the secretary, stating the amount due the corporation from the members, the time when and to whom it shall be paid, and the use to be made of the money collected. Such time shall not be less than thirty days nor more than sixty days from the service of the notice, which notice may be served personally or by mail, and, if by mail, service shall be deemed complete when deposited in the postoffice at the place where the principal office of the corporation is located, directed to each member at the last postoffice address given by the insured to the secretary of the corporation and postage prepaid.

§ 12. Assessment-Penalty for Failing to Pay -Action to Recover-Lien-Exclusion of Delinquent. An action may be brought by the corporation against any member thereof to recover all assessments which he may neglect or refuse to pay, made upon him under the provisions of this act, or the by-laws of the corporation. If the corporation is compelled to bring any such action in order to collect any such assessment, it may recover the amount so assessed, with fifty per cent added thereto in addition to lawful interest, as a penalty for such neglect and refusal to pay within the time required. Any member who refuses to pay his assessment may, for such reason, or for any other reason satisfactory to the directors or executive committee, be excluded by a majority of the directors or executive committee, or as the by-laws may prescribe, from the corporation. Such member shall remain liable for payment of any assessment made prior to his exclusion, and for penalty above provided, in case action has or shall be brought against him therefor, within twelve months after the time it was due. The officers of every such corporation may proceed to collect any assessment

when due and unpaid for thirty days; and the refusal and neglect on their part to endeavor to collect such assessments, or to perform any of the duties imposed by this article, shall render them liable, individually for the amount lost by any person who loses by their neglect or refusal, and an action may be maintained against them for such loss. If any member of the corporation shall be excluded therefrom, as herein provided, and the policy issued to him cancelled, the secretary shall at once enter the same, with date thereof, upon the records of the corporation, and either inform in person or by mai! notify the member of such exclusion; and if by mail the postage shall be prepaid, and the notice be addressed to the office given in the application or policy, or the last address given the secretary by the member; and from and after such personal notice, or five days after the mailing such notice as herein required, such policy shall be cancelled, and all liability for such policy or policies shall cease; but the insured shall be entitled to receive from the corporation a repayment of an equitable portion of all unearned money, in excess of his legal contribution to the reserve fund, to which he has contributed, if any. Not more than twenty per cent. of assessments may be computed as the members' legal contribution to the reserve fund. The corporation shall have a lien upon the property insured to secure the payment of such assessments and calls as may be made under the contract of insurance.

13. Limit of Liability of Members.-If the whole amount of the deposit notes and cash belonging to any such corporation shall not be sufficient to pay the amount due at any one time to the members of such corporation on account of losses occas

ioned by fire, lightning or wind, the limit of liability of each member of the corporation, on account of any assessment that may be required to meet the deficit shall not exceed the following rates and amounts, to-wit: Upon each member of a corporation having less than five hundred thousand dollars insurance in force, ten dollars for each one hundred dollars of insurance he has in said corporation; upon each member of a corporation having over five hundred thousand dollars insurance in force and less than one million dollars insurance in force, five dollars for each one hundred dollars insurance he has in said corporation; upon each member of a corporation having over one million dollars and less than two million dollars insurance in force, three dollars for each one hundred dollars insurance he has in said corporation; and upon each member of a corporation having over two million dollars of insurance in force, two dollars for each one hundred dollars of insurance he has in said corporation.

14. Property-Kinds That May be Insured. -No corporation formed for the purpose specified in this act shall insure any buildings or property out of the limits of the territory comprised in its certificate of incorporation, except when a member lives on or near the boundary line, and has property both within and without the prescribed boundary, that without such boundary may also be insured.

15. Directors-How and When Elected. The directors of every corporation formed under this article shall be chosen by the members, or the insured, at the regular meeting of the corporation prescribed in the by-laws, which meeting if not otherwise provided for shall be held on the second. Tuesday of January each year. At such meeting,

each person insured shall have one vote, and those having two thousand dollars insurance two votes, and an additional vote for each additional one thousand dollars insurance, and shall be entitled to vote by proxy under such rules and regulations as may be prescribed by the by-laws, unless prohibited by such by-laws.

§ 16. Report of Condition to be Made to Commissioner. The president and secretary of any such corporation, whether organized under this article or not, shall make a statement, under oath, to the Insurance Commissioner, showing the condition of the corporation on the thirty-first day of December in each year, which shall contain the amount and kind of property insured; the number of policies issued from the time of organization of the corporation up to the time of making the statement; the number insured during the year last past; the amount of the insurance accepted and the amount withdrawn, expired and canceled during the year; the whole amount of insurance in force on December thirty-first; the amount of moneys received during the year by the corporation; the amount of disbursements, specifying the amount paid for fees, salaries, commissions, and all other matters of interest to the corporation or members, that the Insurance Commissioner may require on or before the first of February next following.

17. Withdrawal and Admission of Members. -Any member of any such corporation may withdraw therefrom at any time, by giving thirty days' written notice to the secretary of same, and paying his share of all claims existing against the corporation, and surrendering his policy or policies to the company. Members may be admitted who reside. or own property within territorial limits upon the

same terms and conditions as the original members, subject to the by-laws of the corporation; but nonresidents owning property insured in such corporation shall not be eligible to office in the corporation.

18. Business to be Confined to Terms of Law -Examination by Commissioner-Penalty. No corporation shall be formed under this act for the purpose of transacting the business of insurance other than herein prescribed, and no such corporation shall insure against any loss except as specified in this act; and any officer violating this law shall be fined from ten dollars to five hundred dollars, according to the discretion of the jury, and shall be personally liable for any losses caused by any such violation, either to the corporation or any member. It shall be the duty of the Insurance Commissioner, upon application of ten members of such a corporation, or to directors, or the president or secretary, to examine into the management of such corporation, and the corporation shall pay all expenses of such examination, and should he find that any officer or any number of officers have been or are at the time violating this law, or the by-laws of the corporation, he shall proceed in like manner as with other corporations who are guilty of like violations, and the officers shall be punished, if found guilty, as prescribed in this law, and shall be subject in addition thereto, to prosecution and punishment for larceny or embezzlement as prescribed by the general laws of this State, if found guilty of any such crime.

§ 19. By-laws-How Enacted.-Every such corporation may make and enforce such by-laws, not inconsistent with the laws of this State, nor those of the United States, by a two-thirds vote of the directors at any meeting; and any amendment may