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satisfactory evidence of that fact furnished to the superintendent before it shall be authorized to do business.
Any existing joint-stock fire insurance corporation, and any corporation formed under this article, may, upon obtaining the written consent of the holders of three-fourths in amount of its stock, permit the insured to participate in the profits of the business of such corporation, and provide how far any scrip issued to the insured for such profits shall be liable for the losses to be sustained. Whenever an amount not less than one hundred thousand dollars has been accumulated, and scrip issued therefor, the corporation may, with the written consent of the holders of threefourths in amount of its stock, pay off and cancel an amount of the original cash capital equal to one-half of the accumulated profits, and so may continue from time to time until the whole amount of the original cash capital is paid off. Before any portion of such capital stock shall be so paid off, proof shall be made to the superintendent and certified by him to be satisfactory, that an amount of accumulated profits has been realized, scrip issued therefor, and investments made thereof in the manner required in this chapter, at least equal to double the amount so desired to be paid off and canceled.
115. Deposit notes and cash payments by members of mutual corporations.-Every person becoming a member of any domestic mutual fire insurance corporation by effecting insurance therein, shall, before he receives his policy, deposit his promissory note for such a sum of money as shall be determined by the directors of the corporation. Such part of such note, not exceeding twenty per cent, as shall be required by the by-laws of the corporation, shall be immediately paid, and the remainder of such deposit note shall be payable in whole or in part, as the exigencies of the corporation shall require for the payment of losses by fire and incidental expenses of the corporation. At the expiration of the term of insurance such note, or the part thereof which shall remain unpaid after receiving thereon from the maker a proportionate share for all losses or expenses occurring during such term, shall be relinquished by the corporation to the maker, and the corporation may loan such portion of the money received upon any such note or from any such member as may not be immediately wanted for its use, if the same shall be secured by a bond and a mortgage on unincumbered real property of double the value of the sum loaned.
§ 116. Assessments in mutual corporations.-The directors shall, as often as they deem necessary, after receiving notice of any loss or damage by fire sustained by any member, and ascertaining the same, or after the rendition of any judgment against the corporation for loss or damage, settle and determine the sums to be paid by the several members thereof as their respective portion of such loss, and publish the same in such manner as they shall see fit or as the by-laws shall have prescribed. The sum to be paid by each member shall always be in proportion to the original amount of his note or notes, and shall be paid to the officers of the corporation within thirty days next after the publication of such notice. If any member shall, for the space of thirty days after such publication and after personal demand for payment shall have been made, neglect or refuse to pay the sum so assessed upon him, the directors may sue for and recover the whole amount of his note or notes, with costs of suit, but execution shall only issue for assessments and costs as they accrue, and every such execution shall be accompanied by a list of the losses for which the assessment is made.
If the whole amount of notes shall be insufficient to pay the loss occasioned by any fire or fires, in such case the sufferers insured by the corporation shall receive, toward making good their respective losses, a proportional share of the whole amount of such notes according to the sums by them respectively insured No member shall ever be required to pay for any loss occasione by fire or inland navigation more than the whole amount of his note. Any such corporation may receive from any person ap plying for insurance, in lieu of a deposit note, the whole amount in cash for the premium therefor, without subjecting such person to any other or additional liability, or in any way impairing or changing the obligation of the corporation or affecting the rights of any person interested therein.
$117. How surplus profits to be estimated.—In estimating the surplus profits of any fire insurance corporation for the pur pose of making any dividend upon its capital stock, there shall be reserved from such profits a sum equal to the whole amount of premiums on unexpired risks and policies, and all sums due the corporation on bonds and mortgages, bonds, stocks and book accounts, of which no part of the principal or interest thereon has been paid during the last year, and for which foreclosure or suit has not been commenced for collection or which, after judg
ment obtained thereon, shall have remained more than two years unsatisfied, and on which interest shall not have been paid, and all interest due or accrued and remaining unpaid. Any corporamay declare dividends not exceeding ten per centum on its capital stock in any one year, if in addition to the amount of its capital stock, and of such dividend, and all actual outstanding liabilities it shall have accumulated and be in possession of a. fund equal to the amount of all unearned premiums on risks not terminated at the time of making such dividend.
Any dividend made contrary to the provisions of this section shall work a forfeiture of the charter of the corporation, and each stockholder receiving any such dividend shall be liable to the creditors of the corporation to the extent of the dividend received in addition to the other penalties and punishments prescribed by law. This section shall not apply to the declaration of scrip dividends by participating corporations. No such scrip dividends shall be paid, except from the surplus profits, after reserving all sums as above provided, including the whole amount of unearned premiums on unexpired risks. And whenever any fire insurance corporation shall have accumulated and be in possession of a fund in addition to the amount of its capital stock, and all actual outstanding liabilities in excess of one-half of the amount of all premiums on risks not terminated such corporation may increase its capital stock from such fund; and distribute such increase pro rata to the stockholders of such corporation, provided, always, that such increase shall be equal to at least twenty-five per centum of the original capital stock of said corporation and shall have been approved by the superintendent of the insurance department and authorized by at least three-fourths of the board of directors of such corporation, and provided, also, that any such corporation may hereafter make and declare a dividend as provided by this chapter.
$118. Allowance of assets and estimation of liabilities upon examinations.-When an examination is made by the authority of the superintendent of insurance into the affairs of any fire insurance corporation doing business in this state, or when such corporation renders a statement to the insurance department, there shall not be allowed as assets any investments which are not held as prescribed by law at the date of such examination or rendering such statement; but unpaid premiums on policies written within three months shall be admitted as available re
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sources. In estimating its liabilities, there shall be charged, in addition to the capital stock and all outstanding claims a sum equal to the total unearned premiums on the policies in force, calculated on the gross sum without any deduction on any account, charged to the policyholder on each respective risk from the date of the issue of the policy. In the case of an examination into the condition of any mutual fire insurance corporation with capital stock notes, the value of such notes shall be ascertained and the responsibility of the makers thereof certified to in the same manner as is required by section one hundred and eleven of this chapter. (As amended by chap. 465 of 1898, § 1.)
119. Liability of directors and corporators.-The directors and corporators of any corporation organized under this article, and those entitled to a participation of the profits of such cor. poration, shall be jointly and severally liable for all debts or liabilities of such corporation, until the whole amount of the capital of the corporation shall have been paid in in cash, and a certificate has been issued to it by the superintendent authoriz. ing it to do business in this state.
§ 120. What to appear on face of policy.-Every domestic mutual fire insurance corporation shall embody the word "mutual" in its title, which shall appear on the first page of every policy and renewal receipt. Every fire insurance corporation doing business as a cash stock corporation shall upon the face of its policy in some suitable manner express that such policy is a policy in a stock corporation.
§ 121. Standard fire insurance policy to be prescribed and used. The printed blank form of a contract or policy of fire insurance, with such provisions, agreements or conditions as may be indorsed thereon or added thereto and form a part of such contract or policy, heretofore filed in the office of the secretary of state by the superintendent of insurance or by the New York board of fire underwriters, pursuant to the provisions of chapter 488 of the laws of 1886 shall be known and designated as the “standard fire insurance policy of the state of New York."
No fire insurance corporation, its officers or agents, shall make, issue or deliver for use, any fire insurance policy or the renewal of any such policy on property in this state, other than such as shall conform in all particulars as to blanks, size of type, context, provisions, agreements and conditions with such printed blank form of contract or policy filed in the office of the secre
tary of state; and no other or different provision, agreement, condition or clause shall be in any manner made a part of such contract or policy, or indorsed thereon or delivered therewith, except as follows, to wit:
First. The name of the corporation, its location and place of business, date of its incorporation or organization, whether it is a stock or mutual corporation, the names of its officers, the number and date of the policy, and if issued through a manager or agent the words "this policy shall not be valid until countersigned by the duly authorized manager or agent of the corporation at
Second. Printed or written forms of description and specification, or schedules of the property covered by any particular policy, and any other matter necessary to clearly express all the facts and conditions of insurance on any particular risk not inconsistent with or a waiver of any of the conditions or provisions of the standard policy herein provided for.
Third. With the approval of the superintendent of insurance, if the same is not already included in such standard form, any provision which any such corporation is required by law to insert in its policies, not in conflict with the provisions of such standard form.
Such provisions shall be printed apart from the other provisions, agreements or conditions of the policy under a separate title as follows: "Provisions required by law to be stated in this policy."
The name, with the word "agent" or "agents," and place of business, of any insurance agent or agents, either by writing, printing, stamping or otherwise, may be indorsed on the outside of such policies.
§ 122. Payment of return premiums on cancellation of policy. -Any corporation, person, company or association transacting the business of fire insurance in this state shall cancel any policy of insurance upon the request of the insured or his legal representatives, and shall return to him or to such representative the amount of premium paid, less the customary short rate premium for the expired time of the full term for which the policy has been issued or renewed, notwithstanding anything in the policy to the contrary. Where the laws of any state permit corporations organized under its laws to cancel policies of insurance upon different terms than herein set forth, corporations organized