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within one year from the date when this Act takes effect, and any corporation organized hereunder within one year from the date of its certificate of incorporation. Such fund, to the extent of the largest amount contracted to be paid by any such corporation to any one person, shall be so invested and deposited, as provided in section two hereof, with the right in the corporation to exchange any such securities for others of equal value. The deposit required by section two of this Act shall constitute a part of the reserve required by this section, at the option of such corporation. When any corporation doing business hereunder shall discontinue business, this fund shall be returned to such corporation, or so disposed of as may be determined by the Superior Court of the county, or city and county, in which is its principal place of business.

SEC. 6. Corporations organized under the laws of any other State or country to transact the business of mutual assessment insurance, must, as a condition precedent to transacting business in this State, deposit with the Insurance Commissioner of this State a certified copy of its charter, or other instrument, required by its home authorities; a statement, under oath, of its president or secretary, of its business for the preceding year, in such form as may be required by the Insurance Commissioner of this State; an appointment of a general agent, service upon whom shall bind the corporation; a certificate that for the next preceding twelve months it has paid, in full, the maximum amount named in its contracts of insurance; a certificate from the proper officer of its State or Government that like corporations of this State are legally entitled to do business in such State or country; copies of its contracts of insurance and applications, which must show that the liabilities of its members are not limited to fixed premiums; and evidence, satisfactory to the Insurance Commissioner, that the corporation has accumulated a fund equal to that required of like corporations in this State, constituting a reserve or surplus fund, held in trust for the benefit of its contract holders, and so invested and held as required by the laws of the State or Government under which such corporation was organized. The Insurance Commissioner shall thereupon issue a license to such corporation to do business in this State. This license must be renewed annually, and may, be revoked whenever it is ascertained that the statements required to be made by this

section are not true. Upon such revocation, notice thereof shall be given by the Insurance Commissioner, by publication in some newspaper published in the City and County of San Francisco, for two weeks, daily, and no new contracts shall be made by such company in this State. When any other State or country imposes any additional license, fees, taxes, or penalties upon any corporation organized or doing business under this Act, like license, fees, taxes, or penalties shall be imposed upon corporations of the same kind, and their agents, of such State or country doing business in this State.

SEC. 7. No corporation doing business under this Act (except accident or casualty corporations) shall issue a contract of insurance upon the life of any person under fifteen years of age, or after he or she has passed his or her sixtyfirst birthday. Every such contract of insurance shall be. founded upon written application therefor, and (except when the application is for health, accident, or casualty insurance only, or for one hundred dollars life insurance, or less) such application shall be accompanied by the report of a reputable physician, containing a detailed statement of his examination of the applicant, and showing the applicant to be in good health, and recommending the issuance of a contract of insurance. Any solicitor, agent, employé, examining physician, or other person making a false or fraudulent statement to any corporation doing business under this Act, with reference to any application for insurance, or for the purpose of obtaining any money or benefit from such corporation, shall be guilty of a misdemeanor, and upon conviction shall be punished by a fine of not less than one hundred dollars nor more than five hundred dollars, or by imprisonment in the county jail for not less than thirty days nor more than one year, or by both such fine and imprisonment, in the discretion of the court; and any person who shall make a false statement of any material fact or thing in a sworn statement as to the death or disability of a contract holder in any such corporation, for the purpose of procuring or aiding the beneficiary or beneficiaries, or contract holder, in procuring the payment of a benefit named in the contract, shall be guilty of perjury, and may be proceeded against and punished as provided by the statutes of this State in relation to the crime of perjury.

SEC. 8. The money, benefit, annuities, endowment, charity,

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relief, or aid to be paid as provided by the contracts issued by any corporation doing business under this Act, shall not be liable to attachment or other process, and shall not be seized, taken, appropriated, or applied by any legal or equitable process, nor by operation of law, to pay any debts or liability of the contract holder, or any beneficiary named thereunder.

SEC. 9. Every domestic and foreign corporation doing business under this Act shall, annually, on or before the first day of February, file with the Insurance Commissioner, in such form as he shall prescribe, a statement of its affairs for the year ending on the preceding thirty-first day of December. The Insurance Commissioner, in person or by duly authorized deputy, shall have the power of examination into the affairs of any domestic corporation doing business or claiming to do business under this Act, at any time, in his discretion, and shall make such examination at least once a year.

SEC. 10. If the Insurance Commissioner, after examination of the affairs of a corporation, shall find that such corporation is not doing its business in conformity to this Act, or that it is doing a fraudulent or unlawful business, or that it is not carrying out its terms of contract, or that it can not within three months from the date of notice of default pay its obligations, he shall cite the president, secretary, manager, or general agent of said corporation, or all of them, to appear before him (stating the time and place) to show cause why the authority of such corporation to do business shall not be revoked; and if they can not show cause, then he shall report the facts to the Attorney-General of this State, who shall commence proceedings in the proper court to restrain said corporation from doing any further business.

SEC. 11. No policy or certificate issued by any corporation or association doing business under the provisions of this Act shall lapse or be lapsed for the non-payment of any assessments, dues, or premiums, unless the corporation or association has first mailed to the insured under such policy or certificate, at his or her last given postoffice address, a notice setting forth the amount to be paid, and the time the same is due and payable; and such notice shall be mailed at least fifteen days before the assessment is due (provided, that such corporations doing business under this Act as collect specific amounts at specific dates, as contained in the contract, shall

not be compelled to send such notices), and an affidavit made by the officer, bookkeeper, or clerk of any such corporation having charge of the mailing of notices, setting forth the facts as they appear on the records in the office of the said corporation, showing that such notice was mailed and the date of mailing, shall constitute conclusive evidence of the mailing of such notice.

SEC. 12. The fees for filing statements, certificates, or other documents required by this Act, or for any service or act of the Insurance Commissioner, and the penalties for any violation of this Act, shall, except as otherwise provided herein, be the same as provided in the laws of this State relating to life insurance companies, and shall be disposed of as provided by such laws.

SEC. 13. And for all lawful expenses under this Act, or by reason of any of its provisions, in the prosecution of any suit or proceedings, or otherwise, for the enforcement of the provisions of this Act, the Insurance Commissioner must present bills duly certified by him, and accompanied with vouchers, to the State Board of Examiners, who must allow the same, and direct payment thereof to be made; and the State Controller shall draw warrants therefor on the State Treasurer for the payment of the same to the Insurance Commissioner, in addition to the ordinary contingent expense, which warrants shall be payable out of the General Fund.

SEC. 14. The provisions of this Act shall not apply to secret or fraternal societies, lodges, or councils, which conduct their business and secure membership on the lodge system exclusively, having ritualistic work and ceremonies in their societies, lodges, or councils, nor to any mutual or benefit association organized or formed and composed only of members of any such society, lodge, or council exclusively.

SEC. 15. All Acts and parts of Acts in conflict with the provisions of this Act are hereby repealed.

SEC. 16. This Act shall take effect immediately.

106 Cal. 101; 117 Cal. 364; 121 Cal. 321; 123 Cal. 110: 129 Cal. 628.


An Act relating to life, health and accident insurance of live stock on the assessment plan and the conduct of the business of such insurance.

[Approved March 23, 1907.]

The people of the State of California, represented in Senate and Assembly, do enact as follows:

SECTION 1. Every contract whereby a benefit may accrue to a party or parties therein named upon the death or physical disability of an animal insured thereunder, or for the payment of any sums of money dependent in any degree upon the collection of assessments or dues from owners holding similar contracts, shall be deemed a contract of mutual insurance upon the assessment plan. Such contracts must show that the liabilities of the insured thereunder are not limited to fixed premiums.

SEC. 2. Corporations may be formed under the general laws of this State to carry on the business of mutual live stock insurance upon the assessment plan, and shall be subject only to the provisions of this Act. No such corporation shall issue contracts of insurance until at least two hundred (200) persons owning live stock have applied, in writing, for membership or insurance therein, and have paid to the treasurer of such corporation the sum of five thousand (5000) dollars. This sum shall be invested in bonds or securities, approved by the Insurance Commissioner of this State, or deposited in some bank in this State where it will earn interest. Said bonds or securities, or evidences of such deposit, shall be placed, through the Insurance Commissioner of this State, with the State Treasurer, and the principal sum shall be held in trust for the contract holders of such corporation, with the right in the corporation to exchange said bonds, securities, or evidence of bank deposit for others of like value. Such corporation shall also, as a condition precedent to issuing any contracts of insurance, obtain the written certificate of the Insurance Commissioner that it has complied with the requirements of

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