A mutual insurance company not possessed of assets at least equal to its unearned premium reserve and other liabilities shall make an assessment upon its members liable to assessment to provide for the deficiency. The assessment must be made against each such member in proportion to the member's liability as expressed in the member's policy. The commissioner, however, may relieve the company, by written order, from any assessment or other proceedings to restore the assets during the time fixed in the order. The company shall record in a book kept for that purpose the order for the assessment and a statement setting forth the condition of the company at the date of the order, the amount of its cash assets and of the notes of its policyholders or of other contingent funds liable to the assessment, the amount of the assessment, and the particular losses or other liabilities for which the assessment is made. The record must be made and signed by the directors who voted for the order before any part of the assessment is collected, and any person liable for the assessment may inspect and take a copy of the record.
26.1-12-24. Making premium reserve good - Assessments - Cancellation of policies - Reinsurance. When, by reason of depreciation or loss of its funds or otherwise, the cash assets of a mutual insurance company, after providing for its other debts, are less than the required premium reserve upon its policies, it shall make good the deficiency by assessment in the mode provided in section 26.1-12-23. If the directors are of the opinion that the company is likely to become insolvent, the board of directors, instead of the assessment, may make two assessments, the first determining what each policyholder must equitably pay or receive in case
of withdrawal from the company and having the policy canceled and the second determining what further sum each must pay in order to reinsure the unexpired term of the policy at the rate at which the whole was insured at first. Each policyholder subject to assessment shall pay or receive according to the first assessment, and the policy then must be canceled unless the policyholder pays the further sum determined by the second assessment, in which case the policy continues in force. In neither case, however, may a policyholder receive or have credited more than the policyholder would have received on having the policy canceled by a vote of the board of directors under the bylaws. If, within two months after the alternative assessments have become collectible, the amount of the policies whose holders have settled for both assessments is less than two hundred thousand dollars, the company shall stop issuing policies. All policies the holders of which have not settled for both assessments are void, and the company may continue only for the purpose of adjusting the deficiency or excess of premiums among the members and settling outstanding claims. No assessment is valid against a person who has not been notified thereof within two years after the expiration or cancellation of the policy.
26.1-12-25. Directors and treasurer of mutual insurance company personally liable for not making and collecting assessments. If the directors of any mutual insurance company neglect or omit for the space of six months to lay, or to use reasonable diligence to collect, any assessment which the board of directors is required to make, they are liable personally for all debts and claims then outstanding against the company or that may accrue until the assessment is laid and put in process of collection. If the treasurer of the company unreasonably neglects to collect an assessment made by order of the board of directors and to apply the assessment to the payment of the claims for which it was made, the treasurer is liable personally to the parties having the claims for the amount of the assessment. The treasurer may repay oneself out of any money afterwards received for the company on account of the assessment.
26.1-12-26. Advance to mutual insurance company - Repayment - Reporting - Commission or promotion expense. Any director, officer, or member of a mutual insurance company, or any other person, may advance to the company any sum of money necessary for the purpose of its business or to enable it to comply with any of the requirements of the law, and such moneys, together with any interest agreed upon, but not exceeding the maximum contract rate, is not a liability or claim against the company or any of its assets and may be repaid only out of the surplus earnings of the company. A commission or promotional expense may not be paid in connection with the advance to the company. The amount of any advance must be reported in each annual statement.