Administration of Deposits

KRS tit. XXV, ch. 304, subtit. 8

in effect

KRS 304.8-010 Deposits of insurers

304.8-010. Deposits of insurers (1) All deposits of assets of insurers required or permitted under this code and made in this state shall be made and maintained with the commissioner. (2) In addition to deposits required for an insurer's authority to transact insurance in this state, an insurer may deposit and maintain with the commissioner deposit of assets: (a) Required of an insurer by the laws of other states as prerequisite for authority to transact insurance in such other states; (b) Required by application of the retaliatory provision, KRS 304.3-270; and (c) In such additional amounts as is permitted by this subtitle, or as expressly required by this code. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1026, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 18, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 1, effective June 18, 1970.

KRS 304.8-020 Deposits to be for benefit of policyholders, creditors, and states

304.8-020. Deposits to be for benefit of policyholders, creditors, and states (1) All deposits shall be held by the commissioner in trust for the benefit and protection of all of the insurer's policyholders and creditors in the United States. (2) The deposit of a domestic insurer shall further be security for payment of taxes, assessments, forfeitures, fines, or other charges due and unpaid to this state or any other state in which the insurer has been authorized to transact insurance, and may be applied to the extent as may be necessary for payment. (3) Except, that deposits required pursuant to the retaliatory provision, KRS 304.3-270, or required of a domestic insurer pursuant to the laws of another state, may be limited to the uses and purposes as are consistent with the provision or laws. But no deposit so required of a domestic insurer shall be allowed in lieu of or as a credit upon any deposit required of an insurer under this subtitle if the purpose of the deposit so required by another state is materially inconsistent with the purpose stated in subsection (1) of this section. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1027, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 19, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 2, effective June 18, 1970.

KRS 304.8-030 Assets eligible for deposit

304.8-030. Assets eligible for deposit Kinds of assets may be deposited by an insurer as follows: (1) Title to unencumbered real property lawfully acquired and held by the insurer under this code. (2) Lawful money of the United States, and other securities of kinds in which the insurer may lawfully invest its funds under this code. Effective: June 18, 1970 History: Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 3, effective June 18, 1970.

KRS 304.8-040 Home office real property as deposit

304.8-040. Home office real property as deposit (1) The commissioner may accept the home office real property of a domestic insurer as a part of any deposit of assets required of the insurer under this code. For this purpose the insurer shall convey such real property by deed to the commissioner, and the deed shall be duly recorded and deposited with the commissioner. (2) Real property so deposited shall not be sold or further encumbered by the insurer except upon advance approval of the commissioner after full submission of the purposes and detail of the sale or encumbrance to the commissioner. The commissioner shall join in the execution of any deed or other document required to consummate the sale or encumbrance. Upon the sale or encumbrance the insurer shall deposit other assets in lieu of such real property. (3) This real property shall be valued at its fair value as determined by the commissioner. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1028, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 20, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 4, effective June 18, 1970.

KRS 304.8-050 Other real property as deposit

304.8-050. Other real property as deposit (1) The insurer's policyholders and creditors in the United States, and this state and other states in which the insurer is authorized to transact insurance, shall have a first lien upon other real property, of which the evidence of the insurer's title is deposited by the insurer. The commissioner shall file proper notice of such lien with the county clerk of the county in which any such property is located. (2) Such real property shall not be withdrawn, sold, or further encumbered unless other eligible assets of equal or greater value are deposited by the insurer in lieu thereof. Upon any such withdrawal, sale, or encumbrance the commissioner shall execute a proper release of such property, which release shall be recorded in the office of such county clerk. (3) For the purpose of determining the amount of deposit, such real property shall be valued at sixty percent (60%) of its fair value as determined by the commissioner. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1029, effective July 15, 2010. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 5, effective June 18, 1970.

KRS 304.8-060 Repealed, 2004

304.8-060. Repealed, 2004 Catchline at repeal: Custodian of insurance securities. History: Repealed 2004 Ky. Acts ch. 24, sec. 48, effective July 13, 2004. -- Amended 2002 Ky. Acts ch. 346, sec. 225, effective July 15, 2002. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 6, effective June 18, 1970.

KRS 304.8-070 Repealed, 2004

304.8-070. Repealed, 2004 Catchline at repeal: Custodian's duties, bond. History: Repealed 2004 Ky. Acts ch. 24, sec. 48, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 7, effective June 18, 1970.

KRS 304.8-080 Commonwealth not liable for safekeeping

304.8-080. Commonwealth not liable for safekeeping The Commonwealth of Kentucky shall not be liable for the safe custody of any assets deposited by an insurer. Effective: June 18, 1970 History: Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 8, effective June 18, 1970.

KRS 304.8-090 Depositories

304.8-090. Depositories (1) The commissioner shall designate at least one (1) bank or trust company in each county of this state containing a city of the first class or a consolidated local government and such other banks as proposed by the insurer and approved by the commissioner which vaults shall be used as depositories for assets of insurers deposited under this code. (2) Any expense associated with depositing assets under this chapter shall be borne by the insurer. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1030, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 21, effective July 13, 2004. -- Amended 2002 Ky. Acts ch. 346, sec. 226, effective July 15, 2002. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 9, effective June 18, 1970.

KRS 304.8-095 Deposits under trust agreement -- Insurer relieved of liability

304.8-095. Deposits under trust agreement -- Insurer relieved of liability Notwithstanding any other provision of law, the commissioner may cause any or all deposits of assets of insurers required or permitted under this code and maintained in this state to be made and maintained in trust with depositories designated pursuant to KRS 304.8-090(1) under trust agreements to which depositories, insurers, and the commissioner are parties, for the purpose of this subtitle. These trust agreements shall provide with respect to deposits thereunder provisions, conditions and stipulations corresponding to those applicable to other deposits under this subtitle and shall require depositories to perform the same duties with respect to deposits thereunder as the commissioner is required to perform with respect to other deposits under the subtitle. Insurers who have made deposits under these trust agreements shall be relieved of all other obligations under this subtitle with respect to the assets deposited thereunder. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1031, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 22, effective July 13, 2004. -- Created 1982 Ky. Acts ch. 258, sec. 2, effective July 15, 1982.

KRS 304.8-100 Record of deposits

304.8-100. Record of deposits As to each insurer making or having a deposit the commissioner shall keep a complete record thereof showing: (1) The particular assets so deposited; (2) The face value, if any, of any asset, and the value thereof as determined by the commissioner; (3) Date of deposit, and place thereof; (4) Assets withdrawn, date thereof, value of assets so withdrawn, and the name and address of any person to whom the assets were delivered; and (5) All other information as the commissioner deems necessary. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1032, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 23, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 10, effective June 18, 1970.

KRS 304.8-110 Inventory -- Certificate

304.8-110. Inventory -- Certificate (1) The commissioner may at any time inventory assets on deposit as to any insurer. Upon request of the insurer the commissioner shall make an inventory at the insurer's expense, and shall furnish the insurer a copy thereof. All inventories shall be made in the presence of the commissioner and two (2) representatives of the insurer designated for the purpose by its board of directors. (2) Upon request, the commissioner shall give to any insurer depositing assets a certificate thereof describing the assets and setting forth their par value, if any, and their value, which valuation shall be determined by the commissioner. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1033, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 24, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 11, effective June 18, 1970.

KRS 304.8-120 Valuation -- Replenishment

304.8-120. Valuation -- Replenishment (1) All assets deposited shall be valued by the commissioner when deposited, such valuation to be determined in accordance with the applicable provisions of this code. (2) If at any time the commissioner finds that the value of assets on deposit by an insurer is less than the amount required for the purposes for which the deposit was made, the commissioner shall by certified mail, return receipt requested, addressed to the insurer at its home office, notify the insurer of such deficiency and require that the deficiency be cured within thirty (30) days from the date of such mailing. The commissioner may suspend or revoke the certificate of authority of any insurer failing to cure any such deficiency within such thirty (30) days. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1034, effective July 15, 2010. -- Amended 1980 Ky. Acts ch. 114, sec. 69, effective July 15, 1980. -- Amended 1974 Ky. Acts ch. 315, sec. 50, effective June 21, 1974. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 12, effective June 18, 1970.

KRS 304.8-130 Voluntary excess deposit

304.8-130. Voluntary excess deposit An insurer may deposit and maintain on deposit assets in value exceeding the amount otherwise required under this code, for the purpose of absorbing fluctuations in value of its required deposit, and to facilitate exchange and substitution of assets in such required deposit. During the solvency of the insurer any such excess deposit or any part thereof shall be released to the insurer upon its request. During the insolvency of the insurer such excess deposit shall be released only as provided in KRS 304.8-170. Effective: June 18, 1970 History: Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 13, effective June 18, 1970.

KRS 304.8-140 Dividends on, and exchange of deposited assets -- Collection by commissioner

304.8-140. Dividends on, and exchange of deposited assets -- Collection by commissioner (1) While solvent and complying with this code an insurer shall be entitled: (a) To collect and receive interest, dividends, and payments accruing upon assets so held on deposit for its account; and (b) From time to time, to exchange and substitute for any of such assets, other assets eligible for deposit. (2) If the insurer fails to cure a deficiency when required, is insolvent, is subject to delinquency proceedings, or is in default as to taxes or other charges due to this state under law, the commissioner shall collect such interest, dividends, and payments and add them to the insurer's deposit. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1035, effective July 15, 2010. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 14, effective June 18, 1970.

KRS 304.8-150 Deposit of reserves by domestic life insurers

304.8-150. Deposit of reserves by domestic life insurers (1) Except as provided in subsection (2) of this section, every domestic life insurer shall, within ninety (90) days after the net cash value of each policy in force has been ascertained as required by law, deposit with the commissioner for the security and benefit of its policyholders, assets in an amount which, together with the sums as may be deposited by it with other states and governments by the requirements of their laws, shall be not less than the ascertained valuation of all policies in force less any sums that it has advanced from its legal reserve to its policyholders on the pledge to it of their policies and any accumulations thereon. (2) If the legal reserve or the aggregate ascertained valuation of all policies in force in any domestic life insurer equals twenty million dollars ($20,000,000), no further deposit shall be required of the insurer so long as the legal reserve remains at or above twenty million dollars ($20,000,000), unless the insurer elects to represent on its policies or otherwise that the legal reserve or cash value of its policies thereafter written is on deposit with this state or one or more of its designated agencies, in which event the insurer shall deposit assets as above set out in an amount equal to the ascertained valuation of all of its policies in force at the time the representation is made. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1036, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 25, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 15, effective June 18, 1970.

KRS 304.8-160 Levy upon deposit

304.8-160. Levy upon deposit (1) Except as provided in subsection (2) of this section, no judgment creditor or other claimant of an insurer shall have the right to levy upon any of the assets held in this state as a deposit for the protection of the insurer's policyholders or policyholders and creditors. (2) As to deposits made pursuant to the retaliatory provision, KRS 304.3-270, levy thereupon shall be permitted if so provided in the commissioner's order under which the deposit is required. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1037, effective July 15, 2010. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 16, effective June 18, 1970.

KRS 304.8-170 Release of deposit

304.8-170. Release of deposit (1) Any required deposit shall be released, in addition to circumstances already provided for, in these instances only: (a) Upon extinguishment of substantially all liabilities of the insurer for the security of which the deposit is held, by reinsurance contract or otherwise; (b) If the deposit is no longer required under this code; (c) If the deposit was made pursuant to the retaliatory provision, KRS 304.3-270, it shall be released in whole or in part when no longer so required; and (d) Upon proper order of a court of competent jurisdiction the deposit shall be released to the receiver, conservator, rehabilitator, or liquidator of the insurer. (2) No release shall be made except on application to and written order of the commissioner made upon proof satisfactory to the commissioner of the existence of one of the grounds therefor. The commissioner shall not have any personal liability for any such release of any deposit or part thereof so ordered by the commissioner in good faith. (3) All release of deposits or any part thereof shall be made to the person then entitled thereto upon proof of right satisfactory to the commissioner. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1038, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 26, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 17, effective June 18, 1970.

KRS 304.8-180 Access to and removal of deposits

304.8-180. Access to and removal of deposits (1) Assets shall not be removed from the bank or trust company wherein the assets are deposited, except upon the written order of at least two (2) officers authorized for the purpose by the insurer's board of directors or other governing body, which order must have been approved by the commissioner. (2) The assets shall be deposited or removed only in the joint presence of the commissioner and two (2) representatives of the insurer authorized for the purpose by the insurer's board of directors or other governing body. (3) Except that assets may be deposited or removed under the direction and upon the order of a court of competent jurisdiction, and in the presence of the commissioner. Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1039, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 27, effective July 13, 2004. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 18, effective June 18, 1970.

KRS 304.8-190 Payments into examination expense revolving fund

304.8-190. Payments into examination expense revolving fund (1) Insurers maintaining deposits of assets in this state under this subtitle, shall pay into the examination expense revolving fund as provided in Subtitle 2 of this chapter, moneys sufficient to pay travel and other necessary expenses of the commissioner related to the maintenance, valuation, protection, or administration of the insurer's deposit. (2) The portion of the expense fund to be paid by each such insurer shall be in the same approximate proportion as the amount the insurer had on deposit on December 31 of the preceding year bears to the total such deposits of all insurers as of December 31 of the preceding year. The commissioner shall assess each insurer for its proportionate share of the expense fund. The minimum charge for each insurer shall be five dollars ($5). Effective: July 15, 2010 History: Amended 2010 Ky. Acts ch. 24, sec. 1040, effective July 15, 2010. -- Amended 2004 Ky. Acts ch. 24, sec. 28, effective July 13, 2004. -- Amended 1982 Ky. Acts ch. 320, sec. 12, effective July 15, 1982. -- Amended 1974 Ky. Acts ch. 210, sec. 3, effective June 21, 1974. -- Created 1970 Ky. Acts ch. 301, subtit. 8, sec. 19, effective June 18, 1970.

Source: Kentucky Legislative Research Commission (legislature.ky.gov)URL: https://apps.legislature.ky.gov/law/statutes/chapter.aspx?id=38694Fetched: 10/20/2026