 24. Be it further enacted, That the Commis-

sioner shall have the power, as hereinbefore pro-

vided, to appoint a competent person to be known a

"Fire

Inspector,"

and

when

any

property

is

de-

Fire In. spector.

stroyed or damaged by fire and the Commissioner

Duties. Powers.

150

I URA CE LAws.

deems it proper to have the cause of such :fire inve tigated, he shall cau e said inspector to make a thorough investigation of all the facts connected with such :fire and report to him in writing under oath. Such inspector, when in his opinion such proceeding are neces ary, 'hall take the te timony of all per ons uppo ed to be cognizant or have information 01' knowledge in relation to the matter as to which theexamination is herein required to be made, and he shall cause the arne to be reduced to writing, and if he shall be of the opinion that there i evidence sufficient to charge any per on with the crime of arson, he shall caus'e such person to be arre ted on a warrant and cause the arne to be fully inve tigated before an officer as is now provided for committal trials, or he hall furni h the Solicitor-General of the Circuit in which the :fire occurred all uch facts together with the name of witne e' and all the information obtained by him in such investiO'ation. Such Fire Inspector appointed to conduct uch ex-' amination shall have the same power a J u tice of the Peace for the purpose of summoning before him in the county where the :fire occurred and compellinO' the attendance of witnesses to testify in relation to an matter which by the provi ions of this Act i the ubjeet of investigation. Said :fire inspector hall have the right to admini tel' oath to witne e apponringo before him and. shall have the power to compel witne e to answer que tion pertaininO' to any investigation as now provided by law for committal Court ,and aid in peetor shall have all the power now conferred by law on courts of inquiry in

INSURANCE LAWS.

151

tbis State in the investigation of any matter cominO' before him under tbis Act.

Sec. 25. Be it further enacted, ~bat said Fire Inspector.

Inspector for

the purpose of making the inve

tiga-

authority to go upon

tion required by tbis ct, shall have authority to go premises.

upon the premi es where the fire occurred and make

investigation as to the cause and origin of fire.

Sec. 26. Be it further enacted, That the Insurance

Commissioner shall have power to pre cribe the com-

Inspectors.

pen

ation of the Fire Inspector for all examinations

compensa tion, how

required by tbis

et, and

aid compen ation

hall be

prescribed and paid.

paid and all other expen e. incurred in uch exami-

nation shall be defrayed by the fire in urance com-

panies doing business in this State, and a tax of not

more tban one-tenth of one per cent. in the di cretion

of the Insurance Commi ioner on the gross premium

receipt of all uch companies is hereby levied for Tax to de

fray fees

this

purpose,

to be collected by the Insurance

Com-

and ex penses, how

mis ioner as other taxe on premiums are now col- collected.

lected. The Insurance Commis ioner hall keep a

separate account of all money received and di

bursed under the provision of this Section and ball

include them in bis report to tbe Legi lature, 2Jl'f)-

vided, that should the amount tbu collected in any

one year be in exce of the amount required to meet

the expen eS' herein contemplated, uch exce s sball

b held subject to the order of the Commissioner to

be used for the arne purpo e in the succeedinO' year,

provided Sections 25 and 26 shall not apply to as~e!,;il

ment farmers co-operative fire companie doing UtI 'i-

152

I SUBANCE LAWS.

ness in this State in not more than four counties iu a division.

Bonding companies, deposit required.

Sec. 27. Be it further enacted, That before an. surety or bonding company shall write any bonds in this State, it shall be required to deposit the um of $25,000 with the State Trea urer, conditioned as is' now provided by law for the deposits required of such companies in writing bonds of public officials of this State. Provided, That whenever any such company shall have already deposited $25,000 a now required by law for writing bonds of publio officials it shall not be required to depo it an additional sum.

Sec. 28. Be it further enacted, That the sum of

Appropria- $7,500, or 0 much thereof as may be necessary,

tion for payment of sal.

be

appropriated

annually,

and

the

same

is

hereby

aries.

appropriated for the payment of all salaries herein

provided for and :fixed for the first year' service

under this Act.

Sec. 29. Be it further enacted, That whenever any domestic life insurance company (a) i insolvent; or (b) has unlawfully refused to ubmit itS' book , papers, accounts, or affair to the reasonable in pection of the Commissioner or his deputy or examiner; (c) or, in the case of a capital tock company, has neglected or refused to ob 'erve an order of the ommissioner to make good within the time prescribed by law, any deficiency of its capital, or, in the ca e of a mutual company, if it assets have not become equal to its liabilities within ninety (90) days from the date of notification thereof by the Commi'sioner;

INSURANCE LAws.

153

or, (d) haS', by contract of reinsurance or otherwise,

transferred or attempted to transfer substantially its

entire property or business, or entered into any

transaction the effect of which is to merge substanti- Commis-

sioner shall

ally it

entire property or businesS' in the

property

take possession of

or

business

of any other

company,

a

sociation,

soci-

property and conduct bus-

ety or order without having first obtained the written

Iness of companies,

approval of the Commissioner; or (e) is found, after when.

an examination, to be in uch condition that its fur-

ther tran action of bu iness will be hazardous to its

policyholders, or to its creditor, or to the public;

or (f) ha wilfully violated its charter or any law of

the tate; or (g) whenever any officer thereof ha

unlawfully refused to be examined under oath touch-

inO' its affairs, the Commi sioner may, the Attorney-

General representing him ,apply to the Circuit Court

or any judge thereof in the judicial district in which

the prinClpal office of such company is located, for

an order directing such company to show cause why

the Commi ioner hould not take pos ession of its

property apd conduct it busine s, and for uch other

relief a the nature of the ca e, the interest of its

policyholders, creditor ,stockholder or the public

may require.

On uch application, or at any time thereafter uch Court may in its di cretion, is ue an injunction restraining such company from the tran action of InjunctiolUl
granted,
its affairS' or di position of its property until the when. further order of the court. On the return of such order to show cause, the court shall hear, try and determine the issues forthwith and shall either deny the application or direct the Commissioner to take

154

I SUBA CE LAWS.

pOS es ion of the property, conduct the bu ine of such company and retain such pos es ion and conduct such bu ine until on" the application of eith~r the Commis ioner, the Attorney-General repre enting him, or uch company, it hall, after a like hearing, appear to the court that the lITound for such order directing the Commis ioner to take po sessi on ha been removed, and that the company can properly resume po session of it property and the conduct of its business.
If on like application an order to show cause and after like hearing the Court shall order the liquidaLiquidation. tion of the business of such company, such liquidation shall be made by and under the direction of the Commissioner, who may deal with the property and bu iness of such company in hi own name as Commissioner or in the name of the company a the court may direct, and the Commi ioner shaH be ve ted by operation of law with title to all the property, contracts and rights of action of such company, a of the date of the order so directing him to liquidate. The :filing or recordinO' of such order in the office of the Clerk of the Superior Court of the county wherein said liquidation is made, shall impart the arne notice that a deed, bill of s'ale or other evidence of title duly filed or recorded by such company would have imparted.
For the purpose of this Section the Commissioner shall have power to appoint under his hand and official seal one or more special Deputy Commi sioners of Insurance as his agent or agent' and to employ such counsel, clerks and assistants, as may by him

INSURANCE LAWS.

155

be deemed necessary and give each of such partie such powers to a sist him as he may consider wise. The compensation of such Deputy, Special Commissioners, counsel, clerks and assistants and all expense of taking po se ion of and conducting the bu ine of liquidating any such company hall be fixed by the Commi sioner subject to the approval of the court, and shall on certificate of the Commis ioner be paid out of the fund or assets of uch company.
For the purpose of this Section the Commi sioner shall have power subject to the approval of the court to make and pre cribe uch rules and regulation' a to him m~y s em proper.
The Commissioner shall tran mit to the Legi lature in his annual report the names of the companie Annual reo
so' taken posse sion of, whether the ame have re- ~oides~~Je
surned business or have been liquidated, or such other f~~~anles charge of or
facts as hall acquaint the policyholders, creditor , liquidated. stockholders and the public with hi 'proceeding under this Section, and to that end the Special Deputy Commissioner in charge of any such company shall file annually with the Commi ioner a report of the affair of such company, imiJar to that required by law to be filed by such company.
Sec. 30. Be it further enacted, That immediately upon the granting of the charter to any insurance company, and before it offer for sale any of it capital tock, such company 0 receiving a charter in oSfupceormvi.sion tlli State or being charter d in any other State and 3~:ls~Y ,offering it stock for sale m. thI.S S tate, bf e ore'It ha sglroannetrinogn of
charter.
been organized and procured a license to do bu ine

156

I SURA CE LAWS.

in tbis State, shall come under the superVISIon of Insurance Commi ioner, and shall collect, hold and disburse its fund under such rules and regulation, as In urance ommis ioner may pre cribe. The Inurance Commi ioner shall give directions a to all use of fund 0 collected until ame are inve ted a the law directS' and the company fully orO'anized and licensed to do business in the State, thereby becoming subject to the rules and regulations hereinbefore provided.
Sec. 31. Every insurance company organized under and doing business ~y virtue of the laws of this State shall have authority to invest its' money or assets in and make loans on bonds of the United States, or of any State, county or city therein, first Investments. lien on improved real estate in any of the States of the United States, not exceeding :fifty per centum of the value of such property; promi sory note amply secured by pledge of securities in which uch companies are authorized to invest their fund ; loan on their own policies not exceeding the re erve thereon, and invest in buildings for home office purpo es. Provided, however, that nothing herein contained shall authorize any such company to inve t in any
other than this State more than the legal re erve value of policies, held in such other State, respectively. Prov.ided, further, that all such investments shall first be approved by the In urance Commissioner of Georgia, except in case of loans on policies of the company not exceedinO' the reserve of the pol;cy at the time of the loan and in any other

INSURANCE LAWS.

157

securitie approved of by the Insurance Commissioner.

Sec. 32. Be it further enacted, That any per on or

person acting as agentS' for any uch companie as Punishment

for violating

contemplated in the previou

ection, who

hall

provisions of precedIng

knowinO'ly and wilfully violate the provi ion of the section.

foregoinO' Section, hall be deemed guilty of a mi. de-

meanor, and punished as provided in ection 1065

of the Code of 1910.

Sec. 33. Be it further enacted, That the Board of Board of DIrectors.
Directors of all life insurance companie chartered by the law of thi State hall consi t of not Ie . than five nor more than twenty members, a majority of whom mu t be bona fide re ident of thi tate, and the majority of which Board hall con titute a quorum for the purpo e of tran acting busine .

Sec. 34. oN-RESIDE T FRATER AL ORDER. Be it

further enacted, That fraternal beneficiary ocieties

or organizations chartered under the laws of other

State or foreign governments, except ocietie which

limit their membership to anyone hazardou

occupa-

Non-resident fraternal

orders.

tion, shall not be allowed to do busine in this tate

with a member hip of less than 1,000 member, and

they hall be required to ubmit evidence to the

Insurance Commissioner that they have in ca h or

approved ecurities at lea t one asses ment on aid

membership. Said societies or as ociations shall file

with Insurance Commissioner of this State a certified

copy 0 the rates charged on cIa ses of policies being

issued by them. Said ocietie' or a ociations 'shall

tipulate definitely in the face of the policy the

158

INSURANCE LAws.

amount to be paid to the beneficiaries under said policies, and said amount shall not be contingent upon the amount collected from the membership of any division or branch of said society or association. No policies' shall be issued by such societies or a sociations without subjecting applicants for insurance to medical examination.

The Insurance Commissioner is hereby authorized

to investigate fully the financial condition of uch

societies or associations, and if in hi . judgment, the

management of their affairs is not such as to justify

LIcense.

the issuance of a license to said society or as' ociation, he is hereby fully empowered to decline to

license such societies or associations, and in case

they have already been licensed to revoke their au-

thority to do business in this State as hereinbefore

provided for the revocation of license of insurance

companies. In the event such societies or associa-

tions fully comply with all the requirements of the

laws of this State, they may be licensed to do business

License fee. in Georgia upon the payment of a license fee of

$40.00.

Domestic fraternal orders.

Sec. 35. DOMESTIC l!'RATERNAL ORDERS. Be it further enacted, That domestic fraternal beneficiary societies or associations shall be chartered by the Secretary of State, and shall conform to all the requirements of the Act of 1893 with reference to the incorporation of insurance companies except that they shall not be required to have any capital stock.
When such companies or associations have been duly chartered by the Secretary of State and have

INSURANCE LAws.

159

received a certificate from aid officer of their incor-

poration, upon application to the Insurance Commi .

sioner, they may be authorized by aid officer to

solicit applications for membership in aid ocieties

or associations, under such rules and regulations a

may be prescribed by the In urance ommissioner. Licenses.

When such ocietie or a sociation have obtained

. not 1 than 300 bona fide application for in urance,

the advance asse sment on which have been paid,

and a list of the subscriber with their po toffice ad-

dre s and the amount of their advance a es ment

has heen ubmitted to the In urance OIDmlS lOner,

and by him verified toO'ether with affidavit that said

as e ment are depo ited with orne bank or tru t

company duly certified by aid bank or tru t com-

pany, the In urance COmIDis ioner, if ati fied that

the character of the officers of such ocietie or a 0-

ciation guarantee honest and efficient management

of the a ociation' affair, hall is ue licen e to uch

ocietie or a ociation to do bu ines in this State

upon the payment of a license fee of $40.00. J 0 License fee.

policies shall be issued by such societies or associa

tions without subjecting applicants to medical ex-

amination. The In urance Commi ioner is hereby

authorized to inve tigate fully the financial condi-

tions of such

'ocieties or associations at any time,

Licenses may be reo

and if in his judgment the management of the affairs

fused or reo Yoked, when.

of such society or association is not uch as to justify

the i suance of the license, he is' hereby fully em-

powered to refuse licen e to nch societie or as ocia-

tion , and in ca e they have already been licensed

such license may be revoked, as' hereinbefore pro-

160

INSURANCE LAWS.

vided for the revocation of license of insurance com-

panies.

All foreign or domestic fraternal companies, cor-

porations, orders, as ociations and beneficiary socie-

ties soliciting bu iness in this State must have a rep-

re entative form of government. Any uch company,

corporation, order, a ociation or beneficiary ociety

Form of

hall be deemed to have a representative form of

government, government when it shall provide in its constitution

and laws for a supreme legislative or governing body

compoS'ed of representatives elected either by the

members or by delegates elected either directly or

indirectly by the members together, with such other

members as may be prescribed by it con titution

and laws; provided, that the elective members shall

con titute a majority in number, and have not less

than two-thirds of the vote, nor Ie s than the votes

required to amend its constitution and laws. 0

member of any domestic in urance fraternity, who

is a director or manager of such insurance frater-

nity, hall have a contract for fees on premiums from

such fraternity.

Sec. 36. Be it further enacted, That all industrial

life insurance companies chartered under the law

of this State to do busine s on the mutual co-opera-

Industrial tive or assessment plan, and limiting their policies

1lte companies con-

to the sum not exceeding $500, shall stipulate

ducted on mutual or

definitely in the face of the policies the amount to be

assessment

plan; regulation and reo

paid

to

the

beneficiaries' under

said

policies

in

the

qulrements. event of the death of the assured. In no event shall

payments to bene'ficiaries by such companies be con-

tingent upon the number of policyholders in the com-

INSURANCE LAws.

161

pany nor on the number in any division or branch of such company. The intention of this law being to require the payment of the full face of the policy as stipulated therein without regard to the sub-divisions of the membership by such insurance companies in the management of their affairs. No policies shall be issued by such companies without subjecting applicants for such insurance to medical examination. It shall be the duty of the Insurance Commissioner to investigate the rateS' of premiums which are to be charged by all such companies and he is hereby authorized to require said companies to charge uch rates as are adequate to pay their policie at maturity. Provided, that companies doing business on the industrial plan shall not be required to have medical examinerS'.

Sec. 37. Be it further enacted, That life insurance

LIte Insur-

companies

chartered

by

the

laws

of

this

State

to

ance on mutual plan,

operate

on

the

mutual

co-operative

or

asses

ment

regulations and require-

plan without limitation as to the amount for which ments.

policies of said company are to be issued, sha llstipu-

late definitely in the face of the policies the amount

to be paid to beneficiarie on the said policies in

the event of the death of the assured. In no event,

shall payments to beneficiaries by such companies

be contingent upon the number of policyholders in

the company or on the number in any division or

branch of such company. The intention of this law

being to require the payment of the full face of the

policy as stipulated therein without regard to sub-

division of the membership of such insurance com-

162

INSURANCE LA.ws.

panies in the management of their affair. No policy shall be issued by such companies without subjecting applicants for such insurance to medical examination. It hall be the duty of the In urance Commi sioner to investigate the rates of premium which are to be charged by all such companies, and he i hereby authorized to require said companies to charge such rates as are deemed by him adequate to pay their policies at maturity.

Sec. 38. Be it further enacted, That from and

after the passage of this Act no income or guarantee

Income or guaranty

fund certificate , as provided for in the Act approved

certificates; Act repeal

August 16, 1909, shall be i sued in this

tate; pro-

ed, with eX' ceptlons.

vided, that the provisions of this Section shall not

apply to insurance companies now chartered and

organized in this State and issuing and sellinO' uch

certificates until the first day of January, 1913, and

said Act being entitled "An Act to :fix the amount

of S'olvent assets, which mutual aid, benefit and indus-

trial life insurance companies shall have and main-

tain; to provide a method by which said companie ,

organized ment plan,

umnadyerptrhoecucroe-osupcehrataisvseetosr;

mutual asses and to provide

for the manner of investing the assets' of such com-

panies; to provide for an examination of such com-

panies by the Insurance Commissioner, and for other

purposes," which Act provides for the issuing of

such certificates, be and the s'ame is hereby repealed.

Fire Insur Sec. 39. Be it further enacted, That all in urance

ance com. panles, mu

companies chartered under the laws of this State to

tual, deposit

required. do a fire insurance busines upon the mutual, co-

INSURANOE LAWS.

163

operative or assessment plan, shall before receiving a license from the Insurance Commissioner, deposit with the State Treasurer of Georgia registered bonds of the United States or of the State of Georgia or county or municipal bonds of this State, registered and validated in the um of $10,000. Said deposit to be made under the same conditions that deposits of non-resident fire insurance companies' are made with the State Treasurer; provided, that tbis shall Exceptions. not apply to such companies as operate in not more than four counties in a division in tbis State, or to farmers' co-operative companies doing fire insurance businesS' in this State on the assessment plan where their policies stipulate that all the property, real and personal, of the policyholder is pledged for the payment of the policy.

Such companies hall always have in good asset

an

amount equal to

the unearned premium liability

Amount ot assets reo Quired.

of the company required of all classes

of fire

insur-

Emergency clause.

ance companies by the law of this State. All poli-

cies issued by such companies shall embrace what i

termed an emergency clause, whereby the company

re erves the right to call for extra a sessments from

its policyholders whenever the contingency arise .

Samples of all policy contracts to be used by such

companies shall, before is uance, be submitted to the

Insurance Commissioner for.his approval.

Sec. 40. Be it further enacted, That all laws and parts of laws in conflict with thi Act be, and the same are, herehy repealed.

Approved August 19, 1912.

164

INSURANCE LAws.

AN ACT
Requiring all promissory notes or other contract taken for the purchase of any gold mining stock, silver mining stock, oil well stock, insurance stock, or any other stock in any incorporated company, domestic or foreign, when sold by any peddler, agent or traveling salesman or promoter, traveling for the purpose of making sales of such articles or stocks to have expres'sed in the face of such notes or contracts the consideration or kind of stock for which the same was given and to render such notes or other contracts void without 0 doing, and providing that all purchasers of such notes or contracts where the con ideration is so expressed and whether before due or not, shall take the same with due notice and subject to all the equities and defences existing between the original parties, and to provide a penalty for failure to comply with this ret.
Section 1. Be it enacted by the General embly of Georgia and it i hereby enacted by the authority of the same, That from and after the pa age of thi Act all promi sory note ,contract or other evidences of debt, taken by any per on, company, or corporation, agent or promoter for the purchase price of any gold minipg stock, silver mining stock, or any other stock in any incorporated company, domestic or foreign, and sold by any peddler, agent or traveling salesman or promoter traveling for the purpose of making sales, hall have expres ed on the face of such notes, contracts or other evidence of

INSURANCE LAWS.

165

debt, the consideration of the same, stating for what the same was given; provided, this Act shall not apply to sales after the original purchase price ha been paid, and certificates of stock have been issued.

Sec. 2. Be it further enacted, That any person,

:firm or corporation who may purchase any note,

contract or other evidence of debt, given for any of

the stock set forth in Section one of thi ct, when

the consideration is expres

ed in the face of the note

Purchasers take subject

to equities.

or contract as required in Section one, whether be-

fore due and without notice or otherwise, where the

consideration is so expres ed, shall take the same

with all the equities exi ting between the original

parties and the maker of uch notes, contracts or

other evidences of debt and the maker shall have

the right to make any d fence to the payment of

same, as against such purcha ers that could have

been made against the original payee.

Sec. 3'. Be it further enacted by the authority afore 'aid, That any per on or corporation vioJatinO' the provi ions of this ct by selling any of the
Penalty for
stocks mentioned in thi Act without expressing in violation. the face of the notes or contract or other evidences of debt the consideration for which the same wa givfln. hall be guilty of a mi demeanor and on conviction shall be punished as provided by Section 1065 of the Penal Code of 1910.

Sec. 4. Be it further enacted, That all l~ws and parts of laws in conflict with this Act be, and the same are, hereby repealed.

Approved by the Governor, Augu t 17, 1912.

166

I SURANCE LAWS.

FIRE I SURA CE OMPANIES, FOREIG WITHDR WAL FROM ST TE.

o. 42.

An Act providing upon what condition , and how' and in what manner a foreign fire in urance company or association doing busine s in this .. tate, which reinsures all its policies and contracts in force in this State, may retire and withdraw from the State, including any and all ecurities on deposit with State officials, and for other purpo e .
SECTION 1. Be it enacted by the General ssembly of the State of Georgia, and it is hereby enacted by the authority of the same, That from and after the passage of this ct, that any foreign fire insurance company or association doing busine in thi State and de iring to retire from thi State before the maturity or expiration of its polieie or contracts, may, upon filing with the In Ul'ance ommissioner a written notice of such intention to withdraw, together with a SWOIn taJtement of it ouL tanding liabilities or obligations under all ueh policie or contracts, so retire or withdraw, including any and all securities on depo it with the State official de ignated by law for the protection of the beneficiarie of such policies or contract , provided such ompan or companies as a condition precedent to such withdrawal, reinsure all such policies or contract , in orne other company or companies authorized to do business in this State, and shall file with said Insurance Commissioner a list howing the name or names of such company or companies in which such outstanding policies, contracts or obligations have been so reinsured; and provided further, that the securities on deposit as aforesaid, shall not be 0 withdrawn from the cu tody, control and po e sion

INSURANCE LAws.

167

of said State official until after such proof as may be required by said Commissioner has first been furnished him that there are, at the time of such withdrawal, no unsettled claim, or claims or losses outstanding against said company or companies so desiring to withdraw; and provided further, that said rreinsurance 'shall be approved by the Insurance Commissioner.
'SEC. 2. Be it further enacted by the authority aforesaid, That all laws and parts of laws in conflict herewith be, and the same are hereby repealed.
Approved August 6, 1913.

INSURANCE COMPANIES, REGULATION A D ,CONTROL 'OF.
No. 239.
An Act to better regulate and control the organization and operation of corporations (foreign and domestic) doing an industrial, health, life or acci- . dent insurance business in t.he State of Georgia, and to provide penalties, and for other purposes.
SECTION 1. Be it enacted by the General Assembly of the State of Georgia, and it is hereby enacted, That no insurance company or association doing business in this State, and no officer, director or agent thereof shall knowinO'ly issue, circulate, or cause to be issued or circulated any estimate, illustration, circular or statement of any sort misrepresenting the terms of any policy issued by it, or the benefits or advantages promised thereby, or dividends or shares of surplus to be received thereon, or shall use any name or title or any policy or class

168

INSURANCE LAWS.

of policies which misrepresent the true nature thereof. Provided nothing contained in this section nor in this Act shall apply to any company or corporation except to corn'.panies or corporations doing an industrial, life, health or accident insurance business; nor shall it apply to any policy, membership or. beneficial certificate except it be an indu trial, health, life or accident insurance policy membership or certificate.
SEC. 2. Be it further enacted, by the authority aforesaid, That from and after the pas ao'e of this Act no agent, director or officer shall knowingly and wilfully receive any premium or assessment on behalf of any in Ul'ance company or a ociation or fraternal organization, knowing at the time of receipt of said premium or assessment that aid compan) or association i insolvent according to. the laws of the State of the organization of said company without giving notice thereof to the per on paying the' aid premium or as essment. That no officer, director, agent, phy ician or other person shall knowingly is ue or cause to be i sued a. poli y or .benefilt certificate, nor aid in the issuing of any policy or benefit certificate, nor aid in the rein tatin o' in memiber hip or policy tanding of any infirm or unhealthv per. on not at the time of uch reinstatement or insurance in an insurable condition, with the intent to defraud, shall be guilty of a misdemeanor.
SEO. 3. Be it further enacted by the authority aforesaid, That no person hall knowingly or wilfully make or aid in making of any false or fraudulent statement representation of any material fact or thing in any written statement or certificate for the purpose of procuring or attempting to procure the payment of any false or fraudulent claim again t any uch insurance company or fraternal or benefit

INSURANCE LAws.

169

association, and no per on shall make any false or fraudulent statement or aid in the making of any false or fraudulent statement in any application for in urance, or as .to the death or di ability of the policy or ertifi ate holder for the purpo e of fraudulently obtaining any money or benefit from any such in Ul'ance company or fraternal or benefit a ociation licen ed to do bu ine s in thi tate.
EC. 4. Be it further enacted, That no per on hall act a agent or solicitor for any in urance com'Pany, benefit as ociation or fraternal organization In thi State without having first procured a licen e therefor from the Insuranc Department of thi tate as l' quired by the law.
EC. 5. Be it f~rth l' nact d b the authorit~ afore aid That any per on who violate thi ct shall be o'uilty of a misdemeanor and upon convi tion hall b puni hed a provided by eetion 1065 of the
ode of Georoia of 1910.
SEC. 6. Be it further enacted by the authority aforesaid, That the Insurance ommi ioner or Deputy Insurance ommi. ioner of thi tate ball have full power to i ue subpoena and proce reqmrmo' the pre ence of witn es and th production of book and paper before him at th place where any inve tigation i being had by him or either of them' and in the event any person who i. erved with uch ubpoena fail to comply therewith, he hall be puni hed as for a contempt by the uperior court of the county in which the hearing is being had, and the superior courts of thi State ar fully empowered hereunto, including the power to is ue attachment or other proce se or notice, to the end that the 1 er-
on so ubpoenaed may have hi proper notice and hi day in court.

170

INSURANCE LAWS.

EO. 7. Be it further enacted, That any laws or parts of law in conflict with this Act be and the arne are hereby repealed.
Approved Augll t 19, 1913.

INSURANCE LAws.

171

I SURANCE CaMPA IES, PREREQUISITE TO RECEIVERSHIP FOR.

No. 439.

An Act to amend an Act approved Au<>'ust 19th, 1912, establishing the Insurance Department 'of this State, and for other purposes, published in the Georgia Laws of 1912, pages 119-143, inclusive, and for other purposes.
SECTION 1. Be it enacted by the General Assembly of Georgia, Tha,.t an Act approved Auo'u t 19th, 1912, and published in Georgia Laws, 1912, pages 119 to 143, inclusive, providing for the establishment of the Department of Insurance. in this State, and for other purposes, under the following title:
"Insurance, Department of, Establi hed, No. 62 ; An Act to provide for the establi hment of a Department of Insurance; to provide officers therefor, tipulate their salaries; to regulate and control the organization of insurance companies; to prescribe the duties and powers of the Insurance commissioner; to prohibit di' crimination by insurance companies; to pre cribe penalties for the violation of the in urance laws of the State, to provide for the general supervision by the Insurance Commissioner of all insurance companie and for the sale of stock in such companies and the general management and conduct of such companies; to require bond and fidelity companies to make deposits, to regulate all foreign and domestic fraternal companie , corporations, orders, association, and beneficiary societies oliciting business in this State; to prohibit the issuing of income or guarantee fund certificates and for other purposes," be amended by adding thereto an additional section to be known as Section 29A and to follow Se tion 29, of aid Act, a now existing, said additional section to read as follows:
"Section 29A. Before any in urance company chartered under the laws of this State or doing business in this State shall hereafter be put in the hands of receiver by

172

INSURANCE LAWS.

any court of equity in till tate, upon any claim or de-

mand not in judgment, it must iiI' t appear that the cau e

of complaint and the matter and gTound upon which the

receiver hip is ouo'ht have been ubmitted, by the com-

plainant to the In urance ommi ioner of till State, and

that uch complaint of the complainant and the matters

charged again t uch insurance company have been pa ed

upon by the In urance ommi sioner ittino- in connection

with the Governor and the ttorney General in the manner

hereinafter provided, to-wit: The In Ul'ance Commi sioner,

the Governor and tbe ttorney General sittinO' as a board

a provided in Section 5, of aid Act of ugust 19th, 1912,

hall, upon such matt r and complaint a referre 1 to pre-

viously in this ection, being iiI d witb the Insurance om-

mi ioner, proceed to h ar tb same after o'ivino' both the

complainant and the in urance company in question op-

portunity to be heard, ample and I 0'81 time, how vel', beinO'

!riven for tbe production of uch evidence a ither party

may deem nece ary. DurinO' the pend ncy of such pro-

ceedinO' , the In urance ommi ioner ball or I I' th com-

pany and it offi er to maintain the a",. et in. tatll quo.

T pon hearinO' arne, aid commi ion, or a majority of

them, hall render a led ion and jud!nDent I' commendinO'

or d clininO' to recommend that the ommi .'joner make

application, in a cordanc with the foreO'oinO' ection 29

for an order directino' the company to how cau e who the

commi ioner hould not take po e ion of it property

and on luct it bu in

No receiv r for an insurance

company doinO' busine in thi I tate hall be appointed on

th p tition of any per on other than th In urance om-

mi ion 1', unle it be mad to a1 pear to the court where

nppli ation for uch appointment i made, that the Insur-

anc omnni sioner has failed or refu ed to comply and pro-

e d with the finclino' of said boad.

EC. 2. Be it further enacted, That all law and partsof laws in conflict with thi Act are hereby repealed.

Approved Auou t 14, 1914.

I SURA CE LAWS.

173

FRATER AL BE EFIT SOCIEITIES REGULATED.
0.524.
An Act for the regulation and control of all fraternal 'benefit ocietie ; to pre cribe their admi ion into thi tate' the amount of licen e f e for each society; how they may be excluded from the State, and for oth l' purpo e .
Be it enacted by the General embly of the State of Georgia, and it i hereby enacted by the authority of the arne,
ECTION 1. Any corporatiun, ociety, order or voluntary a ociation, without capital tock, oro-anized and carried on olely for the mutual benefit of it member and their beneficiarie and not for profit, and having a lodge y tern with rituali ti form of work and repre entative form of governm nt and which hall make provi ion for the payment of benefit , in accordance with Section Five h reof is hereby declared to b a fraternal benefit ociety.
E . 2. Lod 'e Sy tern Defined. Any ociety havin o' a upreme o-overnino' leo-i lative bocly and ubordinate lodo-e or branche by whatev l' nam knoWn, into whi h member hall 'be elected initiat d and admitted in accordance with it con titution, law , rule, regulation, and pre cribed rituali tic cer monie ,'which ubordinate lodg or branches shall be required b the law of uch ociety to hold regular or stated me ting at lea t once in each month, hall be deemed to be operated on the lodge ystem.
SEC. 3. Repre entative Form of Government Defined: Any uch ociety shall be deemed to have a repre entatl-ve form of o-overnment when it hall provide in it con titution and law for a upreme leO'i lative or O'overnino- body com-

174

INSURANCE LAWS.

posed of repre entatives elected either by the members or by delegates elected directly or indirectly by the members, together with such other members as may be pre cribed by its constitution and laws; provided, that the elective members shall con titute a majority in number and have not Ie s than two-third of the vote, nor less than the votes required to amend it constitution and laws: and pr01 ided !1,wther, that the meetings of the supreme or governing body, and the election of officers, representatives or delegates shall be held as often as once in four years. The member , officers, representatives or delegates of a fraternal benefit society shall not vote by proxy.
SEC 4. Exemptions. Except as herein provided, such societies shall be governed by this Act, and hall be exempt from all provisions of the in urance laws of thi State, not only in governmental relation with the State, but for every other purpose, and no~ law hereafter enacted shall apply to> them, unless they be expre sly designated therein.
SEC. 5. Benefits. Sub- ection 1. Every society transacting business under this Act hall provide for the payment of death benefits, and may provide for the payment of benefits in case of temporary or permanent phy ical di ability, eithe,r as the result of disea e, accident or old age; provided,. the period of life at which the payment of benefit for disability on account of old age hall commence, shall not be under seventy years, and may provide for monuments or tombstones to the memory of its decea ed members, and for the payment of funeral benefit. Such society hall have the power to give a member, when permanently disabled or on attaining the age of seventy, aU, or such portion of the face value of his certificate as the laws of the society may provide; p1-ovided, that nothing in this Act contained shall be so construed as to prevent the is uing of benefit certificates for a term of years less than the whole of life which are payable upon the death or disability of the member occurring within the term for which the benefit certificate may be issued. Such society, shall, upon written application of the member, have the power to accept a part of the

INSURANCE LAWS.

175

periodical contrrbutions in cash, and charge the remainder, not exceeding one-half of the periodical contribution, against the certificate with interest payable or compounded annually at a rate not lower than four per cent per annum; provided, that this privilege shall not be granted except to societies which have readjusted or may hereafter readjust their rates of contributions, and to contracts affected by such readjustments.
Sub- ection 2. Any society which hall show by the annual valuation hereinafter provided for that it i accumulating and maintaining the reserve not lower than the u ual re 'erve computed by the American Experience Table and four per cent. intere t, may grant fo its member extended and paid-up protection, or such withdrawal equitie as its constitution and laws may provide; p1"ovided, that uch grant shall in no case exceed in value the portion of the reserve to the credit of such member to whom they are made.
SEC. 6. Beneficiarie. The payment of death benefits hall be confined to wife, hu band, relative by blood to the fourth deoTee, father-in-law mother-in-law, son-in-law, daughter-in-law, tep father, tep mother, step children, children by legal adoption, or to a per on or per on dependent upon the member; provided, that if after the is uance of the original certificate the member shall become dependent upon an incorporated charitable in titution, he shall have the privilege with the consent of the ociety to make uch institution hi beneficiary. Within the above restriction' each member shall have the rio'ht to de io"nate his beneficiary, and from time to time, have the same changed in accordance with the law, rules or regulations of the society, and no beneficiary shall have <;>1' obtain any vested interest in the aid benefit until the ame ha become due and payable upon the death of the aid member; pmvided, that any society may, by its laws, limit the scope of beneficiarie ' within the above cIa es.
,SEC. 7. Qualifications for Membership. ny, ociety may admit to beneficial membership any person not less

176

I SURANCE LAWS.

than sixteen and not more than sixty years of age, who has been examined b'y legally qualified physician, and whose examination has ,been supervised and approved in accordance with the laws of the society; provided, that any benefi~iary member of uch ociety who shall apply for a certificate providing for disability benefit, need not be required to pa s an additional medical examination therefor. Nothing herein contained shall prevent such society from accepting general or ocial member .
SEC. 8. Certificate. Every certificate i ued by any such society shall specify the amount of benefit provided thereby, and shall provide that the certificate, the charter or articles of incorporation, or, if a voluntary a 'ociation, the articles of as ociation,' the con titution and laws of the ociety and the application for member hip and medical examination, signed by the applicant, and all amendments, to each thereof, hall con titute the agreement between the society and the m mber, and copies of the same certified by the secretary of the ociety, or corre ponding officer, shall be received in vidence of tIle terms and conditions thereof, and any hall con titute the agreement between the ociety and the member, and copie of the arne certified by the secretary of the ociety, or corre ponding officer, hall be received in evidence of the term' and conditions thereof, and any change ,addition or amendment to aid chart l' or articles of incorporation, or articles of the a ociation, if a voluntary a ociation, constitution or law duly made, or enacted
ubsequent to the i uance of the benefit certificate 'hall bind the member and hi beneficiaries, and shall govern and control the agreement in an re pect the arne a thouO'h
uch changes, additions or amendments had been made prior to and were enforced at the time of the application for m mber hip.
SEC. 9. Funds. Sub- ection 1. Any society may create, maintain, inve t, di perse and apply an emerO"ency, surplu or other imilar fund in accordance with it law .. Unless otherwi e provided in the contract, such fund hall be held, inve ted, and disbursed for the use and benefit of the ociety and no member or beneficiary shall have or acquire individual right therein or become entitled to any apportionment or the surrender of any part thereof, except as provided in sub-section two of se tion five of thi Act.

I URANCE LAWS.

177

The fund from which benefits hall be paid and the fund from which the expen e of the society shall be defrayed, shall be derived from periodical or other payment by the member of the ociety and accretion of aid fund ; p1"ovided, that no ociety hall hereafter be incorporated which doe not provide for tated periodical contribution ufficient to provide for meeting the mortuary oblio-ations contracted, when valued upon the ba i of the National Fraternal ongre Table of Mortality a adopted b the National Fraternal ongre , Augu t 23d, 1 99, or any higher standard with intere t a umption not more than four per cent. per annum, nor shall any uch ociety be admitted to transact b\lsine in this State which doe not provide for tat d periodi al contribution ufficient to provide for meeting the mortuary obligation contracted when valued upon one of the ba e named in ection 23- of thi bill and applicable thereunder to uch ociety.
No ociety, domesti or foreio-n, hall hereafter be incorporated or admitted to write or accept member for permanent di ability benefit except upon table ba ed upon reliable experience with an intere t as umption not higher than four per ent.
Sub- ection 2. Def ned payment or in talImen of clr.im ~han be con idel'ed R. fixed liabilibe. on the hnp!len ino- of the contino-ency UI on which uch I ayment or in tallment are th reafter to be paid: uch liability hall be the pre ent valu of uch future payment or in tallment upon the rate of inter t and mortality a umed by the ociety for valuation, an 1 every ociety hall maintain a fund ufficient to meet uch liability reo-ardle of propo d future collection to meet any uch liabilitie .
EC. 10. Inve tment. Every ociety hall inve. t it fund only in ecuritie permitted by the law of thi State for the inve tment of the a et of life in urance companie ; provided, that any for iO'n ociety permitted or kino- to do bu ine in thi State, which inve t it fund in a cordance with the law of the tate in which it i incorporated hall be held to meet the requirem nt of thi Act for the inve tment of fund .

17

I SURAl OE LAWS.

EO. 11. Di tribution of Fund. Every provi ion of the law of the ociety for payment by member of such ociety, in whatever form made, hall distinctl tate the purpo e of the ame and the proportion thereof which may be u ed for expen e , and no part of the money collected for mortuary or Ii ability purpo e on the net accretion of either or any of aid fund hall be u ed for expen e '.
EO. 12. Organization. even or more per on , citizens of the nited tate, and a majority of whom are citizens of thi tate, who de ire to form a fraternal benefit ociety, a defined by thi' ct may make and io"n (giving their addres e ) and acknowledge before some officer c9mpetent to take acknowledO"ement of deed, article # of incorporation, in which hall be stated:
Fir t: The propo ed corporat nam of the ociety, which hall not 0 clo ely re emble the name of any oci ty or in 'urance company already tran actinO" bu ine in this State a to mi lead the public or to lead to confu ion:
Second: The purpo e for which it i formed-which shall not include more liberal power than are granted by this Act, provided that any lawful social, intellectual, educational, charitable, benevolent, moral or religiou advantage may be et forth amonO" the purpo e of the ocietyand the mode in which it corporate power are to be exerci ed.
Third. The name re idence and official title of all the officer, tru tee, director or other per on who are to have and exerci e the general control and management of the affairs and fund of the oci ty for tbe fir t year or until the en uing election at which all ucb offic l' sball be elected by tbe upreme legislative or governing body, which election shall be held not later than one year from the date of the i uance of the permanent certificate. uch articl of incorporation and duly certified copi of the on titution and law, rule and regulation and copie of all propo ed form of b nefit certificate, application therefor and circular to be i ued by uch ociety and a bond in the urn of five thouand dollar, with uretie approved by the In urance Offi-

INSURANCE LAWS.

179

missioner, conditioned upon the return of the advanced payment as provided in this section, to applicants, if the organization is not completed within one year, hall be filed with the In urance Commissioner, who may require uch further information as he deems necessary, and if the purpo es of the society conform to the requirement' of thi Act, and all provi ion of law have been complied with, the In urance Commi iOlier hall 0 certify and retain and record, (or file), the articles of incorporation, and furnish the incorporator a preliminary certificate authorizing aid ociety to S'olicit member as hereinafter provided.
Upon receipt of aid certificate from the In urance Commissioner, said ociety may olicit members for the purpose of completing it organization and hall collect from each applicant the amount of not Ie s than one reo'ular montWy payment, in accordance with it table of rate' a provided by its constitution and laws, and hall i ue to each such applicant a receipt for the amount 0 co]] cted, but no uch society hall incur any liability other than for uch advanced payment , nor issue any benefit certificate nor pay or allow, or offer, or promise to payor allow, to any per on an'y death or di abilit benefit until actual bona fide application for death benefit certificate have been ecured upon at lea t five hundred live for at lea t one thou and dollars each, and all uch applicant for death benefit' hall have been regularly examined by leo-ally qualified practiciuophy ician , and certificate of uch examination have been duly filed and approved by the chief m dical examiner of such ociety; nor until there hall be e tabli hed ten ubordinate lodo-es or branche into which aid five hundred applicant have been initiated' nor until there ha been ubmitt d to the In urance ommi ioner under oath of the pre ident and ecretary, or corre pondino- officer of uch
ociety, a Ii t of 'nch applicant, giving their name, addre e, dates examined, date approved, date initiated, name and number of the ubordinate branch of which each applicant i a member, amount of benefit to be granted, rate of tated periodical contribution, which hall be sufficient to provide for meeting the mortuary obligation' cou-

o

IN URANOE LAW.

traeted, wben valued for death benefit upon tbe ba is of tbe National Fraternal ConlITe Table of ~Iortality as adopted by th ational Fraternal ongre ,AuO"u t :.3d, 1 99, or any higber tandard at tbe option of the 'ociety, and for di ability ben fit by table ba ed upon reliable experience and for combined. death and permanent total di ability benefit b table ba ed upon reliable experience with an intere t a umption not bigb l' than four per cent. pel' annum; nor until it shall be shown to th In urance.
ommi ioner by the worn tatement of the tr a mer or corre ponding officer of such ociety, that at I a t fiye hundred applicant' have ach paid in ca h at lea t on regular monthly payment a herein provided pel' one thou and dollar of indemnity to be eff cted, which payment in tbe aO"gregate shall amount to at lea t twenty five hundr d dollar ; all of which ball be credited to the mortuary or di ability fund on a count of ucll applicant and no part of which may be u ed for expense .
aid advanced payment ball, durino' tbe period of orO"anization, be held in tru t, and if th orO"unization is not completed. witbin one year a her inafter proyided, returned to aid applicant .
The Insurance ommi ion l' ma~T make uch examination and require uch furtb l' information a he deems advisable, and, upon pre entation of ati factory viden e tbat the ociety ha complied with all the provi ion of law, he shall i ue to uch ociety a certificate to tbat ff t. ucb certificate hall be prima facie evid nce of tbe exi tence of uch ociety at the dat of uch certificate.
Tbe In uran e ommi ioner ball cau e a record of uch c rtificate to be made and a c rtified copy of ucb re ord may be given in evidence with like ffect a th orio'inal certificate.
1: 0 preliminary certificate granted under tbe provi ions of tbi ection hall be valid after one year from it date or after uch furtber period, not exceeding one ear, a' may be aut,horized by the In urance ommi ioner, upon cau e hoWD' unle the five hundred applicant h!'lrein required bave be n ecured and the organization ha been compl ted

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as herein provided; and the article of incorporation and all proceedings thereunder ball become null and void in one year from the date of aid preliminar certificate, or at tbe expiration of aid extended period, unle uch ociety ball bave completed its organization and commenced bu ine a berein provided.
When any domestic society sball bave di continued busine for tbe period of one year, or ha Ie tban four bundred member, it cbarter hall become null and void.
Every uch society ball have tbe power to mak a contitution and by laws for tbe government of tbe ociety, the admi ion of it memb rs, the manaO'ement of it affair and tbe fixing and readju tinO' of the rate of contribution of it member from time to time; and it bal I have tbe power to change, alter, add to or am nd uch constitution and by-law and ball bave such otber power as are neces'ary and incidental to carry into eff ct tbe object and purpo es of the ociety.
SEC. 13. Power Retained-Rein orporation-Amendment. .Any ociety now eno-aged in tran actino- bu ine .in tbis State may exerci e, after the pas age of tbi Act all of the rigbt conferred thereby, and all of the rio'ht , power and privileo-e now exerci ed or po e ed by it under it cbarter or articles of incorporation not incon istent with thi ct, if incorporated; or, if it be a voluntary a ociation, it may incorporate bereunder. But no ociety already organized ball be required to reincorporate hereunder, and any uch ociety may amend it article of incorporation from time to time in the mann r provide I therein or in it con tituttion and law, and all uch amendment hall be filed with the In urance Commi ioner and ball become 01 erative upon uch :fiJino-, unle a later time be provided in uch amendment or in it articles of incorporation, con titution or law.
EC. 14. (Merger and Tran fer .) No dome tic ociety shall merge with or accept tbe tran fer of th member hip or fund. of any other ociety unle uch merO'er or tran fer i evidenced by a contract in writing etting 'Out in full

182

INSURANCE LAWS.

the terms and condition of uch merger or tran fer, and filed with the In urance Commi sioner of this State, together with a sworn statement of the financial condition of each of aid ocietie , by its president and ecretar ,or corresponding officer , and a certificate of uch officer " duly verified under oath of said officers of each of the contracting
ocieties, that uch merger or tran fer ha been approved by a vote of two-thirds of the member of the upreme legi lative or governing body of each of said societies.
Upon the ubmission of said contract, financial tatement and certificate, the In urance Commi ioner hall examine the ame, and, if he hall find uch financial tatements to be correct and the aid contract to be in conformity with the provi ion of thi ection, and that such merg r or tran fer is ju t and equitable to the member of each of aid societies, he hall approve aid merO'er or tran fer, is ue hi certificate to that effect and thereupon the said contract of merger or tran fer hall be of full force and effect.
Iri ca e uch contract i not approved, the fact of its
ubmi 'Sion and it content hall not be di clo ed by the Insurance Commi sioner.
SEC. 15. (Annual Licen e) ocietie which are now authorized to tran act bu ine 'in thi tate may continue uch bu ine s until the fir t day of April next ucceeding the pa ' age of tbi Act, and the authorit of uch ocietie may thereafter b renewed annually but in all ca e to terminate on the fir t day of the ucceedinO' April; provided, hOWeVe1", the licen e hall continue in full force and effect until the new licen e be i ued or pecifically refu ed. For each uch licen e or renewal the ociety hall pay the ommi loner of In urance forty dollar. A duly certified copy or duplicate of uch Iicen e hall be prima facie evidence that the licen e is a fraternal benefit ociety within the meaning of this ct.
SEC. 16. ( dmi ion of ForeiO'n ociety.) 0 foreign ociety now tran acting bu ine , organized prior to the pas age of this Act, which i .not now authorized to tran act

INSURANCE LAws.

13

business in this State, shall transact any bu ine herein without a license from the In urance Commi ioner. ny such society shall be entitled to a licen e to tran act bu ine s within till tate upon filing with the ommi ioner a duly certified copy of its charter or article of a ociation; a copy of its con titution and law, certified by its secretary or corre ponding officer; a power of attorney to the commis ioner as hereinafter provided; a tatem nt of it bu'iness under oath of it president and secretary, or corre ponding officer , in the form required by the commi ioner, duly verified by an examination made by the upervi inK insurance official of its home State or other State ati factory 10 the commis ioner of Insurance of thi tate; a certificate from the proper official in it home tate, province or country, that the ociety i legally organized; a copy of its contract, which mu t how that b nefit are provided for by periodical, or other payment by per ons holding imilar contract ; and upon furni hing the commi sioner such other information a he may deem nece ary to a proper exhibit of it bu ine and plan of working, and upon howina- that it a tare inve ted in accordance ,vith the law of the State, territory di trict, province or country where it is organized, he hall i sue a licen e to
uch society to do bu ine in thi tate until the fir t day of the ucceeding April, and uch licen e hall, upon compliance with the provi ions of this Act, be renew d annua}] , but in a]] ca e , to terminRte on the fir t day of the ucceeding pril; provided, however, that lic n e hall continue in full force and effect until the new licen e be i sued or pecifically refu ed.
Any foreign ociety d irina- admi ion to thi tate, hall have the qualifications l' quired of dome tic societie organized under thi Act, upon a valuation by anyone of the tandard authorized in ec. 23-A, of thi A t, and have it a et inve ted a l' quired by the laws of the tate, territory, district, country, or province where it i organ-
ized. For each uch licen e or renewal the ociety hall pay
the commi ioner twenty do]]ars. When the commi ioner

14

I SUR E LAWS.

refu e to licen e any society, or revoke its authority to do busine in thi State, he shall reduce hi ruling, order or decision to writing and :file the arne in hi ' office, and hall furni h a cop thereof together with a tatement of his rea on, to the officer of the ociety, upon reque t, and the action of the Commi ioner hall be reviewable by proper proceedinO' in any court of competent juri diction within the tate; provided, howe'Qe1', that no thin 0' contained in thi or the preceding ection hall be taken or con trued a preventing any uch soci ty from continuing in good faith all contract made in this State during the time uch ociety was legally authorized to tran act bu ine herein.
SEC. 17. (Power of Attorney and Service of Proce .) Every ociety whether dome tic or foreign, now tran 'actinO' ,bu ine in thi tate hall within thirty day after the pa age of thi ct, and every uch 0 i ty hereafter applying for admis ion, hall, before beinO' lic n ed appoint in writinO' the In uranc ommi ioner and hi uc or in office to be it true and lawful attorney, upon whom all leO'al proce in any action or proceedino' aO'ainst it hall be served, and in u h writino' hall agree tbat any lawful process aO'ain t it which is serv d upon uch attorney hall be of the arne lelTal force and validity a if 'erved upon the
ociety and that the authority hall continu in force 0 long a any liabilitiy remain out tandinlT in thi tate.
Copie of uch appointment certmed by aid In urance Commi ioner ball be deemed ufficient evidenc thereof and hall be admitted in evid nc with the arne force and effect a tbe ori!rinal thereof milTht be admitted. rvice ball only be made upon ucll attorney, mu t be made in duplicate upon the In urance ommi ioner, or in bi ab ence upon the per on in charge of his office, and ball be deemed uffici nt ervice upon uch ociety; provided, however, that no uch 'ervice hall be valid or binding alTain t any uch ociety when it i required thereund l' to file it an weI' pleadinlT or defen e in Ie than tbirty day from the date of mailing tbe copy of uch ervice to uch society. When leO'al proce again t any 'llch ociety i ervecl upon aid In urance ommi ioner he hall forthwith forward by

I SURANCE LAWS.

185

regi tered mail one of the duplicate cople prepaid and directed to it ecretary or corresponding officer. Legal process shall not be erved upon any uch ociety except in the manner provided her in.

SEC. 18. (Place of 1eeting-Location of Office.) Any

dome tic ociety may provide that the meeting of it legi-

lative or O'overnino' body may be held in any tate, di trict,

province, or territor wherein such society ha sub-ordinate

branche, and all bu ine 'tran acted at uch meeting hall

be a valid in all re pect a if uch meetina- were held in

thi Stat ; but it principal office hall be located in this

State.

.

EC. 19. { 0 Per onal Liabilit .) Officer and member of the upreme, grand or any ubordinate body of any uch incorporate i society shall not be individually liable for the payment of any di ability or leath b nefit provided for in the laws and agreem nt of uch ociety; but the arne ha11 be pa able only out of the fund of uch ociety and in the manner provided by it law .
SEC. 20. (Waiver of the Provi ion of the Law.) The 'on titution and law of the ociety may provide that no subordinate body, nor any of it ubol' Enate offie I' or member hall have the power or authority to waive an of the provi ion of the law and con titution of the society, and the sam hall b bindinO' on the ociety and each and every member th reof and on all beneficiarie of member .
EC. 21. (Benefit N on-Attachable.) No money or other benefit, charity, or relief or aid to be paid, provided or rendered by any uch ociet)' hall be liabl to attachment, O'arni hment or o'ther proce ,or be eized, taken, appropriated or appli d by any legal or equitable proce s or operation of law to pa an debt or liability of a memb I' or beneficiary, or an other per on who may have a right ther under, either before or after payment.
SEC. 22. ( on titution and Law -Amendment.) Every society tran actina- bu ine under thi Act hall file with the In urance ommi ioner a duly certified copy of aU

16

I SURANCE LAWS.

amendments of or addition to it con titution and law within ninety days after the enactment of the arne. Printed copie of the con titution and laws as amended, changed or added to, certified by the ecretary or corre pondino- officer of the ociety, shall be prima facie evidence of the legal adoption thereof.
SEC. 23. (Annual Report) Every ociety tran 'acting busine in this State hall annually, on or b fore the fir t day of farch, file with the In urance ommi ioner, in uch form a he may require, a tatement under oath of it pre ident and Secretary or correspondino' officer, of its condition and standing on the thirty-fir t aay of December next preceding, and of its tran action for the ye:;tr endinO" on that date, and al 0 hall fUTni h uch other information a the commi ioner may deem nece ary to a proper exhibit of its bu ines and plan of workino-. The commi ioner may at other time require any further statement he may deem nece ary to be made relating to uch ociety.
In addition to the annual report herein required, each society hall annually report to the commi ioner a valuation of its certificate in force on December 31 t, last preceding; excluding tho e i ued within the year for which the report i filed, in ea e where the contribution for the fir t year in whole or in part are us d for current mortality and expen e ; provided, the fir t report of valuation hall be made a of D cemb r 31 t, 1912. Such report of yaluation shall how, a contingent liabilitie ,th pre ent mid-year value of the promi ed benefit, provid d in the con titution and law of uch ociety under certificate then ubjeet to valuation' and, a contino-ent a t , the pre ent mid-year value of the future net contribution provided in the onstitution and laws a the arne are in practice actually collected. t the option of any ociety, in lieu of the above, the valuation may how the net value of the certificate ubjeet to valuation hereinbefore provided, and aid net value, when c;omputed in ca of monthly contribution , may be the mean of the terminal values for the end of the preceding and of the current insurance years.

INSURANCE LAWS.

187

Such valuation shall be certified by a competent accountant or actuary, or, at the reque t and expen e of the ociety, verified by the actuary of the department of insurance of the home State of the ociety, and hall be filed with the commis ioner within ninety day after the ubmi ion of the last preceding annual report. The legal minimum standard of valuation for all certificate , except for di ability benefit, ball be the ational Fraternal Congre Table of Iortality a adopted by the . ational Fraternal
onO'res, ugu t 23, 1 99, or at the option of the ociety, any hiO'her table' or, at it option, it may u e a tabl ba. 'ed upon the society' own experienc of at lea t twenty years and covering not Ie than one hUlldr d thou and live with intere t a umption not more than four per c nt per. annum. Each uch valuation report hall t forth clearly and fully the mortality and intere t ba i and the method of valuation. Any society providinO' for di ability benefits hall keep the net contribution for u h ben fit in a fund
eparate an 1 apart from aU other benefits and expense fund, and the valuation of aU other bu ine. of the ociety; p1'ovided, that where a combined contribution table i used by a ociety for both death and permanent total di ability benefit ,the valuation ball be according to table of reliable experience and in such ca e a eparation of the fund hall not be required.
The valuation herein I rovided for hall not be con idered or reO'arded a a t t of th financial olvency of the soci ty, but a h ociety ball be held to be legally solvent o long' a tbe fund in it po e ion are equal to or in exce of its matured liabilitie .
BeO'inning with tbe y-ear 1914: a l' port of uch valuation \ and an explanation of th fa t concerning the conditions of the ociet thereby di clo ed hall be printed and mailed to each beneficiary m mber of the ociety not later than June 1 t, of each year' 01' in lieu thereof, uch report of valuation and howing of the ociety' condition a. thereby di clo ed may be published in the ociety' official pap l' and the i ue containinO' the arne mailed to each beneficiary member of the ociety. Th law of uch society shall provide that if the tated periodical contribution of the mem-

1

IN UBA CE LAws.

bel' are in ufficient to pa all matured death and di ability claims in full, and to provide for the creation and maintenance of the funds required by it law', additional, increa ed or extra rate of contribution ball be collected from the member to meet ucb deficiency; and uch law may provide that, upon the written application or on ent of tbe member, hi certificate may be charged with it I roportion of any deficien y di clo ed by valuation, with int re t not exceeding five per centum per annum.
SEC.23- . (Provi ion to In ur~ Future urity.) If the valuation of the certificate ,a hereinbefore pro, ided, on December 31 t 1917, ball how that tbe pre ent value of future net contribution, toO"ether with the admitt d a et is Ie s than the pre ent value of the promi ed benefit, and accrued liabilitie, uch ociety ball thereafter maintain said financial condition at each ucceeding triennial valuation in re pect of tb d 0Tee of deficiency, a bown in the valuation a of December 31st 1917. If at any ucceding triennial valuation ueh ociety doe not bow at lea t tbe ame ondition tbe commi ion r hall direct that it thereafter comply with the requirem nt herein specified. If the next ucceedino' triennial valuation after the receipt of uch notic shall how that tbe ociety ha. failed to maintain the condition l' quired h rein th commi ioner may, in the ab ence of good cau e hown for uch failure, institute proce dinO" for tbe dis olution of ucb society, in accordance witb the provi ions of ection 24 of tbi ct, or in the ca e of a foreiO"n oci ty, it license may be cancelled in the manner provided in thi ct.
n uch ociety hown by any triennial valuation ubequent to December 31 t, 1917, not to have maintained the condition h rein required, shall, within two years ther after, make such improvement a to how a percentage of deficiency not o-reater than a of D cember 31 t, 1917, or tnereafter a to all new member admitted, be ubject, o far a tate I rate of contribution are concerned, to the ;provision of ection 12 of thi t, applicable in the org'anization of new societies; provided that the net mortuary or beneficial' ontribution and funds of uch new

L RANCE LAWS.

19

members hall be kept parate and apart from the other funds of the ociety.
If uch required improvement i not shown by the succeeding triennial valuation, then the aid new member may be placed in a eparate cla an 1 their certificate valued a an independent ociety in respect of contrihution and funds.
EC. 23-B. In lieu of the requirement of. e tions 23 and 23- ,any ociety acceptino- in it law the provi ion of thi ection may value its certificate on a ba i , herein de io-nated "accumulation basi "by reditino- each member with the net amount contributed for each year and with interest at approximately the net rate earned, and by charging him with hi hare of the los es for each year, herein de ignatea "co t of in urance," and carrying the balance, if any, to hi cr dit. Th charge for the co t of in urance may be accordino' to the actual experience of the ociety applied to a table of mortality rccoonized by the law of thi tate, and hall take into con ideration the amount at ri k durino' each year, which ,hall be the amount payable at death, Ie the credit to the member.
Except a pecifically provided in its arti Ie or law or contracts, no charge hall be carried forward from th fir t valuation hereunder aO"ainst any memb l' for any pa t hare of 10 es ex eeding the contribution and credit. If, after the fir t valuation any m rober' hare of 10 e for any year exceed hi credit includino- the contribution for the year, the contribution hall be increa ed to cover hi hare of the 10 e.
Any uch exce hare of los e charo-eabl to any member may be paid out of a fund or contribution especially created or required for uch purpo e .
Any member may tran fer to any plan adopted by the ociety with net rates on which tabular re erves are maintained, and on uch tran fer hall be entitled to make uch application of hi credit a provided in the law of th ociety. ertificate i ued, rerated or readju ted on a ba is providino- for adequate rate with adequate reserve, to mature ucb certificat upon a uroption for mortality

190

INSURANCE LAWS.

and interest recognized by the law of till State hall be valued on such basis, herein designated a the" Tabular Basis," p1"ovii},ed, that if on the first valuation under t11is section a deficiency in reserve shall be shown for any such certificate, the same shall be valued on the accumulation basi.
Whenever in any society having members upon the tabular basis and upon the accumulation basis, the total of all costs of insurance provided for any year hall be insufficient to meet the actual death and disability losses for the year, the defi iency shall be met for the year from the available funds after setting a ide all credits in the ' re erve or from increased contributions or b an increase in the number of asse ments applied to the ociety as a whole or to classes of members as mav be specified in it laws. ,savings from a lower amount of death los e may be returned in like manner a may be pecified in it law.
If the laws of the society so provide, the a sets repl'oenting the reserves of any eparate clas of member ma~T be carried separately for uch cIa s so et apart, as if in an independent society, and the required re erve accumulation of such class so set apart hall not thereafter bf' mingled with the assets of other classe of the ociety.
table showing the credits to individual members for each age and year of entry and showing oppo ite each credit the tabular reserve required on the whole life or other plan of insurance pecified in the contract, according to assumptions for mortality and intere t recognized by the law of this State and adopted by the society, shall be filed by he society with each annual report, and al 0 be furni hed to each member before July 1 t of each year.
In lieu of the aforesaid statement there may be furnished to each memlber within the arne time a statement giving the credit for such member, and giving the tabular re erve and level rate required for a transfer carryin o' out the plan of in mance specified in the contract. No table or statement need be made or furnished where tlw reserves are maintained on the tabular ba is. For tbi purpo e, individual bookkeeping accounts for each member

I SURANCE LAWS.

191

shall n'ot be required, and an calculations may be made by actuarial methods.
Nothing herein contained shaH prevent the maintenance of such surplus over and above the credits on the accumulation basis and the reserves on the tabular basis a the society may provide by or pur uant to it laws, nor be construed a giving to the individual member any right or claim to any such re erve or credit other than in manner as expre sed in the contract and it laws, nor a making any such reserve or credit a liability in 'determining the legal solvency of the society.
SEC. 24. (Examination of Dome tic 'Societies)---.:The Insurance Commi sioner, or any person he may appoint, shall have the power of visitation and examination into the affairs of any domestic soci ty. He may employ a sistant for the purpose of such examination, and he, or any per on he may apoint, shall have free access to all the books, papers and documents that relate to the bu. iness of the society and may summon and qualify as witness under oath and examine it officer, agent and employees or other persons in relation to the affairs, transactions and conditions of the society. The expense of such examination shan be paid by the society examined, upon statement furnished by the In urance Commi ioner, and the examination shall be made at lea t once in three year.
Whenever, after examination, the In urance Commissioner is satisfied that any dome tic, society has failed to comply with any provi ions of this Act, or is exceeding it powers, or i not earryino' out its contracts in good faith, or is tran acting business fraudulently; or whenever any domestic ociety, after the en tence of one year or more, sball have a membership of Ie s than 400 (or hall determine to discontinue business), the Insurance Commissioner may present the facts relating thereto to the attorney general, who hall, if he deem the circumstances warrant, commence an action in q~lO warranto in a court of competent jurisdiction, and such court shall thereupon notify the officers of such society of a hearinO", and if it shall then appear that such society

192

INSURA. CE LA.WS.

hall be closed, aid ociety hall b enjoined from carr ing on any furth I' busine s, and orne per on shall be appointed receiver of such ociety, and haH proceed at once to take po e ion of the book , paper ,money and other as et of the ociet and hall forthwith, under the direction of th court, proceed to close the affair of the ociet and di tribute it fund to tho e entitle 1 thereto.
.r 0 such proc edings shall be commenced bv the attorney general aO'ain t an u h ociety lmtil after notice ha been duly erved on the chief xecutive officer of the
ociety and. a l' a onable opportunity oiv n to it, on a date to b named in aid notice, to how cau e why uch proceeding should not be commenced.
EC. 25. ( pplication for receiver, etc.)-No application for injunction against or proce dino- for the di . olution of or the appointment of a I' c iver for any u h dome tic soci ty or branh thereof hall be entertaine 1 by any ourt in this tate unle s the am i made by the attorney o-eneral.
EC. 26. (Examination of ForeiO'n ocietie .)-The In urance ommi ioner I' any per on whom h may appoint, may examine any foreio'n ociety tran actin o' or applying for admi ion to tran act busine in thi tate. The aid commi ioner may employ a. istant , and he or any per on he may appoint, hall have fr a ce ~ to all the book, paper and document that relate to the bu. ine s of the ociety, and may ummon and qualify a mtnes under oath and examine it officer, aO'ent and employee and other per on in relation to the affair, tran a tion and con lition of th oci ty. He may in hi discretion, accept in lieu of uch examination tbe examination of the In urance Department of tIle tat, territory, di trict, proviIice or country where uch. oci ty i organized. The actual expen e of examiner making any uch examination ball be paid b the ociety upon the tatement furni hed by the In urance ommi ioner.
If any uch 0 iety or it officers refu e to ubmit to such xamination or to compl with the provi ions of the ection relative thereto, the authority of uch ociety to

IN URANCE LAW.

193

write new bu ine in thi tate hall be su pended or license refu ed until atisfactory evidence i furnished the commissioner relating to the condition and affair of tbe society, and during u h u pen ion tbe ociety hall not write new bu ine in thi tate.
EC. 27. (No A lver Publication )-Penclinoo, durinoo or after an xamination or inv tigations of any uch ociety, either dome tic or foreion, the In urance ommiioner ball make public no financial tatement, report or finding, nor ball he permit to become public any financial tatement, l' port or finding affectin o. the tatu tanding or rio'bt of any uch soci t"y, until a copy tber of shall bave been erved upon uch. ociety, at it hom office, nor until uch society hall bay 1een afforded a rea onable opportunity to an weI' any ucb financial tatement, report or finding and to make u h howinO' in connection therewith a it ma de ire.
EC. _. (Revocation of Licen .)-Wh n the In urance ommi ioner, on inve tigation, i ati fied that any foreioon ociety transactino' bu iness un leI' tbi ct ha excee I d it power, or ha faile 1 to omply with any provision of thi Act, or i concfucting bu ine fraudulently, 01' is not carrying out it contracts in o'ood faith, h hall notify the society of hi findin o', and tate in writino' tb oTound of hi di ati faction, and after reasonable notice require aid 0 iety, on a late named, to ho"'l\ cau e why it licen e hould not be revoked. If on the date named in aid notice uch objection have not b en l' moved to the ati faction of the aid commi ioner, or the ociety doe not pre ent O'ood and ufficient rea on why it autbority to transact bu ine in thi State hould not at tbat time be revoke 1, he may revoke the authority of the ociety to continu bu ine s in thi State. All deci ion and findino- of tbe commi ioner made under the provi ion of thi ection may be revie"'l\ d by proper proceedino' in any court of ompetent juri diction, a provided in ection 16 of tlli. Act.
EC. 29. (Exemption of ertain ocietie.)- otbin o' ontained in tbi Act ball be con tru d to effect or apply

194

INSURA.NCE LAWS.

to grand or subordinate lodges of {asons, Odd Fellows or Knight of Pythias (exclusive of the insl1rance department of the Supreme Lodge, Knights of Pythias), and the Junior Order of United American ~echanics (exclusive of the beneficiary degl'ee or in urance branch of the National Council Junior Order United American Mechanics), or societies which limit their membership to anyone hazardous occupation, nor to similar societie which do not issue insurance certificates, nor to an as ociation of local lodge of a society now doing business in this State which provides death benefit not exceeding five hundred dollar to any one person or disability benefits not exceeding three hundred dollar , in anyone year to anyone person, or both, nor to any.contracts of reinsurance busine s on such plan in this State, nor to domestic societies which limit their membership to the employees of a particular city or town, designated firm, business house or corporation, nor to domestic lodge , orders or associations of a purely religi.ous, charitable and benevolent description, which do not provide for a death benefit of m'ore than one hundred dollars, or for disability benefits of more than one hundred and fifty dollars to anyone person in anyone year. The Insurance Commissioner may require from any society such information as will enable him to determine whether such society i exempt from the provi ions of this Act.
Any fraternal benefit society heretofore organized and incorporated and operating within the definition set forth in Section 1, 2 and 3 of this Act, providing for benefits in ca e of death or disability resulting solely from accidents, but which does not obligate itself to pay death or sick benefits, may be licensed under the provi ions of this Act and shall have all the privileges and hall be subject to all the provisions and reglllations of this ct, except that the provi ions of this Act requiring !medical examinartions, valuation, of benefit certificates, and that the certificates shali specify the amount of benefits, shall not apply to such ociety.
SEC. 3'0. {Taxation.)-Every fraternal benefit society organized or licensed under this Act is hereby declared to

I SURA.J."WE LA.ws.

195

be a charitable and benevolent institution, and all of it funds shall be. exempt from all and every State, county, district, municipal and chool tax, other than taxe on real estate and office equipment.
SEC. 31. (Penaltie .)-An) per on, officer member or examining phy ician of an ociety authorized to do bu ine s under this Ad who hall knowingly or wilfully make any fal e or fraudulent tatement or representation in or with reference to any application for member hip, or for the purpose of obtainino' money from or benefit in any ociety transacting busines under thi Act, shall be o'uilty of a misdemeanor, and upon conviction thereof shall be punished by a fine of not les than one hundred dollar nor more than five hundred dollar , or impri onment in the
ounty jail for not Ie than thirty da ,nor more than one year, or both, in the eli cretion of the court, and any person who hall wilfully make a fal e statement of any material fact or thing in a sworn tatement a to the death or di ability of a certificate holder in any uch ociet for the purpo of procuring payment of a benefit name 1 in th certificate of uch holder, and any per on who hall wilfully make any fa! e tatement in any verified report or declaration under oath requir d or authorized by thi Act, hall be rnilty of p rjury, and hall be proceeded ao'ain t and puni hed a provided by the tatute of thi.
tate in relation to the crime of perjury. ny per on who shall solicit member hip for or in any
manner a i t in procuring membership in any fraternal b nefit ociety not licen~ed to do bu ine s in thi tate, or who hall solicit memb I' hip for, or in any mann I' a i t in procurinO' membership in any uch society not authorized a herein provided to do busine s a herein defined in thi State, hall be guilty of a misdemeanor and upon conviction thereof shall be punished by a fine of not Ie. than fifty nor more than two hundred dollar .
Any ociety, or any officer, aO'ent or employee ther of neglecting or refu inO' to compl with or violatin0' an)*
of tll provi ion of thi et, the penalty for which neO'lect
refu a1 or iolation i not pecified in this ection, hall be

196

INSURANCE LAWS.

fined not exceeding two hundred dollar upon conviction thereof.
EC. 32. The provi ions of this bill hall not apply to fraternal benefit ocietie who e member hip doe not exceed five thou and membe.rs, and that all ocietie~ writing in Ul'ance for employee of the Federal Q'overnment an I public utilitie companies hall come within the provi ion of thi ct.
EC. 33. All uch ocieties and organizations a are
mentioned in this ct hall be ubject to such rule and
resmlations as rna be pre cribed by the Insurance ommi sioner of the State.
EC. 34. Be it further enacted, That all acts and parts of ct incon i tent With this ct are hereby repealed.
pprov d ugu t 17, 1914.

I DEX
TO
I SURA E LAW
OF THE
TATE OF GEORGIA

A

ACT regulating business of Insurance; the Comptroller

General Insurance Commi sioner, etc., Act. Oct. 24,

1887

3-29

AlIIENDING Section 3408 Code of Georgia; Venue of

Suits against Insurance ComPll:nies, etc., Act October

21, 1887

37

AMENDING the third Paragraph Section 9 of Act regu-

lating business of Insurance. Act Dec. 23, 1890 .... 40-41

ASSESSMENT Insurance Companies; Depo its by'

Approved 'by State Treastu'er, etc., Act Aug. 23, 1905.. 108-11Z

ASSESS LENT Plan; Life Insurance Companies; Ap-

!proved by the State Treastu'er Act Dec. 21, 1900

89-91

C

CANCELLATION and Forfeiture of License of Foreign, Life, Accident, etc. Insurance Companies, Act Aug. 16, 1909
CAPITAL Stock of In urance Companies, etc., Act Dec. 18- 1900 . . . . . > ,
CHARTERS of Insurance ompanies. Act Dec. 16, 1902 :..........................................
COM:BINATIO ,Pools, of Insurance Companies, etc., A.:-t. Oct. 21, 1891
POLICIES of Insurance Companies; How Issued. Act Aug. 17, 1906

125 87-88
103
~~-44
117

I SURANeE LAWS.

199

CORPORATIONS doing Life Insurance Business on Assessment Plan, required to print same on Policies and Certificates. Act Nov. 5, 1901

74-75

D

DEPOSITS by Assessment Life Insurance Companies; Approved 'by Treasurer. Act Dec. 18, 1901
DEPOSITS and Registration of Insurance Companies. Act. Dec. 17, 1900

92-96 86

F

FEES Paid by Fire and Storm Assessment Insurance

Companies. No. 311

133-139

FIXING Amount of Solvent As ets of Mutual Aid, Bene-

fit and Industrial Life Insurance Companies, etc. Act

Aug. 16, 1909

126-129

FIXI G Fees of Insurance Commissioner, etc., Act.

Aug. 16, 1909

130-132

FOREIG Fire Insurance Companies, Deposits by. Act

Aug. 22, 1905

104-105

FRATEft AL and Beneficiary Order Defined, etc.

Act Dec. 17, 1900

80-85

FRATERKAL Benefit ocietie ..Regulated...............

173

G

GUARA TEE, etc., Companies; Surety on Bonds of State, County and City Officials. Act Dec. 24, 1896. . 59-64
H
HOME Life Insurance Companies, Deposits by. Act Aug. 22, 10D5 ............................ 10G-.l07

200

INSURANCE LAWS.

HOME and Foreign Insurance Companies; Taxation and Rate; Return and Collection. Act Aug. 16, 1909. 33-35

I

INSURANCE Companies to pay full Amount of Loss,

etc. Act Nov. 23, 1895

56

rnsUR N E Companie , Prerequisite to Receivership for. .

171

INDUSTRIAL Life Insurance Defined and Regulated.

Aet Aug. 22, 1905

113-116

I SUR.A.NCE, Regulating Business of. Act Dec. 20,

1899

76-79

INVESTMENTS by Insurance Companies. Act Aug.

22, 1907

123-124

L

LIVE Stock Companies. Act Dec. 14, 1895

57-58

LIFE Insurance on Reserve Plan; Deposits of. Aug. 20,

1906

118-122

MAl\TNER and Uode of Making Returns by Insurance Company. Act May .. , 1882
METHOD of Incorporating Insurance Companies. Act Dec. 18, 1893
MAKI.r G Certain Business Unlawful. Act Dec 24, 1896
MUTUAL Insurance Company Insuring against Loss by Bl1l'~dar'y. et/'. Act Dec. 21, 1897 P
POLICIES of In Ul'ance CompaI'lies; How I sued. Act. Aug. 17,1906_______________________________________

38-39 45-55 65-67 68-73
117'

INSURA CE LAWS.

201

s

~UITS Against Insurance Companies, etc. Act Dec.

17, 1902

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102

u

lJNLAWFUL for Accident, Liability and Casualty Insur-

anl;le Companies, etc. Act Dec. 1901

97-101