GIFT OF IL- STATE OF IOWA / M LAWS RELATING TO NSURANCE ANNOTATED ALSO TO Corporations for Pecuniary Profit AND Workmen's Compensation 1921 A. C. SAVAGE Commissioner of Insurance Compiled by R. N. LYNCH Policy Examiner 1^1 -yf The Code of Iowa is copyrighted and the statutes herein contained are reprinted by authority of the Executive Council as by law provided. INSURANCE LAW Islotc — Sections in this compilation bear the section numbers of the Code of 1897 or the Supplement of the Code of 19i;'> or the Supplemental Supplement to the Code of 1915, whichever is applicable, or the section and chapter number and number of the General Assembly which passed the act. Section numbers of the proiposed Compiled Code appear directly after the present code section number, or section and chapter of the General Assembly. Much of the law relative to insurance passed by the 37th, o8th and .S9th General Assembly neither repealed nor amended present sections of the then existing law, but in numerous instances added new matter thereto. Such sections and chapters have been inserted in various parts of this compilation, wherever the same seem to be most applicable. Such sections and chapters have no code section numbers and conse- quently are indexed by page number in the index. Sections of the Compiled Code are not in numerical order since it was necessary to follow the arrangement of our existing law and not the proposed arrangement of the Code Commission. 4933i">5 Table of Contents INSURANCE LAWS. Department of Insurance, Ch. 3A, Page 1. Insurance Other Than Life, Ch. 4, Page 5. State and County Mutual Associations, Ch. 5, Page 61. Life Insurance Companies, Ch. 6, Page 68. Assessment Life, Health and Accident Associations, Ch. 7, Page 80. Provisions Applicable to Life Insurance Companies and Associations, Ch. 8, Page 93. Examination of Companies, Ch. 8A, Page 106. Consolidation, Reinsurance Agents, Proxies, etc., Ch. 8B, Page 110. Fraternal Orders or Societies, Ch. 9, Page 114. Reciprocal Exchanges and Miscellaneous Provisions, Miscellaneous Sections, Page 133. APPENDIX. Iowa Short Rate Tables, Page 148. Forms for Articles of Incorporation, Amendments, etc., Page 150. Law of Corporations for Pecuniary Profit, Page 157. Workmen's Compensation Law, Page 185. INDEX. Insurance Laws, Page 218. » « t ■> t INSURANCE LAW OF IOWA CHAPTER 3-A, TITLE IX, CODE. COMMISSIONER OF INSURANCE AND DEPARTMENT OF INSURANCE. Section 1683-r (0. 0. 5460). Appointment by governor — con- firmation by senate — term — bond — compensation. That there is hereby created and established a department to be known as the insurance department of Iowa. The chief officer of said depart- ment shall be styled "commissioner of insurance," and shall be appointed by the governor on or before the first day of July, nineteen hundred fourteen, said officer to serve until February first, nineteen hundred fifteen. On or before the date of the expiration of the term of ofiice of the commissioner hereby pro- vided for, the governor shall nominate, and with the consent of two-thirds of the members of the senate in executive session, ap- point a person for commissioner, who shall be selected solely with regard to his qualifications and fitness to discharge the duties of this position. No nomination shall be considered by the senate until the same shall have been referred to a committee of five, not more than three of whom shall belong to the same political party, to be appointed by the president of the senate without formality of a motion, which committee shall report to the senate in executive session, which report shall be made at any time when called for by the senate. The consideration of nominations by the senate shall not be had on the same legisla- tive day that the nominations are so referred. Subsequent ap- pontments shall be made as above provided and, except to fill vacanies, shall be .for a period of four years. He shall be sub- ject to removal only under and according to the provisions of chapter seventy-eight of the acts of the thirty-third general assemby, as amended. The governor shall fill as in the first in- stance any vacancy which may arise in this office. Before en- tering upon the discharge of the duties of his office, the commis- sioner of insurance shall give a bond in the penal sum of twenty- five thousand dollars, conditioned as provided for in section eleven hundred eighty-three of the code, the same to be approved by the executive council and filed in the ofiice of the secretary of state. [39 G. A., ch. 209, § 15; 35 G. A., ch. 146, § 1.] Sec. 1683-rl (C. 0. 5461). Office — equipment and supplies. The executive council shall provide the insurance department of Iowa with suitable quarters at the seat of government and shall furnish said department Avith furniture, books, supplies, print- ing and stationery necessary to carry out the provisions of this act. All desks, chairs, filing cases and other furniture, and all books, papers, records and securities of whatsoever kind, and .''2 1 y' • , * : J . . ? .'^* ', '-INSURANCE DEPARTMENT Ch. 3-A, T. IX all other property of everj" character now in the office of the auditor of state and relating to or connected with the business and supervision of insurance in this state shall be transferred, delivered and surrendered to the commissioner of insurance upon the second secular day of January, nineteen hundred fifteen. [35 G. A., ch. 146, § 2.] Sec. 1683-r2 (C. C. 5462). Deputy — bond — examiners — assist- ants — clerks — compensation. The commissioner of insurance is hereb}' directed to appoint a deputy commissioner to assist him in his work, who shall serve during the pleasure of the com- missioner of insurance. Before entering upon the duties of his office, the deputy commissioner shall give a bond in the penal sum of ten thousand dollars conditioned as provided in section eleven hundred eighty-three of the code, the same to be approved by the executive council and filed with the secretary of state. The commissioner of insurance is also empowered and directed to appoint such other clerks and assistants as shall be needed in the performance of the duties of his office; and he may con- tract such expenses as may be necessary in the performance of ]iis official duties, including all actual and necessary ex- peiises incurred in attendiug meetings of the insurance com- missioners and sucli other expense as shall be approved by the executive council; but the total amount to be so expended for such contingent expenses shall not exceed the sum of ten hun- dred dollars annually ; and there is hereby appropriated out of any funds in the state treasury not otherwise approi)riated two thousand dollars annually or so much thereof as may be neces- sary to meet the expenses thus incurred. All salaries of addi- tional clerks and assistants herein provided for shall be paid in the same manner as are the salaries of other state officers out of the general revenues of the state and on the first day of each month all such salaries and other expenses as are indicated here- in shall be paid by warrant drawn bv the auditor of state upon the treasurer of state. [39 G. A., ch. 209, ^ 16; 35 G. A., ch. 146, § 3.] CHAPTER 224 39TH G. A. (0. C. 5462-al TO a-3) AN ACT to prevent fraud in the organization of Iowa insurance corpora- tions, and the sale and disposition of the stock and other •securities of insurance corporations within the state of Iowa, by placing the supervision of such organization and sale under the control of the commissioner of insurance, fixing the penalty for violating the provisions of this act, and providing for an appeal from the com- missioner of insurance. Be It Enacted By the General Assembly of the State of Iowa : Section 1. The commissioner of Insurance is hereby given supervision over the organization of domestic insurance corpora- tions, and over all transactions leading up to the organization of such corporations, and also over the sale in the state of Iowa, Ch. 3-A, T. IX INSURANCE DEPARTMENT 3 ol' all stock, coi'tificatcs or other evidences of iiileresl, eillier by (lomestic or I'or'eij^ii insui'aiice coin[)anies or orgaiiizutioiis pro- posing to engager in any insurance business. Neither the stock in an insurance coin])any or the nu^nibership in an insurance association now or hereafter in x^rocess of organization shall be sold or solicited until such company and association, and the promoters thereof, shall have first complied with all of the statu- tory provisions regulating the organization of such companies and associations, and also have secured from the commissioner of insurance a certificate of compliance indicating full compli- ance with the provisions of this act. Before the commissioner of insurance shall issue such certificate of compliance, he shall first be satisfied with the general plan of such organization and the character of the advertising to be used; he shall also fix the time within which such organization shall be completed; he shall also prescribe the method of keeping books and accounts of such corporation and those of fiscal agents. The maximum promotion expense which may be incurred, which shall in no case exceed fifteen (15) per cent of the subscription price of said stock pro- viding that an additional two and one-half per cent (21/2%) of the subscription price of said stock may be used by the company for office expense but no portion of such amount shall be used in the payment of salaries for officers and directors before the issuance l)y the commissioner of iiisurance of authority to transact an insurance business. The commissioner of insur- ance shall have power to regulate all other matters in Connec- tion with the organization of such domestic corporations, and tlie sale of stock or the issuing of certificates by all insurance cor- porations within the state of Iowa, to the end that fraud may be prevented in the organization of such companies and the sale of their stocks and securities. The provisions of tliis act shall apply to insurance corporations now organizing or selling thcii' stocks and securities within the state of Iowa. Sec. 2. Any person, proOnoter, firm, association, company or corporation coming within the provision of this act, who shall fail to comply with the provisions of this act, or with any order of the commissioner of insurance made hereunder, or who shall otherwise neglect or refuse to comply with any of such require- m.ents, shall be guilty of a misdemeanoi', and uj^on conviction thereof shall be fined not to exceed one thousand dollars and by imprisonment in the county jail not to exceed six months. Those guilty of violating the provisions of this act shall, in addition to the criminal punishment otherwise imposed in this act, be liable to a penalty in the amount of corporation stock vrrongfully sold in any insurance corporati(«^n in violation of this act, and said penalty may be collected by civil suits brought by and in the name of the several purchasers of such stock, instituted in any court of competent jurisdiction. Any insurance corporation sell- ing stock or soliciting menibei-shij^s ^vithout fii-sl (Mnnplying A\-i1h 4 INSURANCE DEPARTMENT Ch. 3-A, T. iX the provisions of this act, shall not be granted a certificate of authority to transact business within the state of Iowa from the commissioner of insurance. Sec. 3. Any person, promoter, firm, association, company or corporation aggrieved by any order made by the commissioner of insurance under the provisions of this act, shall have the right to appeal to the district court at the seat of government, by the service of a written notice of appeal on the commissioner of insurance and the attorney general; and thereupon the cause may be docketed and the case may be tried in the district court as a special equitable action by the filing of such transcript and such pleadings as the court may prescribe in order that an intelligent hearing may be had and a just decision rendered thereon free from am'- technical objection or irregularities in the matter of procedure or the introduction of evidence. Sec. 1683-r3 (C. C. 5463). Powers and duties of commissioner. The commissioner of insurance shall be the head of the insurance department of Iowa and shall have general control, supervision and direction of all insurance business transacted in the state of Iowa and shall be charged with the execution of the laws of this state relating to insurance; and all powers now vested in and all duties imposed upon the auditor of this state relating in any way to insurance matters, shall, from and after the taking effect of this act, be vested in and made incumbent upon the com- missioner of insurance herein provided for. [35 G. A., ch. 146, § 4.] Commissioner of insurance authorized to accept service of process on non-resident insurance companies where suit is brought by non-resident of Iowa. The courts in dealing with litigants know neither resident nor non-resident. Flynn v. Western Mutual Life Assn., 171 N. W. 711. Failure of non-resident company to comply with section 1808 of code cannot be pled in its defense to prove lack of notice when notice has been served on commissioner. Companies doing business in state presumed to comply with law. Flynn v. Western Mutual Life Assn., 171 N. W. 711. The law making power may delegate to ministerial officers the right to determine whether conditions have been complied with as a condition precedent to issuing licenses. Legislature may delegate to officers certain powers somewhat judicial in their nature in the control and manage- ment of business. This power may be both discretionary and judicial. Held that commissioner has power to make uniform rulings. Noble v. English, 183 Iowa, 93. Sec. 1683-r4 (C. 0. 5464). Documents and records — auditor shall deliver. All books, records, files, documents, reports, and securities and all papers of every kind and character relating to the business of insurance and now enjoined and required by law to be delivered to or to be filed or be deposited with the auditor of state shall, from and after the taking effect of this act, be deliv- ered to and filed or deposited with the said commissioner of in- surance. [35 G. A., ch. 146, § 5.] Ch. 4,T. IX INSURANCE OTHER THAN LIFE 5 Sec. 1683-r5 (C. C. 5467). Fees. All fees and charges of every character whatsoever which are now required by law to be paid to the auditor of state by insurance companies and associations shall from and after the taking effect of this act be payable to the insurance commissioner whose duty it shall be to account for and pay over the same to the treasurer of state at the time and in the manner as now provided for by law for the auditor of state. [35 G. A., ch. 146, § 6.] Sec. 1683-r6. Acts in conflict repealed. All acts or parts of acts in so far as they are in conflict herewith are hereby re- pealed. [35 G. A., ch. 146, § 7.] CHAPTER 4, TITLE IX, CODE. INSURANCE OTHER THAN LIFE. Section 1684 (0.0. 5598). Proceedings for incorporation. Cor- porations formed for the purpose of insurance, other than life in- surance, shall be governed by the provisions of chapter one of this title, except as modified by the provisions of this chapter. [C. '73, § 1122.] Number 1607; Powers 1609; Procedure 1610; Corporate existance com- mences 1614; Duration 1618. Sec. 1685 (0. 0. 5599). Articles — approval. Each such or- ganization shall present to the commissioner of insurance it^ ar- ticles of incorporation, which shall show its name, objects, loca- tion of its principal place of business and amount of its capital stock, who shall submit it to the attorney-general for examina- tion, and if found by him to be in accordance with the provis- ions of this title, the laws of the United States, and the consti- tution and laws of the state, he shall certify such fact thereon and return the same to the commissioner of insurance, and no ar- ticles shall be approved by the commissioner of insurance or re- corded unless accompanied with such certificate. (Same.) Life 1768-85, Fraternals 1832. Sec. 1686 (0. 0. 5600). Oertificate — recording. If the commis- sioner of insurance approves them, he shall so certify, and the articles with the certificates of approval shall be recorded in the office of the secretary of state as articles of other corporations are, who shall indorse thereon his certificate thereof, as is re- quired in case of other corporations for pecuniary profit. [C. 73, § 1123.] See. 1687 (0. 0. 5601). Name. If the commissioner of insur- ance finds the name of the company to be so similar to one al- ready appropriated by a corporation of the same character as to 6 INSURANCE OTHER THAN LIFE Cli. 4, T. IX be likel}' fo mislead the public or to cause inconvenience, he shall refuse his certificate to its articles on that ground. [C. '73, § 1122.] Applicable to life companies. See 1786. An insurance company, although authorized to do business by the auditor of state [commissioner of insurance], may be enjoined from using a name which is so similar to the name of a foreign insurance company authorized to do business in the state that it is calculated to deceive the public. Atlas Assurance Co. v. Atlas Insurance Co., 138-278. Sec. 1688 (C. C. 5602). Recording with commissioner of in- surance. The article, when thus certified by the secretary of state as recorded in his office, or a copy thereof certified by him as such, shall be filed in the office of the commissioner of insur- ance and remain therein. [C. "73, § 1123.] Sec. 1689 (0. C. 5603). Kind of Company. Every domestic and foreign insurance company organized and doing business under this chapter shall indicate upon the first page of every policy and renewal receipt that the policy is issued b}^ a mutual company in case of a mutual company, and by a stock company in case of a stock companv. [37 G. A., ch. 429, § 1 ; 31 G. A., ch. 68; C. '73, § 1140.] Sec. 1690 (C. C. 5604). Stock or mutual. No company shall be organized to do business upon both stock and mutual plans; nor shall a company organized as a stock company do business upon the plan of a mutual company ; nor shall a companj^ organ- ized upon a mutual plan do business or take risks upon the stock plan. [C. '73, § 1159.] A mutual company cannot issue policies upon the stock plan, and such policies, if issued, are illegal and void. Smith v. Sherman, 113-601, A company issuing a policy on the stock plan will be presumed to have authority to issue such a policy until the contrary appears. One contracting with the company is not bound to know at his peril whether the company has complied with the condition authorizing it to do a stock insurance business. Harris-Emery Co. v. Pitcairn, 122-595. "Where a company organized on a mutual plan issued policies of insur- ance on the stock plan, held, that such policies were invalid and that members of the company were not subject to assessment for losses under such policies. Cory v. Sherman, 96-114. Sec. 1691 (C. C. 5605). Capital required. No stock company shall be incorporated under the provisions of this chapter with a less capital than fifty thousand, nor Jarger than one million dollars, as may be specified in the articles of incorporation, which stock shall be divided into shares of one hundred dollars each, of which capital not less than twenty-five per cent, and in no case less than twenty-five thousand dollars, shall be paid up in cash. The balance of the capital may consist in the bonds or notes of solvent stockholders. [C. '73, § 1124.] Ch. 4, T. IX INSURANCE OTHER THAN LIFE 7 Capital, other than life, 1699, ] 701-10-21-32-39. Life 1769-72. Stock 1690-1713-34. Applicable 1821e. See. 1692 (C. C. 5606). Mutuals must have certificate— con- ditions. No iiiutual c!uinpaiiy sJiall issiu' policies or transact any business of insurance unless it sliaii hold a certificate of author- ity from the commissioner of insurance authorizing the transac- tion of such business, which certificate of atithority shall not be issued until and unless the company shall comply witli the fol- lowing- conditions: (1) It shall hold bona fide applicatioiis for insurance upon which it shall issue simultaneously, or it shall have in force, at least two hundred policies issued to at least two hundred mem- bers for the same kind of insurance upon not less than two hun- dred sei:)arate risks, each within the maximum single risk de- scribed herein ; provided, tJiat not more than one hundred mem- bers shall be required for employer's liability and workmen's compensation insurance. (2) The maximum single risk shall not exceed twenty j^er cent of the admitted assets, or three times the average risk, or one per cent of the insurance in force, whichever is the greater, any reinsurance taking effect simultaneously with the policy be- ing deducted in determining such maximum single risk. (3) It shall have collected a premium upon each application, which premium shall be held in cash or securities in which insur- aiice companies are authorized to invest, which shall be equal, in case of fire insurance, to not less than twice the maximum sin- gle risk assumed subject to one fire not less than ten thousand dollars; and in any other kind of instirance, to not less tlian five times the maximum single risk assumed; and, in case of employer's liability and workmen's compensation insurance, to not less than fifty thousand dollars. (4) For the purpose of transacting employer's liability and workmen's compensation insurance, the applications shall cover not less than one thousand five hundred employees, each such employe being considered a separate risk for determining the maximum single risk. [37 G. A., ch. 429, § 2; C. '73, § 1124.] Sec. 1693 (C. C. 5607). Members of mutuals. Any public or private corporation, board or association in this state, or else- where, may make applications, enter into agreements for and hold policies in any such mutual insurance company'. Any officer, stockholders, trustee or local representative of any such corporation, board, association or estate may be recognized as acting for or on its behalf for the purpose of such member- sliip, but shall not be personally liable upon such contract of in- surance by reason of acting in such representative capacity. The 8 INSURANCE OTHER THAN LIFE Ch. 4, T. IX right of any corporation organized under the laws of this state to participate as a member of any such mutual insurance com- pany is hereby declared to be incidental to the purpose for which such corporation is organized and as much granted as the rights and powers expressly conferred. [37 G. A., ch. 429, § 3; C. 73, § 1124.] UNALLOCATED SECTIONS OP CH. 429, 37TH G. A. Sec. 4 (C. C. 5608). Voting power of mutual members. Every policyholder of such mutual company shall be a member of the company and shall be entitled to one vote, and such members may vote in person or by proxy as may be provided in the by- laws. [37 G. A., ch. 429.] Sec. 5 (0. C. 5609). Maximum premiums — mutual companies. The maximum premium payable by any member of a mutual company shall be expressed in the policy and in the application for the insurance. Such maximum may be a cash premium and an additional contingent premium not less than the cash premium, or may be solely a cash premium, which premium may be made payable in installments or regular assessments. No policy shall be issued for a cash premium without an additional contingent premium unless the company has a surplus which is not less in amount than the capital stock required of domestic stock insur- ance companies transacting the same kind of insurance. [37 G. A., ch. 429.] Sec. 6 (C. C. 5610). Unearned premiums, maintenance in mu- tuals. Such mutual company shall maintain unearned premium and other reserves separately for each kind of insurance, upon the same basis as that required of domestic insurance companies transacting the same kind of insurance; provided, that any re- serve for losses or claims based upon the premium income shall be computed upon the net premium income, after deducting any so called dividend or premium returned or credited to the mem- ber. [37 G. A., ch. 429.] Sec. 7 (C. C. 5611). Mutual assessments — relief. Any such mutual company not possessed of assets at least equal to the un- earned premium reserve and other liabilities shall make an assessment upon its members liable to assessment to provide for such deficiency, such assessment to be against each member in proportion to such liability as expressed in his policy ; provided, the commissioner may by written order, relieve the company from an assessment or other proceedings to restore such assets during the time fixed in such order. [37 G. A., ch. 429.] Sec. 8 (C. C. 5612). Advancement of funds — conditions. Any director, officer or member of any such mutual company, or any other person, may advance to such company, any sum or sums Ch. 4, T. IX INSURANCE OTHER THAN LIFE 9 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 and such interest thereon as may have been agreed upon not exceeding the maximum statutory rate of interest shall not be a liability or claim against the company or any of its assets, except as herein provided and upon approval of the commissioner of insurance may be repaid, but only out of the surplus earn- ings of such com2:)any. No commission or promotion expenses shall be paid in connection with the advance of any such money to the compan}^ The amount of such advance shall be reported in each annual statement. [37 G. A., ch. 429.] Sec. 9 (C. C. 5613). Additional policy provisions. Such mu- tual company may insert in any form of policy prescribed by the law of this state any additional provisions or conditions re- quired by its plan of insurance if not inconsistent or in conflict with any law of this state. [37 G. A., ch. 429.] Sec. 10 (C. C. 5614). Countersigning policies. Such mutual company shall comply with the provisions of any law applicable to stock insurance companies effecting the same kind of insurance requiring that policies be countersigned and delivered through a resident agent, provided that this requirement shall not apply to any policy of such mutual company on which no commission shall be paid to any local agent. [37 G. A., ch. 429.] Sec. 11 (C. C. 5615). Existing corporations not affected. The provisions of this chapter shall not apply to any company or association of this state now doing business whether organized under chapter four or chapter five, title nine of the code, as amended unless such company or association shall so elect by resolution of its board of directors duly certified to by the presi- dent and secretary and filed with and approved by the commis- sioner, and shall further amend its articles, if necessary, to per- mit full compliance with this chapter and to include such addi- tional kind or kinds of insurance as such company or association intends to transact. On the filing and approval of such resolu- tion and on making such amendment if required, such company may be authorized to transact such kinds of insurance under this chapter. [37 G. A., ch. 429.] Sec. 20 (C. C. 5616). Tax — computation. For the purpose of determining the basis of any tax upon the ^' gross amount of pre- miums," or ''gross receipts from premiums, assessments, fees and promisory obligations," now or hereafter imposed upon any mu- tual fire or casualty insurance company under any law of this state, such gross amount or gross receipts shall consist of the gross premiums or receipts for direct insurance, without includ- ing or deducting any amounts received or paid for reinsurance, but with such other deductions as provided by law, and in ad- 10 INSURANCE OTHER THAN LIFE Ch. 4, T. IX ditiou deducting any so called dividend or return of savings or gains to policA'liolers ; provided, that as to any deposits or de- l^osit premiums received by any such company, the taxable pre- miums shall be the portion of such deposits or deposit premiums earned during the year with such deductions therefrom as pro- vided by law. [37 G. A. ch. 429.] Sec. 1694 (0. C. 5617). Organization — stock or mutual. After approval of the articles of incorporation, as provided in section sixteen hundred eighty-five (1685), and upon completing the pub- lications of the notice of incorporation required b.y chapter 1 of this title and filing of the publisher's affidavit thereof with the sec- retary of state together with the articles of incorporation as re- quired in this chapter, which shall be certified to tlie commis- sioner of insurance by the secretary of state; and upon issuance of his certificate, the company shall have the legal existence as a corporation, and the persons named in such articles as incor- 13orators, or a majority of them, are authorized to open books for subscriptions to stock companj^, or to take applications aiul receive premiums for insurance, if a mutual compam^, at such times and places as thej^ may find convenient, and to keep such books open until the full amount required is subscribed or taken. [37 G. A., ch. 429, § 12; C. '73, § 1125.] Sec. 1695 (C. C. 5618). Directors. The affairs of a compan.y organized under this chapter shall be managed by not less than five and not more than twent.y-one directors, all of whom, in case of a stock company, shall be stockholders, or in case of a mutual company, be policyholders, before the company shall effect insurance, be subscribers for stock or for insurance as the case may be. When the subscriptions required by this chapter for stock, if a stock company, or for insurance, if a mutual com- pany, shall have been obtained, the incorporators shall give at least ten days' written notice by mail to such subscribers of a meeting of the subscribers for the election of directors and such meeting shall be held within thirt}^ days after such sub- scriptions have been completed and the directors then elected shall continue in office until their successors have been elected and qualified. [37 G. A., ch. 429, § 13; C. 73, § 1126.] Sec. 1696 (C. C. 5619). Annual meetings. The annual meet- ings for the election of directors shall be held during the month of January, at such time as the bj-laws of the company may direct ; but if for any cause no election is held, or there is a failure to elect at any annual meeting, then a special meeting for that purpose shall be held on the call of a majority of the directors, or of those persons holding a majority of the stock, or of a majority of policy holders if a mutual company, by giv- ing thirty days' notice thereof in some newspaper in general circulation in the county in which the principal office of the Ch. 4, T. IX INSURANCE OTHER THAN LIFE 11 company is located, and the directors chosen at any such annual or special meeting shall continue in office until the next annual meeting, and until their successors are elected and have accepted. [C. 78, § 1127.] Representation 1821v-w. Sec. 1697 (C. 0. 5620). Powers of directors— president. The directors sliall elect by ballot from their own numlx'r a president, and fill all vacancies occurring- in the board or presidency there- of; and tlie board of directors thus constituted, or a majority of tliem, when, convened at the office of the compaiiy, shall be com- petent to exercise all the ])()wers vested in them by tliis chapter. [C. 73, § 1128.] See. 1698 (C. C. 5621). Secretary and other officers — by-laws — records. The board of directors sliall have power to appoint a secretary and any other officers or agents necessary for trans- acting the business of the company, paying such salaries and taking such security of them as is reasonable; it may adopt such by-laws and regulations not inconsistent with law as shall appear to them necessary for the regulation and conduct of the business, and shall keep full and correct entries of their transactions, which shall at all times be open to the inspection of the stock- holders if a stock company, or policy holders if a mutual com- pany, and to, the inspection of persons invested by law with the right thereof. [C. 73, § 1129.] While members of a mutual company may be bound by by-laws adopted after they become members, nevertheless the terms of a policy of insur- ance will be presumed to be governed by the by-laws in force when it is issued, and not to be affected by those subsequently adopted. Farmers' Mut. Hail Ins. v. Slatteri/, 115-410. By-laws duly adopted, but not posted as required by law, are valid and controlling as to all persons informed of their existence, the posting being required for the sole purpose of imparting constructive notice, and if the existence of the by-laws is expressly recognized, the person who receives such certificate is bound thereby. Fee v. National Masonic Ace. Assn., 110-271. The directors of an insurance company organized under this chapter, whether doing business under the ordinary or mutual plan, have the right to ordain and establish by-laws and regulations. The parties may by contract mutually agree to the waiver of a by-law. Hoiidcck v. Mer- chants' and Bankers' Ins. Co., 115-410. Sec. 1699 (C. C. 5622). Funds invested. Any company or- ganized under this chapter shall invest its capital and funds in the folloAving described securities and no other: 1. The bonds of the United States. 2. The bonds of the state or any other state when such bonds are at or above par. 3. Bonds or other evidences of indebtedness of any county, city, town or school district within the state or any other state, drainage district bonds of this state, improvement certificates issued by any municipal 12 INSURANCE OTHER THAN LIFE Ch. 4, T. IX corporation of this state, such certificates being a first lien upon real estate withing the corporate limits of the municipality issuing the same, where such bonds, or other evidences of indebtedness are issued by au- thority of and according to law and bearing interest. 4. Bonds and mortgages and other interest bearing securities being first liens upon real estate within this state or any other state worth at least double the amount loaned thereon and secured thereby exclusive of improvements, or two and one-half times such amount including the im- provements thereon, but no such improvements shall be considered in estimating the value unless the owner shall contract to keep the same insured during the life of the loan, in some reliable fir« insurance com- pany or companies authorized to do business in the state, other than the company making the investment, in a sum at least double the excess of the loan above one-half the value of the ground exclusive of the improve- ments, the insurance to be made payable in case of loss to the company or association investing its funds, as its interest may appear at the time of loss; except that the surplus funds may be invested in stocks other than bank stock or in bonds or other evidences of indebtedness of any solvent dividend paying corporation organized under the laws of any of the states, or the United States, or may be loaned thereon upon pledge thereof, at not exceeding eighty per cent of their current market value, but no investment shall be made in the companies' own stock. [34 G. A., ch. 18, § 3; 33 G. A., ch. Ill, §1; C. '73, § 1130.] "While as between the state and the company the investment of its surplus in bank stock may be unauthorized, such a transaction entered into by the officers for the purpose of avoiding loss to the company may be so ratified by the directors in taking advantage of the benefits thereof as to estop the corporation from treating the transaction as ultra vires. Fidelity Ins. Co. v. German Sav. Banlc, 127-591. Life 1778-91, applicable 1806-7. Fraternals 1839-1. See. 1700 (0. C. 5623). Financial statements — examinations — certificate of authority. After complying with the requirements of the preceding sections, the company shall file with the com- missioner of insurance a satisfactory detailed statement showing the financial condition of the company, including all transac- tions had during its organization, together with a record of all moneys received and disbursed, a list of the stockholders, the amount of stock purchased by each, and the price paid, and such commissioner maj^ appoint in writing some disinterested person to make an examination and if it shall be found that the capital or assets herein required of the company named, according to the nature of the business proposed to be transacted by such company, have been paid in, and are now possessed by it in money or such stock, bonds and mortgages as are required by the preceding sec- tions of this chapter, he shall so certify ; but if the examination is made by another than the commissioner, the certificate shall be by him, and under his oath. The incorporators or officers of any such company, or proposed company, shall be required to state to the commissioner of insurance under oath that the capi- tal or assets exhibited to the person making the examination are actually and in good faith the property of the company ex- amined, and free and clear of anj^ lien or claim on the part of any other person. The certificate of examination of a mutual Ch. 4, T. IX INSURANCE OTHER THAN LIFE 13 company shall be to the effect that it has received and has in its actual possession (a) the cash premiums, (b) actual con- tract of insurance upon property, belonging to the signers thereof, and upon which the insurance applied for can prop- erly be issued, (c) other securities as the case may be, to the extent and value hereinbefore required. The incorporators or officers of such mutual company shall file the statement under oath required of stock companies. The certificate and state- ments above contemplated shall be filed in the insurance de- partment and the commissioner of insurance shall deliver to the company a copy of the report of the examination, in the event one is made, together with his written permission for it to commence the business proposed in its articles of incorpora- tion, which permission shall be its authority to commence busi- ness and issue policies. Such certificate of authority shall ex- pire on the first day of March next succeeding its issue, and shall be renewed annually so long as such company shall trans- act business in accordance with the requirements of law; a copy of which certificate, when certified to by the commissioner of insurance, shall be admissible in evidence for or against a company with the same effect as the original. [37 G. A., ch. 429, § 14; C. '73, § 1131.] See also 1732-31-55. Life 1777-1821a to g. Fraternals 'l839b, c. Sec. 1701 (C. 0. 5624). Capital increased. When the directors of a stock company with less than the maximum capital allowed in this chapter desire to increase the amount, they shall, if au- thorized by the holders of a majority of the stock to do so, file with the commissioner of insurance an amendment of its articles authorizing such increase, not exceeding the maximum authorized capital, and thereupon shall be entitled to have the increased amount of capital fixed by such amendment, and the examination of securities constituting the increased capital stock shall be made in the same manner as provided for the original capital stock. [C. '73, § 1135.] Sec. 1702 (0. 0. 5625). Dividends — ^reserve. The directors or managers of a stock company incorporated under the laws of this state shall make no dividends, except from the profits arising from their business, and in estimating the profits, a reserve for unearned premiums as set out in this section, also a reserve for unpaid losses, expenses and taxes which have been incurred shall be set up ; and there shall also be held as non-admitted assets all sums due the corporation on bonds and mortgages, bonds, stocks and book account, of which no part of the prin- cipal or interest thereon has been paid during the year preced- ing such estimate of profits, and upon which suit for foreclo- sure or collection has not been commenced, or which, after judg- ment has been obtained thereon, shall have remained more thaj^ 14 INSURANCE OTHER THAN LIFE Ch. 4, T. IX two years unsatisfied, and on which interest has not been paid ; and such judgment with the interest due or accrued thereon and remaining unpaid, shall also be so held. Any dividend made contrary to these provisions shall subject the compam^ making- it to forfeiture of its franchise. The policy liability of any com]3any or association, transact- ing business under the proA^isions of this chapter, and the amount such company or association shall hold as a reserve for un- earned premiums, shall be computed in the following manner : On all policies written or renewed prior to January 1, 1922, there shall be held as such unearned premium reserve an amount equal to forty (40) per cent of the aggregate gross premiums written in all policies in force, less deductions for reinsurance in authorized companies or associations. On all policies written or renewed on and after January ], 1922, and running one (1) year or less from date of i^olicy or last re- newal thereof, shall be held as such unearned premium reserve an amount equal to fifty (50) per cent of the aggregate gross premiums Avritten in all policies in force, less deductions for reinsurance in authorized companies or associations. On all policies written or renewed on and after January 1, 1922, and running for more than one (1) year, and not exceeding five (5) years, from date of policy or last renewal thereof there shall be held as such unearned premium reserve an amount of the ag- gregate gross premiums written in all policies in force, less de- ductions for reinsurance in authorized companies or associations, computed in accordance with the following table: Terms far which Reserve for policy was written. unearned premium. Two years 1st year 3-4 2nd year 1-4 Three years 1st year 5-6 2nd year 1-2 3rd year 1-6 Four year s 1st year 7-8 2nd 5^ear 5-8 3rd year 3-8 4th year 1-8 Five years 1st year 9-10 2nd year 7-10 3rd year 1-2 4th year 3-10 5th year 1-10 On all policies written or renewed on and after January 1, .1922, and running for more than five (5) j-ears from date of policy or last renewal thereof, there shall be held as such unearned pre- mium reserve an amount of the aggregate gross premiums, less deductions for reinsurance in authorized companies or associa- Ch. 4, T. TX INSURANCE OTHER THAN LIFE 15 lions ('(juals to Hk^ ])ro rata uiK'anicd prciiiiiin) on all jjolicics in t'oi-cc. Tile lenu pro i-aia used lierein shall he sueh proportion of the gross premiums on policies in f'oree as th(; numher of mouths unexpired hears to the total num])er of months for which tlie policy was written. On all policies written or renewed and for which any premium has been received which would continue a policy in force for a period beyond tlie term for which it was written, or term cov- ered b}^ last renewal thereof, there shall be held as such unearned premium reserve an amount equal to one liundred (K)0) per cent of such premium on all policies in force. Provided, however, that mutual companies or associations, or- ganized, or doing business under this chapter, shall hold as a reserve for unearned premiums an amount equal to at least forty (40) per cent of the aggregate gross premiums written in all policies in force less deductions for reinsurance in author- ized companies or associations. [31) (J. A., ch. 190, § 1 ; ('. '73, § 1136.] See also 1714 sixth, sub-div. 3. Sec. 1703 (C. C. 5626). May own real estate. No company organized under this chapter shall purchase, hold or convex^ any real estate, save for the purpose and in the manner herein set forth : 1. Such as shall be required for the transaction of its business; 2. Such as shall have been mortgaged to it in good faith by way of security for loans previously contracted, or for money due; 3. Such as shall have been conveyed to it in satisfaction of debts perviously contracted in the legitimate business of the company, or for money due; 4. Such as shall have been purchased at sales upon judgments, decrees or mortgages obtained or made for such debt, or obtained by redemption as junior judgment creditor or mortgagee; but it may convey real estate which shall be found in the course of its business not necessary therefor, and all such last mentioned real estate -shall be sold and conveyed within three years after the same has been determined by the commissioner of insurance, unnecessary, unless the company shall procure a certificate from him that the interest of the company will materially suffer by a forced sale, in which event the sale may be postponed for such period as he may direct in such certificate. [C. '73, § 1137.] Life companies and associations 1803. Fraternals 1839k. Sec. 1709 (C. C. 5627). Kinds of Insurance — limitation of risk. 1. [Fire.] Insure houses, buildings, and all other kinds of property against loss or damage b^^ fire, lightning, sprinkler, leakage, or other casualty incident to or connected with fire, lightning, cyclone, tornado, or windstorm hazards and to insure growing crops against destruction l)y hail ; and make all kinds of insurance on goods, merchandise, moneys and securities or other property in the course of transportation, whether on land 16 INSURANCE OTHER THAN LIFE Ch. 4, T. IX or water or any vessel or boat wherever the same may be ; and insure against loss of rents or use of buildings when such loss or use is caused by fire, lightning, windstorms, cyclone or tor- nadoes; and also insure glass against breakage. [38 G. A., ch. 348, § 1 ; 37 G. A., ch. 428, § 1 ; 35 G. A., ch. 144, § 1 ; 34 G. A., ch. 18, § 4; 31 G. A., ch. 72, §§ 1, 2; C. '73, 1132.] 2. [Fidelity.] Insure the fidelity of persons holding places of private or public trust, or execute as surety anj^ bond or other obligation required or permitted by law to be made, given or filed, except bonds required in criminal causes. None but stock companies shall engage in fidelity and surety business ; and insure the maker, drawer, drawee or endorser of checks, drafts, bills of exchange or other commercial paper against loss by reason of any alteration of such instruments. [38 G. A., ch. 372, S. 1913, § 1709.] 3. [Safe deposits.] Insure the safe keeping of books, papers, moneys, stocks, bonds and all kinds of personal property, and receive them on deposit. [S. 1913, § 1709; C. '73, § 1132.] 4. [Live stock.] Insure against loss or damage by theft, in- jury, sickness or death of animals and to furnish veterinary service. [37 G. A., ch. 429, § 16 ; 31 G. A., ch. 69; C, '73, § 1132.] 5. [Casualties classified.] (a) Insure the health of persons and against personal injuries, disablement or death resulting from traveling or general accidents by land or water. (b) Insure against liability for loss, damage or expense result- ing from personal injury or death caused by error or negligence of the insured in the practice of medicine, surgery or dentistry, including the performance of surgical operations, or in the pre- scribing or dispensing of drugs or medicines, or for loss by rea- son of damages in other respects, for which loss, damage or ex- pense the insured is legally liable ; provided, however, that any policy issued by any such company shall contain a provision so that said policy shall inure to the benefit of any person obtain- ing a judgment against the insured to the extent of the insurance carried and for the purpose for which the insurance was issued. (c) Insure against loss or damage to property caused by the accidental discharge or leakage of water from automatic sprink- ler system. • .:| (d) Insure employers against loss in consequence of accidents or casualties of any kind to employes, including workmen's com- pensation, or other persons, or to propertj' resulting from smy act of an employe, or any accident or casualty to persons or property, or both, occurring in or connected with the transaction of their business, or from the operation of any machinery connected there- with. Ch. 4, T. IX INSURANCE OTHER THAN LIFE 17 (e) Insure against liability for loss or expense arising or re- sulting from accidents occurring by reason of the ownership, main- tenance or use of automobiles or other conveyances, resulting in personal injuries or death, or damage to property belonging to others, or both, and for damages to assured 's own automobile when sustained through collision with another object. Provided that should an execution on a judgment against the insured be returned unsatisfied in an action by a person who is injured or whose property is damaged, when such owner or oper- ator has insured his liability for such personal injury or damage, the judgment creditor shall have a right of action against the in- surer to the same extent that such owner or operator should have enforced his claim against such insurer had such owner or opera- tor paid such judgment. [38 G. A., ch. 330 § 1 and 2 ; 37 G. A., ch. 428, § 2 ; 35 G. A., ch. 143, § 1 ; 31 G. A., ch. 71, § 1 ; 31 G. A., ch. 70, § 1 ; 29 G. A., ch. 70, § 1 ; 25 G. A., ch. 32, 1 ; 24 G. A., ch. 29, § 1; C. '73, § 1132.] Life companies may write 1783d, Associations 1784, Fraternals 1822. An association organized by a railroad company for the benefit of em- ployes who participate therein by payment of indemnity in case of acci- dent or death is not within the provisions of the statutes as to insurance. Maine v. Chicago B. & Q. Co., 109-260. An accident within the meaning of a policy of insurance which pro- vides that the injury must occur "through external, violent, and acci- dental means," is a result, the inducing cause for which was not put in motion by the voluntary and unintentional act of the person injured. Payne v: Frat. Ace. Assn., 119 Iowa, 342. In ordinary usage, "casualty" is commonly applied to losses and in- juries which happen suddenly and unexpectedly, not in the usual course of events, and without any design on the part of the person suffering the injury, although the result is brought about by the conscious or intended act of another. Bankers' Mut. Cas. Co. v. First National Bank, 131-456. Foreign corporations are only permitted to do such insurance business in this state as is prescribed by statute. American Fidelity Co. v. Bleakley, 157-442. 6. [Steam boilers.] Insure against loss or injury to person or property, or both, growing out of explosion or rupture of steam boilers. [S. 1913, § 1709.] 7. [Burglary, robbery, theft.] Any insurance company or- ganized and incorporated on the stock or mutual plan may in- sure against loss or damage resulting from burglary or robbery, or attempt thereat. A mutual company organized under this subdivision shall not issue any policy to any person, firm, or corporation other than banks, bankers, loan companies, trust companies, and county treasurers. [37 G. A., ch. 428, § 3 ; 31 G. A., ch. 72, § 1 ; 28 G. A., ch. 60, § 1.] 8. [Credit.] Insure or guarantee and indemnify merchants, traders and those engaged in business and giving credit from loss and damage by reason of giving and extending credit to 18 INSURANCE OTHER THAN LIFE Ch. 4, T. IX their customers and those dealing with them, wliich business shall be known as credit insurance; [29 (I. A., ch. 71, § 1.] 9. [Marine — Automobile — property damage.] Insure vessels, freights, goods, merchandise, specie, bullion, jewels, profits, com- mission, bank notes, bills of exchange and other evidence of debt, bottomry and respondentia interests and every insurance appertaining to or connected with marine risks of transportation and navigation, and make insurance upon automobiles, whether stationary or being operated under their own power, which shall include all or any of the hazards of fire, explosion, transportation, collision, loss by legal liability for damage to property resulting from the maintenance and use of automobiles, and loss by burg- lary or theft or both, but shall not include insurance against loss by reason of bodily injurv to the person. [38 G. A., ch. 348 § 2; 37 G. A., ch. 428, § 4; 33 G. A., ch. 112, § 2.] Only such insurance is authorized as is specifically defined in the Code. Ame7^ican Fidelity Go. v. Bleakly 157 Iowa 442. Cited and approved, 179 Iowa 171 and 180 Iowa 618. Sec. 1710 (C. C. 5628). Kinds of Risks— Limitations. No com- pany authorized to transact business in this state as provided in this chapter, shall issue policies of insurance for more than one of the nine purposes or sub-divisions enumerated in the pre- ceding section, except as herein provided, as follows: (a) Any domestic or foreign insurance company authorized in this state to do the business specified in sub-division one of the preceding section, may in addition to the business specified in sub-division one, insure against the casualties specified in sub- division nine of the preceding section. (b) Any domestic or foreign insurance company authorized in thi-s state to do the business contemplated hy either sub-divi- sions two or five, may in addition to such business insure against the casualties specified in sub-division six of the preceding sec- tion, and also insure against theft, larceny, burglary and robbery, or attempt thereat. (c) Any domestic or foreign company- authorized in this state to transact the business specified in sub-division five of the fore- going section, if it is possessed of a paid up capital of five hun- dred thousand dollars, may, in addition to insuring against the casualties specified in sub-division five, transact the business spe- cified in sub-division two and six of the preceding section and insure glass against breakage. (d) Any domestic insurance company authorized in this state to transact the business specified in sub-division five of the pre- ceding section, and possessed of two hundred and fifty thousand dollars paid up capital stock, may in addition to insuring against Ch. 4, T. IX INSURANCE OTHER THAN LIFE 19 the casualties specified in sub-division five, insure against injury or loss to persons or property, or both, contemplated by sub-divi- sion six, and may also insure glass against breakage. (e) Any foreign insurance company authorized in this state to transact the business specified in sub-division five of the pre- ceding section, if possessed of a paid up capital of three hundred thousand dollars, may, in addition to insuring against the casual- ties specified in said sub-division five, insure against the casual- ties specified in sub-division six of the preceding section and also insure glass against breakage. Providing always, that the charter or articles of incorporation of any such company authorizes the writing of such additional insurance. No coimpany shall expose itself to loss on any one risk or lia/ ard, to an amount exceeding ten per cent of its paid up capital unless the excess shall be reinsured in some other good and re- liable company licensed to do an insurance business in this state. But in no case shall such excess reinsurance exceed ten per cent of the capital of the reinsuring company, and that a certificate of such reinsurance shall be furnished to the insured. But the restrictions as to the amount of risk a company may assume shall not be applicable to a company that receives on deposit and guarantees the safe keeping of books, papers and moneys and other personal property. [39 U. A., ch. 261, § 1 ; 38 G. A., ch. 348, § 3 ; 37 G. A., ch. 428, § 5 ; 34 G. A., ch. 78, § 1 ; 34 G. A., ch. i8, § 21; 33 G. A., ch. 112, ^ 3 ; 31 G. A., ch. 7:1, ^^ 2: 31 G. A., ch ':0. § 2: 20 G. A., ch. 72, § 1; 28 G. A., eh. 61. § 1 ; C. '73, § 1132.] Sec. 1711 (C. 0. 5629). Loans — reinsurance. Such company may lend money on bottomry or respondentia, and cause itself to be insured in companies only authorized to do business in this state, against any loss or risk it may have incurred in the course of its business, and upon the interest which it may have in any property on account of any such loan, and generally to do and perform all other matters and things proper to promote these objects. [34 G. A., ch. 18, § 5; C. '73, § 1132.] Sec. 1712 (0. C. 5630). Policies. All policies or contracts of in- surance made or entered into by the company may be made either with or without the seal of said company, but shall be subscril)e(l by the president, or such other officer as may be designated by the directors for that purpose, and be attested by the secretary thereof. [C. '73, § 1133.] See also 1727-30-45. Standard Fire Policy 1758a. Sec. 1713 (C. 0. 5631). Transfer of stock. Transfers of stock 20 INSURANCE OTHER THAN LIFE Ch. 4, T. IX made by any stockholder or his legal representative shall be sub- ject to the provisions of chapter one of this title relative to trans- fer of shares, and to such restrictions as the directors shall estab- lish in their by-laws, except as hereinafter provided. [C. '73, § 1134.] Sec. 1714 (C. C. 5632). Annual statement. The president or the vice-president and secretary of each company organized or authorized to do business in the state shall annually, on the first day of January of each year or Avithin thirty days thereafter, prepare under oath and file with the commissioner of insurance, a full, true and complete statement of the condition of such com- panj^ on the last day of the preceding month, which shall exhibit the following items and facts: First — The amount of capital stock of the company; Second — The names of the officers; Third — The name of the company and where located; Fourth — The amount of its capital stock paid up; Fifth — The property or assets held by the company, specifying: 1. The value of real estate owned by the company; 2. The amount of cash on hand and deposited in banks to the credit of the company, and in what bank deposited; 3. The amount of cash in the hands of agents and in the course of transmission; 4. The amount of loans secured by first mortgage on real estate, with the rate of interest thereon; 5. The amount of all other bonds and loans and how secured, with the rate of interest thereon; 6. The amount due the company on which judgment has been ob- tained; 7. The amount of bonds of the state, of the United States, of any county or municipal corporation of the state, and of any other bonds owned by the company, specifying the amount and number thereof, and par and market value of each kind; 8. The amount of bonds, stock and other evidences of indebtedness held by such company as collateral security for loans, with amount loaned on each kind, and its par and market value; 9. The amount of assessments on stock and premium notes, paid and unpaid;. 10. The amount of interest actually due and unpaid; 11. All other securities and their value; 12. The amount for which premium notes have been given on which policies have been issued; Sixth — Liabilities of such company, specifying: 1. Losses adjusted and due; 2. Losses adjusted and not due; 3. Losses unadjusted; 4. Losses in suspense and the cause thereof; 5. Losses resisted and in litigation; .6 Dividends in scrip or cash, specifying the amount of each, declared but not due; 7. Dividends declared and due; 8. The amount required to reinsure all outstanding risks on the basis of the unearned premium reserve as required by law. 9. The amount due banks or other creditors; 10. The amount of money borrowed and the security therefor; 11. All other claims against the company; Ch. 4, T. IX INSURANCE OTHER THAN LIFE 21 Seventh — The income of the company during the previous year; specify- ing: 1. The amount received for premiums, exclusive of premium notes; 2. The amount of premium notes received; 3. The amount received for interest; 4. The amount received for assessments or calls on stock notes, or premium notes; 5. The amount received from all other sources; Eighth — The expenditures during the preceding year, specifying: 1. The amount of losses paid during said term, stating how much of the same accrued prior, and how much subsequent, to the date of the preceding statement, and the amount at which such losses were estimated in such statement; 2. The amount paid for dividends; 3. The amount paid for commissions, salaries, expenses and other charges of agents, clerks and other employes; 4. The amount paid for salaries, fees and other charges of officers and directors; 5. The amount paid for local, state, national and other taxes and duties; 6. The amount paid for all other expenses, including printing, sta- tionery, rents, furniture or otherwise; Ninth — The largest amount insured in any one risk; Tenth — The amount of risks written during the year then ending; Eleventh — The amount of risks in force having less than one year to run; Twelfth — The amount of risks in force having more than one and not over three years to run; Thirteenth — The amount of risks having more than three years to run; Fourteenth — The dividends if any, declared on premiums received for risks not terminated; Fifteenth — Each accident insurance company, or company insuring against accidents, shall keep a register of tickets sold or policies issued by its officers or agents, which register shall show the name and residence of the person insured, the amount of insurance, the date of issue of such ticket or policy, and the time the same will remain in force; and the annual statement of each such company shall show the number of tickets sold and policies issued by it during the year, and the aggregate amount of insurance evidenced by such tickets and policies, classified as to the length of time for which such insurance is given. [39 G. A. ch. 190, § 2; C. '73, § 1141.]* Foreign 1716. Life 1773-90. App. 1799. Frat. 1830-36. The statement required as to the financial condition of an insurance company is intended not alone for the information of the auditor [com- missioner of insurance], to enable him to determine whether he should issue a certificate, but also by way of information to the public. The fact that such statement is required to be published indicates such legislative intention. Therefore not only one who contracts for insurance, but also one who becomes a purchaser of stock of the company, is entitled to rely upon such statements, and a purchaser of stock may recover damages against an officer of a company for an intentional false statement which has operated to his prejudice. Wai-field v. Clark, 118-69. The provision that the statement shall show expenditures for the pre- ceding year, and also the amount of losses paid during that time, how much subsequent to the date of the preceding statement, and the amount at which such losses were estimated in such statement, implies that some of the matters to be included in the statement are to be given by way of estimate. Ibid. The sworn statement of the financial condition of an insurance com- pany, filed with the auditor [commissioner of insurance], is for the pro- 22 INSURANCE OTHER THAN LIFE Ch. 4, T. IX tection of the public, and one purchasing stock has a right to rely thereon and may maintain an action for deceit against the officer making the same for damages caused by a false statement made therein. Ibid. Sec. 1715 (C. C. 5633). Certificate refused. The commissioner of insurance shall withold his certificate or permission of author- ity to do business from any comjian}^ neglecting or failing to com- ply with the provisions of this chapter. See 1724-35-47-55; Life 1796. General 1821d. Prat. 1832-39d. Sec. 1716 (C. C. 5634). Annual statements of foreign company. The annual statefment of foreign companies doing business in this state shall also show, in addition to the foregoing matters, the amount of losses incurred and premiums received in the state during the preceding period, so long as such company continues to do business in this state. [C. '73, § 1146.] Sec. 1718 (C. C. 5635). Inquiry by commissioner. The com- missioner of insurance shall address any inquiries to any insur- ance compan}^ in relation to its doings and condition, or any other matter connected with its transactions, which he may deem necessary for the public good, or for a proper discharge of his duties, and any company so addressed shall jjromiDtly re- ply in Avriting thereto. [C. '73, § 1142.] Sec. 1719 (C. C. 5636). Statements published— printed forms. He shall cause to be prepared and furnished to each company organized under the laws of this state, and to the attorney or agent of each company incorporated in other states and foreign governiments, who may apply therefor, printed forms of state- ments required by this chapter, and may from time to time make such changes in the forms as shall seem to him best adapted to elicit from the companies a true exhibit of their condition in respect to the several points hereinbefore enumerated. [C. '73, § 1157.] Sec. 1720-a (C. C. 5466). Commissioner's annual report. He shall cause the information contained in the statements required of the companies organized or doing business in the state to be arranged in detail, and prepare the same for printing which re- port shall be made to the governor on or before the lirst day of May of each year. [28 G. A., ch. ()2, § 1; 16 G. A., ch. 164; C. '73, § 1158.] Applicable also to Life companies. See 1781. Sec. 1721 (C. C. 5637). Foreign companies — capital required. No stock insurance coanpaiiy organized under or by the laws of any other state or foreign government for the purpose speci- fied in this chapter, shall, directly or indirectly, take risks or transact any business of insurance in this state unless possessed of two hundred thousand dollars, of actual paid up capital, ex- Ch. 4, T. IX INSURANCE OTHER THAN LIFE 23 elusive of any assets deposited in any state, territory, district or countr}^ for the special benefit or security of those insured there- in, but companies organized to insure plate glass or live stock exclusively are not required to have a greater capital than one hundred thousand dollars; and such companies organized to in- sure the health of persons and against personal injuries, disable- ments or death resulting from traveling or general accidents by land or water, having an actual paid up capital of one hundred thousand dollars and surplus in an amount to be approved by the commissioner of insurance, exclusive of any assets deposited in other states and territories for the special benefit or security of the insured therein, shall be deemed sufficient within the mean- ing of this section. [38 G. A., ch. 346, § 1 ; 37 G. A., ch. 429, § 18 ; S. S. '15 ; 34 G. A., ch. 18, § 6 ; 21 G. A., ch. 145 ; 16 G. A., ch. 60; 15 G. A., ch. 55; C. '73, § 1144.] Foreign Mutuals 1723. Life 1772. Sec. 1722 (C. C. 5638). Service of process — statement. Any foreign company desiring to transact tlie business of insurance under this chapter, by an agent or agents in the state, shall file with the commissioner of insurance a Avritten instrument, duly signed and sealed, authorizing such conimissioner to acknowledge service of notice or process for and in behalf of such company in this state, and consenting that service of notice or process may be made upon the commissioner of insurance, and when so made shall be taken and held as valid as if served upon the com- pany according to the laws of this or any other state, and waiv- ing all claim or right or error by reason of such acknowledgment of service. Such notice or process with a copy thereof may be mailed to the commissioner of insurance at Des Moines, Iowa, in a registered letter addressed to him by his official title, and he shall immediately upon receipt acknowledge service thereon on behalf of the defendant foreign insurance company by writ- ing thereon, giving the date thereof, and shall immediately re- turn such notice or process in a registered letter to the clerk of the court in which the suit is pending, addressed to him by his official title, and shall also forthwith mail such copy, with a copy of his acknowledgment of service Avritten thereon, in a registered letter addressed to the person or corporation who shall be named or designated by such company in such written instru- ment. And such company shall also file with the commissioner a certified copy of its charter or deed of settlement, together with a statement under oath of the president or vice-president or other chief officer and the secretary of the company for which they may act, stating the name of the company, the place where located, the amount of its capital, with a detailed statement of the facts and items required from companies organized under the laws of this state, and a copy of the last annual report, if any, made under any law of the state by which such company was incorporated; and no agent shall be allowed to transact busi- 24 INSURANCE OTHER THAN LIFE Cli. 4, T. IX ness for any company whose capital is impaired by liabilities as specified in this chapter to the extent of twenty per cent thereof, while such deficiency shall continue. [C. '73, § 1144.] Applicable Life 1808. Praternals 1831. See 3530 Appendix. It is the written consent of the corporation, and not the statute itself, which confers on the auditor [commissioner of insurance] power to acknowledge service. Greaves v. Posner, 111-651. Where a state prescribes conditions upon which a foreign corporation may do business within it, such corporation thereafter doing business in the state will be presumed to have assented to the conditions prescribed and will be bound accordingly: Fred Miller Bi^ewing Co. v. Council Bluffs Ins. Co., 95-31. It is within the power of a state to prescribe the method by which corporations doing business within its jurisdiction may be brought into court and to designate the officer or agent of such corporation upon whom the process necessary to commence an action may be served: Idid. The fact that a policy is issued and accepted in violation of a law prohibiting a company from doing business which has not complied with certain statutory requirements will not be void as between insured and the company, the latter not being allowed to take advantage of such objections, the penalty for violation of the law being imposed upon the company alone: Penmjpacker v. Capital Ins. Co. 80-56. A foreign company has no right to take risks in this state without complying with the requirements of the law whether the contract for such risks are made in this state or not: Seamans v. Zimmerman, 91-363. Premium notes taken by a company not authorized to do business in this state cannot be enforced in an action by a foreign receiver of such company in the courts of this state: Parker v. Lainb, 99-265. A company which has transacted business in the state cannot question the validity of service of notice upon it on the ground that it had not appointed agents, etc., as required by the statute. Sparks v. 'National Masonic Ace. Ass., 100-458. By complying with these provisions as to the designation of an agent upon whom service may be made, the corporation becomes subject to the laws of the state, and to treatment in many respects as a domestic corporations, and liable to be sued in all respects as such a corporation would be: German Bank v. American F. Ins. Co., 83-491. Service of process may be made upon any agent of the company within the state: Niagara Ins. Co. v. Rodecker, 47-162. Failure of non-resident company to comply with section 1808 of code cannot be pled in its defense to prove lack of notice when notice has been served on commissioner. Companies doing business in state pre- sumed to comply with law. Flynn v. Western Mutual Life Assn., 171 N. W. 711. Sec. 1723 (C. C. 5639). Foreign mutual companies. Any mu- tual insurance company organized outside of this state and au- thorized to transact the business of insurance on the mutual plan in any other state of the United States or in the District of Columbia, may be admitted to this state and authorized to transact herein any of the kinds of insurance authorized by its charter or articles of incorporation, when so permitted by the provisions of this chapter, with the powers and privileges and subject to the conditions and limitations specified in said chapter; provided, however, such company has complied Avith all the statutory provisions which require stock companies to file papers Ch.4,T. IX INSURANCE OTHER THAN LIFE 25 and to furnisli information and to submit to examination, and is also solvent according to the requirements of this chapter and is possessed of a surplus safety invested as follows : 1. In case any such mutual company issuing policies for a cash premium without an additional contingent liability equal to or greater than the cash premium, the surplus shall be at least two hundred thousand dollars. 2. In case of any other such mutual company issuing policies for a cash premium or payment with an additional contingent liability equal to or greater than the cash premium or payment, the surplus shall be such an amount as the insurance commis- sioner of loAva may require, but in no case less than fifty thou- sand dollars, provided that the provisions of this section fix- ing a minimum surplus of fifty thousand dollars shall not apply to companies now admitted to do business in Iowa : provided further, that no such mutual company shall be authorized to transact compensation insurance without a surplus of at least two hundred thousand dollars unless all liability for each ad- justed claim in this state, the payment of any part of which is deferred for more than one year, shall be provided for by a special deposit, in a trust company of this state, which shall be a trust fund applicable solely and exclusively to the payment of the compensation benefits for which such deposit is made, or shall be re-insured in an authorized stock company, or in an authorized mutual company with a surplus of at least two hun- dred thousand dollars. [37 G. A., ch. 429, § 19 ; C. 73, § 1144.] See also 1721-35. Life 1772. Associations 1794. Praternals 1829. Sec. 1724 (C. C. 5640). Certificate. When any foreign com- pany has fully complied with the requirements of law and be- come entitled to do business, the commissioner of insurance shall issue to such company a certificate of that fact, which certificate shall be renewed annually on the first day of March, if the com- missioner is satisfied that the capital, securities and investments of such company remain unimpaired, and the company has com- plied with the provisions of law applicable thereto. [C. '73, § 1146.] See 1715-25-47-55. Life 1796. General 1821d. Frat. 1832-39d. The power to exclude foreign corporations includes the right to pre- clude such corporations from continuing in business without complying with the provisions imposed by statute. Manchester Ins. Co. v. Herriott, 91 Fed. 711. It is only upon compliance with statutory requirements that foreign companies become entitled to do business within the state. Hartman v. Hallowell, 126-643. Sec. 1725 (C. C. 5736). Agent to have certificate of authority. No agent shall directly or indirectly act for any insurance com- pany referred to in this chapter, in taking risks or transacting business of insurance in the state, without procuring from the 26 INSURANCE OTHER THAN LIFE Ch. 4, T. IX commissioner of insurance a certificate of authority to the effect that such company has complied with all the requirements of this chapter. [C. 73, § 1145.] Agents 1749-50. Life 1800-14-15-21f, k, 1. Fraternal 1833-37. Life 1796. Applicable 1800-l-21d. Fraternal 1832-39d. An agent procuring insurance for his principal in a company not authorized to do business in the state becomes liable to the principal for any loss resulting from the failure to procure valid insurance. Hartmun V. Hollowell, 126-643. Sec. 1726 (C. C. 5641). Insurance notes. xVll notes taken for policies of insurance in any companj^ doing business in the state shall state upon their face that they have been taken for insur- ance, and shall not be collectable unless the company and its agents have fully complied with the laws of the state relative to insurance. [C. 73, § 1146.] See also 1727. A negotiable note which does not state upon its face that it has been taken for insurance will not be subject, in the hands of an innocent holder, to the defense here indicated. The maker must have that fact appear upon the face of the note if he desires to rely upon such defen-se. Cook V. Weirman, 51- 561. The provisions of this section with reference to notes given for policies of insurance are not applicable to the premium notes taken by a mutual benefit company for policies of insurance issued by them. Corey v. Hhcr- man, 96-114. Sec. 1727 (C. C. 5642). Forfeiture of policies. No policy oi- con- tract of insurance provided for in this chapter shall be forfeited or suspended for non-payment of any premium, assessment or in- stallment provided for in the policy, or in any note or contract for the payment thereof, unless within thirt.y days prior to or on or after the maturity thereof the company shall serve notice in writing upon the insured that such premium, assessment or in- stallment is due or to become due, stating the amount, and the amount necessary to pay the customar}" short rates, up to the time fixed in the notice Avhen the insurance will be suspended, forfeited or canceled, which shall not be less than thirty days after service of such notice, which may be made in person, or by mailing in a registered letter addressed to the insured at his postoffice as given in or upon the policy, and no suspension', for- feiture or cancellation shall take efi'ect until the time thus fixed and except as herein provided, anything in the policy, applica- tion or a separate agreement to the contrary notwithstanding. [18 G. A., ch. 210, §§ 1, 2.] This section was designed to give to the assured at least thirty days from the mailing of the notice in which to make the payment to which the notice refers, and the time cannot be shortened by a direction on the envelope containing the notice that it shall be returned if not delivered within fifteen days. Smith v. Continental Ins Co., 108-332. Where such notice treats two policies as one, although they are separate and distinct, it should specify the amount required to cancel each policy, Ch. 4, T. IX INSURANCE OTHER THAN LIFE 27 and also the aniounl ol" the preiiiiuiii aljoul. (o hecome due on aceounl. thereof. Jhid. Bora v. Iloinc. Ins. do., IIO-MT!). Forfeitures are not favored and the provisions of this section are man- datory and must he strictly followed. McDonald v. Anchor Mat. Ins. Co. 116-:;71. Error in stating the amount of the short rate, as fixed by the auditor under the provisions of Code 5^ 1729, will defeat the forfeiture. Jbid. The provisions of Sec. 1727, as to notice of forfeiture for non-payment of premium note had no application to a forfeiture of membership in a mutual association for failure to pay assessments. Beeman v. Farmers' Poineer Mut. Ins. Assn., 104-83. It appears that the legislature intended to provide for constructive notice by mail, to be completed either when the registered letter is mailed or as soon thereafter as it shall be received at the office of its destination by due course of mail. McKenna v. 8tate Ins. Co., 73-453. The time when the service of notice of forfeiture is complete is the time of mailing the letter in accordance with the provisions of the statute, and not the time when such letter would in due course of mail have reached its destination (arguendo). Ross v. Haickeye Ins. Co., 83-586; and see Holhrook v. Mill Oivncrs' Mut. his. Co., 86-255. Sickness or insanity will not excuse failure to pay insurance premiums when due. 68 Iowa 43; 112 Iowa 724. In the case Courtney v. U. S. Masonic Benefit Assn., 53 N. W. 237, court held somewhat contra under a peculiar set of facts. See. 1728 (C. C. 5643). Cancellation of policy. At any time after the maturity of a premium, assessment or installment, i:>ro- vided for in the poliey, or any note or contract for the payment tliereof, or after the suspension, forfeiture or cancellation of an}- policy or contract of insurance, the insured may pay to the com- pany the customary- short rates and costs of action, if one lias been commenced or judgment rendered thereon, and may then, if he so elect, have his policy and all contracts or obligations con- nected therewith, whether in judgjnent or otherwise, canceled, and they and each of them thereafter shall be void; and in case of suspension, forfeiture or cancellation of any policy or con- tract of insurance, the assured shall not be liable for any greater amount than the short rates earned at the date of such sus])en- sion, forfeiture or cancellation and the costs herein provided. The policy may be canceled by the insurance company by giving five days' notice of such cancellation, in which event it may re- tain only the pro rata premium. [34 (I. A., ch. 18, § 7; 18 G. A., ch. 210, § 3.] See Standard Fire Policy 1758a, XI. An association purporting to be organized under the provisions of § 1160 of the Code of 1873, but in fact exacting premium notes instead of assessments from its members, thereby subjected itself to the requirements of 18 G. A., chap. 210 (Code ^ 1727), as to giving notice of forfeiture on account of non-payment of such notes. Bradford v. Mut Ins. Co., 112-495. The right of assured to cancel the policy and recover back premiums paid in excess of customary short rates cannot be exercised by assigning to another the right to cancel such policy and collect the unearned pre- mium. The assignment would avoid the policy and terminate the right to recover. Nor can such unearned premium be recovered after the policy has been rendered void by taking other insurance. Colby v. Cedar Itainds Ins. Co., 66-577. 28 INSURANCE OTHER THAN LIFE Ch. 4, T. IX If the company elects to enforce a premium note instead of cancelling the policy for non-payment as herein provided, it thereby waives a stipula- tion in the policy that the insurance shall be forfeited on failure to pay the note as agreed. By accepting payment in pursuance of legal proceed- ings^ even after the loss the company waives the right to avail itself of the condition of forfeiture. Bloom v. State Ins. Co., 94-359. It is optional with the company to allow a policy to remain uncancelled, and to accept payments when made_ without waiving its right to insist upon prompt payments at any time thereafter. Morroio v. Des Moines, Ins. Co., 84-256. Sec. 1729 (C. 0. 5644). Short rates. The commissioner of insur- ance shall prepare and publish a table of short rates provided for in the two preceding sections, which, when published, shall be for the guidance of all companies covered in this chapter, and the rate to be given in the notice therein provided, and no greater sum than thus fixed shall be demanded or collected. A copy of said short rates shall be printed on or attached to each policy. For Short Rate Table see Appendix. Sec. 1730 (0. C. 5645). Policy restored— contract not valid. At any time before cancellation of the policy for non-payment of any premium, assessment or installment provided for therein, or in any note or contract for the payment thereof, or after action commenced or judgment rendered thereon, the insured may pay to the insurer the full amount due, including court costs if any, and from the date of such payment, or the collection of the judg- ment, the policy shall revive and be in full force and effect, pro- vided such payment is made during the term of the policy and before a loss occurs. No provision, stipulation or agreement to the contrary in or independent of the policy or contract of in- surance shall avoid or defeat the right of any insured to pay short rates and costs of action, if any, and have the policy and all contracts connected therewith, including judgments rendered thereon, canceled. [18 G. A., ch. 210, § 3.] Sec. 1731 (C. 0. 5646). Examination — dissolution. The com- missioner of insurance shall, when he finds it expedient, appoint one or more persons, not officers, agents or stockholders of any insurance company doing business in the state, to examine into the affairs and conditions of any such company incorporated or doing business therein, or make such examination himself, and the officers or agents thereof shall produce their books for the inspection of the examiners and otherwise assist therein, so far as they can do so ; and in conducting the investigation they may examine under oath the officers or agents of any company, or others, relative to the business and condition of the company, and the result thereof shall be published in one or more papers in the state, when the commissioner believes the public interest requires it. When it appears to the commissioner from such ex- amination that the assets and funds of any company incorporated in this state are reduced or impaired by its liabilities, as defined under the head of liabilities in the statement required by this Ch. 4,T.IX INSURANCE OTHER TITAN LTF^E 29 chapter, more than twenty per cent below the paid up capital stock required, he shall direct the officers thereof to require the stockholders to pay in the amount of such deficiency with sudi a period as lie m'nate in sucli J-C(piisi1i(»n, or lie sIimII coim- municate the fact to the attorncy-ocncrjil, who shall apply 1o the district court or if in vacation to one of the judges thereof, for an order requiring the company to show cause why its busi- ness shall not be dissolved. The court or judge, as the case may be, shall thereupon proceed to hear the allegations and proofs of the respective i)arties; and in case it appears to its or his satis- faction that the assets and funds of said company are not suf- ficient, as aforesaid, or that the interest of the public requires it, it or he shall decree a dissolution of said company and a dis- tribution of its effects, and appoint a receiver tlierefor. The a])- plication of the attorney-geiiei'al may be by tlie court or judge sent to a referee to inquire into and report upon the facts stated therein, Avhich report shall be made to the court or judge [(/. '7^^, § 1149.] See 1700-53-nr>. Life 1777. Applicable 1821 a to g. Fraternal IS^Ob, c. An insurance company may enforce assessments for the purpose of making good a depletion of its capital, without a requisition from the auditor of state [commissioner of insurance] directing sueh assessment. lonm Natinndl Banl- v. Cooper, l^l-nnG. Sec. 1732 (C. C. 5647). Requisition on stockholders. An\' comi:)any receiving such a requisition from tlie comjiiissionor of insurance sliall forthwith call upon its stockholders for such amounts as will make its paid up capital equal to the amount fixed b}^ this chapter or the articles of incorporation of said company ; and in case any stockholder shall refuse or neglect to pay the amount called for after notice personally given, or by advertisement in such time and manner as the commissioner shall approve, it shall be lawful for the company to require the return of the original certificate of stock held by such stock- holder, and in lieu thereof to issue new certificates for such number of shares as the said stockholder may be entitled to in the proportion that the ascertained value of the funds of the said company ma}^ be found to bear to its original capital, the value of such shares for which ncAv certificates shall be issued to be ascertained under the direction of the commissioner, tlie company pa^'ing for the fractional parts of shares, and the direc- tors of such company may issue new stock and dispose of tlie same, and issue new certificates therefor, to an amount sufficient to make up the original capital of the company. Tn the event of additional losses accruing upon new risks, taken after the ex- piration of the period limited by the commissioner in the afore- said requisition for filling up of the deficiency in the capital of such company, and before such deficiency shall have been made up, the directors shall be individuallv liable to the extent there- of. [C. '73, § 1150.] 30 INSURANCE OTHER THAN LIFE Ch. 4, T. IX See lt,yi, 1701-21-39. Life 1769-72. See. 1733 (C. C. 5648). Mutual companies— dissolution. II', upon sueh examination, it shall appear to the comissioner of in- surance that the assets of any eonii:»any organized or operating upon the plan of mutual insurance under this chapter are insuf- ficient to justify the continuance of such company in business, he shall proceed in relation to such company in the same manner as herein required in regard to stock companies ; and the trustees or directors of such company are made personally liable for am^ losses which ma}^ be sustained upon risks taken after the expira- tion of the period limited by the commissioner for filling up the deficiency in the assets or premium notes, and before such deficiency shall have been made up. |C. '78, § 1151. | See also 1721. Life 1770. Sec. 1734 (C. C. 5649). Transfers of stock pending investiga- tion. Any transfer of the stock of any comi^an}^ organized under this chapter, made pending any investigation above required, shall not release the party making the transfer from any liability for losses which ma}^ have accrued previous to such transfer. [Same.] Sec. 1735 (C. C. 5650). Revocation of certificate of foreign company. The commissioner of insurance shall be authorized to examine into the condition and affairs of any insurance com- pany, as provided for in this chapter, doing business in this state, not organized under its laws, or cause such examination to be made by some person or persons appointed by him having no interest in any insurance company; and when it shall appear to his satisfaction that the affairs of any such company are in an unsound condition, he shall revoke the certificates granted in its behalf and cause a notification thereof to be published in some newspaper of general circulation, published at the seat Of gov- ernment, and no agent or agents of such company after such notice shall issue policies or renew any previously issued. [C. '73, § 1152.] See 1721-23. Life 1772. Associations 1794. Fraternals 1829. Sec. 1736 (C. C. 5651). Laws of other states—reciprocity. When, by the laws of any other state, any taxes, fines, penalties, licenses, fees, deposits of money, securities or other obligations or prohibitions are imposed, or would be imposed, on insurance companies of this state doing or that might seek to do business in such other state, or upon their agents therein so long as such laws continue in force the same obligations and prohibitions of what- ever kind shall be imposed upon all insurance companies of such other state doing business in this state or upon their agents here. [C. '73 § 1154.] Applicable to Life Companies. See 1810. Section applied. Siate v. Fidelity & Casualty Co., 77-648. Ch.4, T. IX INSURANCE OTHER THAN LIFE 31 Sec. 1737 (C. C. 5652). Certificates of compliance — ^how pub- lished. The eominissioiier of iiisuraiu-e shall annually, as soon as practicable after the first of March, publish in two newspapers of general circulation, a statement made up from the annual report of every insurance company of the character provided for in this chapter and doing business in this state wliether or- g-anized under the hiws of this or any other state, which state- ments sliall contain a synopsis of the company's annual repoi-t and shall show that the company has in all respects complied with the laws of the state relating to insurance and is authorized to transact business in the state. One publication as above con- templated, shall be made at the seat of government, and in case of companies organized in this state and located elsewhere than in the city of Des Moines, the other shall be made in the county in which the home office of the company is located. The fee for each publication shall be six dollars, which shall be paid to the commissioner of insurance at the time and in the manner pro- vided for in section seventeen hundred fifty-two, supplement to the code, [1902] and shall be by him paid to the papers making the publication upon receipt of a bill for same, together Avith an affidavit by the publisher or foreman shoAving tliat. such publica- tion has been properly made, the same to be filed within thirty davs from the date of such publication. [31 G. A., ch. 73; C. 73, § 1155.] Sec. 1738 (0. C. 5653). False statement of assets. No com- pany transacting the business of fire insurance within the state shall state or represent by advertisement in any newspaper, magazine or periodical or by any sign, circular, card, policy of insurance or renewal certificate thereof or otherwise, any funds or assets to be in its possession and lield available for the pro- tection of holders of its policies unless so held, except the policy of insurance or certificate of renewal thereof may state as a single ite'm the amount of capital set forth in the charter or articles (>f incorporation or association or deed of settlement under Avhicli it is authorized to transact business. |17 0. A., ch. Ill, §§ 1, 3.] Sec. 1739 (C. C. 5654). Statement of capital and surplus. Every advertisement or public announcement, and every sign, circular or card issued or published by any foreign companx' transacting the business of fire insurance in the state, or by any officer, agent or representative thereof, which shall pur])ort to make known its financial standing, shall exhibit the capital aclual- ly paid in in cash, and the amount of net surplus of assets over all its liabilities actually held and available for the payment(d' losses by fire and for the protection of holders of fire policies, and sliail also exhibit the amount of net surplus of assets over all liabilities in the United States actually available for the pay- ment of losses by fire and held in the United States for the pro- tection of holders of fire policies in the United States, including in such liabilities the fund reserved for reinsurance of outstand 32 INSURANCE OTHER THAN LIFE Ch. 4, T. IX ing risks, and the same shall correspond with the latest verified statement made by the company or association to the commis- sioner of insurance. No such company shall write, place or cause to be written or placed any polic}' or contract for insur- ance upon property- situated or located in this state except through its resident agent or agents. [Same, § 2.] See 1691, 1701-21. Life 1769-72. Sec. 1740 (C. C. 5655). Penalty. Any violation of the pro- visions of the two preceding sections shall for the first offense subject the company, association or individual guilty thereof to a penalty of five hundred dollars, to be recovered in the name of the state, w^ith costs, in an action instituted by the county attorney, either in the county in Avhich the company, association or individual is located or transacts business, or in the county where the offense is committed, and such penalty, when recoverd, shall be paid into the school fund of the county in which action is brought. Every subsequent violation of said sections shall sub- ject the coimpany, association or individual to a penalt}^ of one thousand dollars, to be sued for, recovered and disposed of in like manner. [Same, § 4.] Sec. 1741 (C. C. 5656). Copy of application. All insurance companies or associations shall, upon the issue or renewal of any polic}^, attach to such policy, or indorse thereoii, a true copy of any application or representation of the assured whicli, by the terms of such policy, are made a part thereof, or of the con- tract of insurance, or referred to therein, or which may in any manner afi'ect the validity of such policy. The omission so to do shall not render the policy invalid, but if any company or association neglects to comply Avitli the requirements of this section it shall forever be precluded from pleading, alleging or ])roving an^^ such application or representations, or any part thereof, or falsity thereof, or any parts thereof, in any actioji upon such polic3% and the plaintiff in any such action shall not be required, in order to recover aiiainst such company or associa- tion, either to plead or prove such application or representation, but may do so at his option. [18 G. A., ch. 211, § 2.] Applicable to life 1819. Assessment Associations and Fraternals. See Supreme Court opinions to 1741 and 1819. See also 1826. Assured is justified in relying on advice and assistance of a soliciting agent in preparing his application and the language will be given a reasonable construction in favor of assured in order to avoid forfeiture on technical grounds. Bucknam v. Intcr-Htate Business Men's Accident Assn. 183 loica, 652. The provisions of sections 1741 to 1744, inclusive, apply to mutual assessment insurance associations organized under chapter 5, title IX of the code, as well as to insurance companies organized under chapter 4, title IX. Corson v. Iowa Mul. Fire Ins. Assn., 115-485. The fact that the application is not embodied in or attached to the policy does not preclude proof of the terms of the application in a suit by the insured against, members and officers of a mutual benefit association to compel the payment of the assessment, where such evidence is sought Ch. 4, T. IX INSURANCE OTHER THAN LIFE 33 to be introduced for the purpose of showing that the assured knew that the company was conducted on the assessment plan. Moo7'e v. Union Fraternal Ace. Assn., 103-424. The purpose of the statutory provisions under which it is necessary to set the application out in or attach it to the policy is, that when the application is made a part of the contract a true copy must be attached to the policy, so that writings composing the contract may all ap- pear together and that the insured may be in possession of the evidence of what his contract is. Therefore, held, that the statute contemplates more than a mere substantial copy of the application and yet not a true likeness or fac-swiile.. The copy must be so exact and accurate as that upon comparison it can be said to be a true copy without resorting to construction. Johnson v. Des Moines L. Assn., 105-273. Where a copy of an application attached to or incorporated in the policy is defective and incomplete, the company is precluded from proving the falsity of the representations in th.e application as a defense to an action on the policy. Corson v. Anchor Mut F. Ins. Co.. 113-641. Where the copy of an application attached to the policy is totally de- fective and insufficient, the company cannot show misrepresentations or breach of conditions contained in such applicaton. Corson v. Iowa Mut. Fire Ins. Assji., 115-485. The provisions of this section are applicable to mutual companies, not- withstanding the provisions of Code § 1759. Ibid. A premium note, non-payment of which will by the terms of the ap- plication render the policy void, must be set out as a part of the applica- tion under the provisions of this section. (Following Lewis v. Burlington Ins. Co., 71-97; s. c. 80-259). Summers v. Des Moines Ins. Co., 116-593. The examiners' report on an application for life insurance is not a part of the application or representation of the assured a^d is not re- quired to be included in the copy of the application. The same is true as to notes of instructions given for making the application and answers and notes and indorsements upon the back of the application made for mere convenience. Johnson v. Des Moines L. Assn., 105-273. Wliere the copy of the application attached to the policy indicated that it had been signed, but did not show a copy of the signature, held, that it was not such copy as required by the statute, and the terms of the applica- tion could not be considered in an action on the policy. Seller v. Economic L. Assn., 105-87. It is the application or representations of the assured only that is required to be attached to or indorsed upon the policy. It is not neces- sary to indorse thereon provisions found in the by-laws of a mutual com- pany by which the policy is issued. Fitzgerald v. Metropolitan Ace. Assn., 106-457. Endorsement of a copy of the application upon the policy, or its attachment thereto, is a necessary foundation for pleading the falsity of statements made therein. Parlcer v. Des Moines L. Assji., 108-117. The statutory provisions requiring insurance companies to attach a copy of the application to each policy of insurance is applicable to fidelity insurance companies. United States F. c(- G. Co. v. Egg Shippers' Straic- hoard & F. Co., 148 Fed., 353. The provisions of this section are applicable to all kinds of insurance and policies, including those issued by benefit associations upon the muturd assessment plan. Newman v. Covenant M\it. Ins. Assn., 76-56; McConnell v. Iowa Mut. Aid Assn., 79-757. (See now ^ 1819.) The requirements of this section as to attaching the application to or indorsing it upon the policy are applicable to fraternal association acting in a dual character involving the element of insurance, as well as mutual benefit associations. Grimes v. Northwestern Legion of Honor. (See now ^ 1826.) n7-:ur>. This and the preceding section ot this act ai)i)ly to all kinds of insur- 34 INSURANCE OTHER THAN LIFE Ch. 4, T. IX ance and not merely to fire insurance. CooTc v. Federal L. Assn., 74-746. It is incompetent, in defense to an action upon a policy, to plead or prove statements made in the application, where such statements are not reduced to writing and a copy thereof is not attached to or indorsed upon the policy. Ellis v. Council Bluffs Ins. Co., 64-507. And see Wallace v. Council Bluffs Ins. Co., 66-139. Where one premium note was given for two policies on the same prop- erty, one against loss by fire and lightning, and one against loss by tor- nado, and a copy of the note was attached to the former and not to the latter, held, that in an action on the tornado policy, non-payment of the premium note as required could not be relied on. Lewis v. Burlington Ins. Co., 80-259. Where answers in the application are filled up by the agent taking such application from his own knowledge, the fact that a copy of the applica- tion is attached to the policy which is delivered to insured will not bind him to statements thus made, although he fails to notify the company of their falsity. The assured is not required to prove the statements made in the application to be true, and he is therefore not required to examine the copy of the application indorsed on the policy. Donnelly v. Cedar Rapids Ins. Co., 70-693; and see Bennett v. Council Bluffs Ins. Co., 70-600. The conditions of the policy itself may be shown, although they are not contained in an application a copy of which is attached to the policy. Thus a failure to disclose the state of the title may be a representation appearing in the policy itself and may be shown though not appearing in the application attached to the policy. McKinnon v. Mutual F. Ins., Co., 89-170. The provisions of this section are broad enough to cover any renewal or reinstatement of the policy of insurance which has become invalid. (rOOd.vAn V. Provident Savings Life Assurance Society. 97-226. Where a copy of an application attached to or incorporated in the policy is defective and incomplete, the company is precluded from proving the falsity of the representations in the application as a defense to an action on the policy. Corson v. Anchor Mut. F. Ins. Co.. 113-641. Where the copy of an application attached to the policy is totally de- fective and insufficient, the company cannot show misrepresentations or breach of conditions contained in such application. Corson v. loiva Mut. Fire Ins. Assn., 115-485. The provisions of ch. 211, acts of 18 G. A., embodied in this section, held applicable to fraternal societies issuing certificates on lives of members. Stork v. Supi'eme Lodge E. of P.. 113-724. The fact that warranties and representations embodied in the appli- cation cannot be proven because no copy of such application was attached to the policy, does not prevent the company from relying on such war- ranties and representations as are included in the policy itself. Kirk- patrick v. London G^iar. cG Ace. Co., 139-370. Where no copy of the application is indorsed on the policy the defense of false representation in' the application cannot be relied upon. Salzman v. Machinery Mut. Ins. Assn., 142-99. Where the provision as to forfeiture for nonpayment of premium note is contained in the application, failure to attach copy of application to the policy will prevent reliance on default in the payment of a premium note as a defense although notice of such default has been duly given. Rodey v. State Ins. Co., 146-23. The statute does not require that a copy of any agreement made sub- sequently to the issuance or renewal of the policy shall be attached. Wilson V. Royal Union Mut. Life Ins. Co., 137-184. Sec. 1742 (C. C. 5657). Evidence of value— proofs— action. Ill any action broujilil in any court in this state on any policy of insurance for t]ie loss of any building so insured, the amount Ch. 4,T. IX INSURANCE OTHER THAN LIFE 35 stated in the policy sliall be received as prima facie evidence oi! the insurable value oL' the property at the date of the polic}': pro- videcl, the insurance conipan3' or association issuing such policy may show the actual value of said property at date of policy, and any depreciation in the value thereof before the loss occurred ; but the said insurance company or association shall be liable for the actual value of the property insured at the date of the loss, unless such value exceeds the amount stated in the policy. And in an action on such policy it shall onh^ be necessary for the assured to prove the loss of the building insured, and that he has given the company or association notice in writing of such loss, accompanied by an affidavit stating the facts as to how the loss occurred, so far as they are within his knowledge, and the extent of his loss. [Same, § 3.] See also 1744. Applicable to state and county associations operating under chapter 5. Corson v. Iowa Mutual Fire Jns. Assn.. 115-485. The statute does not attempt to fix, as the measure of recovery in case of the destruction of buildings, any other than the actual value of tho Ijuilding at the time of loss. If, after the prima facie t'howing made by proof of the amount of insurance, the company shall offer evidence to show the actual value to be less, then the amount of recovery becomes a question for the jury, and the actual value is as the jury shall find it. The parties may, by contract, stipulate for the ascertainment of this actual value by appraisers. Zaleskj/ v. Home Ins. Co.. 108-341. Whether the latter part of this section is applicable in case of loss of personal property covered by the policy, quaere. Westenhaver i\ German- American Ins. Co., 113-726. Where a policy for $4,000 was issued under an arrangement with the soliciting agent that total insurance to the extent of $7,000 should be procured on the property, held that in an action on the $4,000' policy the total amount of insurance contemplated was prima facie the value of the property insured. Wensel v. Property Mutual Ins. Assn., 129-295. It is error to instruct the jury with reference to the prima facie fact of the value of the property as stated in the policy, as applicable to per- sonal property. Warshatvky v. Anchor Mut. F. Ins. Co., 98-221. A policy is not prima facie evidence as to the value of personal prop- erty insured. The provisions of this section as to presumption of value are applicable only to buildings. Joy v. Security F. Ins. Co., 83-12; Martin V. Capital Ins. Co., 85-643. As to buildings covered by the insurance the burden is on the company to show that the property was not worth the amount for which it was insured. Des Moines Ice Co. v. Niagara F. Ins. Co., 99-193. The law fixes prima facie the measure of recovery in case of loss of a building, and it is immaterial in making out plaintiff's case to show what the kind of building was or the material of which it was constructed or how long it had been in use. Davis v. Anchor Mut. F. Ins. Co., 96-70. The policy being prima- facie evidence of the value of the insured build- ing, it is not incumbent upon the plaintiff in the first instance to prove such value, but evidence in respect to the value being introduced by the defendant, plaintiff may introduce evidence on that point in rebuttal. Martin v. Capital Ins. Co., 85-643. Under particular facts, held, that the evidence as to the value of the property was sufficient, in connection with the prima facie evidence sui)- plemented by the valuation stated in the policy, to support the recovery. Hagan v. Merchants', etc.. Ins. Co., 81-321. It seems that an appraisement agreement relating exclusively to the ne INSURANCE OTHER THAN LIFE Ch. 4, T. IX value of buildings cannot be relied on by reason of the terms of this stat- ute to prevent the bringing of suit on the policy. HarriRon v. German- American F. Ins. Co., 67 Fed., 577. Waiver or proofs of loss cannot be shown under an allegation that they have been furnished. Welsh v. Des Moines Ims. Co., 71-337. Under an allegation of the furnishing of proofs of loss evidence of the waiver of such proofs is not admissible. Heusinkveld v. St. Paul F. 'es or loss personal property, it shall only be necessary for the assured within sixty days from the time the loss occurs, to give notiet in writing- to the company issuing such contract of insurance ac- companied by an affidavit, stating the facts as to how the loss occurred, so far as same are within his knowledge, and the extent of the loss, anv agreement or contract to the contrarv notwith- standing. [20' 0. A., ch. 73, § 1.1 See also 1744. The provisions of the policy relating to proofs of loss are superseded by the statutory provisions so far as they are inconsistent. American Cereal Co. v. Western Assur. Co., 148 Fed., 77. An action is premature and abatable when brought within forty days after service of the notice of loss and proof thereof under a mutual policy of insurance issued under ch. 5, title 9. supp. code, 1913, even though the company dui'ing said forty days denies all liability under thr- policy. Salmon v. Farm Property Mut. _Assn.. 168 la. 521. Defense based upon application not applicable since copy of applies tion attached to certificate was not a true copy. A by-law which aV tempts to define how proof of loss must be filed is invalid if it does not follow the statute on such subject. Lyons v. Farm. Property .U»^ Ins. Assn. 176 N. W. 291. Sec. 1743 (C. C. 5659). Conditions. Any condition or stipula- tion in an application, policy or contract of insurance, making the policv void before the loss occurs, shall not prevent recovery- thereon by the insured, if it shall be shown by the plaintiff that the failure to observe such provision or the violation thereof did not contribute to the loss: provided, however, that any condition or stipulation referring to any other insurance, valid or invalid, or to vacancy of the insured premises or the title or ownership of the property insured, or to lien, or incumbrances thereon cre- ated bv volnntarv act of the insured and within his control, or 40 INSURANCE OTHER THAN LIFE Ch. 4, T. TX to the suspension or forfeiture of the policy durino- default or failure to pay any written oblioation given to the insurance company for llie ])remium, oi* to the assignment or Irjinsfer ol* such policy of insurance before loss without the consent of llie insurance company, or to the removal of the property insured, or to a change in the occupancy or use of the property insured, if such change or use makes the risk more hazardous, or to the fraud of the insured in the procurement of the contract of in- surance, shall not be changed or affected by this provision. No recovery on a polic.y or contract of insurance shall be defeated for failure of the insured to comply, after a loss occurs, with any arbitration or appraisement stipulation as to fixing value of property. No arbitration shall take place except Avhere the prop- erty was situated at the time of loss. Any agreement, stipula- tion or condition in any policy or contract of insurance by which any insurance company reserves or has the right to rebuild shall be void and of no effect in case of total loss, or where the amount of loss, upon the request of the insurance company, has been submitted to arbitration. Nothing herein shall be construed to change the limitations or restrictions respecting the pleading or proving of any defense by any insurance company to Avhich it is subject by law. The provisions of this section shall apply to all contracts of insurance on real and personal propertv. 132 O. A., ch. 75; 28 G. A., ch. G4, § 1 ; 28 G. A., ch. 63, § 1.] This provision has no application to the failure of the insured to comply with a condition precedent to the taking effect of the policy. Banco De Sonoro v. Banker's Muf. Casualty Co., 124-576. A breach of warranty or condition constitutes, generally speaking, no defense if it appears that such breach did not occasion or contribute to the loss; but the defense based on change in use or occupancy is good if such change makes the risk in fact more hazardous. Krell v. Chirkasaio Farmer's Mut. Fire Ins. Co. 127-748. The burden is on the insured suing on the policy to show that change in use or occupancy in violation of the provisions of the policy did not contribute to the loss. Tbid. The question whether a change in occupancy without consent increases the risk is for the jury. Nicholas i\ lotca Merch. Mut. Ins. Co., 125-262. The fact that the furniture in a dwelling house is insured after taking a policy on the house itself does not in the absence of fraud or over- insurance constitute an increase of hazard as to the building. IMd. Breach of an agreement to keep a set of books in iron safe will not defeat recovery for a loss under the policy unless it is pleaded and proven that such breach contributed to the loss. Johnson v. Farmers' Ins, Co. 126-565. A provision in the policy that the removal of the property shall be deemed an increase of the risk as a matter of law is void in view of the statutory provision that the breach of the condition as to removal shall not affect the validity of the policy unless it increases the risk. The burden is on the insured to show that the removal, in violation of the terms of the policy, did not cause or contribute to the loss but the burden is on the company to show as a matter of defense, that it increased the risk. Adams v. Atlas Mut. Ins. Co., 135-299. This section does not apply to forfeitures accrued under policies pre- viously issued. Elliott v. Farmer's Ins. Co., 114-153. Ch.4, T. TX TNSTTRANCE OTHER THAN LIFE 41 This section does not apply to provisions making void the policy for vacancy or unoccupancy. Cone v. Century Fire Ins. Co., 139-205. The burden is on the plaintiff to show that a change of occupancy, if any, in violation of the provisionw of the jjolicy di4 not cause or con- tribute to the fire, and the burden is on the defendant to show that such change, if any, increased the risk, teaman v. Anchor Fire Ins. Co. 149-583. This section has relation to cases where there is provision in the policy prohibiting the act complained of. Where there is no such provision, the burden does not rest on the plaintiff to show that there was in fact not an increase of hazard. When it is shown that the insured has done some act prohibited by the policy, then the burden rests on him to show that the violation did not increase the hazard. Kinney v. Farmers' Miit. F. Ins. ,Soc'y, 159-490. Prom the provision of this section it is evident that it was not intended by code § 1750 to invalidate a provision in a policy that the agent shall bind the company only in writing. Mulrooney v. Royal Ins. Co., (C. C.) 1.57 F'ed. 598. See. 1744 (C. C. 5660). Notice and proof of loss— time of bringing action — provisions not affected by contract. The notice of loss and proof thereof required in section seventeen ]uin- dred forty-two hereof, and the notice and proof of loss undei- oath in case of insurance on personal property, shall be given within sixty days from the time loss occurred, and no action for such loss shall be begun within forty daj'S after stich notio(^ and proofs have been given to the company, nor sliall the time within which action shall be brought be limited to less than one year from the time when a cause of action for the loss accrues. No provisions of any polic}^ or contract to the contrary shall affect the provisions of this and the three preceding sections; ])vr- vided, however, that nothing contained in this section or in sec- tion 1742-a, supplement to the code, 1913, shall be so construed as to prohibit any insurance company not required by the statutes of Iowa to issue a standard form of policy, from embodying, with the approval of the commissioner of insurance, in any in- surance contract issued by it, provisions or conditions whi«^'li are more favorable to the insured than those authorized in said ■statutes. [38 G. A., ch. 348, § 5 : 27 G. A., ch. 44, § 1 : 18 G. A., ch. 211, § 3.] See also 1742-42-a. The statutory requirement as to notice and proofs of loss is all that can be made essential by the contract. A notice and affidavit are sufficient to constitute the proof required. The sufficiency of the document is not de- pendent on the intent, but on the contents. Parks v. Anchor Mut. F. Ins. Co., 106-402. This statute concerning proofs of loss supersedes the provisions of a policy of insurance with relation to the same matter. Washburn-HaUiffan Coffee Co.. v. Merchants' etc. Fire Insurance Co., 110-423. Cause of action for the loss accrues forty days after the filing of notice and proof of loss. Payment under policy is not due until forty days after the filing of notice and proofs. See also Matheson v. loioa State Traveling Men's Assn. 180 Iowa 1035. Action premature and abatable when brought within forty days after service of notice and proofs of loss. This period of statutory immunity 42 INSURANCE OTHER THAN LIFE Ch. 4, T. IX is mandatory and is not waived by denial of liability. Salmon v. Farm Property Mut. Ins. Assn. 168 Iowa 521. Stipulations in a policy that no officer or agent shall have power to waive any provision or condition of the policy, except such asj)y the terms of the policy may be subject of agreement endorsed thereon or added there- to do not prevent waiver of proofs of loss by an officer or agent having general authority to do so. Such a stipulation relates to the conditions and provisions of the policy and not to their performance. Ibid, and Lake V. Farmers' Ins. Co., 110'-473. The provisions of 18 G. A. ch. 211, § 3, relating to proofs of loss, as originally enacted, held applicable to mutual benefit associations as well as fire insurance companies. Parsons v. A. 0. U. W., 108-6. The legislature provides the character and kind of proofs that shall be made upon the happening of a loss, and no greater proof can be exacted; but the company may stipulate for less than is required by the statute in this respect. Kinney v. Farmers' Mut. F. his. Soe'y. 159-490. Good faith requires that upon receipt of proofs of loss, if the company is not satisfied therewith, it should specify its objections thereto to the end that the proofs may be perfected if possible, and if the company fails to specify the objections at a time when they might be remedied it should not afterwards be heard to urge them. Dyer v. Des Moines Ins. Co., 103-524. The action of the company in asking for an arbitration to determine the amount to be paid is a waiver of defects in the proofs or notice of loss known to the company before the arbitration took place. Dee d Sons Co. V. Key City F. Ins. Co., 104-167. Notwithstanding a provision in the policy that none of its terms or con- ditions can be waived by any person except in writing by the secretary of the company^ and that no agent has any authority to waive or modify any printed conditions of the policy, an adjusting agent having power to deter- mine what proofs are satisfactory may waive those proofs which are re- garded unimportant, although certain specified proofs are required by the policy. Brock v. Des Moines Ins. Co., 106-30. Failure to object to the proofs of loss because not accompanied by affi- davit, as required, amounts to a waiver of objection on this ground. Prin- gle V. Des Moines Ins. Co., 107-742. Where the company refuses payment on the ground that the policy has been suspended in consequence of failure to pay an installment of pre- mium waiver of proofs of loss may be inferred. Pray v. Life Indemnity d- Security Co., 104-114; Smith v. Continental Ins. Co.. 108-382. Unqualified refusal to pay constitutes a waiver on the part of the in- surance company of proofs of death where something purporting to be proofs of death has been received by the company and not objected to. Stephenson v. Bankers' Life Assn., 108-637. The promise of the company to pay is as effective as the waiver of proofs, as a denial of liability and the promise of settlement is incon- sistent with insistence on strict compliance with the conditions of the contract. Lake v. Farmers' Ins. Co., 110-473. Telegrams from insured advising the company of the loss and giving it all information which the insured could be supposed to have may con- stitute sufficient proof of the loss and by failing to object for want of an affidavit to such proofs, the company waives the requirement. Nicholas v. Iowa Merch. Mut. Ins. Co.. 125-262. An agent having power to adjust a loss has authority to waive formal proofs of loss. Lake v. Farmers' Ins. Co.. 110-473. Where the adjuster requires the procurement of duplicate invoices, which are prepared at considerable expense^ the company cannot after- wards object that the proofs of loss are not sufficient. If the conduct of the company is such as to induce the insured to rest, in good faith^ under the well founded belief of strict compliance and that the conditions will Ch. 4. T. IX INSURANCE OTHER THAN LIFE not be insisted on, it cannot afterwards set up nonyerforniance of such conditions as a bar to recovery. Ibid. Corson v. Anchoi' Mut. F. Ins. Co.. 113-641. Where action is prematurely brought because of failure of insured to demand on appraisement he cannot cure the defect in his proceeding by subsequently demanding such appraisal and setting out the fact in the supplemental petition. Zaleski/ v. Home Ins. Co., 102-613. Although in the second action it is claimed that the first action was not prematurely brought, this will not sustain the second action brought after the period of limitation under the policy has expired. Wilhclmi v. Des Moines Ins. Co., 103-532. Where the first action for a loss under a policy was prematurely brought and subsequently another action was brought after the time limited in the policy for bringing action held, that the second action was not to be deemed a continuation of the first action under the provisions of code ^ 3455. Harrison v. Hartford F. Ins. Co., 67 Fed., 298. The provisions of 18 G. A., ch. 211, as to time of bringing action were not applicable to associations organized under § 1160 of the code of '73, but associations collecting premiums instead of assessments from mem- bers were not properly organized under that section, and therefore were subject to the provisions of said act of 18 G. A. Bradford v. Mutual Fire Ins. Co., 112-495. The provision of this section as to time of bringing suit held applicable to a loss occurring prior to the taking effect of the code, when the stat- ute provided that suit should not be brought within ninety days. Such a statutory provision relates to the remedy and is not part of the con- tract. Jones V. German Ins. Co.. 110-75. The defense that action on a policy is not brought within the statutory period specified in the contract is one w'hich must be affirmatively intro- duced otherwise it will be deemed waived. Miller Brewing Co. v. Capital Ins. Co., 111-590. Pi'ior to the adoption of this section it was lawful for the parties to create a contract limitation which w^ould be binding on the courts, and un- der this section the parties may contract as before, provided the limita- tion fixed by them is not less than one year. Farmers' Co-op. Creamery Co. V. Iowa State Ins. Co., 112-608. The change in the statute is not applicable to contract limitations un- der a policy executed before the change in the statute, and which were valid when made. Ibid. The time within which action on a policy may be brought cannot by stipulation be limited to less than one year from the time when a cause of action has accrued. Kenny v. Bankers' Ace. Ins. Co., 136-140. An action is premature and abatable when brought within forty days after service of the notice of loss and proof thereof under a mutual policy of insurance issued under Cli. 5, Title 9, Supp. Code, 1913, even though the company during said forty days denies all liability under the policy. Salmon v. Farm Property Mut. Assn., 168 la. 521. The limitation contained in this section as to the time for bringing the action pertains to the remedy, and cannot be controlled by stipulations in the policy of insurance. Vore v. Hawkeye Ins. Co., 76-548; Wilhelmi v. Des Moines Ins. Co., 86-326; Worley v. State Ins. Co., 91-150. These provisions as to the time when action may be brought for the loss, are applicable to actions for loss of goods as well as for loss by reason of damages to the realty. Wilhelmi v. Des Moines Ins. Co.. 86-326. Action cannot be brought before the expiration of the time fixed, even on the refusal of the company to pay. Quinn v. Capital Ins. Co., 71-615; Finster v. Merchants' d- Bankers' Ins. Co., 97-9. Making proofs and giving notice within the prescribed time constiUite conditions precedent to the right of action. Ruthven v. American F. Ins. Co,. 92-316. 44 INSURANCE OTHER THAN LIFE Ch. 4, T. IX The requirement of the statute as to the time within which an action on the policy may not be brought cannot be waived and a suit within the prescribed period is premature. Blood v. Haivkeye Ins. Co., 103-728. The effect of this provision as to the time when action may not be brought is to fix the time when the loss becomes due and payable. It does not affect the maturity of the contract, but is a legislative prohibition of the action before the time specified, and if action is brought before the ex- piration thereof it is prematurely brought and must fail. The objection may be raised by motion in arrest of judgment, without being pleaded as a defense. Taylor v. Merchants' & Bankers' Ins. Co.. 83-402. Where an amended petition properly setting out the cause of action, was filed before the expiration of the time for bringing action and de- murred to_ held, that the company had sufficient notice of the amendment so that the cause of action set up therein must be deemed to have been brought within the proper time. Jamison v. State Ins. Co., 85-229. This section with reference to time after which action may be brought is applicable to life insurance. Christie v. Life Indemnity, etc., Co., 82-360. Therefore held, that an action commenced on a certificate in a benefit company within sixty days after presenting notice of loss was prematurely brought and would be abated. Iltid. Also held, that these provisions were not unconstitutional on the ground that the subject matter was not expressed in the title or that the act em- braced more than one subject, or that it wa« not of uniform operation. IMd. If defendant claims that by reason of the proofs of loss not being suf- ficient the action is prematurely brought, he should set that out in a dis- tinct division of his answer and not in connection with the defense that the defendant cannot recover by reason of defective proofs. McCovit) v. Council Bluffs Ins. Co., 83-247. The fact that a suit had been prematurely brought and is subsequently dismissed on that ground does not entitle the plaintiff to institute another suit after the time limited statutory provision as to the time in which action may be brought. Vore v. Haivkeye Ins. Co., 76-548. The fact that another action on the policy would be barred by reason of limitations in the policy as to time of bringing action will not estop the company from insisting that an action commenced within the prescribed period is prematurely brought, and that plaintiff cannot recover therein. Ibid. The person who thus maintains an action prematurely brought is neg- ligent, within the provisions of § 3455. Wilhelmi v. Des Moines Ins. Co.. 86-326. Where an action was brought in proper time upon a policy of insurance, but subsequently on discovery that the property was niisdescribed, such action was dismissed and an action in equity to reform the policy and re- covery thereunder was commenced within a reasonable time, held, that such second action would not be barred under the provisions of the policy with reference to time for bringing action thereon. Jacobs i\ St. Paul F. t£ M. Ins. Co., 86-145. The objection that the suit was prematurely brought may be raised by motion in arrest of judgment and is not waived by failure to interpose it earlier in the progress of the case. Woodcock ik Haivkeye Ins. Co.. 97-562. A provision in the policy for arbitration in case of disagi'eement as to the amount of loss does not make an arbitration a condition precedent to the bringing of an action. Lesure Lumber Co. v. Mutual F. Ins. Co.. 101- 514. But as to whether appraisement may be made an absolute condition to the rigkt of action, quaere. Zalesky v. Home Ins. Co.. 102-613; 108-341; 114-516. Where the court acquired jurisdiction of the action only by appearance of the defendant, held that the action was to be deemed commenced only Ch. 4, T. IX INSURANCE OTHER THAN LIFE 45 when defendant appeared. Lesure Lumber Co. v. Mutual F. Ins. Co., 101- 514. The notice of proofs of loss herein contemplated include the affidavits showing the facts in regard to the loss which must accompany such notice and proofs and mere notice is not sufficient to determine the commence- ment of the period within which suit cannot be brought. Wilhelmi v. Des Moines Ins. Co.. 86-L52G. Where a petition in an action on a policy of fire insurance stated that the loss occurred "on or about April 14, 1886" and that notice and proofs of loss were given "on or about June 19, 1886," held, that the petition did not show that more than sixty days had intervened between the loss and the notice and proof thereof. District Tp. v. Des Moines Ins. Co., 75-647. The time of limitation fixed by the policy is not extended where proofs are neither furnished nor waived. Cornett v. Phenix Ins. Co., 67-388. The statutory requirement as to notice and proofs of loss is all that can be made essential by the contract. A notice and affidavit are sufficient to constitute the proof required. The sufficiency of the document is not dependent on the intent but on the contents. Parks v. Anchor Mut. F. Ins. Co., 106-402. The defense that action on a policy is not brought within the statutory period specified in the contract is one which must be affirmatively intro- duced, otherwise it will be deemed waived. Miller Brewing Co. v. Capital Ins. Co., 111-590. The provision of this section as to time of bringing suit held applicable to a loss occurring prior to the taking effect of the Code, when the statute provided that suit should not be brought within ninety days. Such a statutory provision relates to the remedy, and is no part of the contract. Jones V. German Ins. Co., 110-75. Prior to the adoption of this section it was lawful for the parties to create a contract limitation which would be binding on the courts, and under this section the parties may contract as before, provided the limi- tation fixed by them is not less than one year. Farmers' Co-op. Creamery Co. V. Iowa State Ins. Co., 112-608. • The change in the statute is not applicable to contract limitations under a policy executed before the change in the statute, and which were valid when made. Ibid. Where action is prematurely brought because of failure of insured to demand an appraisement he cannot cure the defect in his proceeding by subsequently demanding such appraisal and setting out the fact in the supplemental petition. Zalesky v. Home Ins. Co., 102-613. Although in the second action it is claimed that the first action was not prematurely brought, this will not sustain the second action brought after the period of limitation until the policy has expired. Wilhelmi v. Des Moines Ins. Co.^ 103-532. Where the first action for a loss under a policy was prematurely brought and subsequently another action was brought after the time limited in the policy for bringing action, held, that the second action was not to be deemed a continuation of the first action under the provisions of Code § 3455. Harrison v. Hartford F. Ins. Co., 67 Fed., 298. Sec. 1745 (C. C. 5661). Forms of policies. The I'oiiu ol' all policies or permits issued or pi'oposed to be issued by any insur- ance company doing- business in lliis state under the provisions of this chapter, shall first be «'xanjined and approved by the com- missioner of insurance. Sucli commissioner shall refuse 1o au- thorize it to do business or to renew its permission to do busi- ness when the form of policy issued or jn-oposed to be issued does not provide for the cancellation of the same at the reciuest i 46 INSURANCE OTHER THAN LIFE Ch. 4, T. IX of the insured upon equitable terms, and the return to the in- sured of any premium paid in excess of the customary short rates for the insurance up to the time of cancellation, or the release of the insured from any liability beyond such short rates, or for losses after the cancellation of the polic}^ if the insurance be in a mutual company ; and in case any company or association shall issue any policies not containing such provision, it shall be the duty of the commissioner to revoke the authority of such companv or association to do business. [38 G. A., ch. 348, ^ 6; 34 G. A., ch. 18, § 8; 17 G. A., ch. 39, § 1.] Form of Standard Fire Policy 1758a. Life 1783a. The provision of a policy for cancellation by the insured should not be construed as requiring repayment of premiums by the company before such cancellation can become effective. Parsons v. Northicesteni Nat. his. Co.. 133-532. The language of the policy of insurance is to be given its ordinary and popular signification rather than its technical meaning, and that, when capable of two constructions, it is to be given that which is most favor- able to the insured. Vorse v. The Jersey Plate Glass Ins. Co., 119-555. An insurance company cannot reduce the amount of a policy issued to assured by merely writing him a letter stating that it was obliged to re- duce its risk from $1,250 to $500, and enclosing a slip to that effect, with a request that it be attached to the policy, without proof that after the receipt of such letter the insured acquiesced in such reduction. McLean V. American Mut. Fire Ins. Co., 122-355. Sec. 1746 (C. C. 5662). Other insurance — coinsurance clause — prorating. Airy provision, contract or stipulation contained in any polic}' of insurance, issued b}^ any insurance company doing business in the state under the provisions of this chapter, provid- ing or stipulating that the insured shall maintain insurance oh any property coA^ered by such policy to any extent, or shall to any extent be an insurer of the property insured in such policy, or shall bear any portion of the loss on the property insured, shall be void ; and the commissioner of insurance shall refuse to authorize any such company to do business or to renew the authority or the certificate of diWj such company when the form of policy issued or proposed to be issued contain any such pro- vision, contract or stipulation; ]3rovided, that upon the written request of anj^ person desiring insurance, a rider providing for coinsurance may be attached to and become a part of the policy, but in no case shall such rider apply to dwellings or farm prop- erty. The request for the application of the coinsurance clause or rider to any policy of insurance shall be written or printed on a single sheet of paper Avhich shall contain nothing but the re- quest liereinafter set out, and said request must be signed by tlie insured and a copy thereof be left with him by the agent at Hie time the insurance is applied for. No form of request for coin- surance except the following shall be used by any company doing business within this state: REQUEST FOR THE APPLICATION OF THE COINSURANCE CLAUSE In consideration of a reduction from the established rate of per Ch. 4, T. IX INSURANCE OTHER TITAN LIFE 47 cent, to per cent, in premiums to be paid to the insurance company for insurance upon the following described property 1 hereby request that a coiiisui'ance rider lie attiichcd to tlie policy to he issued by said company and hereby agree, that during the life of the policy I will maintain insurance on said property to the extent of at least dollars, (or) per cent, (whichever may be agreed upon) of the actual cash value thereof at the time of fire, and that failing to do so, I shall become a coinsurer to the extent of such deficit. Before signing this request or the coinsurance rider to be attached to the policy to be issued I carefully read each of them and fully understand that in case I shall fail to maintain insurance on the previously describea property to the extent above provided, then in the event of loss or damage this company shall not be liable for a greater i)er cent, of the loss or dam- age to said property than: 1. The total amount of insurance maintained bears to dollars, or: 2. The total amount of insurance maintained bears to per cent, of the actual cash value of the property insured at the time of fire. Date Insured. The coiiisuranoo rider to be used shall be signed by both tlie agent and the insured and a copy thereof shall be left witli tlie insured at the time the application is made for insurance. The rider shall be in form and restrictions as follows: IOWA COINSURANCE AND REDUCED RATE CLAUSE (This clause must be signed by both the insured and the agent.) In consideration of the acceptance by the insured of a reduction in pre- miums from the established rate of per cent, to per cent,^ it is hereby agreed that the insured shall maintain insurance during the life of this policy upon the property insured: 1. To the extent of dollars, or 2. To the extent of at least ])er cent, of the actual cash value thereof at the time of fire (whichever may be agreed upon) and, that failing to do so the insured shall be a coinsurer to the ex- tent of such deficit. This clause, at the request of the insured, is attached to and forms part of policy number of the insurance com- pany of and shall in no case apply to dwellings or farm property, nor to any risk wherein the total value of the property shall be less than twenty-five thousand dollars^ except grain elevators and grain warehouses, and the contents of the same. Insured. Agent. Date No condition or stipulation in a policy of insurance fixing the amount of liability or recoveiy under such policy witli reference to prorating with other insurance on property insured shall be A-alid except as to other valid and collectible insurance, any agreement to the contrary notwithstanding. [37 G. A., ch. IS."), § 1; 34 G. A., ch. 79, § l'; 25 G. A., ch. 31.] The average clause is not prohibited by section 1746 nor section 1758a to d. Dahms d Son v. German Fire Ins. Co. 153 la. 168. Sec. 1747 (C. C. 5663). Doing business without compliance. 4S INSURANCE OTHER THAN LIFE Ch. 4, T. IX Every insurance company organized under the laws of or doing business in this state shall conform to all the provisions of this chapter and to other laws of this state, whether now existing or hereafter enacted, applicable thereto, and when necessary any existing company shall change its charter and by-laws so as to conform thereto, by a vote of a majority of its board of directors. Any officer, manager or agent of any insurance com- pany or association who, with knowledge that it is doing business in an unlawful manner, or is insolvent, solicits insurance with said company or association, or receives applications therefor, or does any other act or thing towards procuring or receiving any new business for such company or association, shall be quilty of a misdemeanor and for every such act, on conviction thereof, shall be adjudged to paj^ a fine of not less than one hundred nor more than one thousand dollars, or be imprisoned in the county jail not exceeding one year, or be punished by both such fine and imprisonment. [C. '73, § 1147.] See 1715-24-26-55. Life 1796. Applicable 1821d. Fraternal 1832-37-39(1. This does not prevent the officers of a company which has not com- plied with the law from reinsuring their risks in another company and transferring to such company the premium notes received therefore. Davenport F. Ins. Co. v. Moore, 50-619. Sec. 1748 (C. C. 5664). Officers punished. Any president, sec- retary or other officer of any company organized under the laws of this state, or any officer or person doing or attempting to do business in this state for any insurance company organized either within or without this state, failing to comply with any of the requirements of this chapter, or violating any of the pro- visions thereof, .shall be guilty of a misdemeanor, and upon con- viction thereof shall be fined in a sum not exceeding one thou- sand dollars, and be imprisoned in the county jail for a period not less than thirty days nor more than six months. [Same.] Sec. 1749 (C. C. 5665). Advertisements — soliciting agents. Every agent of any insurance company shall, in all advertise- ments of such agency, publish the location of the company, giv- ing the name of the city, town or village in which it is located, and the state or government under the laws of which it is or- ganized. Any person who shall hereafter solicit insurance or procure application therefor, shall be held to be the soliciting agent of the insurance company or association issuing a policy on such application or on a renewal thereof, anything in the application, policv or contract to the contrary notwithstanding. [C. '73, § 1148.] * See 1725-50 Life 1800-l-14-15-21k, 1. Fraternal 1833-37. An agent instructed to procure insurance is liable to his principal for any loss resulting from procuring insurance in a company not authorized to do business in the state. Hartman v. Hollowell, 126-643. Sec. 1750 (C. C. 5735). Who deemed agents. The term agent used in the foregoing sections of this chapter shall include any Ch. 4, T. IX INSURANCE!] OTHER THAN LIFE 49 other person who shall in any manner directly or indirectly transact the insui'ance 'business {'t)i- nny insurance company complying" with the laws of this stale. Aii> officer, aj^ciit or rep- resentative ol* an insurance company (loin<4' business in lliis stale who may solicit insurance, procure applications, issue policies, adjust losses or transact the business generally of such companies, shall be held to be the agent of such insurance company with authority to transact all business within the scope of his em- ployment, anything in the application, policy, contract, by-laws or articles of incorporation of such company to the contrary not- withstanding, but members, of mutual assessment associations wiiich pay no commission, reward or gratuity for the procuring of applications for membership, the income of which associations is derived solely from assessments, dues and fees collected from its members for the sole purpose of meeting loss and expenses, shall not be deemed to be agents under anv section of this chap- ter. [39 G. A., ch. 123, § 1; 18 G. A., ch' 211, § l.j See 1725-49. Life ]800-l-14-15-21k, 1. Fraternal 1833-37. A soliciting agent with power to take and forward applications and receive money to be paid when the insurance is effected, does not have authority to bind the company by declarations as to the validity of the contract of insurance or as to the rights and liabilities of the company, when such declarations are not made while discharging his duties as agent in the transaction in question. Schoep v. Bmikos' Allianre Tna. Co., 104-354. An adjusting agent with authority to ascertain and settle losses has of necessity power to determine what proofs are satisfactory and to waive those which are regarded as unimportant. Brock v. Bos Moines Ins. Co., 106-30. Section applied. McMastcr v. Ncio York L. Ins. Co., 78 Fed., s. c 90 Fed., 40; s. c. 99 Fed., 856. An agent having the power to transact all the business within the apparent scope or usual extent of his employment in issuing policies may waive the conditions of a policy as to incumbrances, notwithstanding a provision in the policy denying such authority to the agent. Liquid Car- honic Acid Mfg. Co. v. Phoenix Ins. Co., 126-225. One soliciting insurance and taking applications therefor is the agent of the company issuing the policy, without regard to any provisions found in the policy. Continental L. Ins. Co. v. Chamherlain, 132 U. S. 304. This provision is applicable to life insurance companies. Ityid. It is a matter of general knowledge that the soliciting agent as a rule prepares the application for the owner, and what he does in that respect is within his powers and binds his principal. Jamison v. State Ins. Co., 85-229. An insurance company is chargeable with knowledge of facts macTe known to its agent at the time of taking the application, and an instruc- tion requiring more proof of the agent's authority than was necessary, held not prejudicial to defendant, although erroneous. Key v. Des Moines Ins. Co.. 77-174. Under these provisions, held, that the agent af one company, who, by authority of his customer, applied to an agent of another company author- ized to issue policies, for insurance on the property of his customer, was the agent for the company issuing the policy, and a mistake as between him and the agent issuing the policy was chargeable to the company, and not to the person for whose benefit the policy was issued. »S7. Paul F\ d M. Ins. Co. V. Shaver, 76-282. 50 INSURANCE OTHER THAN LIFE Ch. 4. T. IX If the laws of the state make the agent soliciting or negotiating insur- ance the agent of the company issuing the policy no condition in the policy in terms making such agent the agent of the assured only, will be valid. Fred Miller Breicing Co. v. Council Bluffs Ins. Co., 95-31. Where an insurance agent in Wisconsin negotiated for insurance on property in that state through an insurance agent in another state with- out designating the company in which the insurance should be taken and the second agent placed the insurance in a foreign company, held that the first agent became, under the laws of Wisconsin, the agent of the com- pany in which the insurance was placed in such sense that notice of the suit against the company might be served upon such agent so as to give the Wisconsin courts jurisdiction of such suits. Ibid. An adjuster of losses has authority to waive conditions affecting the validity of the policy. Arispe Mercantile Co. v. Gueen Ins. Co., 141-607, Knowledge by a soliciting agent of the existence of other insurance is a waiver of a stipulation against such insurance. Halzman v. Machin- ery Mut. Ins. Assn., 142-99. Assured is justified in relying on advice and assistance of a soliciting agent in preparing his application and the language will be given a reasonable construction in favor of assured in order to avoid forfeiture on technical grounds. Buchnam v. Inter-State Business Men's Accident As.sn., 183 Iowa, 652. A company is chargeable with notice of other insurance of which the soliciting agent has knowledge. Wilson v. Anchor Ins. Co., 143-458. An insurance company is not chargeable with notice of other insur- ance on the part of a soliciting agent where the only scope of such agent's employment was to return the policy for correction. Scridner v. Anchor F. Ins. Co., 144-328. If an agent has knowledge of past conditions or existing facts avoiding a policy which is secured by him, a company issuing a policy with such knowledge on the part of its agent cannot insist upon these facts for the purpose of avoiding it; but knowledge by a soliciting agent of the intention to violate some condition of the policy in the future is not binding upon the company. House v. Security F. Ins. Co., 145-462. An adjuster of losses can waive compliance with the provisions of the policy requiring the insurer to separate the damaged from the undamaged goods. Farrncr.s' Mercantile Co. v. Farmers' Ins. Co., 161-5. Even though the secretary of a mutual company has no authority to agree to the removal of property beyond the limits of the county in which the association has authority to take risks, if after notice to the secretary of such removal the association makes assessments on the policy, the prohibition of the policy against removal is waived. Kesler v. Farmers' Mut. F. & L. Ins. Assn., 160-374. Provisions of the policy are valid, notwithstanding this section, which prescribe the manner in which the local agent shall exercise his authority so as to bind the company. Mulrooney v. Royal Ins. Co. (D. C.) 157 Fed. 598, (C. C. A.) 163 Fed. 833. Sec. 1751 (C. C. 5666). Provisions applicable to associations. The provisions of the foregoing sections relative to insurance companies shall apply to all such companies, partnerships, as- sociations or individuals, whether incorporated or not. 1 C. "73, § 1147.] Sec. 1752 (C. C. 5667). Fees. There shall be paid to the com- missioner of insurance for services re(|uired under the provisions Ch. 4, T. IX INSURANCE OTHER THAN LIFE 51 of this chapter the following fees, which shall be accounted for by him in the same manner as other fees received in the discharge of the duties of his office : 1. For filing and examination of the first application of any company and accompanying articles of incorporation for organization in this state, and the issuing of the permission to do business, ten dollars; 2. For filing application of any foreign company for certificate to do business in this state and the accompanying certified copy of charter or article of incorporation, twenty-five dollars; 3. For permission to foreign company to do business in this state, or certified copy thereof, two dollars; 4. For filing annual statement of a domestic company, and issuing the renewal of the permission required by law to authorize continuance in business; three dollars; 5. For filing annual statement of a foreign company, twenty dollars, and issuing renewal of permission, two dollars; 6. For each certificate of authority to agent of foreign company, two dollars; 7. For each certificate of authority to agent of domestic company, fifty cents; 8. For every copy of any paper filed, the sum of twenty cents per folio, and for affixing the official seal to such copy and certifying the same, one dollar; 9. For each certificate for publication of foreign companies, two dol- lars, and for each certificate for publication of Iowa companies, fifty cents, [27 G. A. ch. 45, §§ 1, 2, 3. C. '73, § 1153.] See 1818, as to life companies and associations. Sec. 1753 (C. C. 5668). Expenses of examination. The nec- essary expenses of anj^ examination of any insurance company made or ordered to be made by the commissioner of insurance under this chapter shall be certified to by him, and paid on his requisition by the company so examined; and in case of failure of the compan}^ to make such payment the commissioner shall suspend such company from doing business in this state until sucli expenses are paid. If such expenses are not paid by the com- pany, they shall be audited by the executive council and paid out of the state treasury. But in no case shall any foreign in- surance company be examined except bv order of the executive council. [16 G. A., ch. 37; C. '78, § 1156.] See 1700-31-55. Life 1777. Applicable 1S21 a to g. Fraternals 1839b, c. Sec. 1754 (C. C. 5669). Combinations. It shall l)e unlawful for two or more insurance companies doino- busiiu'ss in this state, or for the officers, agents or employes of such companies, to make or enter into any combination or aj^reement relatin*!: to the rates to be charged for insurance, the amount of commissions to be allowed agents for procuring the same, or tlie manner of Irans- acting the insurance business within Ihis state; and any such com- pany, officer, agent or employe violating this provision shall be guilty of a misdemeanor, and on (•on\ic1ion thereof shall i)ay a 52 INSURANCE OTHER THAN LIFE Cli. 4, T. IX l^enalty of not less than one hundred dollars nor more than five hundred dollars for each offense, to be recovered in the name of the state for the use of the permanent school fund. [38 G. A., ch. 318, § 1; 26 G. A., ch. 22, § 1.] See also section 1782 and last citation thereunder. The statutory prohibition of combinations between fire insurance com- panies in relation to the rates of commissions or the manner of trans- acting business is not in violation to the state constitution prohibiting the granting of special privileges and immunities, and requiring general laws to be uniform in operation. But so far as such provisions make it unlaw- ful for two or more companies to enter into any agreement as to the amount of commissions to be allowed agents, they are invalid as depriving the companies of the liberty of contract, secured by the federal constitu- tion. Greemoich Ins. Co. v. Carroll, 125 Fed. 121. (As to the second point this case is reversed. Carroll v. Greenwich Ins. Co., 199 U. S., 401.) Sec. 1755 (C. C. 5670). Revocation of authorit3^ The com- missioner of insurance is authorized to summon before him, for examination under oath, any officer, ag-ent or employe of any such company suspected of violating any of the provisions of the pre- ceding section, and, on complaint to him in writing by two or more residents of this state charging such company under oath upon their knowledge or belief with violating the provisions of the preceding section he shall summon any officer, agent or em- ploye of said company before him for examination under oath; if upon such examination, and that of any other witness pro- duced and examined, he shall determine that such company is guilty of a violation of any of the provisions of the preceding section, or if any such officer, agent or emploj^e after being duly summoned shall fail to appear or submit to examination, the com- missioner shall forthwith issue an order revoking the authority of such company to transact business within this state, and it shall not thereafter be permitted to do the business of fire insur- ance in this state at any time within one year therefrom. [26 G. A., ch. 22, § 2.] Certificate revoked. See 1715-24-25-47. App. 1821d. Frat. 1832-39-d. Sec. 1756 (C. C. 5671). Appeal. Either party may appeal from the decision of the commissioner of insurance made pur- suant to the preceding section, to the district court of the coun- ty where the same was made, within twenty days from the time of the rendition of such decision, by serving a written notice of such appeal on the opposite party and on the commissioner, and filing with the clerk of said court a good and sufficient bond for the payment of all costs on the appeal in case the decision sliall be affirmed. On such appeal said court shall try the case de novo, as equitable causes are tried, and on such evidence as eitJier party may jjroduce, and may reverse, modify or affirm the de- cision of the commissioner. [Same, § 3.] Sec. 1757 (C. C. 5672). Evidence. The statements and declara- rii.4,T. IX INSURANCE OTHER THAN LIFE 53 tioiis made or testimony given by any such officer, agent or em- ploye in the investigation before the commissioner of insurance, or upon tlie licaring and trial before the district court, as provided ill the two pi-eceding* sections, sliall uol be used against the person making tiie same in any criminal prosecution against him. [Same, §4.] Sec. 1758 (C. C. 5673). Insurance in unauthorized companies. No action sliaii be maintained in any court m the state upon any policy or contract of fire insurance issued upon any property s^-^uated in the state by any company, association, partnership, individual or individuals that have not been authorized by the commissioner of insurance to transact such insurance business, unless it shall be shown that the insurer or insured, wdthin six months after the issuing of such policy or contract of insurance, lias paid in to the state treasury two and one-half per cent of the gross premium i^aid or agreed to be paid for such policy or contract of insurance [26 (1. A., ch. 28. | Sec. 1758-a (C. C. 5674). Additional riders and clauses per- mitted. It shall be unlawful for any insurance company tu issue any policy of fire insurance upon any i^roperty in this state ex- cept upon automol)iles and marine risks other or different t'l-oin the staiidai-d form of tire insurance poTu^y herein s«'t t'oi-lh, ex- cept, I. It may print in its policy its name, location, date of in- corporation, amount of its paid-up capital stock, (if a stock com- pany), names of its officers and agents, tlie number and date of the policy, the amount (under dollar mark) for which it is is- sued, and if issued through an agent, the words: "This policy shall not be valid until countersigned by the duly authorized agent of tliis company at ' ' II. It may use in or upon its policy forms or slips of the (h*- scription, location and specifications of the property insured, to- gether with permits upon such conditions not in conflict with the provisions of law, as may be agreed upon, for the use or storage of electricit.y, gasoline, explosives, or other extra liazardous prod- ucts or materials; for repairs or improvements; for the operation or ceasing to operate ; and for the vacancy of the premises ; and permits for hazards other than those specifically mentioned above; also a mortgagee's or loss pa^^able clause, and other per- mits or riders, not in conflict with law. III. It may also by written or printed clause upon such condi- tions not in conflict with the provisions of law as may be agreed upon, provide that a policy shall cover any loss or damage caused by lightning, tornadoes, cyclones, hail or windstorms not exceed- ing the sum insured or the interest of the insured in the property; provided, if there shall be other valid insurance on sucli property INSURANCE OTHER THAN LIFE C\\. 4, T. IX whereby the same is insured against loss by lightning-, tornadoes, cyclones, hail or windstorms, said company shall be liable only pro rata witii such other valid and {•olleetibh* insurance for an^^ such loss b\' lightning, tornadoes, cyclones, hail or windstorms. IV. Any company incorporated in this state, or authorized to do business herein, shall print in its policy or attach thereto any provisions which such company are required b}^ law to insert in its policies or attach thereto, not included in the provisions of this polic3^, but such provisions shall be printed apart from the other conditions and agreements of this policy and under a sep- arate title as follows: ''Provisions required by law to be stated in the policy of insurance." V. It shall print upon its policy issued in compliance with the preceding provisions of this act, the words: "Iowa Standard Fire Insurance Policv." [33 G. A., ch. 112, ^ 1; 32 G. A., ch. 76, § 1.] See 1712-27-28-29-30-45, concerning policies other than life. A rider to a blanket policy on several buildings incorporating therein an average clause is not prohibited by this section. Dahms v. German F. Ins. Co., 153-168. Sec. 1758-b (C. C. 5675). Standard fire insurance policy — form. Tlie policy sliall l)e plainly printed, and no part thereof shall be in type smaller than brevier; the conditions thereof shall be printed in uniform numbered lines, as adopted and approved by the commissioner of insurance, and such policy shall be in terms and conditions as follows : . I. In consideration of the stipulations herein named and of dollars, does insure for the term of from the day of 19 at noon (standard time), to the day of 19. . . at noon (standard time), against all direct loss or damage by fire, except as here- inafter provided, to an amount not exceeding dollars, to the following described property, while located and contained as de- scribed herein, and not elsewhere, to-wit: It is hereby agreed that the insured may obtain $ additional insurance in companies authorized to do business in the state of Iowa. II. This company shall not be liable beyond the actual cash value of the property covered by this policy at the time any loss or damage occurs, and said liability shall in no event exceed what it would cost the insured to repair or replace the property lost or damaged with material of like kind and quality. The sum for which this company is liable pursuant to this policy, shall be payable forty days after due notice and proofs of loss have been received by this company in accordance with law. III. This policy shall be void if the insured has concealed or mis- represented any material fact of circumstance concerning this insurance of the subject thereof. Cli. 4, T. IX INSURANCE OTHER THAN LIFE 55 IV. Unless otherwise provided by agreement of this company this policy shall be void: (a) If the insured now has or shall hereafter procure any other coiv tract of insurance valid or invalid on the property covered in whole or in part by this policy; or (b) If the subject of insurance be a manufacturing establishment, and it cease to be operated for more than ten consecutive days; or (c) If the building herein described, whether intended for occupancy by the owner or tenant be or become vacant or unoccupied and so remain for ten consecutive days; or (d) If the interest of the insured be other than unconditional and sole ownership; or (e) If the subject of insurance be a building on ground not owned by the insured; or (f) If any change other than by death of the insured, whether by legal proceedings, judgment, voluntary act of the insured or otherwise, take place in the interest, title, possession or use of the subject of insur- ance, if such change in the possession or use makes the risk more haz- ardous; or (g) If the subject of insurance or a part thereof (as to the part so encumbered) be or become encumbered by lien, mortgage or otherwise created by voluntary act of the insured or within his control; or (h) If the property insured or any part thereof (as to the part so removed) be removed to any other building or location than that specified in the policy; or (i) If this policy be assigned l)efore loss. V. Unless otherwise provided by agreement of this company, this policy shall be void: (a) If the subject of insurance be a manufacturing establishment, and it be operated in whole or in part at night later than 10 o'clock; or (b) If the hazard be increased by any means within the knowledge of the insured; or (c) If mechanics be employed in building, altering or repairing the within described premises for more than fifteen days at any one time; or (d) If illuminating gas or vapor be generated in any building cov- ered hereby, or on any premises adjacent thereto for use upon the insured premises; or (e) If there be kept, used, or allowed on the within described premises benzine, benzole, dynamite, ether, fireworks, gasoline, Greek fire, gun- powder, exceeding twenty-five pounds in quantity, naphtha, nitroglycerine, or other explosives, phosphorus, calcium carbide, petroleum or any of its products of greater inflammability than kerosene of lawful standard, which last named article may be used for lights and kept for sale accord- ing to law, in quantities not exceeding five barrels; or (f) If the insured permits the property which is the subject of insur- ance, or any part thereof, to be used for any unlawful purpose. Provided that nothing contained in paragraph five herein shall operate to avoid this policy in any case, if the insured shall establish that the failure to observe and comply with such provisions and conditions did not contribute to the loss. VI. This company shall not be liable for loss caused directly or in- directly by invasion, insurrection, riot, civil war, or military usurped power, or by theft, or by neglect of the insured to use all reasonable means to save and preserve the property during and after a fire, or when the property is endangered by fire in neighboring premises; or (unless fire 56 INSURANCE OTHER THAN LIFE Ch. 4, T. IX ensues, and in that event, for damage by fire only,) by explosion of any kind or by lightning; but liability for direct damage by lightning may be assumed by specific agreement, VII. This company shall not be liable for loss or damage to any prop- erty covered by this policy if the insured shall fail to pay any written obligation given to the company for the premium or any assessment or installment of premium when due; provided the company shall have given the insured notice as required by law. Upon payment and acceptance by the company of the delinquent premium assessment or installment of premium before loss occurs, or after loss, if the company shall have had notice thereof and accepts such payment, this policy shall be revived and in full force according to its terms. VIII. If a building or any part thereof fall, except as the result of fire, all insurance by this policy on such building, or its contents, shall immediately cease. IX. This company shall not be liable for loss to accounts, bills, cur- rency, deeds, evidence of debt, money, notes or security; nor, unless liability is specifically assumed thereon, for loss to awnings, bullion, casts, curiosities, drawings, dies, implements, jewels, manuscripts, medals, models, patterns, pictures, scientific apparatus, signs, store or office furni- ture or fixtures, sculpture, plate glass, frescoes or decorations; or prop- erty held in storage or for repairs; nor, beyond the actual value destroyed by fire for loss occasioned by ordinance or law regulating construction or repairs of buildings, or by interruption of business, manufacturing pro- cesses or otherwise. X. Any application, survey, plan, or description of property signed by the insured and referred to in this policy shall, when a copy is attached hereto, be a part of this contract, and shall be held to be a i-epresentation and not a warranty. XL This policy shall be canceled at any time at the request of the insured; or by the company by giving five days' notice of such cancella- tion either by registered letter directed to the insured at his last known address, or by personal written notice. If this policy shall be Cfincelled as hereinbefore provided, or become void or cease, the premium having been actually paid, the unearned portion shall be returned on surrender of this policy or last renewal, this company retaining the customary short rates; except that when this policy is cancelled by this company by giving notice it shall retain only the pro rata premium. XII. If, with the consent of this company, an interest under this policy shall exist in favor of a mortgagee or of any person or corporation having an interest in the subpect of insurance other than the interest ot the insured as described herein, the previsions and conditions hereinbe- fore contained shall apply in the manner expressed in such provisions and conditions of insurance relating to such interest, as shall be agreed upon by this company. XIII. If property covered by this insurance is so endangered by fire as to require removal to a place of safety, and is so removed, that part of this policy in excess of its proportion of any loss and value of property remaining in the original location, shall, for the ensuing five days only, cover the property so removed in the new location; if removed to more than one location, such excess of this policy shall cover therein for such five days in the proportion that the value in any one new location bears to the value in all such new location; but this company shall not in any case of removal, whether to one or more locations, be liable beyond the proportion that the amount hereby insured shall bear to the total valid and collectible insurance on the whole property at the time of fire, whether the same cover in new location or not. XIV. If loss occur the insured shall as soon as i)racticablc after lit Ch. 4, T. IX . INSURANCE OTHER THAN LIFE 57 ascertains the fact of such loss, give notice in writing thereof to the company, protect the property from further damage, forthwith separate the damaged and undamaged personal property, and put it in the best possible order, and shall, within sixty days from date of loss, furnish this company with notice thereof in writing accompanied by affidavit stating the facts as to how tho loss occurred and the extent thereof, so far as such facts are within his knowledge. XV. The insured as often as reasonably required, shall exhibit to any person designated by this company, all that remains of any property herein described as to which a claim for loss or damage is made, and submit to examination under oath by any person named by this company, and subscribe the same, and, as often as reasonably required, shall pi-o- duce for examination all books of account, bills, invoices, and other vouchers, or certified copies thereof, if originals be lost, at such reasonable place as may be designated by this company or its representatives, anci shall permit extracts and copies thereof to be made; provided, however, that this company shall not be held to have waived any of the provisions or conditions of this policy or any forfeiture thereof by any examination or investigation herein provided for. XVI. This company shall not be liable under this policy for a greater proportion of any loss on the described property, or for loss by and ex- pense of removal from premises endangered by fire, than the amount hereby insured shall bear to the whole amount of valid and collectiblfc insurance covering such property. XVII. No suit or action on this policy, for the recovery of any claim thereon, shall be sustainable in any court of law or equity, unless com- menced within twelve months next after the right of action for the loss accrues. XVIII. Wherever in this policy the word "insured" occurs, it shall be held to include the legal representative of the insured, and wherever the word "loss" occurs, it shall be deemed the equivalent of "loss or damage." XIX. This policy is issued and accepted subject to the foregoing stipu- lations and conditions, together with such other provisions, agreements or conditions now or hereafter specifically authorized by law as may be endorsed hereon or added hereto. In witness whereof, this company has executed and attested these presents. : Secretary. President. Countersigned at this day of 19.. Agent. [34 G. A., ch. 18, §§ 9, 10; 32 G. A., ch. 76, § 2.] See also 1728-41-43-44-45. The notice requisite to the cancellation of a policy by the insurance company may be waived by the insured. Warren v. Franklin Fire Ins. Co., 161-440. Sec. 1758-c (C. C. 5676). Violations— penalty. Any insurance company, its officers or agents, or eitlier of them, violating: any of the provisions of this act, by issuing, deliverin<>- or offering- t(» issue or deliver any policy ol lire insurance on property in this state other or different from the standard form, herein provided for, shall be gmliy of a misdemeanor, and upon complaint mad.- by the commissioner of insunincr. or by any citi/ou of this stat«', siiall, upon conviction lliereor, be i)uiiislu'(l by a line <»f ii(»l h-ss 58 INSURANCE OTHER THAN LIFE Cli. 4, T. IX than fifty dollars nor more than one hundred dollars for the first offense, and not less than one hundred nor more than two hundred dollars for each subsequent offense, and such company shall, until the payment of such fine, be disqualified from doing- any insurance business in this state ; but any policy so issued or delivered shall, nevertheless, be binding upon the company issu- ing or delivering the same. [32 G. A., ch. 76, § 3.] Sec. 1758-d (0. 0. 5677). Existing statutes — waiver in interest of insured. Nothing contained in this act nor any provisions or conditions in the standard form of policy provided for herein, shall be deemed to repeal or in any way modify existing statutes nor to prevent any insurance company issuing such polic.y, from waiving am^ of the provisions or conditions contained therein, if the waiver of such provisions or conditions shall be in the in- terest of the insured. [32 G. A., ch. 76, § 4.] Sec. 1758-e (C. 0. 5678). Policy must appear in name of issuing company only. That every fire insurance company and associa- tion authorized to transact business in this state shall conduct its business in the name under which it is incorporated, and the policies issued by it shall be headed or entitled only by such name. There shall not appear on the face of the policy or on its filing back, anything that Avould indicate that it is the obliga- tion of any other than the company responsible for the payment of losses under the policy, though it will be permissible to stamp or print on the bottom of the filing back, the name or names of the department or general agencv issuing the same. [36 G. A., II. F. 516, § 1.] Sec. 1758-f (C. C. 5679). Misleading statements prohibited. No insurance coiiipany or department or general agency of an insurance company, doing business, in this state, or its officers or agents, shall issue any false or misleading advertisement through newspapers or other periodicals, or any false or mis- leading representations by signs, cards, letterheads, etc., tending to conceal or misrepresent the true identity of the insurer or insurance company, Avhich is carrying the lial)ility under any policy issued in this state. Nor shall any insurance company or department or general agency of an insurance company, doing business in this state, issue any advertisement or representation of any character, giving the appearance of a separate or independent insuring organization on the part of any department or general agency, and the type or lettering used in any advertisement or repre- sentation shall set forth the name of the company or organization assuming the risk more couspicuousl}^ than tliat of any depHrl- ment or general agency. [36 G. A., H. F. 516, § 2. | Sec. 1758-g (C. C. 5680). Penalty. Any vi(»]alion of tliis act Ch. 4, T. IX INSURANCE OTHER THAN LIFE 59 shall be punished bv a fine of not exceeding live hundred dollars. [36 G. A., H. F. 516, § 3.] See. 1758-h (C. C. 5681). Agent may advertise individual business without mentioning company represented. Nothing herein contained shall l)e construed to prevent any representative of an insurance company from advertising his own individual business without specific mention of the name of the company or companies which he may represent. | 36 (I. A., 11. F. 516, § 4. | CHAPTER 286— 38th G. A. PROVIDING FOR AND AUTHORIZING PHYSICIANS, DRUGGISTS, DENTISTS, AND GRADUATE NURSES— MUTUALS (House File No. 10 7) AN ACT providing- for the organizing, admitting from other states, licensing and regulating of mutual insurance corporations, organized among physicians, druggists, dentists and graduate nurses for their protection against loss in actions for alleged error, mistake or neg- ligence; requiring such organizations to be incorporated; providing for fees, taxes, licenses, reports, cancellations, supervision and other regulations thereof and repealing all acts and parts of acts in conflict therewith. Be It Enacted hy the General Assembly of the State of Iowa: Section 1 (C. C. 5697 to 5699 inclusive). Any number of p]jysicians, dniggists, dentists and graduate luirses, licensed to l)ractice their profession in the state of Iowa, may, by complying with the provisions of this chapter and without regard to other statutory provisions, enter into contracts with each other for the ])urpose of protecting themselves by insurance against loss by leason of actions at laAV on account of their alleged error, mis- take, negligence or carelessness in the treatment and care of patients, including performance of surgical operations, or in the prescribing and dispensing of drugs and medicines, or for loss I)}' reason of damages in other respects, and to reimburse any member in case of such loss. All corporations, organized for the purpose of transacting such insurance business under the provisions of this act, shall incorporate under the provisions of chapter 1, title IX of the code, as amended, and be known as mutual corpoi'ations ; and are hereby empo\yered to collect such assessments, or premium pa^'ments, provided for in their articles of incorporation or by-laws, as are required to pay losses and expenses incurred in the conduct of their business. Such mutual insurance corporations may issue certificates of membership, or policies; and may provide that all assessments, av premium pay- ments, payable thereunder, be made in cash, or on tlie installment, or assessment plan. Any policy issued by any sn<'h comj^any sliall <'(.ntain a provi- 60 INSURANCE OTHER THAN LIFE Ch. 4. T. IX sion SO that said policy shall inure to the benefit of any person obtaining a judgment against the insured to the extent of the insurance carried and for the purpose for which tlie insurance was issued. Sec. 2 (C. C. 5700-5701). The articles of such mutual insurance corporations, shall be submitted to, and approved by, the attornej^ general and the commissioner of insurance before being filed with the secretary of state, and no such mutual insurance corpo- ration shall issue membership certificates, or policies, until its form of certificate, or policy, shall have been submitted to, and approved by, the commissioner of insurance and until it has secured from such commissioner of insurance a certificate author- izing it to transact such an insurance business. No such certificate^ shall be issued by the commissioner of insurance until two liundred fifty (250) applications have been received,- representing, in the aggregate, one million ($1,000,000) dollars of insurance, nor until the commissioner of insurance lias satisfied himself that such mutual insurance corporation has bona fide applications representing the number of applicants and the amount of insur- ance herein required, and that there is in the possession of such mutual insurance corporation cash assets amounting to not less than ten thousand ($10,000) dollars. Sec. 3 (C. C. 5702). Such mutual insurance corporations doing business under the provisions of this chapter shall, annually, in the month of January, report to the commissioner of insur- ance, upon blanks furnished by him, the same facts, so far as applicable, as are required to be furnished by mutual insurance associations under the statute of Iowa, which report shall be tabulated by the commissioner of insurance and published by him in the annual report on insurance. Sec. 4 (C. C. 5703). Such mutual insurance corporations shall, annually, set aside and maintain as a re-insurance reserve, an amount equal to ten i3er cent of the receipts from assessments, or premium payments, during the year until the total amount thus accumulated shall equal forty per cent, but not to exceed fifty per cent of the amount of the annual assessment, or premium payment, at the rate charged for such insurance on all policies in force. The reserve thus accumulated may be used for the payment of losses and expenses, and w^hen so used shall be restored and maintained in like manner as originall}^ accu- mulated. Sec. 5 (C. C. 5704). Any certificate of membership, or policy, issued by such a mutual insurance corporation may be cancelled by the corporation by giving five days' written notice thereof to the insured; or such cancellation may be upon demand of the insured; and such cancellation, when so made, either bj^ the Ch. 5, T. IX STATE AND COUNTY MUTUAL ASSOCIATIONS 61 coi'poratiou or by the insured, shall be upon a pro-rata basis, and the cancellation of such certificate or policy shall release the member from all other future (jblijj;ations Lo such corporation. 8ec. 6 (C. C. 5705). Such a imiliial insurance corporation shall pay the same fees for admission into I he state, for annual reports and for annual certilieat(\s of authority as are required to be paid b}^ domestic mutual companies organized and doing business under chapter 4, title JX of the code of Iowa, as amended; such certificate shall expire March first of the year following the date of its issue. The commissioner of insurance shall liave and exercise the same control over such corporations as he now has over nuitual assessment insurance associations organized and doing business under the i)ro visions of chapter 5, title IX of the code of Iowa. TIk^ provisions as to nuxximum liability of members to assessments when assets are insufficient and lo assessments when the corpoi-ation is insolvent, found in sections 17r)l)-j, 17r)f)-k and 17r)l)-l, su|)[)leinent to the eode, li)!:}, shall apply to all mutual insui'anee c()ri)()rations organized uiub'r the provisions of this act. ^ See. 7 (C. C. 5706). Any mutual insurance association organ- ized under the laws of any other state, for th(» purpose of transacting the kind of business described in section 1 of this act, and which has been in business not less than one year, and has on hand cash assets in an amount of not less than ten thou- sand ($10,000) dollars, and has not less than three hundred (300) members, shall upon application, be admitted to do business in this state; and shall thereafter make all reports and be subject to taxation, examination and supervision by the commissioner of insurance to the same extent and in the same manner as are domestic corporations organized under the provisions of this act. Sec. 8 (C. 0. 5707). All acts, or parts of acts, in conflict here- with shall be so construed as not to include corporations regu- lated by this act. In effect b}' publication April 30, 1919. CHAPTER 5, TITLE IX Ch. 120, 39 G. A. STATE AND COUNTY MUTUAL ASSOCIATIONS AN ACT to provide for the organization, regulation, taxation and operation of mutual insurance associations, also to repeal chapter five (5), title nine (IX) of the code, and amendments thereto, (C. C. sec. 5682, chapter 8), and to enact a substitute therefor. Be It Enacted hij the General Asseinhhj of the State of Iowa: Section 1. That chapter five ('>), title nine (IX) of the code 5 62 STATE AND COUNTY MUTUAL ASSOCIATIONS Ch. 5, T. IX (G. C section 5682, chapter 8), be repealed and the following enacted in lien thereof: "8ee. 1. Any nnmber of persons may by incorporating nnder chapter 1, title IX, of the code, enter into contracts with each other for the following kinds of insurance from, loss or dam- age by : First, fire and lightning ; second, tornado, cyclone and windstorm; third, theft and against any or all loss, expense and liability resulting from the ownership, maintenance or use of any automobile or other vehicle, but siiall not include, by county mutuals, insurance against bodily injury to the person; fourth, ])late glass, against breakage of glass local or in transit; fifth, liailstorms. For the purpose of this protection these contracts of insurance shall be subject only to such provisions as are contained in this chapter, and shall consist of: First, an appli- cation on blanks furnished by the association and signed by the insured or his representative, which ma}^ contain in addition to other provisions; the value of the property, the proper descrip- tion thereof, the amount of other insurance and the incumbrance thereon, and agreement to be governed by the articles of incor- poration and by-laws in force at the time the policy is issued, a representation that the foregoing statements are true as far as the same are known to the insured or material to the risk, and that the insurance shall take effect when approved by the secre- tary. Second, a policy issued by the association in accordance with its rules, and approved by the commissioner of insurance. Such associations may insure risks of their members or may reinsure risks of other associations or companies; or may organ- ize reinsurance associations for the reinsurance of risks. The word 'persons' and 'members' as used in this chapter shall be construed to mean trustees, administrators, and all other indi- viduals, public or private corporations or associations. "Sec. 2. Any association incorporated under the laws of this state for the purpose of furnishing insurance as provided for in this chapter, doing business only within the county in which is situated the town or city named in its articles of incorporation as its principal place of business, or the counties contiguous thereto, shall for the purpose of this chapter, be deemed a county mutual assessment association; all other associations operating hereunder shall, for the purpose of this chapter be deemed state mutual assessment associations, and such associations may do business throughout the state and in other states where they are legalized and authorized to do business. The w^ords 'mutual' and 'association' shall be incorporated in and become a part of their name. "Sec. 3. No state mutual assessment association shall issue policies until at least one hundred and twenty-five (Ti.")) appli- Ch. 5, T. IX STATE AND COUNTY MUTUAL ASSOCIATIONS 63 cations have been received in any class as shown by section one (1) hereof, representing the following amount of insurance: Classes 1, 2, 3 and 5, two hundred and fifty thousand dollars ($250,000) each, class 4, one hundred thousand dollars ($100,000) and no county mutual assessment association shall issue policies until applications for insurance to the amount of fifty thousand dollars ($50,000) representing at least fifty (50) applicants have been received, and no application for insurance during the period of organization shall exceed two per cent of the amount required for organization, nor after one year of organization one per cent of the total insurance in force, any reinsurance taking effect simultaneously with the policy being deducted in determining such maximum single risk. Neither shall any association issue policies of insurance until its articles of incorporation, by-laws and form of policy shall have been submitted to the commis- sioner of insurance, and if upon examination of same he finds them to conform to the provisions of this chapter, he shall at once issue to the association a certificate authorizing it to transact an insurance business. *'Sec. 4. Such associations may collect a j)()licy and contin- gent fee, and such assessments, provided for in their articles of incorporation and by-laAvs, as are required to pay losses and necessary expenses, and for the creation and maintenance of an emergency fund for the payment of excess l()ss(\s, and no part of such emergency fund can be claimed by any member whose policy exiDires or is surrendered for cancellation. Any associa- tion may collect assessments for losses and expenses for one 3^ear in advance; or for more than one year in advance where such advance assessment does not exceed five (5) mills on each dollar of insurance in force ; and in case the funds of any association are not sufficient to pay losses that have been reported or adjusted the association may bori'ow money for payment of losses until such time as it is practical to make an assessment or until the regular assessment period. Poinds raised by such associations which, because of temporarily low rate of losses are not needed to ])ay losses and expenses in any year, may be passed to an emergency fund to bo held for i)a\-- ment of excess losses in a subsetiuent year or years; such fund mny be deposited in banks, or at the option of the board of directors may be invested in the classes of securities permitted by section 1699 of the code, as amended; but under the direc- tion of the board of directors and with the consent of the commissioner of insurance a part of such fund may be invested in a home office building. When the emergency fund of any association reaches an amount equal to 100 per cent of the average cost per thousand on all policies in force for the full terra foj- wjiicli assessment is collected and not less tluiii one hundred 64 STATE AND COUNTY MUTUAL ASSOCIATIONS Ch. 5, T. IX thousand dollars ($100,000) or such amount of capital stock as is required of domestic companies, such associations may issue policies of fixed premiums. Associations using a basis rate whose risks consist princij^ally of store buildings and their con- tents, manufacturing establishments, public garages, lumber yards, office buildings, hotels, theaters, moving picture houses, stocks of implements or automobiles, shall maintain at all times net assets equal to 40 per cent of one annual assessment at the basis rate charged for such insurance on all policies in force, and may provide in its bj^-laws and specify in its policies the maxi- mum liability of its members to the association; such liability shall not be less than a sum equal to the basis rate charged by the association for insurance nor greater than a sum equal three times such basis rate. "Sec. 5. Each association doing business under the provisions of this chapter shall, annually, in the month of January report to the commissioner of insurance, upon blanks furnished by him, such facts as are required of domestic insurance companies organizing under chapter 4 of title IX of the code, as are appli- cable to this chapter. These reports shall be tabulated and published by the commissioner of insurance in the annual report of insurance, one copy of which shall be sent to each association. The county associations, the state associations, and those doing an exclusive tornado, an exclusive hailstorm, or an exclusive automobile insurance business, shall be separately classified in said report. i i Sec. 6. In furnisbing pi'oofs of loss under any contract of insurance under this chapter for loss or damage it shall be nec- essary for the insured, within sixty (60) days from the time loss or damage occurs, to give notice in writing to the association issuing such contracts of insurance accompanied by an affidavit stating the facts as to how the loss occurred so far as the same are within the knowledge of the insured, the property destroyed or damaged and the extent of the loss; provided, however, that in case of damage or loss to live stock by fire or lightning or loss or damage to automobiles by theft or fire, notice of such loss must be given the association by mailing written notice within five (5) days from the time such loss or damage occurred, and in case of loss to growing crops by hail, notice of such loss must be given the association by mailing a registered letter within ten (10) days from the time such loss or damage occurred. No action on any loss shall be begun until the date when such loss becomes due in accordance with the articles of incorporation or by-laws of such association and in no event sooiun- than forty (40) days after such proof has been given to the association and no action can be started after one year from the date such cause of action accrues. Ch. 5, T. IX STATE AND COUNTY MUTUAL ASSOCIATIONS 65 ^'Sec. 7. In any action brought in any court in this state on any policy of insurance for the loss of any building so insured, the amount stated in the policy shall be received as prima facie evidence of the insurable value of the building at the date of the polic}^ : Provided, the association issuing such policy may show the actual value of said property at date of policy, and any de- preciation in the value thereof before the loss occurred; but the said association shall be liable for the actual value of the property insured at the date of the loss, unless such value exceeds the amount of insurance stated in the polic3^ And in any action on a policy to recover loss or damage on personal property, the association shall not be liable in excess of the amount of damage or loss at the time the loss or damage occurs ; provided that the value of growing crops may be stated in the policy or contract. *'Sec. 8. The commissioner of insurance may address inciuirics to any association in relation to its doings and condition, and any association so addressed shall promptly reply thereto in writ- ing. If the commissioner of insurance is then satisfied that the association has failed to comply with any provisions of this law, or is exceeding its powers, or is not carrying out its contracts in good faith ; or is transacting business fraudulently or soliciting insurance in territories where it is not legally admitted to do business, or is in such condition as to render the further trans- action of business by it hazardous to the public or its policy- holders, the business under his supervision and witli the consent of the association may be reinsured in some mutual association, or he may present the facts relating thereto to the attorney general, and if the circumstances warrant, he may commence an action in quo warranto in a court of competent jurisdiction, and such court shall thereupon notify the officers of such association of a hearing, and unless it shall then appear that some special and good reason exists ^vhy such association should not bo closed, said association shall be enjoined from carrying on any further business, and some person shall be appointed receiver of such associations and shall proceed at once to take possession of the books, papers, moneys and other assets of the association and shall forthwith, under the direction of the court, proceed to close the affairs of the association and to distribute its funds to those entitled thereto, or he may make an assessment pro rata on the membership liable to an assessment to pay the legitimate debts of the association. "Sec. 9. Any policy of insurance issued by any association operating under the provisions of this chapter may be cancelled by the association giving five (5) days' written notice thereof to the insured, or if the insured shall demand in Avriting or in person of the association \\\v eancellation of policy, the asso- 66 STATE AND COUNTY MUTUAL ASSOCIATIONS Ch. 5, T. IX elation shall immediately advise him by letter to last knoAvn address, the amount, if any, due, as his pro rata share of losses and in addition actual expenses incurred on said policy. Upon surrender of his policy and payment of all sums due, his mem- bership shall cease, provided, that during the months of June, July and August, hail insurance policies may be cancelled only at the option of the officers of the association carrying the risk. Upon the cancellation of any policy of insurance issued under the provisions of this act all obligations to the association having been paid, the unearned portion of any advance assessment paid, other than the emergenc}^ fund, shall be returned to the insured upon the surrender of his policy, the association retaining a pro rata share for losses and in addition actual expenses incurred on said policy. When the policy is cancelled by the association by giving notice thereof it shall retain only the pro rata assessment. ''Sec. 10. Any state mutual assessment association contem- plated by this chapter, before being authorized to do business in this state, shall require its secretary and treasurer to give bond, personal or surety, to the association in such sums as the directors shall deem sufficient, no less however, than ten thou- sand dollars ($10,000) for each office, which bond after being approved by the president of the association, shall be deposited with the commissioner of insurance as security for the faithful performance of the duties of the secretary and treasurer in liandling the funds of the association. Should the commissioner of insurance find the surety on said bonds, or the amount thereof, insufficient, he may require additional security, or an increase in the amount of the bond. If such additional security or increase be not furnished within thirty (30) days after notice thereof, the commissioner of insurance shall refer the matter to the attorney general the same as under section 8, of this chapter, and shall be taken care of by him in accordance therewith. "Sec. 11. Unless the time and place of holding the annual meeting of the members of any association transacting business under the provisions of this chapter is plainly r.tated in their articles of incorporation or by-laws, twenty (20) days' notice of the time and place of holding of said meetings shall be given to all members of the association. Members of the association at such annual meetings shall have power to make or amend articles of incorporation or by-laws as they in their judgment may deem necessarj^ and when such articles of incorporation and by-laws are printed on the policy they become a part thereof and are binding upon the association and the insured alike. Officers shall be elected in the manner prescribed in the articles of incor- poration or by-laws. Annual meetings may adjourn from time to time. Ch. 5, T. IX STATE AND COUNTY MUTUAL ASSOCIATIONS 67 "Sec. 12. Every state iiiul-ual assoeiatioii doing business under tliis chapter shall on or befort; the; lirst. day ol! March, each year, pay to the treasurer of state a sum eciuivalent to one per centum of the gross receipts from premiums, assessments, fees and prom- issory obligations for business done within the state, including all insurance upon property situated in the state after deducting the amount actually paid for losses on property located within this state and the amount returned upon cancelled policies and and rejected applications covering property situated within the state and the amount paid for reinsurance on property situated within the state. The commissioner of insurance shall at least once in each biennial period cause the books of each state mutual association doing business under this chapter to be examined and shall furnish a report of such examination to the association so examined. The expense of such examination shall be paid by the association as provided for in section eighteen hundred twenty-one-c (1821-c), supplement to the code, 1913 (C. C. Sec. 5470). County mutual associations shall be exempt from the examination and the payment of tax provided foi' in this section. ''See. 13. In assessing for taxatit)n tlie moneys and credits of such mutual insurance corporations, the assessor shall ascertain the debts or liabilities, if any, of the corporation to its policy- holders or other persons which liabilities shall be deducted as provided in section 1311 of the code. In ascertaining such corpo- rate indebtedness, a debt shall be deemed to exist on account of its liabilities on the policy certificates or contracts of insurance issued by its equal to the amount of surplus or other funds accu- mulated by such corporation for the purpose of fulfilling its policy contracts of insurance and which can be used for no other- purpose. "Sec. 14. Such associations shall i^ay the same fees for annual reports and annual certificates of authority as are required to be paid by domestic companies organized and doing business under the preceding chapter, which certificates shall expire March 1st of the year following the date of its issue. "Sec. 15. No person or corporation shall solicit any applica- tion for insurance for any association, other than county mutuals, in this state without having procured from the commissioner of insurance, a license authorizing him to act as agent. Violation of this provision shall be punished by a fine not exceeding twenty- five dollars ($25.00) per day. The commissioner of insurance shall upon the receipt of payment of fifty cents (r)Oc) issue license to act as agent to any person for wdiom a license is requested by any association doing l)usiness unde»* tlie provisions of this chapter. The commissioner of insurance may, for a just 6S LIFE INSURANCE COMPANIES Ch. G. T. IX and reasonable cause, cancel the license of such agent after due notice and hearing. ''Sec. 16. That section seventeen hundred fifty-nine-a (1759-a), supplement to the code, 1913, and all sections to and including section seventeen hundred fifty-nine-o (1759-o), supplement to the code, 1913 (C. C. Sees. oii&2 to 5()9(i), and ail amendments thereto, be and the same are herebv repealed.'' [39 G. A., ch. 120.] " . i CHAPTER G, TITLE IX, CODE. LIFE INSURANCE COMPANIES Section 1768 (C. C. 5477). On level premium plan. Every life insurance company upon the level premium or the natural premium plan, created under the laws of this or any other state or country, shall, before issuing policies in the state, comply with the provisions of this chapter applicable to such companies. Before any such company shall be permitted to incorporate under the laws of this state, it shall present its articles of incor- poration to the commissioner of insurance and the attorney general and have the same by them approved. Such articles shall show the name, location of principal place of business, object, amount of capital, if a stock company, and shall contain such other provisions as may be necessary to a full understand- ing of the nature of the business to be transacted and the plan upon which the same is to be conducted. All amendments to such articles and amendments hereafter made to the articles of incorporation of companies already organized under the laws of this state shall be approved in like manner. [32 G. A., ch. 81; C. '73, § 1161.] Articles Approved 1785. Fraternals 1832, other than Life 1685. It is not unlawful for an insurance company to discriminate between policy holders and those who are not policy holders in the loaning of money, nor for it to agree that one who takes insurance shall have a loan thereon. Key v. National Life Ins. Co., 107-446. A policy of life insurance issued to a resident of Iowa, but provid- ing that the premiums were to be paid at the insurer's office in New York, where payment of the insurance was also to be made, and signed at the insurer's home office in New York City is a New York contract, governed by the laws of that state, though to take effect on delivery to the assured, in the absence of proof of the place of actual delivery. Sum7n.it v. U. S. Life Ins. Co., 123-681. The provisions of this section as to "any contract of insurance to agree- ment other than as plainly expressed in the policy issued" is to be limited in its application by the title of the act in which it was first enacted, and by the general provisions of the section, and is therefore applicable only to cases of discrimination. Kelley v. Mutual L. Ins. Co., 109 Fed., 56. The provision as to contracts "plainly expressed in the policy issued" includes in the term "policy" the provision of the application endorsed Ch. 6, T. IX LIFE INSURANCE COMPANIES 69 thereon, in accordance with Code § 1819. Mutual L. Ins. Co. v. Kelly, 114 Fed., 268. The amendment of this section made by 27 G. A., chap. 46, held not applicable where the policy had been issued and the death had occurred prior to the taking effect of the amendment. Beverly v. Northern L. Assn., 112-730. Sec. 1769 (0. C. 5478). Stock companies — capital. Stock com. panics organized under the laws of this state shall have not lesn than one hundred thousand dollars of capital, which shall be paid up and invested in bonds of the United States of this state, or in bonds and mortgages upon unincumbered real estate in the state, worth, exclusive of improvements, at least double the sum loaned thereon, which securities shall be deposited with the commissioner of insurance, and upon such deposit, and evidence by affidavit or otherwise satisfactory to the commissioner that the capital is all paid up, and that the company is the actual and unqualified owner of the securities representing the paid up capital, he shall issue to such company the certificate herein- after provided for, but no part of the aforesaid shall be loaned to anv stockholder or officer of the company. [39 G. A., ch. 261, § 2; C. '73, § 1162.1 Other than Life, 1691, 1783-e. Sec. 1770 (0. 0. 5479). Mutual companies — conditions. Level premium and natural premium life insurance companies organ- ized under the laws of this state upon the mutual plan shall, before issuing any policies, have actual applications on at least two hundred and fifty lives for an average amount of one thousand dollars each, a list of which, giving the name, age, residence, amount of insurance, and annual premium of eacli applicant shall be filed with the commissioner of insurance, and a deposit made with him of an amount equal to three-fifths of the whole annual premium on said applications, in cash or the securities required by the foregoing section ; and on compliance with the provisions of this section, the commissioner shall issue to such mutual companv the certificate hereinafter prescribed. [C. '73, § 1163.1 Other than Life, applicable 1690-92-1721-33. Sec. 1772 (C. C. 5481). Foreign companies — capital or surplus -^investments. No company incorporated by or organized under the laws of any other state or government shall transact busi- ness in this state unless it is possessed of the actual amount of capital required of any company organized by the laws of this state, or, if it be a mutual companj^ of surplus equal in amount thereto, and the same is invested in bonds of the United States or of this state or in interest-paying bonds, when they are at or above par, of the state in which the company is located, or of some other state, or in notes or bonds secured by mortgages on 70 LIFE INSURANCE COMPANIES Ch. 6, T. IX unincumbered real estate Avithin this or the state Avhere such company is located, Avorth double the amount leaned thereon, which securities shall, at the time, be on deposit with the super- intendent of insurance, auditor, controller or chief financial officer of the state by whose laws the company is incorporated, or of some other state, and the commissioner of this state is fur- nished with a certificate of such officer, under his official seal, that he as such officer holds in trust and on deposit for the bene- fit of all the policyholders of such company the securities aboye mentioned. This certificate shall embrace the items of security so held, and show that such officer is satisfied that such securities are worth one hundred thousand dollars. Nothing herein con- tained shall invalidate the agency of any company incorporated in another state by reason of its having exchanged the bonds or securities so deposited with such officer for other bonds or securities authorized by this chapter, or by reason of its having drawn its interest and dividends on the same. [C. '73, § 1164.] Foreign. Associations 17 94. Fraternals 1829. Other than Life 1721-23-35. Capital. 1769-83e, g. Other than Life 1691, 1701-21-69. Sec. 1773 (C. C. 5482). Annual statement. Tlie president or vice-president and secretary or actuary or a majority of the directors of each company organized hereunder shall annually, by the first day of March, prepare under oath and file in the office of the commissioner of insurance a statement of its affairs for the year terminating on the thirty-first day of December preceding, showing : 1. The name of the company and where located; 2. The names of officers; 3. The amount of capital, if a stock company; 4. The amount of capital paid in, if a stock company; 5. The value of real estate owned by the company; 6. The amount of cash on hand; 7. The amount of cash deposited in banks, giving the name of the bank or banks; 8. The amount of cash in the hands of agents, and in the course of transmission; 9. The amount of bank stock, with the name of each bank, giving par and market value of the same; 10. The amount of bonds of the United States, and all other bonds and securities, giving names and amounts, with the par and market value of each kind; 11. The amount of loans secured by first mortgage on real estate, and where such real estate is situated; 12. The amount of all other bonds, loans, how secured, and the rate of interest; 13. The amount of premium notes and their value on policies in force, if a mutual company; 14. The amount of notes given for unpaid stock, and their value in detail, if a stock company; 15. The amount of assessments unpaid on stock or premium notes; 16. The amount of interest due and unpaid; 17. The amount of all other securities; Ch. 6, T. IX LIFE INSURANCE COMPANIES 71 18. The amount of losses due and unpaid; 19. The amount of losses adjusted but not due; 20. The amount of losses unadjusted; 21. The amount of claims for losses resisted; 22. The amount of money borrowed and evidences thereof; 23. The amount of dividends unpaid on stock; 24. The amount of dividends unpaid on policies; 25. The amount required to safely reinsure all outstanding risks; 26. The amount of all other claims against the company; 27. The amount of net cash premiums received; 28. The amount of notes received for premiums; 29. The amount of interest received from all sources; > 30. The amount received from all other sources; 31. The amount paid for losses; 32. The amount of dividends paid to policyholders, and the amount to stockholders, if a stock company; 33. The amount of commissions and salaries paid to agents; 34. The amount paid to officers for salaries and other compensation; 35. The amount paid for taxes; 36. The amount of all other payments and expenditures; 37. The greatest amount insured on any one life; 38. The amount deposited in other states or territories as security for policyholders therein, stating the amount in each state or territory; 39. The amount of premiums received in this state during the year; 40. The amount paid for losses in this state during the year; 41. The whole number of policies issued during the year, with the amount of insurance effected thereby, and total amount of risk; 42. All other items of information necessary to enable the commis- sioner of insurance to correctly estimate the cash value of policies, or to judge of the correctness of the valuation thereof. [15 0. A., ch. 2, § 2; C. 73, § 1167.] See 1799. Fraternal 1830-36. Other than Life 1714-16. This section recognizes the existence of a debt from the company to its policy-holders. Equitable L. Ins. Co. v. Board of Equalization, 74-178. Sec. 1774 (C. C. 5483). Valuation of policies. As soon as prac- ticable after the filing of such statement, the connnissioner of insurance shall ascertain tlie net cash valne of every policy in force upon the basis of the American table of mortality and foui* and one-half per cent interest, or actuaries' combined experience table of mortality and four per cent interest, in all companies organized under the laws of this state. For the purpose of making- such valuation he may employ a competent actuary, who shall be paid by the company for which the service is rendered; but the company may make such valuation, and it shall be received ])y the commissioner upon satisfactory proof of its correctness. The net cash value of all policies in force in any such company l)eing ascertained, the commissioner shall notify it of the amount, and Avithin thirty days thereafter the officers thereof shall deposit with the commissioner the amount of the ascertained valuation in the securities specified in section eighteen hundred and six, chapter eight of this title. No stock company organized under the laws of this state sliall be required to make such deposit until the cash value of the policies in force, as ascertained by the 72 LIFE INSURANCE COMPANIES Ch. 6, T. IX commissioner, exceeds the amount deposited by it as capital. [21 G. A., ch. 169; 17 G. A., ch. 47; C. '73, § 1169.] Valuation of Assessment Association policies see 1798a. Praternals 1839J. Sec. 1775. (C. C. 5484). Annual certificate. On receipt of such deposit and statement, and the statement and evidence of investment of foreign companies, all of which shall be renewed annually, by the first day of March, the commissioner of insurance shall issue a certificate setting forth the corporate name of the company, its home office, that it has fully complied with the laws of the state and is authorized to transact the business of life insurance for the ensuing year, which certificate shall expire on the first day of April of the ensuing year, or sooner upon thirty days' notice given by the commissioner of the next annual valuation of its policies. Such certificates shall be renewed annually, upon the renewal of the deposit and statement by a domestic company, or of the statement and evidence of invest- ment by a foreign company, and compliance with the conditions above required, and be subject to revocation as the original certificate. [15 G. A., ch. 2, § 3; C. '73, § 1170.1 Sec. 1776. (C. C. 5485). Penalty— dissolution. Upon a failure of any company organized under the laws of this state to make tlie deposit or file the statement in the time herein stated, the com- missioner of insurance shall notify the attorney general of the default, who shall at once apply to the^ district court of the county where the home office of such company is located, if the court is in session, if not, to any judge thereof, for an order requiring the company to show cause upon reasonable notice, to be fixed by the court or judge as the case may be, why its business shall not be discontinued. If, upon the hearing, no sufficient cause is shown, the court shall decree its dissolution. Companies organized and chartered b}^ the laws of a foreign state or country', failing to file the evidence of deposit and statement within the time fixed, shall forfeit and pay the sum of three hundred dollars, to be collected in an action in the name of the state for the use of the school fund, and their right to transact further new busi- ness in this state shall immediately cease until the requirements of this chapter have been fullv complied with. [15 G, A., ch. 2, §4;C. '73, § 1171.] Sec. 1777. (C. C. 5486). Examination by commissioner — ^re- ceiver. The commissioner of insurance at anv time may make a personal examination of the books, papers, securities and busi- ness of any life insurance company doing business in this state, or authorize any other suitable person to make the same, and he or the person so authorized may examine under oath any officer or agent of the company or others, relative to its business and man- Ch. G, T. TX LIFE INSURANCE COMPANIES 73 agement. If upon such examination the commissioner is of the opinion that the company is insolvent, or that its condition is such as to render its further continuance in business hazardous to the public or holders of its policies, he shall advise and communi cate llu' fuels lo llir alloi'iicy •iciici-iil, who shall al, once apply to the district court of the county or any .iudsje thereof, wliere tlie home office of a domestic company or an agency of a foreign company is located, for an injunction to restrain the company from transacting further business except the payment of losses already ascertained and due, until further hearing, and for tho appointment of a receiver, and, if a domestic company, for the dissolution of the corporation. The judge of such court may grant a preliminary injunction with or without notice, as he may direct, and the court, on the final hearing, may make decree sub- ject to the provisions of the following!: section as to the appoint- ment of a receiver, the disi)osition of the deposits of the company in the hands of the commissioner, and its dissolution, if a domes- tic company. [C. 73, § 1172.] Applicable 1821, a to g. Fraternal 1839b, c. Other than Life 1700- 31-53-55. In an action to close the business of a corporation for failure to com- ply with the provisions of chapter 5, title IX, of the Code of '73, held, that it must be assumed that the corporation was duly organized, ^tatc ex rel. V. Iowa Mut. Aid Assn., 59-125. Rec. 1778. (C. C. 5487). Securities. The securities of a de- faulting or insolvent company, or a company against which pro- ceedings are pending under the preceding section, on deposit shall vest in the state for the benefit of the policies on which such deposits were made, and the proceeds of the same shall, by the order of the court upon final hearing, l)e divided among the holders thereof in the proportion of the last annual valuation of the same, or at au}^ time be applied to the purchase of reinsur- ance for their benefit. [C.'73, § 1173.] See also 1699, 1791. Applicable 1806-7. Fraternals 1839 1. Sec. 1779. (C. C. 5488). Change of securities. Companies shall have the right at any time to change the securities on de- posit by subsituting a like amount of the character required in the first instance. If the annual valuation of the policies in force shows them to be less than the amount of security deposited, then the company may withdraw such excess, but twenty-five thousand dollars must always remain on deposit. [C. '73, § 1174.1 See Sections 1791, 1806. Fraternals 1839 1. Sec. 1780. (0. C. 5489). Interest collected. Companies hav- ing on deposit with the commissioner bonds or other securities may collect the dividends or interest thereon, delivering to their authorized agents the coupons or other evidence of interest as 74 LIFE INSURANCE COMPANIES Ch. 6, T. IX the same iDeeome due, but if any company fails to deposit ad- ditional security when and as called for by the commissioner, or pending any proceedings to close up or enjoin it, the commissioner of insurance shall collect such dividends or interest and add the same to such securities. [C. 73, § 1175.] Sec. 1781. (C. C. 5465). Commissioner's annual report. Be- fore the first day of May the commissioner of insurance shall make an annual report to the governor of the general conduct and condition of the companies doing business in the state, and include therein an aggregate of the estimated value of all out- standing policies in each of the companies, and in connection therewith prepare a separate abstract thereof as to each company, and of all the returns and statements made to him bv them. [0. '73, § 1176.] For other than Life, see 1720. Sec. 1782. (0. 0. 5490). Discriminations. No life or casualty, health or accident insurance company or association shall make or permit any distinction or discrimination between persons insured of the same class and equal expectancy of life in the amount or payment of premiums or rates charged for policies of life or endowment insurance, or in the dividends or other benefits payable thereon, or in any other of the terms or conditions of the contract it makes ; nor shall any such company or association or agent thereof make any contract of insurance agreement, other than as plainly expressed in the policy issued; nor shall any such company or association or agent pay or allow, directl}^ or indirectly, as an inducement to insurance, any rebate of pre- mium payable on the x^olicy, or any special favor or advantage in the dividends or other benefits to accrue thereon, or any valuable consideration or inducement whatever, not specified in the policy or contract of insurance. [34 G. A., ch. 18, ^ 13; 27 G. A., ch. 46, § 1; 23 G. A., ch. 33, § 1.] Court construed the word "casualty" so that it includes fire, steam boiler and practically all coverage under Chapter 4. Bankers MuUial Casualty Co. v. First National Bank, 131 loiva 456. The provision of this section as to "any contract of insurance agree- ment other than as plainly expressed in the policy issued" is to be limited in its application by the title of the act in which it was first enacted, and by the general provisions of the section, and is therefore applicable only to cases of discrimination. Kelley v. Mutual L. his. Co., 109 Fed., 56. The provision as to contracts "plainly expressed in the policy issued" includes in the term "policy" the provision of the application endorsed thereon, in accordance with code § 1819. Mutual L. Ins. Co. v. Kelly. 114 Fed., 268. The amendment of this section made by 27 G. A., ch. 46, held not applicable where the policy had been issued and the death had occurred prior to the taking effect of the amendment. Beverly v. Northern L. Assn., 112-730. Ch. 6, T. IX LIFE INSURANCE COMPANIES 75 It is not unlawful for an insurance company to discriminate between policy-holders and those who are not policy-holders in the loaning of money, nor for it to agree that one who takes insurance shall have a loan thereon. Key v. Natioiial Life Ins. Co., 107-446. Sec. 1783. (C. C. 5491). Penalty. Every corporation, officer or agent thereof who shall knowingly violate any of the provi- sions of tlie preceding section shall forfeit and pay a sum not exceeding five hundred dollars, to be recovered by an action in the name of the state for the benefit of the school fund, and the license may be revoked for three vears, in the discretion of the court. [23 G. A., ch. 33, § 2.] Sec. 1783-a. (C. C. 5492). Policy forms filed with commissioner of insurance for approval. It shall be unlawful for any insurance company transacting business within this state, under the pro- visions of chapter six of title nine of the code, to write or use any form of policy or contract of insurance, on the life of any individual in this state, until a copy of such form of xx^licy or contract has been filed with and approved by the commissioner of insurance. [38 G. A., ch. 348, § 7 ; 30 G. A., ch. 59, § 1.] Other than Life 1745. Standard form 1758a. Sec. 1783-b. (C. C. 5493). Medical examination. Said officials shall decline to approve any such form of policy or contract of insurance unless the same shall, in all respects, conform to the law^s of this state applicable thereto and unless the issuance of the same is based upon a satisfactory medical examination of the applicant by a physician duly authorized to pvaetice medicine or by an osteopathic physician duly authorized to jn-actiee oste- opathy in the state of Iowa, or the state where examined and no policy or contract of insurance shall be issued by any insurance compau}' to any individual in this state until such examination shall have been passed and duly approved by the medical exam- iner or medical board of such company. Provided, however, that no medical examination of any person to be insured under an industrial policy shall be required or be necessary when the amount of the policy of insurance is five hundred dollars ($500.00) or less. [39 G. A., ch. 223; 36 G. A., H. F. 116, § 1 ; 30 G. A., ch. 59, § 2.] Sec. 1783-c. (C. C. 5494). Penalty. Any company violating any of the provisions of this act shall upon conviction thereof, be fined in a sum not less than one hundred nor more than one thousand dollars for each such offense, and the court may also revoke its authority to do business within this state. Should any company decline to file a copy of its form of policies or con- tracts, as provided in this act, the commissioner of insurance shall suspend ils authority to transact business Avithin the state until such form of policies or contracts have been so filed and approved. [30 G. A., ch. 59, § 3.] 76 LIFE INSURANCE COMPANIES Ch. 6, T. IX Sec. 1783-d. (C. C. 5495). Life insurance companies may write other insurance. Any life insurance company organized on the stock or mutual plan and authorized by its charter or articles of incorporation so to do, may in addition to such life insurance, insure either individually or on the group plan the health of persons and against personal injuries, disablement or death, re- sulting from traveling or general accidents by land or water, and insure employers against loss in consequence of accidents oi casualties of any kind to employes or other persons, or to property resulting from any act of the employe or any accident or casualty to persons or property, or both, occurring in or connected with the transaction of their business, or from the operation of any machinery connected therewith, but nothing herein contained shall be construed to authorize any life insurance company to insure against loss or injury to person, or property, or both, growing out of explosion or rupture of steam boilers. Every life insurance companj^ issuing a separate policy, or maintaining a separate department, for the purpose of writing any of the classes of insurance authorized by this section shall also be sub- ject to all of the provisions applicable to companies authorized to write a similar kind of insurance under the provisions of chapter 4, title IX of the code. [39 G. A., ch. 133 ; 38 G. A., ch. 348, § 8; 31 G. A., ch. 74.] Sec. 1783-e. (0. C. 5496). Capital stock — minimum amount. From and after the taking effect of this act, no insurance com- -pany other than life shall be incorporated to tranact business upon the stock plan with less than two hundred thousand dollars ($200,000) capital, the entire amount of which shall be fully paid up in cash and invested as provided by law. No part of the capital referred to, shall be loaned to any officer or stockholder of the company. But no increase of the capital stock of any company shall hereafter be made unless the amount of said in- crease is fully paid up in cash and such company sliall be pos- sessed of a surplus in cash or invested in securities authorized by law, equal to twenty-five (25) per cent of such paid up and outstanding capital at the time certificate of authority is first applied for and issued. [39 G. A., ch. 261, § 4; 32 G. A., ch. 79, § 1.] See sections 1769-72. See. 1783-g. (C. C. 5499). May not advertise authorized capital. No insurance company shall, after the taking effect of this act, be permitted to adverlise or publish an authorized capital, or to represent in any manner itself as possessed of any greater capital than that actuallv naid iqi and invested as al)()ve provided. [32 G. A., ch. 79, § 3.]' Sec. 1783.h. (C. C. 5500). Penalties. Any person, firm or Ch. 6, T. IX LIFE INSURANCE COMPANIES 77 corporation violating any of the provisions of this act, or failing to comply with any of its provisions, shall be subjected to the penalties provided in section four of cluipter fifty-six, acts of the thirtieth general assembly. [32 G. A., ch. 79, § 4.] See 1821-d herein. Revocation of certificates. CIIAPTEK li)7-38TII G. A. DEFINING AND AUTHORIZING GROUP LIFE INSURANCE. (House File No. 546) AN ACT defining group life insurance, authorizing chapter six (6) life insurance companies to issue contracts providing for such group life in- surance, fixing the terms under which such group life insurance can be written, prescribing certain provisions and conditions to be embodied in such a life insurance contract, and waiving the medical examination required by section seventeen hundred eighty-three-b (1783-b), supple- ment to the code, 1913, in all cases of such group life insurance. Be It Enacted hy the General Assemhly of the State of Iowa: Section 1. (C. C. 5502). Group life insurance is hereby de- clared to be that form of life insurance covering not less than fifty employes, with or without medical examination, written under a policy issued to the employer, the premium on which is to be paid by the employer or by the employer and emploj^es jointly, and insuring only all of his emploj^es, or all of any class or classes thereof determined by conditions pertaining to the employment, for amounts of insurance based upon some plan which will preclude individual selection, for the benefit of persons other than the employer; provided, however, that when the premium is to be paid by the employer and employe jointly and the benefits of the polic}^ are offered to all eligible employes, not less than seventy-five per centum of such employes may be so insured. Sec. 2. (C. 0. 5503). Any level premium life insurance com- pany, organized on the stock or mutual plan and authorized to transact insurance business under the provisions of chapter 6, title IX, of the code, may, by complying with the provisions of said chapter six and with the provisions of this act, issue con- tracts providing for group life insurance as defined in section 1 hereof. Sec. 3. (C. C. 5504). No policy of group insurance shall be issued or delivered in this state unless and until a copy of the form thereof has been filed with the commissioner of insurance and approved by liim; nor shall such i^olicy be so issued or de- livered unless it contains in substance the following provisions: (1) A provision that the |)()licy shall be incontestable after two years from its date of issue, except for non-payment of 78 LIFE INSURANCE COMPANIES Cli. 6, T. IX premiums and except for violation of the conditions of the policy relating to military or naval service in time of war. (2) A provision that the policy, the application of the em- ployer and the individual applications, if any, of the employees insured, shall constitute the entire contract between the parties, and that all statements made by the employer or by the individual employees shall, in the absence of fraud, be deemed representa- tions and not warranties, and that no such statement shall be used in defense to a vlaim under the policy, unless it is contained in a written application. (3) A provision for the equitable adjustment of the premium or the amount of insurance payable in the event of a misstate- ment of the age of an employee. (4) A provision that the company will issue to the employer for delivery to the emiDloyee, whose life is insured under such policy, an individual certificate setting forth a statement as to the insurance protection to which he is entitled, to whom payable, together with provision to the effect that in case of the termina- tion of the employment for any reason whatsoever the employee shall be entitled to have issued to him by the company, without further evidence of insurability, and upon application made to the company within thirty-one da3\s after such termination and upon the payment of the premium applicable to the class of risk to which he belongs and to the form and amount of the policy at his then attained age, a policy of life insurance in any one of the forms customarily issued by the company, except term in- surance, in an amount equal to the amount of his protection under such group insurance policy at the time of such termination. (5) A provision that to the group or class thei'eof originally- insured shall be added from time to time all new employees of the employer eligible to insurance in such group or class. Policies of group insurance, when issued in this state by any company not organized under the laws of this state, may contain, when issued, any provision required by the law of the state or territory, or district of the United States under wliich the com- pany is organized ; and policies issued in other states or countries by companies organized in this state, may contain any provision required by tlie laws of the state, territory, district or country, in which the same are issued, anything in this section to the contrary notwithstanding. Any such policy may be issued or de- livered in this state which in ilie o]")inion of tlie comniissioiier of insurance contains provisions on any one or more of tlie severed foregoing requirements more favoi-able to the employer or to employee than hereinbefore required. (C. 0. 5505). In every group policy issued by a domestic Ch. 6, T. TX LIFE INSURANCE COMPANIES 79 life insurance company, the employer shall be deemed to be the policyholder for all purposes within the meaning of this chapter, and, if entitled to the vote at meetings oL' the company, shall be entitled to one vote thereat. Sec. 4. (C. C. 5506). No policy of group insurance, nor the proceeds thereof, when paid to any employee or employees there- under, shall be liable to attachment, garnishment, or other process, or to be seized, taken, appropriated or applied by any legal or ecjuitable process, or operation of law, to pay any debt or liabilitj^ of such employee, or his beneficiary, or any other person who may have a right thereunder, either before or after payment ; nor shall the proceeds thereof, when not made payable to a named l)eneficiary, constitute a part of the cstnte of the employee for the payment of liis del)ts. Sec. 5. (C. C. 5507). Tlie provisions of section seventeen hun- dred eighty-three-b (1783-b), supplement to the code, 1913, relat- ing to medical examination of applicants, shall not apply to in- surance Avritten under this act. Efeective July 4, 1919. CHAPTER 304— 38th G. A. GRANTING POWER TO LIFE INSURANCE COMPANIES TO HOLD FUNDS IN TRUST. (Senate File No. 436) AN ACT authorizing life insurance companies to act as trustee of the proceeds of certain insurance policies. (This act is additional to chapter six (6), title nine (IX), of the supplement to the code, 1913). Be It Enacted hij the General Assembly of the State of Iowa: Section 1. (C. C. 5501). Anj^ life insurance company organized under the provisions of chapter six, title nine of the code, and acts amendatory thereof, and doing business in this state, shall have the power to hold in trust the proceeds of any life insurance policj' issued by it, upon such terms and subject to such limita- tions as to revocation by the policyholder and control by the beneficiar}' thereunder, as shall have been agreed to in writing by such company and the policy-holder. Provided, that the trust provisions herein contemplated shall in no manner subject said corporation to any of the. provisions of the laws of Iowa relating to banks or trust companies ; and provided further, tliat the forms of such trust agreements shall be first submitted to and approved by the commissioner of insurance of Iowa. In effect by publication April 29, 1919. 80 ASSESSMENT ASSOCIATIONS Ch. 7, T. IX CHAPTER 198— 39th G. A. AN ACT to authorize the valuation of bonds and other securities held by life insurance companies, assessment life associations and fraternal beneficiary associations by the amortization method. Be, It Enacted hy the General Asseinhly of the State of Iowa: Section 1. (C. C. 5597-al). All bonds or other evidences of debt having a fixed term and rate held by any life insurance company, assessment life association or fraternal beneficiary association authorized to do business in this state may, if amply secured and not in default as to principal and interest, be valued as follows : * If purchased at par, at the par value; if purchased above or below par, on the basis of the purchase price adjusted so as to bring the value to par at maturity and so as to yield in the mean- time the effective rate of interest at Avhich the purchase Avas made; provided tliat the purchase price shall in no case bo taken at a higher figure than the actual market value at the time of purchase; and, provided further, that the commissioner of in- surance shall have full discretion in determining the uu^liod of calculating values according to the foregoing rule. CHAPTER 7, TITLE IX, CODE. ASSESSMENT LIFE, HEALTH AND ACCIDENT INSURANCE ASSOCIATIONS. Sec. 1784. (C. C. 5508). Defined. Every corporation organized upon the assessment plan, for the purpose of insuring the lives of individuals or furnishing benefits to the widows, heirs, orphans or legatees of deceased members, or insuring the health of persons or furnishing accident indemnity, shall be styled an association, and any corporation doing business under this chapter which provides for the payment of policy claims, accumulation of a reserve or emergency fund, the expense of management and prosecution of the business, by payment of assessments as pro- vided in its contracts, and wherein the liability of the insured to contribute to the payment of policy claims is not limited to a fixed amount, shall be deemed to be engaged in the business of life insurance upon the assessment plan, and shall be subject^ to the provisions of this chapter, and chapter eight, of title nine of the code. [31 G. A., ch. 75 ; 28 Cx. A., ch. 65, § 1 ; 21 G. A., ch. 65, § 1.] A company operating on the mutual assessment plan is not relieved from the provisions of this chapter by the provisions of code § 1798 exempting from its operation associations organized solely for benevolent purposes. Gonnell v. lotva State Trav. Men's Assii., 139-444. The association cannot amend its by-laws in such manner as to affect the promise of the society to pay a particular sum to the insured. A Ch. 7, T. IX ASSESSMENT ASSOCIATIONS 81 member has the right to rely on the terms of his contract. Fort v. Iowa Legion of Honor, 146-183, The general power to amend the bj^-laws reserved by the socie-ty does not authorize an amendment which impairs the vested rights of the members. Ibid. Where the association eo amended its by-laws as to repudiate its exist- ing contracts and to provide for a new rate of assessment on a diminished policy, held that failure to tender the amount due under the original contract did not defeat his right of action to recover damages for breach of contract by such charge. Ibid. The fact that the association has no funds with which to pay a judg- ment does not defeat the right to recover damages for repudiation of the contract. Ibid. Where the assured agrees to be bound by amendments to the by-laws or articles subsequently adopted, he must take notice thereof and is as effectually concluded thereby as by those existing at the time of issu- ance of his certificate or policy. Elliott v. Home Miit. Hail Assn., 160-105. The statute recognizes the authority of such associations to insure for the benefit of legatees and in the absence of limitation prescribed in the articles or by-laws, it is presumed that persons of any class enumeratea in the statute may be beneficiaries. Brinsmaid v. loioa State Trav. Men's Assn., 1.52-134. Members of a mutual benefit association are bound to take notice ot and be governed by its by-laws. Fitzgerald v. Metropolitan Ace. Assn., 106-457. The statutory provisions with reference to mutual benefit associations, held to be applicable to an association organized under such provisions, although it had not flilly complied therewith. Crocker v. Hogin, 103-243. Life insurance companies, except as otherwise specially provided, are incorporated under the general provisions as to the formation of corpora- tions. Krause v. Modern Woodmen, 133-199. Where the deceased acoidentally received a wound on his finger, caus- ing infiammation, which developed into blood poisoning, resulting in his death, such death resulted from a disease which followed as a natural consequence of the physical injury, and was an accidental death within a policy requiring that death must result solely from accidental injuries. Delaney v. Modem Ace. Club, 121-528. Under the constitution of the association known as the Ancient Order of United Workmen, held, that such association, notwithstanding its fra- ternal character, was in effect a mutual insurance company, and that the supreme lodge of that corporation, being incorporated under the laws of Kentucky, was not authorized to exercise any powers or do business ii; Iowa without compliance with the laws of Iowa with reference to life insurance companies. State ex rel. v. Miller, 66-26. Where one of the objects of an association is to pay to the beneficiaries a sum of money upon the death of a member which is to be raised by assessments upon other members it is to be deemed an insurance com- pany. Grimes v. Northicestern Legion of Honor, 97-315. Former provisions of this character, held applicable to a fraternal society such as the Ancient Order of United Workmen, ha^^ing life insur- ance and insurance against sickness and disability as its main object. State ex rel. v. Nichols, 78-747. Mutual aid associations organized to furnish financial aid and benefits to the families of deceased members on the payment of membership fees, dues and assessments, held, not to be within the former provisions as to life insurance companies. State ex rel. v. Iowa Mut. Aid Assn., 59-125. And see § 1798. A railroad relief association organized by the railroad company for the benefit of employes who participate therein is not a life insurance com- pany. Maine v. Chicago, B. d Q. R. Co., 109-260. 82 ASSESSMENT ASSOCIATIONS Cli. 7. T. IX An employe, member of such association who has accepted the benefits provided for by his contract of membership is bound by the terms of such contract. Jhid. Sec. 1785 (C. C. 5509). Articles of incorporation — certificates. ''Certificates of membership" or "certificate," when used in this chapter with respect to the insurance of the members, shall be taken to mean and include policy of insurance. The articles of incorporation and bj^-laws of any such association shall show its plan of business, and be submitted to the commissioner of in- surance and the attorney-general, and if they are found b.y those officers to complj^ with the provisions of this title, chapter and of law, they shall approve the same. When the articles are thus approved, they shall be recorded in the office of the secre- tary of state, and a notice published within ninety days in the manner and for the time provided in the general incorporation laAvs. [39 G. A., ch. 58, § 1 ; 21 G. A., ch. 65, § 2.] See 1768. Fraternals 1832. Other than Life 1685. The president and the board of directors of a mutual life association are both governed by the association's articles of incorporation and the statues of the state defining and limiting their respective duties and powers. Slierman v. Harlyin et al., 125-174. Where the articles of incorporation of a mutual benefit life insurance association provide that the beneficiaries shall be entitled to a sum equal to what would be realized from an assessment upon all members, as shown by the books, at the time of death, but in no case shall the sum exceed the amount stated in the certificate, and also provide for a mortuary fund, to be raised by assessments, from which death losses shall be paid, and the certificate itself stipulates that the beneficiaries shall receive a definite sum, the amount due to be provided for by assessment, etc., as provided for in the articles of incorporation, the beneficiary is entitled to a money judgment, and not merely a mandatoi^y order to make and pay over the proceeds of an assessment. Thornhurg v. Farmrrs' Life Association, 122- 260. The burden is on the defendant association to show that an assessment at the time of the member's death would not have yielded the full amount named in the certificate. Ibid. Sec. 1786. (C. C. 5510). Name. No such association shall take any name in use by another organization, or one so closely re- sembling it as to mislead the public as to its identitv. [21 G. A., ch. 65, § 3.] See other than Life, Sec. 1687. The provisions of Code § 1689 as to including the word "mutual" in the name of a mutual company has no application to associations organ- ized under this chapter. Moore v. Union Frat. Ace. Assn., 103-424. The action of the auditor [commissioner of insurance] in determining the name under which the association may do business is not conclusive as to another association claiming a prior right to the use of the same or a similar name. Grand Lodge v. Graham, 96-592. Therefore held, that plaintiff, an association of the character contem- plated in this section and authorized to do business under the name of the Grand Lodge of the Ancient Order of United Workmen of Iowa, could not enjoin an unincorporated society or voluntary association from using Ch. 7, T. IX ASSESSMENT ASSOCIATIONS 83 the name, it appearing that defendant had a prior right to the use of such name. JMd. Sec. 1787. (C. C. 5511). Conditions for commencing business — approval of policy forms. Before issuing- any policy or certifi cate of menibersliip, if the association at the time has not a mem- bership sufficient to pay the full amount of its certificate or policy on an assessment, it shall cause all applications for insurance to have printed in red ink, in a conspicuous manner along the margin thereof, the words: ''It is understood that the amount of insur ance to be paid under this application, and certificate or policy issued thereon, shall depend upon the amount collected from an assessment therefor." It must have actual applications upon at least two hundred fifty lives for at least one thousand dollars each; and it shall file with the commissioner of insurance satis- factory proof that the president, secretary and treasurer have each given a good and sufficient bond for five thousand dollars for the faithful discharge of their duties as such officers, sworn copies of which shall be filed with him. It shall also file ^yith him a list, verified by the president and secretary, of the applications, giving the name, age and residence of each applicant, the amount of insurance applied for by each, together with the annual dues and the proposed assessments thereon. Its policy forms shall -be approved, as provided by section seventeen hundred eighty- three-a of the supplement to the code, 1907. [34 G. A., ch. 18, § 14; 21 G. A., ch. 65, §4.] See 1724-25. Fraternals 1832; also § 1783a. Under the bond given by the president of an assessment life insur ance company, the sureties are not liable to a receiver of the company for moneys wrongfully paid by him to one member which were collected for the benefit of another who has in turn been satisfied from funds subse- quently collected or for money misappropriated after the expiration of the bond. Sherman v. Hnrlnn, 124-643; 125-174. Any act of the president of the association contrary to his duty under its articles of incorporation, even though directed or acquiesced in by the board of directors, constitutes a breach of duty involving liability of the surety on his official bond if it results in loss to the association. Sherman V. Harbin, 125-174; 124-643. A new bond executed on re-election for another year is a new and inde- pendent undertaking and not a continuance of the bond for the previous year, roicl. Auditing the books of the company being no part of the duty of the president, he is not liable under his official bond for not discovering errors overlooked by the auditing committee. Ibid. The act of the president in diverting the beneficiary fund to the pay- ment of expenses in resisting claims renders him liable on his bond. Ibid. If the obligation of the association is no more than to levy an assess- ment on its members and pay the benefit or indemnity stipulated from the proceeds derived therefrom, then the remedy is in equity to compel an assessment and an action at law cannot be maintained. But if the con- tract, whether contained in the certificate of membership, the articles of incorporation or by-laws, is for the payment of defined or fixed sums upon the happening of specific contingencies, then the remedy is at law. Frank v. Interstate Business Men's Act: Assn., 151-684. 84 ASSESSMENT ASSOCIATIONS Ch. 7, T. IX Where the plan of the association requires that assessments be col- lected quarterly and that the sums provided in the contract be paid on the death of the member out of the proceeds of assessments on hand derived either from annual dues or assessments, then the action is properly at law even though the amount to be paid is subject to the lim- itation that it cannot exceed the assessment of a certain amount per member in good standing at the time of the injury. Idid. Fidelity bonds of the president of a mutual life association organized under chapter 65, acts of the Twenty-first General Assembly, though run- ning to the association, may be enforced by any one for whose benefit they were executed. Sherman v. Harhin et al., 124-643; 125-174. Sec. 1788 (CO. 5512). Assessments. The articles and by-laws of each such association and its notices of assessments shall state the objects to which the monej^ to be collected is to be devoted, and no part of the proceeds thereof shall be applied to any other purpose than as stated and the excess, if any, beyond payment of the benefit, shall be set aside and applied only to like purposes, except that all sums collected for expenses and not used for that purpose may be transferred to the benefit, emergency or reserve fuM. [21 G. A., ch. 65, § 6; 30 G. A., ch. 60.] The design of this section was not to compel the specification in the notices of assessment of particular items on which the moneys collected would be expended. A general, but inclusive, statement of the objects or purpose of the assessment is sufficient. Mulherin v. Bankers Life Ins. Co., 163-740. While in the enforcement of a claim for a death loss against a mutual benefit association resort must be had in the first place to an action in mandamus to compel a levy of an assessment, yet, where the corporation fails to make the levy at a time when it would be effectual in furnishing the fund for the payment of the claim, and postpones it until long after, when by reason of decrease in the membership in the association it be- comes ineffectual, the association may be held liable in damages. Christu V. loiva L. Ins. Co., 111-177. In such case interest from the time the money should have been col- lected and paid over under the terms of the contract may be added. IMd. The beneficiaries being entitled to the amount realized on particulai assessments under their certificates, the misappropriation of an assess- ment made for a loss under one certificate to the payment of a loss under a different certificate, does not give rise to an action on the bond of the officer making such appropriation at the suit of the receiver of the com- pany. Sherman v. Harbin. 124-643; 125-174. The provisions of section 1788 of the Code, that the articles, by-laws, and notices of assessment of assessment life insurance associations shall state the object to which the money to be collected is to be devoted, and that no part of the proceeds shall be applied to any other purpose, apply only to assessments, and not to dues for contingent expenses or fixed charges, such as an agent's commission charge on policy renewals. Schrimplin v. Farmers' Life Assn., 123-102. Moneys collected from assessment levied in accordance with the pro- visions of section 1788 of the Code, should be applied on the particular loss for which the aissessment, or a specific proportion thereof, was raised, and that neither the association nor its officers were entitled to direct the same to other liabilities or losses, Sherman v. Harbin et al., 124-643; 125-174. Where benefit assoesments levied by a mutual life association belonged to certain of its beneficiaries, and the association's articles contained Ch. 7, T. IX ASSESSMENT ASSOCIATIONS 85 other provisions for ordinary expenses and those incident to the protec- Lion of the association against unjust claims, the association's officers haa no authority to use money received from benetit assessments, made to pay death losses, for the payment of expenses incuired in the litigation of alleged unjust claims, islierman v. Harbin et al., J2r)-174; J:i4-t)4:i. Where the by-laws of an insurance company provided several sources from which death losses might be paid, and it was nowhere indicated that an assessment must necessarily be made for each loss, a by-law providing that a beneliciary should be entitled to a sum of money equal to what would be realized from an assessment from all members in good standing at insured's death, not exceeding the amount of the certificate, did not make the levy of an assessment a condition precedent to insurer's lialiility. Wood v. Farmers' Life Ass7i., 121-44. Where decedent's certificate in a mutual benefit association provided that on decedent's failure to pay stipulated assessments as agreed, the contract should "close and be of no effect," and, prior to the making of a contract between the association and defendant for the reinsurance of all of the association's members in good standing at the time the contract was made, deceased had refused to pay assessments levied, on the ground that they were unjust, he acquired no rights under the association's contract of insurance. Parvin v. Mutual I'eserve Life Ins. Co., 125-95. The liability of a member of a mutual benefit company is to be de- termined by an assessment on the basis of membership at the time of the loss and not at the time an assessment is made by order of court to pay such loss. Collins v. Bankers' Ace. Assn., 96-216. Where it was provided that the failure to pay assessments did not work an absolute forfeiture till the expiration of six months, held, that the receipt of intermittent dues during the six months was not a waiver of the default where the member did not, during the six months, take the steps necessary for reinstatement. Leffingwell v. Grand Lodge A. 0. U. W., 86-279. Where the contract was between the subordinate lodge and the mem- ber, held, that the member had no right to offset, as against dues, com- pensation due him under a contract with the grand lodge. Ibid. Sec. 1789. (0. C. 5513). Insurable age — beneficiary — assign- ment of policy. No association organized or operating under this chapter shall issue a certificate of membership to any person under fifteen nor over sixty-five years of age, nor unless the beneficiary named in the certificate is the husband, wife, relative, legal representative, heir, creditor or legatee of the insured mem- ber, nor shall any such certificate be assigned. Any certificate issued or assignment made in violation, of this section shall be void. The beneficiary named in the certificate may be changed at any time at the pleasure of the assured, as may be provided for in the articles or by-laws, but no certificate issued for the bene- fit of a wife or children shall be thus changed so as to become payable to the creditors. [21 G. A., ch. 65, § 7.] Applicable, see 1813. Fraternals 1824. Age: An association is not precluded by the provisions of this section from assuming by consolidation the liability of another association to a member, although at the time of such consolidation the member is over the age when a valid certificate could have been issued. Catlicart v. Equitable Mut. L. Assn., 111-471. A company whose articles do not prohibit the insurance of persons over the age specified by Code § 1789 cannot by its by-laws render a contract 86 ASSESSMENT ASSOCIATIONS Ch. 7, T. IX of insurance with a person witliin tbe statutory age ultra vires and void. Krause v. Modern Woodmen, 133-199, The provision as to change of beneficiaries relates to tlie certificate and not to the fund, and the word "assignment" as here used is equivaleni to the word "endorsement." A beneficiary who is substituted by the act of the person on whose life the certificate is issued is not an assignee of the certificate. Shuman v. Supreme K. of H., 110-480. Where the right to change the beneficiary is specifically provided for in the certificate, and the manner of doing so is pointed out, the method indicated must be adopted and if that method involves the issuance of a new certificate, the endorsement of a certificate without the observance of the formalities required will not give the endorsee a right to the proceeds as against the beneficiaries designated by the certificate itself. Shuman V. A. 0. U. W., 110-642. Where the benefit was made payable to the wife of the deceased, who was disqualified to collect it on account of having feloniously caused the death of her husband, held that her heirs had no interest in the benefit fund, but that the amount payable was held in trust by the association for the estate of the deceased. Sehmidt v. Northern Life Assn., 112-41. The beneficiary named in such a certificate has no property right therein, but only an expectancy. If a beneficiary is designated who does not belong to the class of persons enumerated by statute, the insurance becomes payable to those who would have been entitled to it in the absence of any designation. Ibid. Where the parties have agreed upon a mode by which a change of bene- ficiary may be effected, the change can be made in that mode only, unle.'^c:; by subsequent agreement, assented to by the association, a different mode is substituted. Modern Woodmen v. Little, 114-109. The beneficiary in a fraternal or mutual benefit association has no vest- ed interest, but is subject to provisions as to changing beneficiaries and when the member has done all in his power to effect the change and entitle him to a new certificate in favor of the proposed beneficiary equity will carry out his purpose, although the actual issuance and acceptance of tlie new certificate were prevented by the death of the member. WandeV v. Ml/Stic Toilers, 130-639. And it seems that if by action of the local officer the member is misled as to the steps necessary to be taken, the association will be estopped to question the sufficiency of the change. Ibid. This section applies to foreign as well as domestic companies. Belknap V. Johnston. 114-265. Where the certificate is a contract of insurance, made in another state, and change of beneficiary is made and completed in that state, according to its laws, it will be valid. Ibid. The right to change beneficiary existing in such other state at the time the contract was made cannot be affected by subsequent legislation of such state. Ibid. Where it was provided that the certificate should not be assignal)le in payment of or security for any debt, held, that the assignment thereof as a security was invalid and the creditor acquired no rights thereunder, Crocker v. Ilogin, 103-243. Until the beneficiary is changed by law, he has an actual, subsisting in- terest in the policy which will pass to his administrator in case of his death, and as against such beneficiary, or his administrator, suicide on the part of the insured is not a defense in the absence of a provision to that effect in the policy. But fraud, in procuring a policy with the intent to commit suicide, will vitiate the entire contract, and defeat recovery. Parker v. Des Moines Life A.v.sn., 108-117. Under an ordinary life policy the beneficiary has a vested right which cannot be impaired without his consent, Haerter v. Mohr, 114-636. In an action against a mutual benefit company by one claiming under a Ch. 7, T. IX ASSESSMENT ASSOCIATIONS 87 certificate as wife of the insured, the company defending on the ground that insured had a' prior wife living, and that plaintiff was not, therefore, entitled to the benefit, has the burden of showing that a prior marriage existed, and had not been dissolved. Parsons v. A. 0. U. W., 108-6. A "relative" for whose benefit a certificate may be taken includes a step- father, after the death of the wife, on whom the relationship depends. Simcoke v. Grand Lodge A. O. U. W., 84-383. The provisions that the beneficiary may, by the consent of the society, be changed without the consent of the person who has been such benefi- ciary, is in accordance with the law previously existing with reference to the effect of such certificates. Broivn v. Grand Lodge A. 0. U. W., 80-287; Carpenter v. Knairp, 101-712. The provisions of § 1741, requiring the application of the assured to be indorsed on or attached to the policy, applies to all policies and contracts for life insurance, including those of mutual benefit associations issued upon the assessment plan, McConnell v. Iowa Mut. Aid Assn., 79-757; Grimes v. Northwestern Legion of Honor. And see now §§ 1819, 1826; 97-315. Where it was provided in the certificate of a mutual benefit society that it should be void in case the beneficiary named was not a natural heir of the member taking the certificate, held, that knowledge on the part of the society that the beneficiary named was not an heir of the member taking the certificate without objection on the part of the society, and continuing to collect assessments, and continuing to treat the certificate as valid, constituted a waiver of such condition. (Decided prior to the enactment of these provisions). Lindscy v. Western Mut. Aid. aS'oc, 84-734. Also held, that where such certificate was forfeited for non-payment of dues after the taking effect of the statute, but payment was subsequently accepted by the company, and the member was restored, such restoration did not amount to the making of a new contract, but was a waiver of the forfeiture, and the former certificate continued in force. Ihid. Also held, that statements of the member with reference to good health, on which such restoration was made, were not false in such sense as to render such restoration void. Ihid. Upon the surrender of a certificate for the purpose of changing benefi- ciaries the company is not permitted to alter, add to or take from other conditions of the contract in the new certificate and thereby bind the in- sured without his assent. Wood v. BrotlierJiood of Am. Yeomen, 148-^0. In the absence of any provision for notice to the company of a change of l)eneficiary, such change may be made by provision in a will. Brinsmaid v. Iowa State Trav. Men's Assn., 152-134. , Until the beneficiary is changed by law, he has an actual, subsisting in- terest in the policy which will pass to his administrator in case of his death, and as against such beneficiary, or his administrator, suicide on the part of the insured is not a defense in the absence of a provision to that effect in the policy. But fraud, in procuring a policy with the intent to commit suicide, will vitiate the entire contract and defeat recovery. Parker i\ Des Moines Life Assn., 108-117. If under the terms of the contract the benefit is payable to some extent and under some conditions to a beneficiary within the description of the statute, the naming of a beneficiary not authorized by statute to receive the benefit under certain conditions does not render the contract invalid and the recovery of the benefit may be had by the beneficiary coming within the statutory provisions. OTiphant v. Avieriean Health t(- Aec. Assn., 147- 656. The beneficiary named in a certificate of a fraternal beneficiary associa- tion has no vested interest during the life of the member; but on the death of such member the person who, under the terms of the contract with the association, is then entitled to receive the benefitij provided for in 88 ASSESSMENT ASSOCIATIONS Ch. 7, T. IX the certificate does acquire a vested interest therein. Holden v. Modern Brotherhood, 151-673. The effort of a member to change a beneficiary which is not made in ac- cordance with the rules of the association regulating the manner in which such changes may be made, is ineffectual. But to this rule there are some well defined exceptions, as where the society has waived compliance or estopped itself to assert noncompliance; where it is beyond the power of the member to comply literally with the regulations; or if the insured has pursued the course pointed out in the by-laws and has done all in his power to change the beneficiary, but before the new certificate actually issues he dies. IMd. When a benefit society pays the money into court upon one of its cer- tificates, it waives all mere technical defenses which it might have set up against either claimant and leaves the court free to award the fund upon equitable principles and the court will then determine as to which of the two rival claimants is, in equity, entitled to the fund. IMd. Sec. 1790. (C. C. 5514). Report to commissioner of insurance — examination. The annual business of such association organ- ized under the laws of this state shall close on the thirty-first day of December of each j^ear, and it shall Avithin sixty days there- after prepare and file in the office of the commissioner of insur- ance a detailed statement, verified by its president and secre- tary, giving its assets, liabilities, receipts from each assessment and all other sources, expenditures, salaries of officers, number of contributing members, death losses paid and amount paid on each, death losses reported but not Daid, and furnish such other information as the commissioner of insurance, who shall i)rovide blanks for that purpose, may require so that its true financial condition may be shown, and shall pay, upon filing each annual statement, the sum of three dollars and such other fees as are required by the provisions of section 1818 of the code. He sliall publish such annual statement in detail in his report, and for the p^irpose of verifjang it he may make or cause to be made an ex- amination of the at¥airs of any, such association at its expense, Avhich shall be, if done by him or his clerk, necessary hotel and traveling expenses only, if by a person not regularly employed in his office, the actual cost thereof, not exceeding ten dollars ptT day for the time required and actual expeiises; but the examina- tion herein provided for shall be in addition to those autliorized by the provisions of section 1821-a, supplement to the code, 1913. If the commissioner regards it necessary for the safety of the funds of the association, he maj^ require the bonds of the officers to be increased to an amount not exceeding double the sum for which they are accountable, and he may also recjuire supple- mental reports from such association at such time and in such form as he may direct, and it shall be the duty of its officers to furnish the bonds and reports when thus required. [38 0. A.> ch. 348, § 9 and 10; 21 G. A., ch. 65, § 8.1 - Sec. 1791. (C. C. 5515). Investment of accumulations. Any association accumulating any moneys to be held in trust for the Ch. 7, T. IX ASSESSMENT ASSOCIATIONS 89 purpose of the fulfillment of its polic}^ or certificate, contract, or otherwise, shall invest such accumulations in the securities pro- vided in section eighteen hundred and six, chapter eight, of thigj title, and deposit the same with the commissioner of insurance, as therein i^rovided. But such association may invest in real estate in Iowa such a portion of said accumulation as is necessary for its accommodation in the transaction of its business to be owned by said association, and in the erection of any building for such purpose may add thereto rooms for rental. [21 G. A., ch. 65, § 9.] Life 1778. Applicable 1806-7. Fraternal Societies 18H9-1. Sec. 1792. (C. C. 5516). Change of securities. Such associa- tion may at any time change its securities on deposit by substitut- ing a like amount in other securities of the same character, and the commissioner of insurance shall permit a withdrawal of the same, upon satisfactory proof in writing filed with him that they are to be used for the purpose for which they were originally deposited. [Same, §§ 10, 11.] Sec. 1793. (0. C. 5517). Collection of interest. The commis- sioner of insurance shall permit the associations owning the bonds or other securities to collect and retain the interest accruing thereon, delivering to them the evidences of interest as the same become due; but on default of any association to make or enforce such collection, he may collect the same and add it to the securi- ties in his possession, less the expense thereof. [Same, § 12. J Sec. 1794. (C. C. 5518). Foreign companies. Any association organized under tlie laws of any other state to carry on the busi- ness of insurijig tlio lives of persons, or of furnisliiiig lienefils to tlie widows, orphans, heirs or legatees of deceased members, or of paying accident indemnity, or surrender value of certifi- cates of insurance, upon the stipulated premium plan or assess- ment plan, may be permitted to do business in tlie state by complying with the requirements hereinafter made, but not other- wise. It shall file with the commissioner of insurance a copy of its charter or articles of incorporation, duly certified by tlie proper officers of the state wherein it was organized, together with a copy of its by-laws, application and policy or certificate of membership. It shall also file with the commissioner of insurance a statement, signed and A-erified by its pi-esident and seci-etary, which shall show the name and location of the association, its principal place of business, the names of its president, secretary and other princij^al officers, the number of certificates or policies in force, the aggregate amount insured thereby, the. amount paid to beneficiaries in the event of (h^ath or accident, the amount paid on the last death loss and the date thereof, the amount of cash or other assets owned by the association and how invested, and any other information w liich Mic coiniiiissioncr may require. 90 ASSESSMENT ASSOCIATIONS Ch. 7, T. IX The statement, papers and proofs thus filed shall show that the death loss or surrender value of the certificate of insurance or accident indemnity is in the main provided for by assessments upon or contributions by surviving members of such association, and that it is legally organized, honestly managed, and that an ordinary assessment upon its members of other regular contribu- tions to its mortuary fund are sufficient to pay its maximum cer- tificate to the full limit named therein. Upon its complying with the provisions of this section, and of section eighteen hun- dred and eight, chapter eight, of this title, and the payment of twenty-five dollars, the commissioner shall issue to it a certifi- cate of authority to do business in this state, provided the same right is extended by the state in which said association is organ- ized to associations of the same class in this state. When the commissioner doubts, the solvency of any foreign association, and the falure to pay the full limit named in its certificate or policy shall be such evidence of insolvency as to require the commis- sioner to investigate it, he shall for this or other good cause, at the expense of such association, cause an examination of its books, papers and business to be made, and if upon such examination he finds that the association is not financially sound, or is not pay- ing its policies or certificates in full, or is conducting its business 'fraudulently, or if it shall fail to make the statement required by law, he may revoke its authority and prohibit it from doing busi- ness until it shall again comply with the provisions of this chapter. If the commissioner appoints some one not receiving a regular salary in his office to make this examination, such examiner shall receive ten dollars per day for his services in addition to his actual traveling and hotel expenses, to be paid by the association examined, or by the state on the approval of the executive council, if the association fails to pay the same. The provisions of this section shall apply to fraternal beneficiary associations doing exclusively an accident insurance business, and upon compliance Avith the provisions of this chapter, and the provisions of chapter eight of title nine of the code, so far as the same are applicable, such associations may be authorized to transact business within this state. [39 0. A.", ch. 58, ^ 2; 32 G. A., ch. 82; 21 G. A., ch. 65, § 13.] Sec. 1795. (C. C. 5519). Proceedings to control or wind up AVhen any association organized under tliis title and chapter fails to make its annual statement on or before the first day of March, or is conducting its busiiu^ss frauduU'ntly or not in compliance with law, or is not carrjdng out its contracts with its members in good faith, the commissioner of insurance shall promptly com- municate the fad lo 1lie attorney general, who sliall at once com- mence action bororc tJie dislricl court of the county in wliich such association has ils ])riiici|)al |)lac(^ of business, giving it Ch.7, T. rX ASSESSMENT ASSOCIATIONS 91 reasonable notice thereof, and if upon a hearing it is found to h^ advantageous to the liolders of certificates of membership therein, said court or judge may remove any ofHcer or officers, nnd appoint others in tlieir ])lac(; until the next annual election. If it is ad- vantageous to tlie holders of certificates that the affairs of said cor])oration be wound up, the court or judge shall so direct, and for that purpose ma}' appoint a receiver who shall treat all legal claims for death benefits as preferred. The receiver may also, with the approval of the court, or judge, transfer the members of such association who consent thereto to some like solvent association of the state, or divide the surplus accumulated in nroportion to the share due each certificate at the time. [21 (J. A., ch. (i'^, §16.1 Other than Life 1731. Life 1777, 1821g. Fraternals 1836. The fact that a mutual benefit association is doing business without com- plying with the law cannot be taken advantage of in an action against it by another association to restrain the use by defendant Ol a name common to the two, it appearing that plaintiff has no prior right to the use of such name. Grand Lofl{/e v. Graham., 96-592. See. 1796. (C. C. 5520). Certificate of Authority. Upon com plinnce witli tlie ])r()visi()ns of tliis cliapter by an association, the coiinnissioner of insurance shall issue to it a certificate, setting forth that it has full.v complied with the provisions of this chapter, and is authoi-ized to transact business for a period of one year from April first of the vefir of its issue. [87 (J. A., ch. 227; 21 Ci. A., ch. (if), § 18.1 8ec. 1797. (C. C. 5521). Distribution of surplus — surrender value. Any association which provides in the main for the pay- ment of death losses or accident indemnity by assessments upon its members, or stipulated premium plan, may provide for the equitable distribution of any surplus or advance insurance fund accumulated in the course of its business, which may be paid in cash or applied in the reduction or payment of future premiums, paid up or extended insurance, as its rules or contracts mav provide, and for an equitable surrender value upon the cancel- lation of a certificate or policy, provided the terms and conditions thereof are set forth in such policy or certificate of membership, and such surrender value shall in the main be accumulated during the term of such policy or certificate. | 21 (1. A., ch. Oo, § 20.1 Since the enactment of this provision a mutual life company has no authoi'ity to stipulate in its policies that an assessment shall be made for the purpose of paying an endowment. Dishnng v. Iowa Life tt Endowment Assn., 92-163. And where prior to the passage of this statute endowment contracts had been made by such a company, and the risks of such company were after- ward reinsured in another mutual company, which issued a different pol- icy, held, that the second company was under no obligation to make an assessment for the payment of such endowment. Ibid. 92 ASSESSMENT ASSOCIATIONS Cli. 7, T. IX Sec. 1798, (C. C. 5522). Benevolent societies — process. Nothing in this chapter shall be constrned to applj" to any associa- tion organized solely for benevolent purposes and composed wholl}^ ol* nieml)ers of any one occupation, guild, profession or religious denomination, but any such society may, by complj^ng with the provisons hereof, become entitled to all the privileges thereof, in which event it shall Ix^ amenable 1o the provisions of this chapter so far as they are applicable ; jDrovided that if organized under the laws of another state or country, they shall file with the commissioner of insurance an agreement in writing authorizing service or notice of process to be made upon tlie said commissioner of insurance, and when so made shall be as valid and binding as if served upon the association witliin this state. [34 (1. A., ch. IS, § If); 21 G. A., ch. 05, § 21.] A mutual assessment company providing for benefits to its members in case of death or accident is not an association organized solely for benevo- lent purposes within the provisions of this section. ConnvAl v. Iowa t^lcttc Trav. Men's Assn., 139-444. Sec. 1798-a. (C. C. 5523). Future organization or authoriza- tion prohibited — valuation of policies of existing associations. No life, health or accident insurance company or association, other than fraternal beneficiary associations, Avhich issues contracts, the performance of which is contingent upon the payment of assess- ments of call made upon its members, shall do business within this state except such companies or associations as are now authorized to do business within this state and which, if a life insurance company or association, shall value their assessment policies or certificates of membership as yearly renewable term policies according to the standard of valuation ot life insurance policies prescribed by the laws of this state; provided, however, that the insurance commissioner of this state may authorize any health or accident insurance company or association organized under the laws of any other state or territor}^, to do business in this state, if, under the laws of such state or territory health and accident insurance companies or associations organized under the laws of this state are permitted to do business in such state. The provisions of this section shall not applj^ to unincorporated assessment associations now existing in this state, and having policy holders or certificates of membership numbering not less than two hundred fifty, and which were organized or in existence in this state as such unincorporated assessment associations prior to March 23, 1907 ; but any such unincorporated assessment associations now existing in this state, having policy holders or certificates of membership numbering not less than two hundred fifty and which were organized or in existence in this state prior to March 23, 1907, ma}^ by becoming hereafter incorporated in this state, and complying with the provisions of this chapter, be- Ch. 8, T. IX LIFE COMPANIES AND ASSOCIATIONS 93 come entitled to all o\' llie privileges hereof, in winch event it shall become amenable to the provisions of this chapter as far as they are applicable. [37 G. A., ch. 413, § 1 ; ch. 234; 34 CI. A., ch. 18, § 16; ch. 83 § 1.] Sec. 1798-b. (C. C. 5524). Reincorporation as legal reserve company — stock company. Any existing domestic assessment company or association or fraternal beneficiary society may, with the written consent of the commissioner of insurance, upon a majority vote of its trustees or directors, amend its articles of incorporation and by-laws in such a manner as to transform itself into a legal reserve or level premium company, and upon so doing and upon procuring from the commissioner of insurance a certificate of authority, as prescribed by law, to transact business in this state as a legal reserve or level premium company, shall incur the obligations and enjoy the benefits thereof, the same as though originally thus incorporated, and such corporation under its charter as thus amended, shall be a continuation of sucli original corporation, and the officers thereof shall serve through their respective terms as provided in the original charter, but their successors shall be elected and serve as in such amended articles provided; but such amendment or reincorporation shall not affect existing suits, rights or contracts. Any assessment company or fraternal beneficiary society rein- corporated to transact life insurance business, shall value its assessment policies or certificates or benefit certificates as yearly renewable term policies according to the standard of valuation of life insurance policies prescribed by the laws of this state. Provided that accident or health associations may take ad- vantage of all the provisions of this section, in so far as appli- cable, and may thereupon transform themselves into stock com- panies. But no such company or association shall reorganize under the provisions of tliis section unless it shall have accumu- lated sufficient surplus to constitute a reinsurance reserve equal to the unearned premium on all outstanding policies or certifi- cates, as prescribed by the statutes of this state relating thereto. [36 G. A., S. F. 492, § 1 ; 34 G. A., ch. 18, § 17; 32 G. A., ch. 83, § 2.] CITAPTER 8, TITLE TX, C^ODE. PROVISIONS APPLYING TO LIFE INSURANCE COMPANIES AND ASSOCIATIONS. Sec. 1799. (C. C. 5525). Annual statement. Every company or association organized inuh'r tlie laws of any otlier state or country and doing Inisiiiess in this state shall annually, by the first day of March, file with the commissioner of insurance a 7 94 LIFE COMPANIES AND ASSOCIATIONS Ch. S, T. IX statement of its affairs for the year terminating on the thirt}'- first day of December preceding, in the same manner and form provided for similar companies or associations organized in this state. Tlie commissioner ma}^ amend the form of the annual statement required to be made by companies or associations doing business in this state, and propose and require such ad- ditional matter to be covered therein as he may think necessary to elicit a full exhibit of the standing of any such company oi association. [15 G. A., ch. 2, § 1; C. 73, § 1166.] See 1773. Praternals 1830-36. Other than Life 1714-16. 8ec. 1800 (C. C. 5526). Ag3nt's certificate. No ])erson shall, directly or indirectly, act within this state as agent, or otherwise, in receiving or procuring applications for insurance, or in doing or transacting any kind of life insurance l)usiness, for any com- pany or association contemplated in tlie \\vo chapters preceding, except for the purpose of taking applications for organizations, unless the compan}'- or association for wliich he is acting has re- ceived a certificate from the commissioner of insurance. authoriz- ing it to transact business therein, nor until he shall have received from said commissioner a certificate showing that such comj^aiiy or association lias complied with the provisons of law, and that such person is authorized to act for it [Same.] See 1814-15-21k, 1. Fraternal 1883-37. Other than Life 1725-49-50. Sec. 1801 (C. C. 5527). Penalty for acting without certifi- cate. Any such compan}'' or association that does or solicits new business without the certificates required b}^ the two preceding chapters shall forfeit five hundred dollars for every day's neglect to j:)rocure the same. Any person knowingly soliciting applica- tions or making insurance for any company or association having no such certificate from the commissioner of insurance as required, shall forfeit and paj" the sum of three hundred dollars, and any person acting for an}^ company or association authorized to trans- act business without having the agent's certificate prescribed in the preceding section in his possession, shall be liable to pay twenty-five dollars for each day's neglect to procure the same during the time he thus acts. [15 G. A., ch. 2, § 5 ; C. '73, § 1177.] See 1814-15-21k, 1. Fraternal 1833-37. Other than Life 1725-49-50. Sec. 1802 (C. 0. 5528). Recovery of penalties. Actions brought to recover any of the penalities provided for in this* chapter shall be instituted in the name of the state b.y the county attorney of the county, under the direction and authority of the commissioner of insurance, and may be brought in the dis- trict court of any county in which the company or association proceeded against is engaged in the transaction of business, or in Avhich the offending person resides, if it is against him. Thb Ch. 8, T. IX LIFE COMPANIES AND ASSOCIATIONS 95 penalties, when recovered, shall be paid into the state treasury for the use of the school fund. [15 G. A., ch. 2, § 6; C. 73, § 1178.J Sec. 1803 (C. C. 5529). Real Estate. No such company or association organized under the laws of this state shall purchase, hold or convey real estate, except for the purposes and in the manner herein set forth : 1. Such as is required for its use in the transaction cC its business; 2. Such as shall have been mortgaged to it in good faith by way of security for loans previously contracted in the course of its dealings; 3. Such as shall have been conveyed to it in satisfaction of debts previ- ously contracted in the course of its dealings; 4. Such as shall have been purchased at sales under execution issued upon judgments and decrees based upon debts due it, or obtained by re- demption as junior judgment creditor or mortgagee. [C. '73, § 1180.] Other than Life 1703. Fraternal 1839k. Sec. 1804 (C. C. 5530). When to be sold. All real estate acquired which is not necessary for such company or association in the convenient transaction of its business shall be sold witliin five years after it acquired title thereto, unless it procures a cer- tificate from the commissioner of insurance that its interests will suffer by a forced sale thereof, in which event the time may be extended as the commissioner shall direct in said certificate. [C. '73, § 1181.] Sec. 1805 (C. C. 5531). Policy exempt from execution. A policy of insurance on the life of an individual, in the absence of an agreement or assignment to the contrary, shall inure to tlie separate use of the husband or wife and children of said individ- ual, independently of his creditors. The proceeds of an endow- ment policy payable to the assured on attaining a certain age shall be exempt from liability for any of his debts. Any benefit or indemnity paid uiuler an accident policy shall be exempt to the assured, or in cas(^ of his denth to the liusband or wife and chil- di'(Mi of the assured, from his d('l)ts. Tlio jivjiils of all policies ol" life or accident insurance payalde to the snrviving Avidow shall be exempt from liability for all debts of such beneficiary con- tracted prior to the death of the assured, but the m mount thus exempted shall not exceed five thousand dollars. [24 (}. A., ch 28; 18 G. A., ch. 5; C. 73, ^ 1182, 2372; R., § 2362; C. '51, § 1330.] The execution of an ordinary life policy confers immediately a vested right upon and raises an irrevocable trust in favor of th(; party named as beneficiary, a right which cannot be impaired without tlie beneficiary's consent. Haerther v. Mohr, 114-636. The purpose of this section being to provide that the money derived from life or accident insurance shall enure to the benefit of the widow, exempt from h^r antecedent debts, it follows that she may invest a part or the whole thereof in property which shall be necessary for the com- fort and support of her family, without impairing this right of exemp- 96 LIFE COMPANIES AND ASSOCIATIONS Ch. 8, T. IX tion. The exemption is not limited to the money itself. Gooh v. Allee, 119-226. In the absence of any contract or arrangement, the proceeds of life in- surance are not exempt in the hands of the heir from the debts of such heir. O'Melia v. Hoffmeyer, 119-444. Where a bankrupt holds a policy payable to himself, his heirs or legal representatives, the surrender value thereof will be a part of the assets of his estate in bankruptcy, under the provisions of the federal bankrupt law. In re Lauge, 91 Fed., 361; In re Steele, 98 Fed., 78. The provisions of the bankrupt law as to exemption of policies of life insurance are only applicable to cases where there is no exemption by the state law, but so far as such policies are exempt by the state law such exemption is recognized under the general provisions as to exempt prop- erty. Steele v. Buel, 104 Fed., 968. This section contemplates a case where the policy is payable to de- ceased, or his or her legal representatives, and not a case where the policy is payable to another person for his use and benefit, in which case it can- not be otherwise disposed of by will. McChire v. Johnson, 56-620. Where a decedent left a wife but no children, held, that the proceeds should go to the wife alone, and not be divided among all the distributees of his estate. Rhode v. Bank, 52-375. The proceeds of life insurance are exempt to heirs generally and not merely to wife and children, to whom they are distributed free from the debts of the deceased. Larj'ahee v. Palmer, 101-132. The proceeds of the policy when realized by the person entitled thereto, are not exempt from execution for the debts of such person. The exemp- tion exists only as to the debts of the person insured. Smedlep v. Felt, 43-607; Murray v. Wells, 53-256. This section does not exempt the avails of a policy of insurance from the debts of a beneficiary when such beneficiary is a person other than the assured. Murdy v. Skyles, 101-549. Therefore a benefit payable to the member of an association and by him transferred to his wife is not exempt from the debts of the wife. IMd. The exemption to the wife as against her own antecedent debts relates only to cases of death of the husband who is the assured. Ihid. Under a policy of insurance for the use and benefit of the wife of as- sured, the sum stipulated being payable to said assured or her legal repre- sentatives "or if the said assured be not then living the said sum shall be payable to her children or to their children if under age," held, that the wife and the children being dead before the death of insured the proceeds of the policy were payable to the grandchildren and were not subject to the debts of the deceased wife. In re Conrad's Estate, 89-396. Where a certificate of insurance in a mutual benefit company was made payable to the "legal" heirs of assured, held, that the widow of assured was not within such description, but that the proceeds of such certificate should go to the children of deceased. Phillips v. Carpenter, 79-600; but see now § 3313. The exemption of this section may apply to property purchased with the avails of the insurance. Booth v. Martin, 158-434. In a particular case held, that the evidence did not show a contract to subject the proceeds of a life policy to the payment of a debt. Herriman V. McKee, 49-185. Where the proceeds of a policy of life insurance are used to release other property from a claim under which it is held, the property, so re- leased becomes subject to the payment of debts, Fricdlandcr v. Mahoncy, 31-311. The proceeds of a life policy are assets of the estate, and only differ from other assets in the manner of their distribution. Kellcy v. Manri, 56-625. Ch. 8, T. IX LIFE COMPANIES AND ASSOCIATIONS 97 A daughter, who is the beneficiary in a policy of insurance on the life of her. father, may make a valid assignment of the policy, and the assignee need not have an insurable interest in the life of the insured or that of the beneficiary. Farmers' cC Traders' Bank v. Johnson, 118-282. Further as to disposition of proceeds as assets of the estate, see § 3313. Sec. 1806 (C. C. 5532). Investment of funds. The funds re- quired by law to be deposited with the commissioner of insurance by any company or association contemplated in the two chapters preceding, and the funds or accumulations of any such company or association organized under the laws of this state held in trust for the purpose of fulfilling any contract in its policies or certificates, shall be invested in the following described securities and no other: 1. The bonds of the United States; 2. The bonds of this state or of any other state when such bonds are at or above par; 3. Bonds or other evidences of indebtedness of any county, city, town or school district within the state or any other state, drainage district bonds of this state, improvement certificates issued by any municipal cor- poration of this state such certificates being a first lien upon real estate within the corporate limits of the municipality issuing the same, where such bonds or other evidences of indebtedness are issued by authority of and according to law and bearing interest, and are approved by the com- missioner of insurance; 4. Bonds and mortgages and other interest-bearing securities being first liens upon real estate within this state or any other state worth at least double the amount loaned thereon and secured thereby exclusive of improvements, or two and one-half times such amount including the im- provements thereon, if such improvements are constructed of brick or stone; but no such improvements shall be considered in estimating the value unless the owner shall contract to keep the same insured in some reliable fire insurance company or companies authorized to do business in the state, during the life of the loan, in a sum at least equal to the excess of the loan above one-half the value of the ground exclusive of the im- provements, the insurance to be made payable in case of loss to the com- pany or association investing its funds, as it interests may appear at the time of loss; provided that before a company or association may invest any of its funds in such securities as are specified in this subdivision of this section in any state other than the state of Iowa it shall first obtain consent of the commissioner of insurance so to do; any mortgage lien upon real estate shall not, for the purposes of this section, be held or con- strued to be other than a first lien by reason of the fact that drainage or other improvement assessments may have been levied against the real estate covered by said mortgage, whether the installments of said assess- ment be matured or not, provided that in determining the value of said real estate for loan purposes, the amount of the drainage or other assess- ment tax unpaid, shall be deducted. 5. Loans upon its own policies, where the same have been in force at least two full years, in an amount not exceeding the net terminal reserve. If such loan is made, the company must describe in the note or contract taken, the amount of the loan, the name of the borrower, the number of the policy, and the terms of such note or contract shall make the amount loaned a lien against such policy and such note or contract shall be num- bered, dated and signed, giving the post-office address of the insured. 6. Any such real estate in this state as is necessary for its accom- modation as a home office; and in the erection of any building for such purposes, it may add thereto rooms for rent; provided that before any 98 LIFE COMPANIES AND ASSOCIATIONS Ch. S, T. IX company or association shall invest any of its funds, in accordance with the provisions of this subdivision, it shall first obtain the consent of the executive council. The maximum amount which any such company or association shall be permitted to invest in accordance with the pro- visions of this subdivision shall not exceed ten per cent of the lawful reserve on its policies or certificates of insurance, provided, however, that a stock company may invest such portion of its paid up capital, in addition to said ten per cent of the lawful reserve on its policies, as is not held to constitute a part of its legal reserve deposit under sec- tion seventeen hundred seventy-four (1774) of the code; provided further that the total legal reserve of such company shall be equal to or exceed the amount of its paid up capital stock. Any company or association so investing its funds may use the value of any such real estate and home office building as a part of the deposit of legal reserve in which case it shall convey the same to the commissioner of insurance by trust deed, such property to be held by him in trust for the benefit of the policy- holders or members of the company or association. The commissioner of insurance shall execute and deliver to the company or association a quit claim deed to the property held by him in trust whenever the full legal reserve of said company or association shall be invested in other securities provided in this subdivision and deposited with the commis- sioner of insurance. The value of said property whether deeded in trust or otherwise shall be determined from time to time by the commissioner of insurance. All such securities sluill be deposited with the commissiouer, subject to his approval, and shall remain Avith him until with- drawn in accordance with law. Any company or association re- ceiving payments or partial payments on any securities deposited with the commissioner of insurance shall notify him of such fact, giving the amount and date of payment, within thirtj^ days after such payment shall have been made. The officers of any company or association which fails to report the receipt of payments or partial payments as above provided, shall be liable to a fine in double the amount collected and not reported Avithin the time and in the manner above specified. It shall be the duty of the com- pany or association and of the officers thereof to withdraw from deposit any loans made in accordance with the provisions of sub- division five of this section Avithin fifteen daj^s after the date of the lapsing or termination of any policy of insurance "upon Avhich any such loan is made. Any association making deposit with the commissioner of insurance as herein contemplated, shall at the time of making request for the withdrawal of any securi- ties designate for Avhat purpose the same are desired to be Avith- draAvn. The commissioner of insurance shall have authority to suspend or revoke the certificate of authority of any company or association failing to comply Avith any of the provisions of this section or for violatiiiii' the same. [^7 CI. A., cli. 404 : 86 (1. A., S. F. 452, § 1 ; 36 G. A., H. F. 610, § 1 ; 36 G. A., ch. 145, ^ 1 ; 31 G. A., ch. 77; 28 G. A., ch. 66, ^ 1; 25 G. A., ch. 33; 24 G. A., ch. 30; 21 G. A., ch. 65, § 9; 21 G. A., ch. 169; 17 G. A., ch. 47; C. '73, § 1179.1 See also 1699, 1778-91. Fraternal 1839 1. Ch. 8, T. IX LIFE COMPANIES AND ASSOCIATIONS 99 Sec. 1807 (C. C. 5533). Investment in land and buildings. Such organization may purchase such real estate in the state with a portion of its accumulations as may be necessary for its use in the transaction of its business, and in the erection of a building thereon for such purpose, to which rooms for rent may be added. [21 G. A., ch. 65, § 0.] Sec. 1808 (C. C. 5534). Service of process. Every life insurance company and association organized under the laws of another state or country shall, before receiving a certificate to do business in this state or any renewal thereof, file in the ofQce of the com- missioner of insurance an agreement in writing that thereafter service of notice or process of any kind may be made on the com- missioner of insurance, and when so made shall be as valid, binding and effective for all purposes as if served upon the com- pany according to the laws of this or any other state, and waiving all claim or right of error by reason of such acknowledgment of service. Such notice or process, with a copy thereof, may be mailed to the commissioner of insurance at Des Moines, Iowa, in a registered letter addressed to him by his official title, and he shall immediately upon its receipt acknowledge service thereon on behalf of the defendant foreign insurance company by writing thereon, giving the date thereof, and shall immediately return such notice or process in a registered letter to the clerk of the court in which the suit is pending, addressed to him by his official title, and shall also forthwith mail such copy, wdth a copy of his acknowledgment of service written thereon, in a registered letter addressed to the person or corporation who shall be named or designated by such company in such written instrument. [21 G. A., ch. 65, § 13;C. '73, § 1165.] Applicable see 3530 Miscel. sections. Fraternal 1831. Other than Life 1722. Failure of non-resident company to comply with section 1S08 of code cannot be pled in its defense to prove lack of notice when notice has been served on Commissioner. Companies doing business in state presumed to comply with law. Flynn v. Western Mutual Life Assn., 171 N. W., 711. Sec. 1809 (C. C. 5535). Provisions additional. The provisions of the preceding section are merely additions to the general provi- sions of law on the subjects therein referred to, and are not to be construed to be exclusive. Sec. 1810 (C. 0. 5536). Laws of other states — reciprocity. If by the laws of any state, or the rulings or decisions of the appro- priate officers thereof, any burden, obligation, requirement, dis- qualification or disability is put upon any company or association of any class organization in this state, effecting its freedom to do business in that state, then the same or like burden, obligations, requirement, disqualification or disability shall be put upon every such company or association of the same class from that state 100 LIFE COMPANIES AND ASSOCIATIONS Cli. 8, T. IX doing or seeking to do business in this state; and the commis- sioner of insurance shall enforce the provisions of this section, and in doing so may refuse or revoke the certificate of such com- pany or association of such other state; and it shall be unlawful for the commissioner of insurance to impose upon companies or associations organized under chapter seven of this title any rules or regulations, requirements or limitations, that shall not be im- posed Avith equal force upon like companies or associations from other states doing a like business in this state. [21 G. A., ch. 65, § 13.] See also 1821. Other than Life 1736. Sec. 1811 (0. C. 5537). Defenses to actions on policies — intoxi- cation. In any action pending in any court of the state on any policy or certificate of life insurance, wherein the defendant seeks to avoid liability upon the alleged ground of the intemperate habits or habitual intoxication of the assured, it shall be a suf- ficient defense for the plaintiff to show that such habits or habit- ual intoxication of the assured Avas generally known in the com- munity or neighborhood where the agent of the defendant resided or did business, if thereafter the company continued to receive the premiums falling due thereon. [16 G. A., ch. qd, § 1.] This provision has no application to mutual benefit associations. Knapi) V. Brotherhood of Am. Yeomen, 128-566; s. c. 149-137. If representations as to the habits of an applicant are knovrn to the soliciting agent to be false the false statements in the application as to such habits cannot be relied upon by the company as a defense. Biermann V. Chiai-anty Mut. Life Ins. Co., 142-341. Sec. 1812 (C. C. 5538). Physician's certificate. In any case where the medical examiner, or physician acting as such, of any life insurance company or association doing business in the state shall issue a certificate of health or declare the applicant a fit subject for insurance, or so report to the company or association or its agent under the rules and regulations of such company or association, it shall be therebj^ estopped from setting up in defense of the action on such policy or certificate that the assured was not in the condition of health required by the policy at the time of the issuance or delivery thereof, unless the same was procured by or through the fraud or deceit of the assured. [Same, § 2.] Applicable to Fraternals. See Supreme Court decisions. To defeat recovery oii account of false statements as to the health of the applicant, the defendant must show, not only that the statements of the applicant were false and fraudulent, but that the examiner was de- ceived thereby. But the defendant is not estopped by the certificate of the medical examiner from setting up fraud on the part of the applicant in procuring such certificate on which the policy was issued. Welch v. Union Central L. Ins. Co., 108-224. The purpose of this statutory provision, estopping the company from setting up misrepresentations as to the health of deceased where a medical examiner has passed on the fitness of the applicant, is to prevent recovery being defeated on any policy where the company has, by its agent, exam- Ch. 8, T. TX LIFE COMPANIES AND ASSOCIATIONS. , : ' > ■ V'> I'Ol: inecl and passed upon the fitness of the applicant for insurance, and it is quite immaterial what representation-s have been made, or warranties given. The fraud or deceit referred to in the statute is that of procuring the report or certificate of the physician and not the policy. Weimer v. Economic L. Assn., 108-451. Unless the examiner is deceived by answers in the application, or in some other way, the company is not entitled to have the condition of health of the insured at the time of the issuance of the policy investigated. In the absence of fraud or deceit practiced on the medical examiner the company is estopped from questioning the truthfulness of the answers made by the insured in the application. Stcioart v. Equitable Mut. L. Ins. Assn., 110-528. Under this section the company is estopped from inquiring into the correctness of answers in the application, in the absence of an allegation that the medical examiner's report was procured through fraud or deceit. The fact that the statements in such application amount to warranties is immaterial. Nelson v. Ncderland' L. Ins. Co., 110-600. The provisions of this section evidently relate to procedure, and not to the validity of the contract, and therefore control in an action on a policy issued in another state by a foreign insurance company. Ibid. Where a physician reports in favor of the application, and it is not proven that such report was secured by fraud practiced upon the physi- cian, the defendant is estopped from denying the truthfulness of the ap- plicant's representations. Brown v. Modern Woodmen, 115-450. The medical examiner or physician referred to in this section is the person who examines the applicant and determines his condition of health and reports whether he is a proper risk. Peterson v. Des Moines L. Assn., 115-668. The provisions of this section apply to the person who represents the company in making an examination of applicants as to their physical con- dition, and not to the action of the medical director of the company in determining whether the risk shall be accepted. Wood v. Farmers' Life Assn., 121-44. Proof of the falsity of the representations made in an application for life insurance is not alone sufficient to establish that such representations were fraudulently made. Ley v. Metropolitan L. Ins. Co., 120-203. The provisions with reference to the conclusiveness of a health certifi- cate given by a medical examiner have no application to mutual benefit associations. Smith v. Supreme Lodge, 123-676. In an action on a fraternal benefit certificate evidence of fraud in the application consisting in false answers as to the conditions of the appli- cant's health is admissible to defeat recovery. Ibid. To constitute obtaining a certificate of health, by an applicant for life insurance, by fraud, it is not enough that his answers to the medical ex- aminer be untrue, but he must have known them to be false, and the ex- aminer must have been thereby deceived into issuing the certificate. Welch V. Union Central Life Ins. Co., 117-394. Unless the examining physician's certificate was procured by fraud, a company whose physician certifies that an applicant is a fit subject for in- surance, is estopped from setting up the falsity of assured's warranties as to his health prior to the medical examination. Broion v. Modern Wood- men of America, 115-450. Unless the agent is purposely misled by the applicant for insurance, the company is estopped from putting in issue whether at the time of the is- sue or delivery of the certificate he was a fit subject for insurance. Roe V. National Life Ins. Assn., 137-696. To constitute such fraud or deceit there must have been an intention to deceive and the examiner must have relied upon the false statements made by the insured or have been misled by concealment of facts which good faith required him to disclose. Ibid. '-lOi^ L^FE*; eOTVIPANIES AND ASSOCIATIONS Ch. S, T. IX The provisions of this section are not applicable to fraternal benefit societies, orders or associations. Sargent v. Modern Brotherhood, 148-600. Where a policy of insurance takes effect from the time it is mailed to the applicant, the applicant's condition of health at that time is not open to question or consideration if he has been pronounced by the company's physician a fit subject of insurance. Unterharnscheidt v. Missouri State Life Ins. Co., 160-223. Section applied. The provisions of section 1812 of the Code are not applicable to fraternal beneficiary associations organized under the provisions of chapter 9, title IX of the code, since section 1825 of such chapter exempts such associations from the provisions of the laws relat- ing to life insurance companies. Smith v. Supreme Lodge K. t6 L. of Golden Precept, 123-676. 8(H'. 1813 (C. C. 5539). Misrepresentation of age. In all cases where it shall appear that the age of the person insured has been understated in the proposal, declaration or other instrument upon Avhicli a policy of life insurance has been founded or issued, then the amount payable under the policy shall be such as the premium paid v/ould have purchased at the correct age; provided, however, that one who, by misstating' his age, obtains life insurance not otherwise obtainable shall be enti- tled to recover from the insurer on account of such policy only the acere^-ate premiums paid. [38 G. A., ch. 348, S 11 ; 16 G. A., ch. 55, § 3.] Sec. 1814 (C. 0. 5540). iregal business. Any officer, manager or agent of any life insurance company or association who, with knowledge that it is doing business in an unlawful manner or is insolvent, solicits insurance with said company or associations, or receives applications therefor, or does any other act or thing towards procuring or receiving any new business for such com- pany or association, shall be guilty of a misdemeanor, and for every such act, on conviction thereof, shall be adjudged to pay a fine of not less than one hundred nor more than one thousand dollars, or be imprisoned in the county jail not exceeding one year, or be punished by both such fine and imprisonment. All contracts, promises and agreements made by any person to or with any such company or association concerning any premium, policy or certificate of new business, after the revocation of its certificates or denial of authority to do business, shall be null aiid void, and all payments of premiums or assessments advanced or made by any person on account of any sucli policy, certifieate of new business, or upon any arrangement therefor, may be recov- ered from such company or association, or its agent to whom payment was advanced or made, or from both of them, and in ad- dition thereto plaintiff may recover an equal amount as liquidated damages, together with a reasonable fee to plaintiff's attorney for services in the case. As to agents. See 1800-1, 1821k, 1. Fraternals 1833-37. Other than Life 1725-49-50. Illegal business 1821f. Other than Life 1747, 1758, Ch. 8, T. TX LIFE COMPANIES AND ASSOCIATIONS 103 Sec. 1815 (C. C. 5541). Advertisements— who deemed agent. The provisions of sections seventeen hnndred anil forty-nine and seventeen hnndred and fdty of chapter four, of this title, shall apply to life insurance companies and associations. [18 G. A., ch. 211, §§ 1, 2.1 Sec. 1816 (C. C. 5542). Penalty for fraud in procuring insur- ance. Any agent, physician or other person who shall knowingly, by means of concealment of facts or false statements, procure or assist in procuring from any life insurance organization any policy or certificate of insurance, shall be punished by a fine of not to exceed one thousand dollars or by imprisoinuent in the county jail not to exceed one vear, or by l)()lli, in Ihe discretion of the court. [21 G. A., cli. K)5,' § 19.1 Sec. 1817 (C. 0. 5543). Conspiracy to defraud. If two or more persons conspire to defraud or obtain any money from any life insurance company or association by means of false state- ments as to the death of any person insured, or the false appear- ance of the death of any such i)erson, each shall be punished by imprisonment in the penitentiary not to exceed ten years. Any person who by such means obtains any money or property on the policy or certificate of the person so insured shall be punished by imprisonment in the penitentiary not to exceed fifteen years. Any person who thus attempts to obtain money from any such company or association shall be i)unished hy like imprisonment not to exceed seven years. Sec. 1818 (C. C. 5544). Fees. When not otherwise provided, each life insurance company doing business in this state, except those organized under the law^s thereof, shall pay to the com- missioner of insurance the following fees: 1. Upon filing declaration or certified copy of the charter or articles of incorporation, twenty-five dollars; 2. Upon filing the annual statement, twenty dollars; 3. For each certificate of authority and certified copy thereof, two dollars; 4. For each agent's certificate, two dollars; 5. For every copy of any paper filed, the sum of twenty cents per folio, and for certifying and affixing the official seal thereto, one dollar; 6. For valuing policies, ten dollars for each million dollars of insur- ance or fraction thereof. Companies organized under the laws of the state shall pay the following fees : 1. For filing an examination of the first application and the issuance of certificate thereon, ten dollars; 2. For filing each annual statement and issuance of renewal certificate, three dollars; 3. For each agent's certificate, fifty cents. The provisions of the chapter on insurance other than life shall apply as to fees under this and the two preceding chapters, except as modified by this section. | C. '73, § 1183.] See also 1752. 104 LIFE COMPANIES AND ASSOCIATIONS Ch. 8, T. IX Sec. 1819 (C. C. 5545). Copy of application. All life insurance companies or associations organized or doing business in this state under the provisions of the preceding chapters shall, upon the issuance of any policy, attach to such policy, or indorse thereon, a true copy of any application or representation of the assured which by the terms of such policy are made a part thereof, or of the contract of insurance, or referred to therein, or which may in any manner affect the validity of such policy, or, upon reinstatement of a lapsed policy, shall attach to the renewal receipt a true copy of all representations made by the assured upon which the renewal or reinstatement is made. The omission so to do shall not render the policy invalid, but if any company or association neglects to comply with the requirements of this section, it shall forever be precluded from pleading, alleging or proving such application or representations, or any part thereof, or the falsity thereof, or any part thereof, ^ in any action upon such policy, and the plaintiff in any such action shall not be required, in order to recover against such company or association, either to plead or prove such application or repre- sentation, but may do so at his option. See 1741. As to Assessment, Life and Fraternals, see Supreme Court opinions. A cross-petition asking cancellation of the policy on the ground of fraud committed by the making of false answers in the application can- not be sustained where a copy of the application has not been attached to or incorporated in the policy. Biermann v. Guaranty Mut. Life Ins. Co., 142-341. The purpose of this section is to require all representations and war- ranties to be attached to the policy so that all parts of the contract may be together and the insured may be at all times in possession of the evidence of his contract. Nutter v. Des Moines L. Ins. Co., 156-539. Whether the provision that a copy of the application must be attached to or endorsed upon the policy pertains solely to matters of remedy and procedure, and is therefore applicable in an action in this state upon a policy regardless of the place of contract, quaere; but held that the stat- ute of Minnesota under which the policy was executed, though different in terms from the statutory provision in this state, should receive the same construction, and that evidence of fraudulent statement in the ap- plication not thus attached or endorsed was inadmissible. Rauen v. Pru- dential Ins. Co., 129-725. The provisions of 18 G. A., chap. 211, as to attaching copy of ap- plication to policy (now embodied in Code § 1741) held applicable to fraternal societies. Stork v. Supreme Lodge K. of P., 113-724. Section applied. Mutual L. Ins. Co., v. Kelly, 114- Fed., 268. Sec. 1820 (C. C. 5546). Limitation of action. No stipulation or condition in any policy or contract of insurance or beneficiary certificate issued by any company or association mentioned or referred to in this chapter, limiting the time to a period of less than one year after knowledge by the beneficiary within which notice or proofs of death or the occurrence of other contingency insured against must be given, shall be valid. In case of accident or licalth insurance it slmll be valid for Ch. 8, T. IX LIFE COMPANIES AND ASSOCIATIONS 105 any company or association to limit by contract the time when notice or proofs of deatli, canse or disability or other contingency insnred against shall be given; but in no case shall said notice be limited to a period of less than 60 days after knowledge by the beneficiary within which such notice or proofs must be given, |83G. A, ch. 113, §§1,2.] The provisions of 18 G. A., ch. 211, § 3, relating to proofs of loss, held applicable to mutual benefit associations as well as fire insurance companies. Parsons v. A. O. U. W., 108-6. The time within which an action may be brought for the loss on the policy cannot by stipulation be limited to less than one year from the time the cause of action has accrued. Kenny v. Bankers Ace. Ins. Co., 136-140. A stipulation in the by-laws of a mutual benefit association organized and acting under the provisions of code § 1784 exacting written notice of the death of a member within fifteen days after death is invalid. Connell v. loiva State Trav. MeiVs Assn., 139-444. Sec. 1820-a (C. C. 5547). Disbursements— vouchers— affidavit. No domestic life insurance company shall make any disbursement of one hundred dollars or more unless the same be evidenced by a voucher signed by or on behalf of the person, firm, or corpora- tion receiving the money and correctly describing the consid- eration for the paj-ment. If the expenditure be for both services and disbursements the voucher shall set forth the services ren- dered and an itemized statement of the disbursements made. When such voucher cannot be obtained the expenditure shall be evidenced by an affidavit of some officer or agent of said company describing the character and object of the expenditure and stating the reason for not obtaining such voucher. [32 G. A., ch. 84.] Sec. 1820-b (C. C. 5548). Misrepresentations prohibited. No life insurance corporation doing business in this state and no officer, director or agent thereof shall issue, circulate, or use, or cause or permit to be issued, circulated, or used, any estimate, illustration, circular or statement of any sort misrepresenting the terms of any policy issued by it or the benefits or advantages promised thereby or the dividends or share of surplus to be received thereon, or shall use any title of any policy or class of policies misrepresenting the true nature thereof. [32 G. A., ch. 85, § 1.] Sec. 1820-c (C. C. 5549). Penalty. Any person violating the provisions of this act, shall be deemed guilty of a misdemennoi' and shall be punished accordingly. [32 G. A., ch. 85, § 2.] Sec. 1820-d (C. C. 5550). Reports — form — convention edition. All reports contemplated under sections seventeen hundred four- teen, seventeen hundred seventy-three, seventeen hundred ninety, seventeen hundred ninety-nine and eighteen hundred thirty of the code, and acts amendatory thereof may be upon forms furnished by the commissioner of insurance, and who may, at his option upon authority of the executive council, purchase such forms 106 EXAMINATIONS Ch. 8-A, T. IX as are approved by the national convention of insurance commis- sioners, known as convention edition. [34 G. A., ch. 18, § 18.] Sec. 1821 (C. C. 5551). Taxes, how paid. In case this or any other state shall impose or levy any tax on any company or association, the same may be paid from any surplus or emer- gency fund of such company or association. CHAPTER 8-A, TITLE IX, CODE. EXAMINATION OF INSURANCE COMPANIES. See. 1821-a (C. C. 5468). Examination authorized — at least biennially. The commissioner of insurance may, at any time he may deem it advisable, make an examination of or inquire into the affairs of any insurance company authorized or seeking to be authorized to transact business within this state, provided that such examination shall not be less frequent lluin once dur- ing each biennial period. [30 G. A., ch. 56, § l.j See lS21b, c. Life 1777. Fraternals 1839b, c. Other than Life 1700- 31-53-55. Sec. 1821-b (C. C. 5469). Companies to assist — administer oaths. When any company is being examined, the officers, employes or agents thereof shall produce for inspection all books, documents, papers or other information concerning the affairs of such company, and shall otherwise assist in such examination so far as they can do. The commissioner of insurance, or his legally authorized representative in charge of the examination, shall have authority to administer oaths and take testimony bearing upon the affairs of anv companj^ under examination. [30 G. A., ch. 56, § 2.] Sec. 1821-c (C. 0. 5470). Examiner — assistants — compensation ■ — expenses — how paid. The commissioner of insurance is hereby authorized to appoint two insurance examiners, one of whom shall be an experienced actuary, the other of whom shall be an experienced and competent fire insurance accountant, who, while conducting examinations, shall possess all the powers conferred upon the commissioner of insurance for such purposes. Said examiners shall give bond to the state conditioned upon the faithful performance of their duties, in the sum of five thousand dollars, which bond shall be filed with and approved by said commissioner. The entire time of the examiners shall be under the control of the said commissioner, and shall be employed as he may direct. The said commissioner may, when in his judgment it is advisable, appoint assistants to aid in making examinations. If in making any examination a situa- tion develops which, in the judgment of the commissioner, requires the services of an expert examiner having special train- Ch. 8-A, T. IX EXAMINATIONS 107 ing and knowledge not possessed by the regular examiners of the department he may also employ sueh an expert assistant examiner, avIio shall receive as full compensation for such serv- ices the sum of not to exceed twenty-five dollars per day. Said examiners and assistants and the said commissioner shall receive actual and necessary traveling, hotel and other expenses while engaged in conducting examinations away from their respective places of residence. Such expenses, together with the compen- sation of the assistants, shall be paid by the treasurer of state, upon warrants drawn b}- the auditor of state, bills for the same having first been approved by the state board of audit. All bills for expenses of any examination, together with the compen- sation of the assistants, shall be charged to and paid by the companies examined, and upon failure or refusal of any company examined to pay such bill or bills, the same may be recovered in an action brought in the name of the state under the direction of the executive council, and the commissioner may also revoke the certificate of authority of such company to transact business within this state. All fees collected under the provisions of this chapter shall be paid to the commissioner of insurance and shall be bv him turned into the state treasurv as are other fees of his office. [39 G. A., ch. 209, § 17 ; 38 G. A., ch. 348, § 14.] Sec. 1821-d (C. C. 5471). Revocation of certificate — publication of results of examination. If upon investigation or examination, it shall appear that any company is insolvent or in an unsound condition, or is doing an illegal or unauthorized business, or that it has refused or neglected for more than thirty days to pay final judgment rendered against it in the courts of this state, the connnissioner of insurance may suspend its authority to transact business within this state until it shall have complied in all re- spects with the laws applicable to such company or has paid such judgment, or he may revoke its certificate of authority to transad business Avithin this state and having revoked the certificate oT any company organized under the laws of this state, he shall at once report the same to the attorney general, who shall apply to the district court or any judge thereof for the appointment of a receiver to close up the affairs of said company ; provided that in the case of companies organized on the stock plan under the provisions of chapter four, title nine of the code, the above named ofiicer shall proceed as provided in sections seventeen hundred thirty-one and seventeen hundred thirty-two of the code; and in case of companies organized under the i^rovisions of chapter six, title nine of tlie code, said officers shall proceed as provided in sections seventeen hundred seventy-seven and seventeen hundred seventy-eight of tlie code, and no receiver shall be apjiointed for any company contemplated by this chapter except upon application of the attorney general, unless five days' lOS EXAMINATIONS Ch. S-A, T. IX notice shall have been served upon the commissioner of insur- ance and attorne}^ general, stating the time and place of the hearing of such application, at which time and place said officers shall have the right to appear and be heard as to such applica- tion and appointment. The results of any examination shall be published in one or more newspapers of the state or in pamphlet form, when in the opinion of the commissioner of insurance the interests of the public require it. [30 G. A., eh. 50, § 4.] See 1796, Fraternals 1832-39(1. Other than Life 1715-24-25-47-55. Sec. 1821-e (0. C. 5472). Transfer of stock pending examina- tion. Any transfer of stock of any company, pending an iinves- tigation, shall not release the party making the transfer from any liabilitv for losses that mav have occurred previous to such transfer. [30 G. A., ch. 56, § 5^.] Sec. 1821-f (C. C. 5473). Soliciting business after revocation of authority — penalty. Any officer, manager, agent or represent- ative of any insurance company contemplated by this act, who, with knowledge that its certificate of authoritj^ has been sus- IDended or revoked, or that it is insolvent, or is doing an unlawful or unauthorized business, solicits insurance for said company, or receives applications therefor, or does any other act or thing toward receiving or procuring any new business for said com- pany, shall be deemed guilty of a misdemeanor and shall be subject to the penalties provided in section eighteen hundred fourteen of the code, and the provisions of said section are hereby extended to all companies contemplated by this act. [30 G. A.,, ch. 56, § 6.] Sec. 1821-g (C. C. 5474). Refusing to be examined — penalty. Should an}^ company decline or refuse to submit to an examina- tion as in this act provided, the commissioner of insurance shall at once rcA^oke its certificate of authority, and if such company is organized under the laws of this state, he shall report his action to the attorney general, who shall at once apply to the district court or a judge thereof for the appointment of a receiver to Avind up the affairs of the company. [30 G. A., ch. 56, § 7.] Sec. 1821-h (C. C. 5475). Nonresident companies. Examina- tion of insurance companies not located within this state shall only be made by 'order of the executive council, and at such time as it may direct. [30 G. A., ch. 56, §8.] Sec. 1821-i (C. C. 5476). ''Company" defined. The word ''company" as used in this act shall mean all companies or associations organized under the provisions of chapters four, five, six, seven or eight of title nine of the code, except county mutuals, and all companies or associations admitted or seeking Ch. 8-A, T. IX EXAMINATIONS 109 to be admitted to this state under the provisions of any of the chapters herein referred to. [30 G. A., ch. 56, § 9.] Sec. 1821-j. Kepeals conflicting acts. [30 0. A., ch. 50, § 10. | CHAPTEU 181, 39TII G. A. (U. 0. 5476-al). AN A('T to prohibit the sale or disposal of shares of corporate stock iu conjunction with policies of insurance. Be It Enacted hy (ho (General Asscmhlij of the Hl). Examination — assistants — compensa- tion. The commissioner of insurance may, at any time he may deem it advisable, either in person or by his legally appointed representative, make an examination of or inquire into the affairs of any fraternal beneficiary association authorized or seeking to be authorized to transact business within this state, provided the examination of associations organized under- the laws of this state shall not be less frequent than once during each biennial period. [39 G. A., ch. 209, ^ 18 ; 38 G. A., ch. 348, ^ 12; 30 G. A., ch. 61, § 2.] Sec. 1839-c (C. C. 5574). Officers to assist — examiner may ad- minister oaths. When an association is being examined, the of- ficers, agents or employes thereof shall produce for inspection all books, papers, documents or other information concerning the affairs of the association and shall otherwise assist in the examin- ation. The commissioner of insurance or examiner shall have authority to administer oaths, and may summon and may examine under oath any officer, employe, representative or agent of any association concerning its aff'airs or condition. [30 G. A., ch. 61, § 3.] Sec. 1839-d (C. C. 5575). Revocation or suspension of author- ity. If upon investigation or examination, it shall appear to the satisfaction of the commissioner of insurance that any association is doing an illegal or unauthorized business, or is failing to fulfill its contracts with its members, or is conducting its business fraud- ulently, or if its membership or the amount of its insurance in force has been reduced below the legal requirement, or should any association decline or refuse to submit to an examination, the commissioner of insurance may suspend or revoke its certifi- cate of aut.horit.y to transact business within this state, and liav- ing revoked the certificate of authority of any association or- ganized under the laws of this state, he shall at once report tlie same to the attorney-general, who shall apply to the district court or any judge thereof for the appointnu^nt of a receiver to wind up the affairs of such association. [30 G. A., cli. 61, § 4.] (See 1832. Other than Life 1724-25-47-55, 1821cl. Sec. 1839-e (C. C. 5576). Expenses — how paid. In addition to Ch. 9, T. IX FRATERNAL SOCIETIES 125 the compensation of the assistants the commissioner of insurance or examiner and assistants shall be entitled to actual and neces- sary traveling', hotel and other expenses while conducting examin- ations away from their respective places of residence, the same to be paid b}' the treasurer of state upon warrants drawn by the auditor of state, bills therefor having been filed under oath and approved by the executive council. Such expense and compensa- tion shall, by the commissioner of insurance, be charged to and collected from the associations examined and should any associa- tion neglect or refuse to pay the same, the commissioner of insur- ance shall at once revoke its certificate of authority to transact business within this state. [39 G. A., ch. 209, § 19 ; 30 G. A., ch. 61, § 5.] Sec. 1839-f (C. C. 5577). Soliciting new business — penalty. Any officer, manager, agent or representative of any association who with knowledge that its certificates [certificate] of authority has been suspended or revoked or that it is doing an illegal, un- authorized or fraudulent business, solicits insurance for said as- sociation or receives applications therefor, or does any other act or thing toward receiving or procuring any new business for said association, shall be deemed guilty of a misdemeanor and for every such act, on conviction thereof, shall pay a fine of not less than one hundred nor more than one thousand dollars, or be im- prisoned in the count}^ jail not more than one year, or be pun- ished by both such fine and imprisonment. [30 G. A., ch. 61, § 6.] Sec. 1839-g (C. C. 5578). Plan of consolidation or re-insurance — approval. When any fraternal beneficiary association shall pro- pose to consolidate or enter into any re-insurance contract with any other association or organization, it shall present its proposed plan of consolidation or re-insurance, together with a statement of the condition of its affairs to the commissioner of insurance for his approval. Should he approve the plan, the same shall be sub- mitted by any association proposing to re-insure its risks or transfer its business, to its local lodges or organizations or to a regular or special meeting of its supreme lodge or governing body to be voted upon, such notice being given as the commis- sioner of insurance may direct. If, in the judgment of the com- missioner of insurance, it is deemed advisable he may also re- quire the plan to be in like manner submitted to the association proposing to accept or re-insure the risks of any other associa- tion. In case two or more associations propose to consolidate, the proposed plan of consolidation shall be submitted, as above provided, to all the associations interested in such consolidation. In any of the above cases, a two-thirds vote of all of the mem- bers of each association present and voting shall be necessary to an approval of any plan of consolidation or re-insurance, and in no case shall proxies be voted. On presenting to the com- 2 126 FRATERNAL SOCIETIES . . / Ch. 9, T. IX missioner of insurance satisfactory proof that the foregoing pro- visions have been complied with and that the required number of votes have been cast in favor of the proposed plan, he shall issue to the associations an order to the effect that the plan has been approved, and the same shall be in force and effect from and after the date of such order, and the commissioner of insur- ance shall direct such distribution of the assets of any such asso- ciation or associations as shall be just and equitable. [30 G. A., ch. 63, § 1.] Sec. 1839-h (C. C. 5579). Expenses, how paid. All expenses or costs incident to proceedings under the provisions of this act shall be paid by the associations interested. [30 G. A., ch. 63, § 2.] Sec. 1839-i (C. C. 5580). Penalty. Any officer, director or man- ager of aiw association violating or consenting to the violation of am^ of the provisions of this act shall be punished by a fine of not less than one thousand dollars, or by imprisonment in the county jail not less than one year, or by both such fine and im- prisonment in the discretion of the court. [30 G. A., ch. 63, § 3.] Sec. 1839-j (C. 0. 5581). Mortuary assessment. No fraternal beneficiary^ society not admitted to transact business within this state prioi'v to the passage of this act, shall be incorporated or given a permit or certificate of authority to transact business within this state, unless it shall first show that the mortuar}^ as- sessment rates provided for in whatever plan of business it has adopted, including the issuance of term, whole life or limited payment certificates with withdrawal options, are not lower than is indicated as necessary by the following mortality table : [NATIONAL, FRATERNAL CONGRESS MORTALITY TABLE.] > 1 >> I > 1 " 1 nS o o >5 2 <=> be 1 1 p O 1 > 1 1 t4-l .c o o 'C/3 3 — 3"" early p ability dyin 0) be Is •gbC c c arly pr ability dying < ;^ ^ ^ < y. ^ (V 34.... 92,772 557 .0060040 74 38,172 2,969 .0777795 35.... 92,215 567 .0061487 75. . . . 35,203 3,009 .0854957 36.... 91,648 578 .0063067 76.... 32,194 3,026 .0939927 37.... 91,070 591 .0064895 77.... 29,168 3,016 .1031010 38.... 90,479 606 .0066977 78.... 26,152 2,977 .1138345 39.... 89,873 622 .0069209 79.... 23,175 2,905 .1253506 40.... 89,251 640 .0071708 80.... 20,270 2,799 .1380858 41.... 88,611 660 .0074483 81.... 17,471 2,659 .1521951 42.... 87,951 683 .0077657 82.... 14,812 2,485 .1677694 43.... 87,268 708 .0081129 83.... 12,327 2.280 .1849599 44.... 86,568 734 .0084797 84.... 10,047 2,050 .2040410 45.... 85,826 761 .0088668 85.... 7,997 1,800 .2250844 46.... 85,065 790 .0092870 86.... 6,197 1,539 .2483460 47.... 84,275 822 .0097538 87.... 4,658 1,277 .2741520 48.... 83,453 857 .0102693 88.... 3,381 1,023 .3025732 49.... 82,596 894 .0108238 89.... 2.358 788 .3341815 50.... 81,702 935 .0114440 90.... 1,570 579 .3687898 51.... 80,767 981 .0121460 91 991 404 .4076690 52.... 79,786 1,029 .0128970 92.... 587 264 .4497445 53.... 78,757 1,083 .0137512 93.... 323 161 .4984520 54.... 77,674 1,140 .0146767 94.... 162 89 .5493827 55.... 76,534 1,202 .0157054 95.... 73 44 .6027397 56.... 75,332 1,270 .0168587 96.... 29 19 .6551724 57.... 74,062 1,342 .0181200 97.... 10 7 .7000000 58.... 72,720' 1,418 .0194994 98.... 3 3 1.0000000 59.... 71,302 1,501 .0210513 Provided, however, that this section shall not be construed so as to apply to or affect any association organized solely for bene- volent purposes and whose articles of incorporation, constitution, rules, or by-laws, provide, that at the time of the admission to membership, each member when joining shall belong to one oc- cupation or guild. The certificate written by any domestic fraternal beneficiary association operating under the provisions of the foregoing mor- tality table shall be valued in the same manner as provided in section seventeen hundred seventy-four of the code, except that such valuation shall be based upon the foregoing mortality table and four per cent interest. [38 G. A., ch. 227; 37 G. A., ch. 193, § 1;34G.A., ch. 18, §19;32G.A., ch. 80.1 See. 1839-k (C. C. 5582). Acquisition of real estate— erection of building — conditions. Any fralemal Ix'iicficiai'y society, order or association organized under the laws of this state, accumulating money to be held in trust for the purpose of the fulfillment of its 128 FRATERNAL SOCIETIES Ch. 9, T. IX certificates or contracts, shall be permitted to invest not to exceed ten per cent, of the aggregate amount of such accumulation in such real estate in this state as is necessary for its accommoda- tion as a home office, and in the purchase or erection of any building for such purpose it may add thereto rooms for rent; provided that before any association shall invest any of its funds in accordance with the provisions of this subdivision it shall first obtain the consent of the executive council. Any company or association so investing its funds shall convey the real estate thus acquired to the commissioner of insurance by deed, such property to be held by him in trust for the benefit of the members of such association, the value thereof to be determined from time to time by the commissioner of insurance. Provided, that nothing in this act shall be construed to permit the officials or board of directors of such society, order or association to make such investment with out authority specifically granted by the said society, order or as- sociation through its grand or supreme lodge or convention. [37 G. A., ch. 379; 32 G. A., ch. 87.] Sec. 1839-1 (C. C. 5583). Investment af funds — securities de- posited. Any fraternal beneficiary society, order or association organized under the laws of this state, accumulating money to be held in trust for the purpose of the fulfillment of its certificates or contracts, shall invest such accumulations in the following se- curities and no other: 1. Bonds of the United States. 2. Bonds of this or any other state, when such bonds are at or above par. 3. Bonds or other evidences of indebtedness of any county, city, town or school district within the state or any other state, or drainage bonds of any drainage district in the state of Iowa where such bonds or other evidences of indebtedness are issued by authority of and according to law and bearing interest, and are approved by the executive council. 4. Bonds, mortgages and other interest bearing securities being first liens upon real estate within this state or any other state, worth at least double the amount loaned thereon and secured thereby exclusive of improvements, or two and one-half times such amount including the improvements thereon, if such improvements are constructed of brick or stone; but no such improvements shall be considered in estimating the value unless the owner shall contract to keep the same insured in some reliable fire insurance company or companies authorized to do business in the state, during the life of the loan, in a sum at least double the excess of the loan above one-half the value of the ground exclusive of the im- provements, the insurance to be made payable in case of loss to the com- pany or association investing its funds, as its interest may appear at the time of loss. All such securities shall be deposited with the commissioner of insurance subject to his approval, and shall remain with him until withdrawn in accordance with the provisions of tliis act. Any fraternal beneficiary society, order or association receiving pay- ments or partial payments on any securities deposited with the Ch. 9, T. IX FRATERNAL SOCIETIES 129 commissioner of insurance, shall notify him of such fact giving the amount and date of payment within fifteen days after such payment shall have been made. The officers of any societ}^, order or association which fails to report the receipt of payments or partial payments as above provided shall be liable to fine in dou- ble the amount collected and not reported within the time and in the manner above specified. Any society, order or association required to make a deposit with the commissioner of insurance as herein contemplated, shall at the time of making such deposit, designate by what provisions of its articles of incorporation or laws such fund is accumulated and upon making request for withdrawal of an}^ funds shall desig- nate for what purpose such withdrawal is desired. Any society, order or association, may at any time change its securities on deposit by depositing a like amount in other securi- ties of the same character and the commissioner of insurance shall permit a withdrawal of the same upon satisfactory proof in writ- ing filed with him that they are to be used for the purpose for which they were originally deposited. The commissioner of insurance shall have authority to suspend or revoke the certificate of authority to any society, order or association failing to comply with any of the provisions of this act or for violating the same. Nothing in this section shall be construed to apply to any as- sociation organized solely for benevolent purposes and whose articles of incorporation, constitution, rules or by-laws provide that, at the time of the admission to membership, each mem- ber, when joining, shall belong to one certain occupation, guild, profession or religious denomination; nor shall the provisions of this chapter be construed to apply to organizations, societies, or associations, the membership of which consists of female mem- bers of the families of members of any one occupation, guild, pro- fession or religious denomination ; nor shall the provisions of this chapter be construed to apply to auxiliary societies or associations the membership of which consists of female members of the fam- ilies of members of any one occupation, guild, profession or re- ligious denomination. '[37 G. A., ch. 193, § 2; 34 G. A., ch. 82, § 1; 32 G. A., chs. 88-89.] Other than Life 1699. Life 1778-91-1806. Sec. 1839-m (C. 0. 5584). Receiver on application of attorney general only. No application for the appointment of a receiver, for any fraternal beneficiary society, or branch thereof, shall be entertained by anv court in this state, unless same is made by the attorney general.' [36 G. A., S. F. 491, § 1.] 130 FRATERNAL. SOCIETIES Ch. 9, T. IX Sec. 1839-11 (C. C. 5585). When proceedings may be commenced. No such proceedings shall be commenced by the attorney general against any fraternal beneficiary society until the commissioner of insurance has first made an examination of such fraternal benefi- ciary society, and completed a report upon its affairs, and not until after notice has been duly served on the chief executive officers of the society, and a reasonable opportunity given to it, on a date to be named in said notice, to show cause why such proceedings should not be commenced. [36 G. A., S. F. 491, § 2.] Sec. 1839-0 (0. 0. 5586). Examinations and statements not public. Pending, during or after an examination or investigation of such fraternal beneficiary society, the commissioner of insur- ance shall make public no financial statement, report or finding, nor shall he permit to become public any financial statement, re- port or finding affecting the status, standing or rights of any such society until a cop}^ of such examination and investigation shall have been served upon such society, at its home office, nor until such society shall have been afforded a reasonable opportunity to answer such financial statement, i-nvestigation, report or finding, and to make such showing in connection therewith, as it may de- sire. [36 G. A., S. F. 491, § 3.] CHAPTER 302, 38th G. A. PROVIDING FOR TRANSFORMATION TO LEGAL RESERVE LEVEL PREMIUM COMPANIES. AN ACT relating to fraternal beneficiary societies, and providing a method whereby such fraternal beneficiary societies may be reincorpo- rated as a legal reserve level premium life insurance company. Be It Enacted hy the General AssemUij of the State of Iowa: Section 1 (C. C. 5587). Any existing fraternal beneficiary so- ciety may amend its articles of incorporation and by-laws in such a manner as to transform itself into a legal reserve level premium company doing business either as a mutual or stock company, but only after complying with the following provisions : AVhenever any such society shall propose to transform itself into a legal reserve level premium company as herein provided, it shall file with the commissioner of insurance, its proposed articles and by-laws, its plan of transformation, setting forth in detail the terms and conditions of such transformation and also the method by which it proposes to protect the interests of its membership. The commissioner may proceed to hear and determine such peti- tion without notice, or, if he deems it necessary that such notice should be given in order to conserve the interests of the member- ship, he shall require the society to first notify, by mail, all of the members of such society of the pendency of such petition, the Ch. 9, T. IX FRATERNAL SOCIETIES 131 contents of such notice to be determined by the commissioner. When notice shall have been given, as above provided, any mem- ber of said society shall have the right to appear before said com- missioner and be heard with reference to said petition. The commissioner may also make such examination into the affairs and conditions of the society as he deems proper, and shall have power to summon and compel the attendance and testimony of witnesses, and the production of books and papers, and may ad- minister oaths. If satisfied that the interests of the membership of said society are properly protected and that no reasonable objection to said petition exists, the commissioner may authorize in writing, such transformation, or may first require such modi- fication thereof as may seem to him necessary for the best inter- ests of such membership; and the said commissioner shall make such order and disposition of the assets of any such society as in his judgment may be just and equitable. Sec. 2 (C. C. 5588-5589). The commissioner shall require the plan of transformation to be submitted to the supreme governing bod}^ of such society, to be voted upon. AVhen submitted, it shall be either at a regular meeting of said supreme governing body or at a special meeting of same called for that purpose. A notice of said special meeting, in the form approved by the insurance commissioner, shall be given in accordance with the requirement of the by-laws of such society. When so submitted, a majority vote of the said supreme governing body present and voting, as authorized by its articles of incorporation and by-laws, shall be necessary to an approval of such plan of transformation; and no proxies shall in any case be voted. If the supreme governing body approves the plan of trans- formation, the board of directors or other managing body of such society shall submit the plan to a referendum vote of the mem- bers of such society under such regulations as may be prescribed by the commissioner of insurance and if the result of such vote shall show that the majority of the members of such society has voted to repeal the action of the supreme governing body, then the same shall be considered as repealed by such society and shall be null and of no effect. Any such plan of transformation submitted to the supreme governing body as herein contemplated, must first have been approved by the commissioner of insurance ; and the result of said vote must be filed with such commissioner and be by him determined before any transformation shall be so effective. No such transformation shall take place until after its plan has been approved by the commissioner, either with or without a hearing as herein provided, nor until such approved plan has been adopted by a majority vote of the board of direc- tors or board of trustees of such society ; nor, if submitted to the suprehie governing body, until such approved plan lias also been 132 FRATERNAL SOCIETIES Cli. 9, T. IX adopted by a majority vote of the said supreme governing body present and voting. Sec. 3 (0. C. 5590). Any such society so transformed, shall in- cur the obligations and enjoy the benefits thereof the same as though originally thus incorporated, and such corporation, under its charter as thus amended, shall be continuation of such original corporation, and the officers thereof shall serve through their respective terms as provided in the original charter, but their successors shall be elected and serve as in such amended articles provided ; but such amendment or re-incorporation shall not affect existing suits, claims or contracts. Any such fraternal benefi- ciary society taking advantage of this section, to reorganize into a stock company shall offer to each member of said society the privilege of subscribing for and purchasing his or her proportion- ate amount of capital stock. Sec. 4 (C. C. 5591). The existing certificates of membership of any fraternal beneficiary society which shall have transformed itself into a legal reserve level premium life insurance company, in conformity with the provisions of this section shall be valued as follows: (a) Certificates on which rates of contribution are not on the basis of any table of mortality, valued as j^ear renewable term policies according to the standard of valuation of life insurance policies prescribed by the laws of this state. (b) Certificates on which the rates of contribution are based upon a standard table of mortality and specified rate of interest, valued in accordance with such standard. The reserve so ascertained shall be held as a liability by the company in its annual statement rendered to the insurance de- partment. Miscellaneous Sections FIRST SECTION (C. 0. 5497). From and after the taking effect of this act, no insurance company or association organized under the statutes of Iowa to transact an insurance business, shall invest its capital, surplus funds or other assets in, or loan the same on, property owned by any officer or director of such company or by any of the immediate members of the family of any such officer or director; neither shall any such officer or director gain through the investment of funds of any such company. [38 G. A., Ch. 348, § 13.] SECOND SECTION 37 G. A.. Ch. 180. RECIPRlOCAL OR INTER-INSURANCE CONTRACTS AUTHORIZED. AN ACT authorizing and regulating the exchange of reciprocal or in- ter-insurance contracts among individuals, partnerships and cor- porations; empowering corporations to enter into such contracts; regulating process in suits on such contracts; providing for fees, taxes and licenses; and providing penalities. Section 1 (0. C. 5708). Reciprocal contracts authorized. In- dividual, partnerships and corporations, including independent school districts and municipal corporations, of this state, hereby designated subscribers, are hereby authorized to exchange re- ciprocal or inter-insurance contracts with each other, and with individuals, partnerships and corporations of other states, terri- tories, districts and countries, providing insurance among them- selves from any loss which may be insured against under the law, except life insurance. Sec. 2 (C. C. 5709). Execution of contract — place of business of attorney. Such contracts may be executed by an attorney agent or other representative herein designated attorney, duly authorized and acting for such subscribers under powers of at- torney, and such attorney mav be a corporation. The principal office of such attorney shall be maintained at such place as is designated by the subscribers in the power of attorney ; provided that, where the principal office of such attorney is located in an- other state, the commissioner of insurance shall not issue a cer- tificate of authority, or license, as provided in this act unless such attorney shall hold a license or certificate of authority from the insurance department of such other state. Sec. 3 (C. C. 5710). Preliminary showing. Such subscribers so contracting among themselves, shall, through their attorney, file with the commissioner of insurance a declaration verified by the oath of such attorney, or, where such attorney is a corporation, by the oath of the duly authorized officers thereof, setting forth: 134 MISCELLANEOUS SECTIONS (a) The name of the attorney and the name or designation under which such contracts are issued, which name or designa- tion shall not be so similar to any name or designation adopted by any attorney or by any insurance organization in the United States prior to the adoption of such name or designation by the attorney, as to confuse or deceive, (b) The location of the principal office. (c) The kind or kinds of insurance to be effected. (d) A copy of each form of policy, contract or agreement under or by which insurance is to be effected. (e) A copy of the form of power of attorney under which such insurance is to be effected. (f) That applications have been made for indemnity or in- surance upon at least one hundred separate risks aggregating: not less than one and one-half million dollars represented by executed contracts or bona fide applications to become concur- rentlv effective; or, in case of employers' liability or work- men's compensation insurance, coverina: a total payroll of not less than two and one-half million dollars. (g") That there is in the possession of such attorney anrl available for the pavment of losses, assets amounting to not less than fiftv thousand dollars, and, in case of employers' lia- bility or workmen's compensation insurance, that such assets shall amount to not less than one hundred thousand dollars. (h) A financial statement under oath in form prescribed for the annual statement. (i) The instrument authorizing service of process as provided for in this act. (j) Certificate showing deposits of funds. Sec. 4 (C. C. 5711). Actions — venue — service of process — judsr- ment. Con currently with the filinsf of the declaration provided for by the terms of section 3 of this act, the attorney shall file with the commissioner of insurance an instrument in writing; executed bv him for said subscribers, conditioned that, upon the issuance of certificate of authority provided for in this act, action may be brought in the county in which the property or person insured thereunder is located, and that service of process may be had upon the commissioner of insurance in all suits in this state arising out of such policies, contracts or agreements, which service shall be valid and binding upon all subscribers exchang- ing at any time reciprocal or inter-insurance contracts through such attorney. Three copies of such process shall be served and MISCELLANEOUS SECTIONS i:"'.5 the commissioner of insurance shall file one copy, forward one copy to said attorney, and return one copy with his admission of service. A judgment rendered in any such case where service of process has been so had upon the commissioner of insurance, shall be valid and binding against any and all such subscribers as their interests appear and such judgment may be satisfied out of the funds in the possession of the attorney belonging to such subscribers. Sec. 5 (C. C. 5712). Reports — limitations on risks. There shall be filed with the commissioner of insurance by such attorney whenever the commissioner of insurance shall so require, a state- ment under oath of such attorney showing the maximum amount of indemnity upon a single risk, and, except as to workmen's com- l")ensation insurance, no subscriber shall assume on any single risk an amount greater than ten per cent of the net worth of such subscriber. Sec. 6 (C. C. 5713). Standard of solvency. There shall at all times be maintained as assets a sum in cash, or in securities of the kind designated by the laws of the state where the principal office is located for the investment of funds of insurance com- panies, equal to one hundred per cent of the net unearned premiums or deposits collected and credited to the accounts of subscribers or assets equal to fifty per cent of the net annual deposits collected and credited to the accounts of subscribers on policies having one year or less to run and pro rata on those for longer periods; in addition to which there shall be maintained in cash, or in securities, assets sufficient to discharge all liabilities on all outstanding losses arising under policies issued, the same to be calculated in accordance with the laws of the state relating to similar reserves for companies insuring similar risks. Provided that, where the assets on hand available for the payment of losses other than determined losses, shall not equal two hundred thousand dollars, all liability for each deter- mined loss or claim deferred for more than one year, shall be provided for by a special deposit in a trust company of the state in which the principal office is located, to be used in pay- ment of compensation benefits for disability ; such deposit to be a trust fund and applicable only to the purposes stated, or such liability may be reinsured in authorized companies with a surplus of at least two hundred thousand dollars. For the purpose of said reserves, net deposits shall be construed to mean the advance paj^ments of subscribers after deducting therefrom the amount specifically provided in the subscriber's agreement for expenses. If at any time the assets so held in cash or such securities shall be less than required above, or less than one hundred thousand dollars as to employers' liability or workmen's compensation insurance, or less than fifty thousand dollars as to other classes 136 MIJ^CELLANEOUS SECTIONS of insurance, the subscribers or their attorney for them shall make up the deficiency Avithin thirty claj^s after notice from the commissioner of insurance so to do. In computing the assets required by this section, the amount specified in subdivision (g), section 3, shall be included. See. 7 (0. 0. 5714). Annual financial report — examination by commissioner. Such attorney shall, within the time limited for filing the annual statement by insurance companies transacting the same kind of business, make a report, under oath, to the commissioner of insurance for each calendar year, showing the financial condition of affairs at the office where such contracts are issued and shall, at any and all times, furnish such additional information and reports as may be required. Provided, however, • that the attorney shall not be required to furnish the name and addresses of any subscribers except in case of an unpaid final judgment. The business affairs, records and assets of any such organization shall be subject to examination by the commissioner of insurance at any reasonable time, and such examination shall be at the expense of the organization examined. Sec. 8 (C. C. 5715). Powers, extension of. Any corporation now or hereafter organized under the laws of this state shall, in addition to the rights, powers and franchises specified in its articles of incorporation, have full power and authority to exchange insurance contracts of the kind and character herein mentioned. The right to exchange such contracts is hereby declared to be incidental to the purposes for which such corpo- rations are organized and as fully granted as the rights and powers expressly conferred. Sec. 9 (C. C. 5716). Certificate of authority. Upon compli- ance with the requirements of this act, the commissioner of insurance shall issue a certificate of authority or a license to the attorney, authorizing him to make such contracts of insurance, which license shall specify the kind or kinds of insurance and shall contain the name of the attorney, the location of the prin- cipal office and the name or designation under which such contracts of insurance are issued. Such license shall be renewed annually upon a showing that the standard of solvency required * herein has been maintained and that all fees and taxes required have been paid. Sec. 10 (C. C. 5717). Violations — penalty. Any attorney who shall exchange any contracts of insurance of the kind and character specified in this act, or any attorney or representative of such attorney, who shall solicit or negotiate any applications for the same without the attorney having first complied witli the foregoing provisions, shall be deemed guilty of a misdemeanor and, upon conviction, shall be subject to a fine of not less than MISCELLANEOUS SECTIONS 137 one liundred dollars nor more than five hundred dollars. For the purpose of organization and upon issuance of permit by the commissioner of insurance, powers of attorney and applications for such contracts may be solicited without compliance with the provisions of this act, but no attorne}^, agent or other person shall make any such contracts of indemnity until all of the provisions of this act shall have been complied with. Sec. 11 (0. C. 5718). Refusal or revocation of certificate. In addition to the foregoing penalties and where not otherwise provided, the penaltj^ for failure or refusal to comply with any of the terms and provisions of this act, upon the part of the attornej^, shall be the refusal, suspension or revocation of certifi- cate of authority or license by the commissioner oE insurance and the public announcement of his act, after due notice and oppor- tunity for hearing has been given such attorney so that he may appear and show cause why such action should not be taken. Sec. 12 (C. C. 5719). Attorney to give bond — amount. Where the principal office of the attorney in fact is located In this state, he shall give bond to the subscribers in such sum as the advisory committee of the exchange shall deem sufficient, not less, hoAV- ever, than in the sum of ten thousand dollars, which bond, after being approved by the advisory committee and by the commis- sioner of insurance, shall be deposited with the commissioner of insurance as security for the faithful performance of the duties of the attorney handling the funds of the subscribers. Should the commissioner of insurance consider the surety on said bond, or the amount thereof, insufficient, he may require additional security or an increase in the amount of the bond. If such additional security or increase be not furnished within thirtj^ days after notice to furnish the same, the commissioner of insurance may revoke the certificate of authority. Where the principal office of the attorney is located in another state, there shall be filed with the commissioner of insurance, in con- nection with the declaration, provided for by section 3 hereof, certified copies of all such bonds given by such attorney as securitj^ for the funds of subscribers. Sec. 13 (C. C. 5720). Fees and taxes. In lieu of all other taxes, licenses, charges and fees whatsoever, such attorney shall pay annually on account of the transaction of such business in this state, the same fees as are paid by mutual companies trans- acting the same kind of business, and an annual tax of two and one-half per cent upon the gross premiums or deposits collected from subscribers in this state during the preceding calendar year, after deducting therefrom returns, or cancellations, 'considera- tions for reinsurances, and all amounts returned to subscribers or credited to their accounts as savings. 13S ' MISCELLANEOUS SECTIONS Sec. 14 (C. C. 5721). Form of contract. The attorney may insert in any form of policy prescribed by the laws of this state any provisions or conditions required by the plan of reciprocal or inter-insurance, provided the same shall not be inconsistent with or in conflict with any law of this state. Such policy, in lieu of conforming to the language and form prescribed by such la\v, shall be held to conform thereto in substance if such policy includes a provision or endorsement reciting that the polic.y shall be construed as if in the language and form prescribed by such law. An3^ such policy or endorsement shall first be filed with and approved by the commissioner of insurance. Sec. 15 (C. C. 5722). Reinsurance. Such attorney shall not effect am' reinsurance on risks in this state unless the insurance carrier granting such reinsurance shall be licensed in this state. Sec. 16 (C. C. 5723). Laws applicable. Except as herein provided, the making of contracts as herein provided for and such other matters as are properly incident thereto, shall not be subject to the laws of this state relating to insurance unless they are* therein specifically mentioned. Sec. 360 (C. C. 8433). When guaranty company may be accepted as surety — premium — not applicable to criminal cases. Whenever an}^ person who now or hereafter may be required or permitted to give a bond applies for the c^.pproval thereof, any officer or body who is now or shall hereafter be required to approve the sufficiency of such bond shall accept and approve the same, whenever its conditions are guaranteed by a company or corporation duW organized or incorporated under the laws of this state, or authorized to do business therein, and to guarantee the fidelity of persons holding positions of public or private trust, or secure any bond above referred to, and which company shall have the certificate of the commissioner of insurance author- izing it to do business therein, as provided in chapter four of title nine of this code, and the premium for am^ such guaranty or surety company bond as defined in this section, may, by the approval of the court, be paid out of the trust funds in the hands of the party of whom the bond is required. The certificate of the commissioner of insurance, to the effect that such company has complied with the requirements of said chapter and title and is authorized to do business in this state, shall be sufficient evidence to authorize the officer or body having the approval of such bond to accept and approve the same, but no such security shall be accepted on any bond for an amount in excess of ten per cent of the paid up cash capital of such company or corpo- ration unless the excess shall be reinsured in some other company or corporation authorized to do business in the state and in no case to exceed ten per cent of the capital of the reinsuring com- pany and provided that a certificate of such reinsurance shall be MISCELLANEOUS SECTIONS lo9 furnished to the insured, but nothing herein contained shall apply to bonds in criminal cases. [36 G. A., H. F. 219, ^ 1 ; 34 G. A., ch. 18, § 1; 33 G. A., ch. 25, § 1 ; 21 G. A., ch. 157, §§ 1, 5.] Sec. 361 (C. C. 8434). Release from liability — same as private persons. Such company or corporation may be released from its liability as such surety on any bond on the same terms and conditions, and in the same manner, as is by law prescribed for the release of natural persons as such sureties, it being the intent of this chapter to enable companies created, incorporated or chartered for such purposes to become surety on bonds required by law, subject to all the rights and liabilities of natural persons. [21 G. A., ch. 157, § 2.] [21 G. A., ch. 157, § 3.] Sec. 362 (C. C. 8436). Suit on bond of guarantee company — notice. AVhenever suit is required to be 'brought on any bond given by such company, service shall be had upon any agent of such company in this state, and if there is no agent in the state, then service may be had by serving the commissioner of insurance fifteen days before the term of court in which the suit is sought to be brought, and it shall be the duty of the commis- sioner of insurance, upon service being made upon him, to imme- diately mail a copy of such notice to such company at their principal place of business, and any notice so served shall be deemed to be good and sufficient service on any such company. [21 G. A., ch. 157, § 3.] Sec. 422 par. 6 (C. 0. 3130). Powers specified. The board of supervisors at any regular meeting shall have the following powers, to-wit: 6. To cause the county buildings to be insured in the name of the county, or otherwise for its benefit. [R,, § 303.] Sec. 425 (C. 0. 3132). Expenditure of insurance money. In any county in this state where any of the public buildings thereof have been or may hereafter be destroyed by fire, wind or light- ning, the board of supervisors of such county, for the purpose of reconstructing the same, may appropriate and use, in addition to the amount now authorized by law, the amount received by way of insurance on such building or buildings so destroyed. [19 G. A., ch. 54.] The following class of property is not to be taxed : Sec. 1304, par. 8 (0. C. 4482). Exemption. The accumulations and funds held or possessed by fraternal beneficiary associations for the purpose of paying the benefits contemplated by section cigh-teen hundred and twenty-two (1822) of the code, or for 140 MISCELLANEOUS SECTIONS payment of the expenses of such association. [31 G. A., ch. 48.] Sec. 2071 (C. 0. 5090). Liability for negligence or wrongs of employes. (This section relates to the liability' of railway corpo- rations to employes in consequence of neglect or mismanagement or their agents, engineers or other employes.) * * * Nor shall an}^ contract of insurance, relief, benefit, or indemnity in case of injury or death, entered into prior to the injury, betAveen the person so injured and such corporation, or any other person or association acting for such corporation, nor shall the acceptance of any such insurance, relief, benefit, or indemnity b}^ the person injured, his widoAV, heirs or legal repre- sentatives after the injury, from such corporation, person, or association, constitute any bar or defense to any cause of action brought under the provisions of this section, but nothing con- tained herein shall be construed to prevent or invalidate any settlement for damages between the parties subsequent to injuries received. [27 O. A., ch. 49, § 1.] The so-called Temple amendment (added to this section by 27 G. A., ch. 49), prohibiting any defense on account of a contract between a rail- road company and its employes in the nature of a contract for insurance or relief in case of accident, made prior to the injury, is constitutional. Such a contract constitutes a limitation such as is prohibited by the statute. McGuire v. C, B. d Q. R. Co., 131-340. An agreement entered into at the time of the employment between the company and an employe that if he sustains any personal injury for which he makes a claim against the company for damages he will give notice thereof in writing within thirty days is a limitation on the com- pany's liability, and therefore invalid. Mumford v. C, R. I. d P. Ry. Co., 128-685. Participation in the benefit of a relief fund will not, under the pro- visions of this section, defeat recovery of damage for personal injury re- ceived by plaintiff in defendant's employment, the injuries complained of having been received in this state, although the contract of employ- ment was made in another state where such limitation of liability was not invalid. Hamilton v. C. B. d Q. Ry. Co., 145-431. The provision of this section as amended, relating to the acceptance of benefits from a relief fund, is not unconstitutional. On appeal affirm- ing McChiire v. C, B. d Q. Ry. Co., 131-340, 219 U. S. 549, 31 Sup. Ct. R. 259. Sec. 2783 (C. C. 2568). Use of contingent fund. (School boards). It may provide and pay out of the contingent fund to insure school property such sum as may be necessary. Sec. 3313 (C. C. 6664). Life insurance — damages for death — widow deemed heir. The avails of any life or accident insurance, or other sum of money made payable by any mutual aid or benev- olent society upon the death or disability of a member thereof, are not subject to the debts of the deceased, except by special contract or arrangement, and shall be disposed of like other property left by the deceased. When a wrongful act produces death, damages recovered therefor shall be disposed of as per- sonal property belonging to the estate of the deceased, but if MISCELLANEOUS SECTIONS 141 the deceased leaves a husband, wife, child or parent, it shall not be liable for the payment of debts. The word ''heirs" or "legal heirs" or other equivalent words used to designate the beneficia- ries in any life insurance policy or certificate of membership in any mutual aid or benevolent association, where no contrary intention is expressed in such instrument, shall be construed to include the surviving husband or wife of the insured, and the share of such survivor in the proceeds of such policy or certificate made payable as aforesaid shall be the same as that provided by law for the distribution of the personal property of intestates. [18 G. A., ch. 5; C. 73, §§ 1182, 2372, 2526; R., §§ 2362, 4111; C. '51, § 1330.] Sec. 3386 (C. C. 7917). Heir of beneficiary causing death or disability. No person who feloniously takes or causes or procures another so to take the life of another shall inherit from such person, or receive any interest in the estate of the decedent as surviving spouse, or take by devise or legacy from him, any portion of his estate; and no beneficiary of any policy of insur- ance or certificate of membership issued by any benevolent association or organization, payable upon the death or disability of any person, who in like manner takes or causes or procures to be taken the life upon which such policy or certificate is issued, or who causes or procures a disability of such person, shall take the proceeds of such policy or certificate; but in every instance mentioned in this section, all benefits that would accrue to any such person upon the death or disability of the person whose life is thus taken or who is thus disabled shall become subject to distribution among the other heirs of such deceased person, according to the foregoing rules of descent and distribution in case of death, and in case of disability the benefits thereunder shall be paid to the disabled person. [29 G. A., ch. 135, § 1.] In absence of contract exemption proceeds of policy payable to insured's estate where no beneficiary named in policy though insured came to death through assassination. Public policy does not condemn promise to pay estate of insured who has died of injuries inflicted by the named bene- ficiary. Schmidt v. Northern Life Assn., 112 Iowa 41. Sec. 3499 (C. C. 7149). Against insurance companies. Insur- ance companies may be sued in any county in wliich their prin- cipal place of business is kept, or in which the contract of insurance was made, or in which the loss insured against occurred, or, jri case of insurance against death or disability, in the county of the domicile of the insured at the time the loss occurred, or in the county of plaintiff's residence. [21 G. A., eh. 65, § 13; C. '73, § 2584.] Under this section an action may be brought before a justice of the peace against an insurance company in another county than that of its residence, notwithstanding the provisions of § 4476, with reference to the 10 142 • MISCELLANEOUS SECTIONS place of bringing action in justices courts. Hunt v. Farmers' Ins. Co., 67-742. Suit may be brought in the county where the loss occurs. State Ins. Co. V. Granger, 62-272. A provision in a certificate of mutual benefit insurance by which it is stipulated that action shall not be brought thereon except in a certain county named is not valid. Matt v. Iowa Mut. Aid Assn., 81-135. An action may be brought against an insurance company in any county in which the loss occurred, although it ha-s no agent on whom service can be made, provided jurisdiction in rem is acquired by publication. Lesure Lumber Co., v. Mutual F. Ins. Co., 101-514. An action against an insurance company may be brought in the county in which the loss occurred, even though the principal place of business of a company is in another county of the state. Parcler v. National Masonie Ace. Assn., 95-149. Mutual benefit associations are to be deemed insurance companies with- in the provisions of this section. IMd. Sec. 3530 (C. C. 7175). On agent of insurance company. If the action is against an insurance company, for loss or damage upon any contract of insurance or indemnity, service may be had upon any general agent of the company whenever found, or upon any recording agent or agent jvho has authority to issue policies. This provides a method of service upon an agent in any case, no matter whether the action arose out of or was connected with any business involving his agency or not. Bradshaw v. J)es Moines Ins. Co., 154-101. Sec. 4784 (C. C. 8631). Burning to injure insurers. If any person wilfully burn any building, goods, wares, merchandise or other chattels which are insured against loss or damage by fire, or wilfully cause or procure the same to be burned, with intent to injure the insurer, whether such person be the owner thereof or not, he shall be imprisoned in the penitentiary not exceeding ten years. [C. '73, 3888; R., 4230; C. '51, § 2606.] See. 5054 (C. C. 8726). Fraudulent destruction of boats, etc. If any person cast away, sink or otherwise destroy any raft, boat or vessel, within any county, with intent to defraud any owner or insurer thereof, or the owner or insurer of anj^ property laden on board the same, or any part thereof, he shall be imprisoned in the penitentiary not exceeding five years, or fined not exceed- ing two thousand dollars and imprisoned in the county jail not exceeding one year. [C. '73, § 4082; R., § 4403; C. '51, § 2753.] Sec. 5055 (C. C. 8684). Fitting out for that purpose. If any person lade, equip or fit out, or assist in lading, equipping or fitting out, any raft, boat or vessel, with intent that the same be cast away, burnt, sunk or otherwise destroyed, to injure or defraud any owner or insurer thereof, or of any property laden on board the same, he shall be fined not exceeding one thousand dollars and imprisoned in the countv jail not exceeding one year. [C. '73, § 4083; R., § 4404; C. '51, §2754.] MISCELANEOUS SECTIONS (TAXES) 143 Sec. 5056 (C. C. 8687). Making false bills of lading. If any owner of an}- boat or vessel, or of any property laden or pretened to be laden on board the same, or if any other person concerned in the lading or fitting out of such boat or vessel, make out and exhibit, or cause to be made out and exhibited, any false estimates of any goods or property laden or pretended to be laden on board such boat or vessel Avith intent to injure or defraud any insurer of such boat or vessel or property, or of any part thereof, he shall be fined not exceeding one thousand dollars, or imprisoned in the penitentiarv not more than three years. [C. '73, § 4084; R., § 4405; C. '51,'^§ 2755.] • Sec. 5057 (C. C. 8688). Making false affidavits or protests. If any master or other officer of any boat or vessel make, or cause to be made, any false affidavit or manifest, or if any owner or other person concerned in such boat or vessel, or in the goods or property laden on board the same, procure any such false affidavit or manifest to be made, or exhibit the same, with intent to injure, deceive or defraud any insurer of such boat or vessel, or of the goods or propert}' laden on board of the same, he shall be imprisoned in the penitentiar}^ not exceeding five years, or be fined not exceeding three thousand dollars and imprisoned in the county jail not exceeding one vear. [C. '73, § 4085; R., § 4406; C. '51, § 2756.] Sec. 1333 (C. C. 4517). Taxation of foreign companies. Every insurance company or association organized or incorporated under the laws of any other state or nation other than the United States, and every other insurance company whose charter may be owned or a majority of whose stock ma}^ be controlled or whose business shall be carried on in the interest or for the benefit of any insurance company or association incorporated under the laws of any state or nation other than the United States, shall at the time of making the annual statements as required by law, pay into the state treasm\y as taxes two and one-half per cent of the gross amount of premiums received by it in cash, promissor}^ obligation or other form of settlement for l)usiness done in the state, including all insurance upon property situated in this state and upon the lives of persons resident in this state, during the preceding year. Every insurance company incorporated under the laws of any state of the United States other than the state of Iowa, not including associations operating under the provisions of chapter seven, title nine of this code, or fraternal beneficiary associa- tions doing business in the United states, shall at the 1"ime of making the annual statement as required by law, pay into the state treasury as taxes two and one-half per cent of the gross amount of premiums received by it for business done in this 144 MISCELLANEOUS SECTIONS (TAXES) state, including" all insurance upon property situated in this state and upon the lives of persons resident in this state during the i^receding year. At the time of paying said taxes said companies and associa- tions shall take duplicate receipts therefor, one of which shall be filed with the commissioner of insurance, and upon filing of said receipt, and not till then, the commissioner shall issue the annual certificate as provided by law. No deduction or exemption from the taxes herein provided shall be allowed for, or on account of any indebtedness owing b}" an}^ such insurance company or association. Provided, how- ever, that companies doing a fire insurance business may deduct from the gross amount of premiums received, the amount of premiums returned upon cancelled policies issued upon property situated in this state. [32 G. A., ch. 56; 29 G. A., ch. 57, § 1; 28 G. A., ch. 43, § 1; C. 73, § 807; R., § 718; G. '51, § 464.] This section which requires insurance companies to pay a tax on gross earnings within the state and exempts them from payment of all other taxes, state or local, except taxes on real property and special assessments is unconstitutional under constitution, art. 8, § 2, which subjects property of all corporations for pecuniary profit to taxation the same as that of individuals. Haivkeye Ins. Co. v. F^^encTi, 109-585. The tax here provided for is not unconstitutional on account of lack of uniformity. There is no requirement that taxes on business or on privileges shall be uniform. Scottish U. & N. Ins. Co. v. Herriott, 109-606. Gross insurance premium tax does not apply to premium returned after cancellation of policy. Tax not collectible on reinsurance premiums re- ceived from other companies without the state. In re Continental Casualty Co. Appeal of Great American Insurance Compayiy, et al. 179 N. W., 185. The officers of the state are not authorized to collect this tax by suit or distraint of property. The only effect of the non-payment is that the auditor [commissioner of insurance] will not issue a certificate author- izing the delinquent company to do business in the state during the ensuing year. Manchester Ins. Co. v. Herriott, 91 Fed., 711. This section is not unconstitutional on account of lack of uniformity. IMcl. Sec. 1333-b (C. C. 4519). Provides that every domestic insur- ance corporation, not including stock, county mutuals and frater- nal associations, shall on or before January 26th of each year furnish to the assessor of the district in which its principal place of business is located a statement verified by its president show- ing for the past calendar year: 1. A duplicate statement required by law to be made to the commisf^oner of insurance. 2. A detailed statement of its property and assets of every kind and the value of each item thereof, including guaranty and reserve fund. MISCELANEOUS SECTIONS (TAXES) 145 It shall be the duty of the assessor upon receipt thereof to assess against the coi*poration the value of all personal property owned by such corporation, at the same rate and purpose as tlie property of private individuals as provided in Sec. 1305, code. Sec. 1333-c (C. C. 4520). [In assessing for taxation the moneys and credits of such domestic insurance corporations, the assessor shall ascertain the debts or liabilities, if any, of the corporation to its shareholders or other persons which liabilities shall be deducted as in section 1311 code. In ascertaining such corporate indebtedness, a debt shall be deemed to exist on account of its liabilities on the policy certificates or contracts of insurance issued b}^ it equal to the amount of surplus or other funds accumulated by such corporation, for the purpose of fulfilling its policy contracts of insurance and which can be used for no other purpose.] [37 G. A., ch. 258, § 1.] The purpose of the legislature as indicated by statutory provisions with reference to the taxation of insurance companies is to make the moneys and credits of such companies taxable, subject only to certain definite exceptions and these exceptions are limited to funds which may be accumulated pursuant to law or the contract of insurance or the articles of incorporation of the company for the purpose of fulfilling its policies, certificates or other contracts of insurance. Therefore held that an unassigned or surplus fund was not within the exception. Chicago Life Ins. Co. v. Board of Review, 131-254. Sec. 1333-d (C. C. 4521). State tax— date payable. Every insurance corj)oration or association of whatever kind or char- acter organized under the laws of the state of loAva, not including county mutuals or fraternal beneficiary associations, which count}' mutuals and fraternal beneficiary associations are not organized for pecuniary profit, shall, on or before the first day of March of each year, pay to the treasurer of state a sum equivalent to one per centum of the gross receipts from premiums, assessments, fees and promissory obligations required by insur- ance contracts which are received during the next year preceding the first day of January' last past, after deducting the amounts actually paid for losses, matured endowments, dividends to policyholders and the increase in the amount of the reserve as certified by the department actuary in his official statement to the commissioner of insurance on the 31st day of December previous, based on the actuaries' table of mortality and four per cent, and the amounts returned to members upon cancelled policies, certificates and rejected applications during said year, and not until such payment shall the commissioner of insurance issue the annual certificate as provided by law. Provided, that insurance companies organized under the provisions of chapter four (4) of title nine (9) of the code shall onh- be required to paj^ to the treasurer of state a sum equivalent to one per centum upon the gross receipts from premium, assessments, fees and 146 MISCELLANEOUS SECTIONS (TAXES) promissory obligations for business done Avithin this state, or on claims arising within the state, including all insurance upon property situated or on business done in the state, after deducting the amount actually paid for losses on property located within the state and the amount returned ux)on cancelled policies and rejected applications covering propertj^ situated within this state. [38 G. A., ch. 371, § 1; 32 G. A., eh. 57; 28 G. A., ch. 43, § 5.] APPENDIX Appendix 1. Iowa Short Rate Tables. 2. Forms for Articles of Incorporation, Amendments, etc. 3. The Law Relative to Corporations for Pecuniary Profit. 4. The Law Relative to Employers' Liability and Workmen's Compensation. IOWA SHORT RATE TABLE Periods exceeding 20 days, and not exceeding 25 days, to be the rate of 25 days, and so on up to one year. If policy was written for one year and has been in force any number of days indicated in left hand column, the company may retain from the annual premium the percentage indicated by the figures set opposite in the right hand column. 55 days 29 1 day. . . 2 55 2 days. . 4 60 3 <( . 5 65 4 (( . 6 70 5 " . 7 75 6 <( . 8 80 7 (< . 9 85 8 <( . 9 90 9 ♦' .10 105 10 " .10 120' 11 <( .11 135 12 " .12 150 13 <( .13 165 14 it .13 180 15 " .14 195 16 (( .14 210 17 20 " 22 months 2'0 22 90 95 100 If policy was written for three years and has run for 3 months or less, 25% of term premium. Over 3 and not exceeding 6 months 6 " "9 9 " " 12 12 " " 15 15 " " 18 18 " " 21 21 " " 24 24 " " 27 27 " " 30 30 " " 33 30 40 50 60 70 75 80 85 90 95 33 months 100 If policy was written for four years and has run for 4 months or less, 25% of term premium. Over 4 and not exceeding 8 months 30 40 50 60 70 75 80 85 90 95 44 months 100 If policy was written for five years and has run for 5 months or less, 25% of term premium. 4 and not exceeding 8 months 8 12 12 16 16 20 20 24 24 28 28 32 32 36 36 40 40 44 Over 5 10 15 20 25 30 35 40 45 50 55 and not exceeding 10 months 30 15 20 25 30 35 40 45 50 55 40 50 60 70 75 80 85 90 95 months 100 If policy was written for six years and has run for 6 months or less, 25% of term premium. Over 6 and not exceeding 12 U ;^2 " " 18 " 18 " " 24 " 24 " " 30 " 30 " " 36 " 36 " " 42 " 42 " " 48 " 48 " " 54 " 54 " " 60 " 60 " " 66 " 66 months 30 40 50 60 70 75 80 85 90 95 months 100 150 APPENDIX HAIL SHORT RATE TABLE Prepared by the commissioner of insurance of the state of Iowa in ac- cordance with provision of section 1729 of the code of Iowa, and applying to all policies issued by companies operating under chapter 4, title 9, of the code, and covering growing crops against the hazard of HAIL. The following percentage of premiums as shown on policy shall be charged and considered earned in case of cancellation on request of the insured: On all policies cancelled during months of January, February, March and to April loth 25 % April 15th to May 15th 37%7o May 15th to June 1st 50^%' June 1st to June 15th 75 % June 15th to December 31st following 100 % SUGGESTIVE FORM FOR ARTICLES OF INCORPORATION Articles of incorporation and amendments to articles of incorporation should be submitted in triplicate. Three copies should be forwarded to the commissioner of insurance for the approval of that official and the approval of the attorney general. After the approval by the com- missioner of insurance and the attorney general, "such articles of incor- poration, or amendments to such articles of incorporation, should be recorded with the county recorder, after which they should be forwarded to the secretary of state for recording and certification. Sections 1610 and 1615 of the corporation law completely cover this subject matter. Section 1613 of the corporation law requires that articles of incorpora- tion be published once a week for four consecutive weeks within a period of three months from time such articles are recorded with the secretary of state. Section 1615 of the corporation law requires the same procedure for amendments to articles of incorporation. Section 1613 also requires that companies make a return of proof of publication to the secretary of state after the publication has been made. The following forms will give what is usually necessary in articles of incorporation of an insurance corporation. These forms are drawn up for stock companies. If the form is to be followed by a mutual company the word "members" should be substituted for "stockholders" and for "stock interest" etc. If the forms are to be followed by mutual associa- tions the word "members" should be substituted for "stockholders" and the word "association" substituted for "company" etc. ARTICLES OF INCORPORATION OF THE We, whose names are hereto subscribed, hereby associate ourselves into a body corporate under the provisions of chapter 1, title IX, of the code of Iowa and acts amendatory thereof; assuming all the powers, rights and privileges gi-anted bodies corporate under said chapter and title, and do adopt the following articles of incorporation, to-wit: Article I. The name of this corporation shall be the Article II. Its principal place of business shall be at in the county of and state of Iowa. Article HI. The object of the corporation is APPENDIX 151 (Here state the object of the corporation. Designate the section or sections and chapter of the code under which the corporation proposes to operate.) The corporation shall have the right to buy, hold, sell and convey personal property and such real estate as is authorized by the laws of the state of Iowa and necessary for the proper conduct of the affairs of the corporation. All conveyances of real property and releases of mortgages made by the corporation shall be executed by the president and countersigned by the secretary with an impression of the corporate seal attached, if the corporation has a seal; and all releases of liens, judgments or other claims that are required by law to be made of record may be executed by the president, vice-president or secretary of the corporation. (The following article cannot be used by a Mutual.) Article IV. The amount of capital stock authorized is thousand dollars, divided into shares- of ($100.00 for other than life companies) dollars each. No stock shall be issued until the corporation has received payment in full therefor at par in cash. The capital stock authorized may be increased by vote of in interest of all the stockholders, by the adoption of an amendment to these articles. When the outstanding capital is increased, the additional shares shall be offered to the existing stockholders proportionately to their holdings at not less than par. (This article must state the amount of capital stock which cannot be less than. $200,000.00 for other than life companies. See section 1783-e. Life insurance companies need only have $100,000.00 capital. Property cannot be taken as payment for insurance stock.) Article V. The corporate period of this corporation shall begin on the date the secretary of state issues a certificate of incorporation, and shall terminate at the expiration of years from said date unless sooner dissolved by a vote of the stockholders at any annual meeting, or at a special meeting called for that purpose, or by unanimous consent as provided by law. (Life insurance companies may endupe for fifty years; those for other insurance purposes not to exceed twenty years. See section 1618.) Article VI. The affairs of this corporation shall be managed by a board of directors, who shall elect a president, vice- president, secretary and treasurer and such other officers, including an executive committee, as they may see fit or as may be provided for by- laws of this corporation. (Not less than five directors. See section 1695.) Article VII. The annual meeting shall be held on the day of of each year at o'clock at the home office of the company. Until the first election which shall be held on , the following persons shall be directors: Name Postoffice Address and the following persons shall be officers: President Postoffice . Vice-President Postoffice , Secretary Postoffice , Treasurer Postoffice . Postoffice , 152 APPENDIX All officers of this corporation shall hold office for the term of one year or until their successors are elected, and have qualified. Every director shall be a stockholder and if any director shall sell or transfer his stock in this corporation he shall at once cease to be a director. The board of directors may fill all vacancies occurring in its membership between annual elections by the appointment of qualified persons to hold office for the remainder of the term. Special meetings of the stock- holders may be called at any time by the president upon giving days' notice in person or in writing to the stockholders and shall be called by him at any time upon request of stockholders representing shares of stock, and in case of his neglect or refusal to call a meeting, the parties owning stock to the amount of shares may join in a call of the stockholders, which meeting shall be the same as though called by the president. At all meetings of the stockholders each stock- holder shall be entitled to one vote for each share of stock held by him, which vote he may cast in person or by written proxy. Article VIII. The highest amount of indebtedness to which this cor- poration may at any time subject itself shall not exceed two-thirds of its paid-up and outstanding capital stock. (A Mutual may designate a definite amount.) Article IX. The private property of the stockholders shall be exempt from corporate liability except to the extent and in the matter pro- vided by the laws of the state of Iowa. (Substitute members for stockholders, in a Mutual.) Article X. The corporation may make and alter by-laws at pleasure, and may authorize the board of directors to do so, subject to such re- strictions as may be deemed advisable. Article XI. (Stock companies must comply with the provisions of 1821-v relative to proportionate representation. Make reference to this section in drawing this provision.) Article XII. Amendments to these articles may be made at any annual meeting of the stockholders, or at a special meeting called for that pur- pose, two-thirds of all stockholders in interest voting for such amend- ments. Dated this day of 19. . . . State of Iowa, County, ss. On this day of , 19. . . . before me, a notary public in and for said county and state, personally appeared said persons being to me personally known to be the identical persons whose names are subscribed to the foregoing articles of incorporation, and each for himself acknowledged the same to be his free and voluntary act and deed for the uses and purposes therein expressed. Witness my hand and notarial seal at in the county of state of Iowa, the day and year last above written. (Seal) Notary Public. APPENDIX 153 SUGGESTIVE FORM FOR AMENDMENT TO ARTICLES OF INCOR- PORATION See note which precedes forms for ai-ticles of incorporation AMENDMENT TO ARTICLE OF INCORPORATION OF THE Knoio All Men "by These Presents: That at a meeting of the stockholders (or members) of company (or association), a cor- poration duly organized under the laws of the state of Iowa, held at the office of the company (or association) in Iowa, on the day of A. D. 19 after due and legal notice had been given to the stockholders (or members) thereof in conformity with its articles of incorporation, and the laws of the state, at which the requisite majority of the stock (or members) of said corporation was represented, the following amend- ment was adopted, by a vote of the stock interests (or members) of the said company (or association), as shown below: Amendment: The president and secretary of the company (or association) were duly authorized and directed to sign, acknowledge, record, publish and do all things which are by law required, to execute, complete and carry into effect the above amendment to the articles of incorporation of said company (or association). We, and chairman and secretary of said meeting do hereby certify the above to be a true and correct statement of the proceedings of the stockholders (or mem- bers) at the above named meeting. Chairman. Secretary. In conformity with the above resolution we, the president and secretary of said corporation, have executed this instrument, and do hereby sign and acknowledge the same, for and in behalf of the said corporation, this day of A. D., 19 President. Secretary. State of Iowa, County of ss. Be it remembered, that on this day of A. D. 19. . . ., before me, a notary public in and for said county and state, personally appeared and each being to me personally known, who being by me duly sworn did say, that they are the president and secretary respectively of the and that said instrument was signed and sealed in behalf of said cor- 154 APPENDIX poration by authority of its stockholders (or members), and that they acknowledged said instrument to be the voluntary act and deed of said corporation, by them voluntarily executed. (Seal) Notary Public. SUGGESTIVE FORM FOR CERTIFICATE OF RENEWAL Certificates of renewal must be submitted in triplicate together with three copies of the amended articles of incorporation. These certificates must be approved by the commissioner of insurance and attorney gen- eral, recorded by the county recorder, recorded and certified to by the secretary of state, published as articles of incorporation are published, and proof of publication returned to the secretary of state. See section 1618 of the corporation law. CERTIFICATE OF RENEWAL Be it remembered, that at a special meeting of the stockholders (or members) of the company (or association), a corporation duly organized and existing under the laws of the state of Iowa, having its place of business at county, Iowa, held on the day of 19...., after due and proper notice had been given the stockholders (or members) thereof, and at which meeting the requisite number of shares of stock (or members) of said corporation was represented, in accordance with its articles of incorporation and the laws of the state, the following resolution was adopted by a vote in favor thereof, wherefore the said resolution was declared duly adopted: Resolved, That the corporate period of the company (or association), which will expire on the. .' day of , 19 .... , is hereby extended for a period of years from said date, continuing until unless sooner dissolved by the voluntary action of the stockholders (or members). Be It Further Resolved, That the renewal, amended and substituted articles of incorporation submitted to the stockholders (or members) at said meeting and hereto attached be and the same are hereby adopted as the articles of incorporation of said corporation under the renewal herein provided for. Resolved Further, That the president and secretary of this company (or association) be and they are hereby authorized and directed to sign, acknowledge, record, publish and do any and all things which are by law required, to execute, complete and carry into effect the above resolution, and to execute, sign and acknowledge the renewal, amended and sub- stituted articles of incorporation duly adopted at said meeting. We, , and Chairman and secretary of said meeting do hereby certify the above to be a true and correct statement of the proceedings of the stockholders (or members^) at the above named meeting. CJhairman. Secretary. In conformity with the above resolution, we, the president and secre- tary of said corporation, have executed this instrument, and do hereby sign and acknowledge the same, for and in behalf of the said corporation, this day of , A. D. 19 President. Secretary. APPENDIX 15J State of Iowa, County of ss. Be it remembered that on this clay of A. D. 19. . . ., before me, a notary public in and for said county and state, personally appeared and each being to me personally known, who being by me duly sworn did say, that they are the president and sec- retary respectively of the and that said instrument was signed and sealed in behalf of said cor- poration by authority of its stockholders (or members), and that they acknowledged said instrument to be the voluntary act and deed of said corporation, by them voluntarily executed. (Seal) Notary Public. PUBLICATION NOTICE (Section 1613 provides that notice of incorporation must be published once a week for four consecutive weeks during a period of three months after certificate has been issued by the secretary of state. Section 1615 requires the same publication of all amendments to articles of incorpora- tion. It is not necessary that articles or amendments be published in full. The following concise form, may be used. NOTICE OF INCORPORATION Notice is hereby given that the undesigned have associated themselves together as a body corporate under the name of the insurance company (or association), with principal place of business at , Iowa. The general nature of the business to be transacted by such corpora- tion is that of insurance under the general provisions of chapter , title IX, code of Iowa. The amount of capital stock authorized to be issued is $ This company (or association) will commence its corporate existence as soon as a certificate is issued by the secretary of state, and may endure for. years, unless otherwise terminated as by its articles of incorporation provided. Its affairs shall be conducted and managed by a president, secretary, treasurer, and a board of directors to be elected at the annual meeting of the stockholders in accord with its articles of incorporation and by-laws. The highest amount of indebtedness to which this company (or associa- tion) can at any time subject itself is $ Private property of the stockholders shall be exempt from corporate debts. CORPORATION LAWS 11 Corporation Laws CORPORATIONS FOR PECUNIARY PROFIT Domestic Corporations TITLE IX, CHAPTER 1, CODE OF IOWA. Section 1607. Who may incorporate. Any number of persons may become incorporated for the transaction of any lawful busi- ness, but such incorporation confers no power or privilege not possessed by natural persons, except as hereinafter provided. [22 G. A., ch. 86, § 2; C. '73, § 1058; R., § 1150; C. '51, § 673.] Sec. 1608. Single person. Except as otherwise provided hy law, a single person may incorporate under the provisions of this chapter, thereby entitling himself to all the privileges and immunities provided herein, but if he adopts the name of an individual or individuals as that of the corporation, he must add thereto the word ''incorporated." [C. '73, § 1088; R., § 1179; C. '51, § 702.] Sec. 1609. Powers. Among the powers of such corporations are the following : 1. To have perpetual succession; 2. To sue and be sued by its corporate name ; 3. To have a common seal, Avhich it may alter at pleasure; 4. To render the interests of the stockholders transferable; 5. To exempt the ^private property of its members from liability for corporate debts, except as otherwise declared; 6. To make contracts, acquire and transfer property — pos- sessing the same powers in such respects as natural persons ; 7. To establish by-laws and make all rules and regulations necessarv for the management of its affairs. [C. '73, § 1059; R., § 1151 ; C. '51, § 674.] Sec. 1610. Articles adopted and recorded — approval — fees — index book of county recorder. Before commencing any business except their own organization, they must adopt articles of incor- poration, which must be signed and acknowledged by the incorporators, recorded in the office of the recorder of deeds of the county where the principal place of business is to be, in a book kept therefor ; and the recorder must, within five days thereafter, indorse thereon the time when the same were filed and the book and page where the record will be found. Said articles thus APPENDIX (Corporations) 159 indorsed shall then be forwarded to the secretary of state, and be by him recorded in a book kept for that purpose. The county recorder shall keep in his office an index book for articles o£ incorporation, which shall be ruled and headed sub- stantially after the following- form, and shall make entries therein in order in which they are filed in his office. INDEX TO ARTICLES OF INCORPORATION Name Place of Business Date of FilinB M D Y Date of Inst M D Y Where Recorded P&. Capital Stock Keninrks Such corporation shall pay to the secretary of state, before a certificate of incorporation is issued, a fee of twenty-five dollars, and, for all authorized stock in excess of ten thousand dollars, an additional fee of one dollar per thousand. Should any corpora- tion increase its capital stock, it shall pay a fee to the secretary of state of one dollar for each one thousand dollars of such increase, and a recording fee of ten cents per one hunlred words, no recording fee to be less than fifty cents. Farmers' mutual co- operative creamery associations, whose articles of incorporation provide that the business of the association be conducted on a purely mutual and co-operative plan, without capital stock, and Avhose patrons shall share equally in expense and profits, domestic and domestic local building- and loan associations [and] incorpo- rations organized for the manufacture of sugar from beets grown in the state of Iowa, shall be exempt from the payment of the incorporation filing fee provided herein in excess of twenty-five dollars. When articles of incorporation are presented to the secretary of state for the purpose of being filed, if he is satisfied that they are in proper form to meet the requirements of law, that their object is a lawful one and not against public policy, tliat their plan for doing business, if any be provided for, is honest and lawful, he shall file them; but if he is of the opinion that they are not in proper form to meet the requirements of 160' APPENDIX (Corporations) the law, or that their object is an unlawful one, or against public policy, or that their plan for doing business is dishonest or unlawful, he shall refuse to file them. Should a question of doubt arise as to the legality of the articles, he shall submit them to the attorney general whose duty it shall be to forthwith examine and return them with an opinion in writing touching the point or points concerning which inquiry has been made of him. If such opinion is in favor of the legality of the articles, and no other objections are apparent, they shall then, upon pay- ment of the proper fee, be filed and otherwise dealt with as the law provides. If, however, such opinion be against their legality they shall not be filed. Upon the rejection of any articles of incorporation by the secretary of state, except for the reason that they have been held by the attorney general to be illegal, they shall, if the person or persons presenting them so request, be sub- mitted to the executive council, which shall, as soon as prac- ticable, consider the said articles, and if the council determines that the articles are in proper form, of honest purpose, not against public policj^, nor otherwise objectionable, it shall so advise the secretary of state in writing, whereupon he shall, upon the payment of the proper fees, file the same and proceed otherwise as the law directs; but if the council sustains the previous action of the secretary of state in rejecting said articles, such decision by the council shall be reported to the secretary of state in* writing, and he shall then return said articles to the person or persons presenting them with such explanation as shall be proper in the case. Nothing in this act shall be construed as repealing or modifying any statute now in force in respect to the approval of articles of incorporation relating to insurance companies, building and loan associations or investment com- panies. [35 G. A., ch. 135, § 1 ; 34 G. A., ch. 73, ^ 1 ; 33 G. A., ch. 104, § 1; 32 G. A., ch. 70; 29 G. A., ch. 66, § 1 : 27 G. A., ch. 41, U ; 27 G. A., ch. 40, ^ 1, 2 ; 26 G. A., ch. 98 ; 17 G. A., ch. 23 ; C. '73, §1060; E.' 1152; C. '51, § 675.] Sec. 1611. Limit of indebtedness. Such articles must fix the highest amount of indebtedness or liability to which the corpora- tion is at any one time to be subject, which in no case, except risks of insurance companies, and liabilities of banks not in excess of their available assets, not including their capital, shall exceed two-thirds of its capital stock. But the provisions of this section shall not apply to the bonds or other railway or street railway securities, issued or guaranteed by railway or street railway companies of the state, in aid of the location, construc- tion and equipment of railways or street railways, to an amount not exceeding sixteen thousand dollars per mile of single track, standard gauge, or eight thousand dollars per mile of single track, narrow gauge, lines of road fo.r each mile of railway or street railway actually constructed and equipped. Nor shall APPENDIX (Corporations) 161 the provisions of this section apply to the debentures or bonds of any company incorporated under the provisions of this chapter, the payment of which shall be secured by an actual transfer of real estate securities for the benefit and protection of purchasers thereof; such securities to be at least equal in amount to the par value of such bonds or debentures, and to be first liens upon unincumbered real estate worth at least twice the amount loaned thereon. Nor shall the provisions of this section apply to the debentures or bonds of any company organized under the provisions of this chapter, provided said company shall have not less than one million dollars ($1,000,000) paid in and outstanding capital stock, the payment of which debentures and bonds shall be secured by the actual transfer of the obligation of individuals, partnerships, associations or corporations, for the benefit and protection of purchasers thereof; provided, however, that where such obligations are secured by the actual transfer of warehouse receipts of bonded warehouses as security collateral thereto, said obligation to represent not exceeding seventy-five per cent (75%) of market value of the commodity represented by such warehouse receipt, debentures or bonds may be issued to an amount not in excess of one hundred per cent (100%) of the actual value of said obligations; provided, further, that the said debentures shall be first liens upon the said oblia'ations and upon the warehouse receipts collateral thereto ; and provided, further, that where such debentures or bonds shall be issued upon the security of obligations endorsed by a bank permitted to do banking business in the state of Iowa, or obligations secured by collateral other than warehouse receipts of bonded ware- houses, said collateral to consist of chattel loans on live stock up to eighty per cent (80%) of its value, or investments author- ized by law for Iowa savings banks, they shall not be issued for an amount in excess of ninety per cent (90%) of the actual value of such obligations, and such debentures or bonds shall be first liens upon said obligations, and the collateral thereto. Nor to debentures or bonds issued by any corporation organized under this chapter for the purpose of manufacturing or selling gas, heat, steam or electricity, or constructing or operating inter- urban or street railways, or for any one or more of said pur- poses, when such debentures or bonds are not issued in an amount exceeding twice the amount of the paid up capital stock of such corporation. [39 G. A., S. F. 727; 36 G. A., ch. 278, M ; 21 G. A., ch. 57; 20 G. A., ch. 22; 0. '73, § 1061 ; R., § 1153; C. '51, § 676.] Sec. 1612. Place of business — how changed — notice or process — upon whom and how served. Any corporation organized under the laws of this state shall fix upon and designate in its articles of incorporation its principal place of business which must be in this state, and if outside the limits of a city or town then its postoffice address must be given. The place of business so desig- 162 APPENDIX (Corporations) nated shall not be changed except through an amendment to its articles of incorporation. Its place of business shall be in charge of an agent of the corporation and shall be the place where it shall hold its meetings, keep a record of its proceedings and its stock and transfer books. Provided that any corporation organ- ized under the laws of this state that does not maintain an office in the county of its organization, or transact business in this state, shall file with the secretarj^ of state a written instrument duly signed and sealed, authorizing the secretary of state to acknowledge service of^ notice or process for and in behalf of [^"or" in 31 G. A. session laws. Editor] such cor^Doration in this state, and consenting that service of no- tice or process may be made upon the secretary of state, and when so made shall be taken and held as valid as if served according to the laws of this state, and waiving all claim or right or error by reason of such acknowledgment of service. Such notice or process, with a copy thereof, may be mailed to the secretary of state at Des Moines, Iowa, in a registered letter addressed to him b}^ his official title, and he shall immediately upon its receipt acknowledge service thereon in behalf of the defendant corpora- tion by writing thereon, giving the date thereof, and shall immediately return such notice or process in a registered letter to the clerk of the court in which the suit is pending, addressed by his official title, and shall also forthwith mail such copy, with a copy of his acknowledgment of service written thereon, in a registered letter addressed to the corporation or person who shall be named or designated by the corporation in such written instrument. If any such corporation shall fail to file with the secretary of state the power and authority to acknowledge serv- ice as herein provided on or before Juh^ first, nineteen hundred and six, it shall be the duty of the secretary of state to notify such corporation to file such power and authority within thirty days thereafter, and in case of failure to complj- with such notice it shall be the dut}^ of the attorney general of the state to proceed against such corporation to forfeit its charter and wind up its affairs. [33 G. A., ch. 105, § 10; 33 G. A., ch. 104, § 2; 31 G. A., ch. 64.1 Sec. 1613. Notice published — what to contain. A notice must be published once each week for four weeks in succession in some newspaper as convenient as practicable to the principal place of business, which must contain: 1. The name of the corporation and its principal place of business ; 2. The general nature of the business to be transacted; 3. The amount of capital stock authorized, and the times and conditions on which it is to be paid in; APPENDIX (Corporations) 163 4. The time of the coinmencemcnt and termination of the corporation ; 5. By what officers or persons its aff'airs are to be conducted, and the times when and manner in which they will be elected ; 6. The highest amount of indebtedness to which it is at any time to subject itself; • 7. Whether private property is to be exempt from corporate debts. Proof of such publication, by affidavit of the publisher of the newspaper in which it is made, shall be filed Avith the secretary of state, and shall be evidence of 'the fact. [29 G. A., cli. 67, § 1; C. '73, §§ 1062-3; R., §§ 1154-5; C. '51, §§ 677-8.] Sec. 1613-a. Defective publication — legalized. That each cor- poration heretofore incorporated under the laws of the state of Iowa which have [has] caused notice of their [its] incorporation to be published once each w^eek for four consecutive weeks in some daily, semiweekly or triweekly newspaper, instead of caus- ing the same to be published in each issue of such newspaper for four consecutive weeks are hereby legalized and are declared legal incorporations the same as though the law had been com- plied with in all respects in regard to the publication of notice. [29 G. A., ch. 226, § 1.] Sec. 1614. May begin business. The corporation may com- mence business as soon as the certificate is issued by the secretary of state, and its acts shall be valid if the publication in a news- paper is made within three months from the date of such certifi- cate. [17 G. A., ch. 23; C. '73, § 1064; R., § 1156; C. '51, § 679.] Sec. 1614-a. When time limit for publication has expired — legalized. That in all instances where the incorporators of cor- porations for pecuniary profit have omitted to publish notice of incorporation within three months from the date of the certifi- cate of incorporation issued by the secretary of state, but have published notice thereafter, in manner and form as by law required, such notices are hereby legalized and shall have the same force and effect as though published within said period of three months, as to all acts of said corporation from the date of said completed publication. [37 G. A., ch. 06, § 1 ; 33 G. A., ch. 272, § 1.] Sec. 1614-b. Pending litigation — not affected. Nothing herein contained shall be construed as to affect pending litigation. [37 G. A., ch. 96, § 2; 33 G. A., ch. 272, § 2.] 164 APPENDIX (Corporations) NOTICES OF INCORPORATION H. F. 199 AN ACT to legalize the publication of certain notices of incorporation in cases where notice had not been published within the time as pro- vided in section sixteen hundred fourteen (1614) of the code. Be It Enacted hy the General AssemMy of the State of Iowa: Section 1. Notices of incorporation — delayed publication^^ legalization. That in all instances where the incorporators of corporations organized in this state for pecuniary profits have omitted to publish notices of such incorporation within three months from and after the date of the certificates of incorporation issued by the secretary of state, but did publish such notices within three months after the date required by law in such cases in the manner and form as required by law, such notices of incor- poration are hereby legalized, and shall have the same force and effect in all respects as though the same had been published within said three months' period, as provided by section sixteen hundred and fourteen (1614) of the code and amendments thereto, and all the corporate acts of such corporations from and after the date of such completed publications are hereby legalized in all respects. Sec. 2. Pending litigation. Nothing herein contained shall be so construed as to affect any pending litigation. [38 G. A., ch. 158.] Approved April 5, A. D. 1919. SENATE FILE NO. 465. AN ACT to legalize the publication of certain notices of incorporation in cases where notice had not been published within'the time as provided in section sixteen hundred fourteen (1614^ of the code (C. C. 5334). Be It Enacted hy the General AssemMy of the State of Iowa: Section 1. That in all instances whete the incorporators of corporations organized in this state for pecuniary profit have omitted to publish notices of such incorporation within three months from and after the date of the certificates of incorpora- tion issued by the secretary of state, but did publish such notices thereafter in the m^ner and form as required by law, such notices of incorporation are hereby legalized, and shall have the same force and effect as though published within said period of three months. Sec 2. Nothing herein contained shall be so construed as to effect any pending litigation. Sec. 3. This act being deemed of immediate importance shall take effect and be in force from and after its publication in the APPENDIX (Corporations) 165 Des Moines Register and tlie Des Moines Capital, newspapers published in the city of Des Moines, Iowa, without expense to the state. Approved March 11, A. D. 1921. Sec. 1614-c. Annual report — whajt shown. Any corporation organized under the laws of this state or under the laws of any other state, territory or any foreign country, which has complied with the laws of this state relating to the organization of corpo- rations and secured a certificate of incorporation or permit to transact business in this state, and any corporation that may hereafter organize and become incorporated under the laws of this state, and shall secure a certificate of incorporation or permit to transact business in this state, and any foreign cor- poration that may hereafter comply with the laws of this state relating to foreign corporations and secure a permit to transact business within this state, shall, between the first day of July and the first day of August of each year, make an annual report to the secretarj^ of state, said report to be in such form as he may prescribe, upon a blank to l)e prepared by him for that purpose, and such report shall contain the follow- ing information : 1 . Name and postoffice address of the corporation ; 2. The amount of capital stock authorized; 3. The amount of capital stock actually issued and out- standing ; 4. Par value of such stock, designating whether preferred or common stock, and amount of each kind; 5. The names and postoffice addresses of its officers and direc- tors and whether any change of place of business has been made during the j^ear previous to making said report. [33 G. A., ch. 105, § 1.] Sec. 1614-d. Signature and oath — by whom — permit — exemp- tion. The report required by section one of this act shall be signed and sworn to by an officer of the corporation, and when filed with the secretary of state shall be accompanied by the fee required in section three hereof, and also by an application for a permit to be issued to said corporation under the provisions of this act; said permit to be in such form as the secretary of state may prescribe and which shall be in force and effect for one year from and after tlie first day of July of the year in which it is issued, except that where the term of a corporate existence shall expire in less than a year from the first day of July aforesaid, then said permit shall be issued for such unex- pired term only; provided, however, that any corporation organ- ized under the laws of this state, and any foreign corporation 166 APPENDIX (Corporations) filing a certified copy of its articles of incorporation after the first day of April of any year, shall be exempt from the provi- sions of this act for the period ending one year from the first day of July following, after which it shall be subject to all the provisions of this act. [33 G. A., ch. 105, § 2.] Sec. 1614-e. Annual fee. * Every corporation whose corporate period has not expired, which has heretofore obtained, or may hereafter obtain, a certificate of incorporation or permit under the provisions of chapter one of title nine of the code to transact business, in this state as a corporation, whether the same be a domestic or a foreign corporation, shall pay to the secretary of state an annual fee in the sum of one dollar. [33 G. A., ch. 105, § 3.] Sec. 1614-f. Failure to make a report and pay fee — penalties — list of delinquencies — action to collect. Any corporation organ- ized under the laws of this state, and any foreign corporation authorized to do business in this state, which shall fail to make the report and pay the annual fee provided for in this act, and within the time required in section one hereof, shall, in addition to the annual fee of one dollar required, incur the following penalties, beginning the month of September and dating from the first day thereof, to-wit: For the month of September the sum of one dollar, for the month of October the sum of two dollars, for the month of November the sum of three dollars, for the month of December the sum of four dollars, and for each month thereafter the sum of five dollars. If on the first day of January following, such corporation shall not have filed the annual report and paid the annual fee together with all monthly penalties due at the time of fiilng said report and paying said fee, the secretary of state shall furnish to the attorney general a list of deliquent domestic corporations and he may direct the county attorney of the county in w^hich the corporation has its principal place of business to bring suit for the collection of the fee and penalties then due, or may bring such action himself. Any domestic corporation may, prior to the first day of February of any subsequent year, escape the pajanent of fee and penalties by dissolving the corporation in the manner provided by section sixteen hundred and seventeen of the code, and filing with the secretary of state a proof of publication of notice of dissolution. Any foreign corporation that shall fail to make the annual report and pay the annual fee and penalties that may be due shall therebj^ forfeit its right to do business within this state. [38 G. A., ch. 205, § 1 ; 33 G. A., ch. :!05, § 4.] Sec. 1614-g. Notice of delinquency. During the month of August of each year the secretary of state shall prepare a list of all delinquent corporations and file the same in his office, and on or before the first day of September he shall send by registered APPENDIX (Corporations) 167 mail to each delinquent a notice of sucli delinquency and of the penalties provided in section four of this act, and that if the annual report required is not filed and the annual fee paid, together with penalties due, on or before the last day of Janu- ary, that on the first day of February following, notice of such delinquency will be filed with the attorney general, wlio may cause action to be brought for the collection of the fee and penalties due the state, or, at his discretion, the attorney general may recommend that the secretary of state cancel the name of any delinquent corporation from the list of live corpo- rations in his office, and enter such cancellation on the proper records, and when so cancelled by the secretary of state the corporate rights of any such corporation shall be forfeited and its corporate period terminated on the date such cancellation shall have been entered on the records of his office; provided, however, that the secretary of state shall forward to such corpo- ration, a written notice of the recommendations of the attorney general, such notice to state that unless said corporation shall within sixty days of the date of such notice fully comply with the provisions of this act b}^ filing in the office of the secretary of state any report that may be due and pay all fees and penal- ties that have accrued, or, in lieu thereof file a proof of publica- tion of notice of dissolution as required by section sixteen hundred seventeen (1617) of the code, a declaration of forfeiture and cancellation will be entered on the records of his office. After such declaration and forfeiture shall have been entered by the secretary of state on the records of his office such corpo- ration shall not be entitled to exercise the rights of a corporate body, except, it may be allowed a reasonable time to close up its business and wind up its affairs, but no new business shall be transacted. The notice herein provided for, w^hen enclosed in a sealed envelope with legal postage affixed thereon, and addressed to the corporation, shall constitute a legal notice for the purpose of this act, provided, that any corporation whose corporate rights shall have been cancelled and forfeited in the manner provided in this act, or any stockholder or creditor of such corporation may, however, make an application to the executive council in the manner provided in section one hundred seventy-h (170-h), supplement to the code, 3913, for a compromise of the claim of the state for the fee and penalties that may have accrued under the provisions of this chapter, and upon payment to^ the secretary of state the fee or fees that may have accrued, and such amount in addition thereto as penalties as may be fixed by the executive council, and also, upon filing such annual reports as may be delinquent, the secretary of state shall reinstate said corporation and the decree of cancellation and forfeiture pre- viously entered shall be annulled and the corporation shall be entitled to continue to act as a corporation for the unex- 168 APPENDIX (Corporations) pired portion and its corporate period, as fixed by its articles of incorporation and the limitations prescribed by law, with the right of renewal under section sixteen hundred eighteen-a (1618-a), supplement to the code, 1913; provided, however, that no corporation shall be permitted to waive any duty or obligation required of corporations or the payment of any just claim or claims by reason of such cancellation, forfeiture, and reinstate- ment as herein provided. [38 G. A., ch. 205, § 2; 33 G. A., ch. 105, § 5.] [^"of" in enrolled bill.] Sec. 5 (38 G. A., ch. 205). Fees and penalty a lien. The fees and penalty provided for in this act* shall be a prior lien on any property of the corporation against all persons, whether said property is in the possession of said corporation or otherwise. *See sees. 1614-f and 1614-g. Sec. 1614-h. Forfeiture of permit — entry of cancellation. On the first day of February following the date of the notice pro- vided for in section five of this act, all foreign corporations that have not complied with the provisions of this act shall forfeit the right to transact business in this state and a declaration of forfeiture and cancellation shall be entered upon the margin of the record of the certified copy of the articles of incorpora- tion of such company in the office of the secretary of state or in such other record as the secretary of state may provide. [38 G. A., ch. 205, § 3; 33 G. A., ch. 105, § 6.] Sec. 1614-j. Complying corporations listed with county recorder. After the first day of November and not later than the first day of January of each year, the secretary of state shall compile an alphabetical list of the domestic and foreign corporations that have complied with the provisions of this act, together with postoffice address, and mail a copy thereof to each county recorder in this state, who shall file the same in his office. [33 G. A., ch. 105, § 8.] Sec. 1614-k. Annual notice of requirements by secretary of state. It shall be the duty of the secretary of state between the first day of May and the first day of July of each year to notify all corporations whose corporate period has not expired, or that have not dissolved according to law, that are subject to the pro- visions of this act, of the requirements herein made, enclosing therewith a blank form of report and application as herein pro- vided; and the mailing of said notice at Des Moines, Iowa, ad- dressed to the corporation at its postoffice address as shown by the records of his office shall be deemed a full, complete and legal notice for the purpose of this act. [33 G. A., ch. 105, § 9.] APPENDIX (Corporations) 169 Sec. 1614-i. Certain corporations exempted. Nothing in thi^ chapter shall be construed as imposing- an annual fee or requir- ing a report from any corporation organized for religious, edu- cational, scientific or charitable purposes or other corporations organized under chapter two of title nine of the code, or of anj^ corporation engaged in the banking business, nor to insurance companies or associations who have paid the taxes provided in sections thirtee!n hundred thirty-three >and thirteen hundred thirty-three-d of the supplement to the code, 191):5, and received a certificate of authoritv from the state auditor. [38 G. A., ch. 205 § 4; 34 G. A., ch. 18, § 20; 33 G. A., ch. 105, § 7.] Sec. 1615. Change of articles — fees. Amendments to articles of incorporation making changes in any of the provisions of the articles may be made at an}- annual meeting of the stockholders or special meeting called for that purpose, and they shall be valid only when recorded, approved and published as the original ar- ticles are required to be. If no increase is made in the amount of capital stock, a certificate fee of one dollar and a recording fee of ten cents per one hundred words must be paid ; no record- ing fee less than fifty cents. Where capital stock is increased the certificate fee shall be omitted but a filing fee of one dollar per thousand dollars of such increase together with a recording fee of ten cents per one hundred words shall be paid. Such amendments need only be signed and acknowledged by such of- ficers of the corporation as may be designated by the stockhold- ers to perform such act. [33 G. A., ch. 104, § 5; 22 G. A., ch. 88; C. 73, § 1065; R. § 1157; C. '51, § 680.] Sec. 1616. Individual property liable. A failure to substan- tially comply with the foregoing requirements in relation to or- ganization and publicity shall render the individual property of the stockholders liable for the corporate debts; but corporators and stockholders in railways and street railway companies shall be liable only for the amount of stock held by them therein. [C. 73, § 1068; R. §§ 1166, 1338; C. '51, § 689.] Sec. 1617. Dissolution — notice of. A corporation may be dis- solved prior to the period fixed in the articles of incorporation, by unanimous consent, or in accordance with the provisions of its articles, and notice thereof must be given in the same manner and for the same time as is required for its organization; pro- vided however, that only the officers of a corporation shall be required to sign and acknowledge the articles of dissolution of such corporation and the notice of such dissolution shall be deemed sufficient if signed by the officers of such corporation and published as required bv law. [37 G. A., ch. 128, § 1 ; C. '73, §§ 1066-7; R., §§ 1159-60; C. '51, §§ 682-3.] Sec. 1618. Duration — renewal — certificate and articles to be recorded — fees — notice — proof filled — exemptions. Corporations 170 APPENDIX (Corporations) for the construction and operation, or the operation alone, of steam railways, interurban railways and street railways, for the establishment and conduct of savings banks, or for the transaction of the business of life insurance, may be formed to endure fifty years; those for other purposes, not to exceed twenty years; but in either case they may be renewed from time to time for the same or shorter periods, within three months before or after the time for the termination thereof, if a majority of the votes cast at any regular election, or special election called for that purpose, be in favor of such renewal, and if those voting for such renewal will purchase at its real value the stock voted against such renewal. Such renewals shall date from the expiration of the corporate period which it succeeds and shall be limited in duration to a period not exceeding the time allowed by law to the same class of corporations. Within five days after the said action of the stockholders for the renewal of any corporation, a certificate, showing the proceedings re- sulting in such renewal, sworn to by the president and secretary of the corporation, or by such other officers as may be designated by the stockholders, together with the articles of incorporation, Avhich may be the original articles of incorporation or amended and substituted articles, shall be filed for record in the office of the recorder of the county 'in which the principal place of busi- ness of said corporation is situated, and the same shall be re- corded. Upon filing with the secretary of state the said certifi- cate and articles of incorporation, within ten days after they are filed with the recorder, and upon the payment to the secre- tary of state of a fee of twenty-five dollars, together with a re- cording fee of ten cents per one hundred words and an additional fee of one dollar per thousand for all authorized stock in excess of ten thousand dollars, the secretary of state shall record the said certificate and the said articles of incorporation in a book to be kept by him for that purpose, and shall issue a proper cer- tificate for the renewal of the corporation. Within three months after the filing of the certificate and articles of incorporation with the secretary of state, the corporation so renewed shall publish a notice of renewal. Said notice shall be published once each week for four weeks in succession in a newspaper as convenient as practicable to the principal place of business of the corpora- tion, and proof of publication filed in the office of the secretary of state, and shall contain the matters and things required to be publislied by section sixteen hundred thirteen of the code, relat- ing to original incorporations. Farmers' mutual co-operative creamery associations, domestic and domestic locai building and loan associations, and corporations organized for the manufac- ture of sugar from beets grown in the state of Iowa, shall be exempt from the pavment of the incorporation fee, provided here- in. [34 G. A., ch. 74, § 1 ; 34 G. A., ch. 73, § 2 ; 33 G. A., ch. 104, § APPENDIX (Corporations) 171 3 ; 30 G. A., ch. 2, § 13 ; 29 G. A., cli. 66, § 2 ; 28 G. A., ch. 56, § 1 ; C. '73, § 1069; R. § 1158; C. '51, § 681.] Sec. 1618-la. Renewals legalized. That in all instances where proper action has been taken prior to February 1, 1915, by the stockholders for renewal of any corporation for pecuniary profit and the certificate showing such proceedings together Avith the articles of incorporation have been filed and recorded in the office of the county recorder and later in the office of the sec- retary^ of state, although there has been failure to file such cer- tificates and articles of incorporation in either or both of the said offices within the time specified therefor by law; such re- newals are hereby legalized and shall be held to have the same force and effect as though the filings of the said documents in the said offices had been made within the periods prescribed by the statute. [36 G. A., ch. 54, § 1.] Sec. 1618-lb. Pending litigation. This act shall not affect pending litigation. [36 G. A., ch. 54, § 2.] Sec. 1618-a. Renewal of corporate existence. The corporate existence of any state or savings bank may be renewed or ex- tended, from time to time, for a period not longer than the time for which such banks may organize, by an affirmative vote of two-thirds of the stockholders thereof, at a stockholders' meet- ing held for that purpose, within three months before or after the time of the expiration of its charter as shown by its certifi- cate of incorporation issued by the secretary of state. Such meeting shall be called upon a notice signed by at least two of the officers of the bank and by a majority of its directors, specif yinsr the object of the meeting, and the time and place thereof, pub- lished once a week for four consecutive weeks before the time at which the same is to be held, in some newspaper in the county wherein the bank is located. If at such meeting the reouired vote is given, a certificate of the proceeding's showinsr compliance with the foregoina: provisions and the time to which the corporate period is to be continued, shall be signed and verified by tho af- fidavit of the chairman and secretary of tlie meetiupr, certified to by a majority of the board of directors, and fosrether with the articles of incorporation, as they exist at the date of the meet- insr, shall be recorded in the office of the recorder of deeds of the proper county and filed, recorded and fees paid, as provided in section sixteen hundred eisrhteen of the code and shall be by the secretarv of state certified to the auditor of stato. When the meeting is held previous to the exniration of the charter of the bank, such amendments may be made to the articles of incorpora- tion, subject to the provisions thereof, as mav be deemed neces- sary and whether held before or after the extension of the cor- porate period, such changes may be made in the articles as are necessary to show the time to which the corporate period is ex- 172 APPENDIX (Corporation-s) tended and the names of the officers and directors at the time of the renewal or extension. AVhen the above has been complied with, the auditor of state shall issue to such bank a certificate as provided in section eighteen hundred forty-three of the code, notice of which shall be published as required by the provisions of said section. [31 G. A., ch. 65.] [The above section is made applicable to §§ 1889-d to 1889-n by § 1889-m.] Sec. 1618-b. Fees — since when due — ^repeal. [33 G. A., ch. 104, § 6.] [28 G. A., ch. 56, § 2.] Sec. 1619. Legislative control. The articles of incorporation, by-laws, rules and regulations of corporations hereafter organ- ized under the provisions of this title, or whose organization may be adopted or amended hereunder, shall at all times be sub- ject to legislative control, and may be at any time altered, abridged or set aside by law, and everv franchise obtained, used or en.ioyed by such corporation may be regulated, withheld, or be subject to conditions imposed upon the enjoyment thereof, whenever the general assembly shall deem necessary for the pub- lic good. [C. '73, § 1090.] Sec. 1620. Fraud— penalty for. Intentional fraud in failino: to comply substantially with the articles of incorporation, or in deceiving the public or individuals in relation to their means or their liabilities, shall be a misdemeanor, and shall subject those guilty thereof to a fine and imprisonment, or both, at the discre- tion of the court. Any person who has sustained injury from such fraud may also recover damages therefor against those guilty of participating in such fraud. [C. '73, § 1071; R., § 1163; C. '51, § 686.] Sec. 1621. Diversion of funds. The diversion of the funds of the corporation to other objects than those mentioned in its articles and in the notice published, if any person be iniured thereby, and the payment of dividends which leaves insufficient funds to meet the liabilities thereof, shall be such fraud as will subject those guilty thereof to the penalties of the preceding sec- tion: and such dividends, or their eauivalent, in the hands of stockholders, shall be subject to such liabilities. If the directors or other officers or agents of any corporation shall declare and pay anv dividend when such corporation is known by them to be insolvent, or any dividend the payment of which would render it insolvent, or which would diminish the amount of its capital stock, all directors, officers or agents knowingly consenting there- to shall be jointly and severally liable for all the debts of such corporation then existing, but dividends made in good faith be- fore knowledge of the occurring of losses shall not come within the provisions of this section. [C. '73, §§ 1072-3; R., §§ 1164-5; C. '51, §§ 687-8.] APPENDIX (Corporations) 173 Sec. 1622. Forfeiture. Any intentional violation of the board of directors or the managing officers of the corporation of the provisions of the two preceding sections shall work a forfeiture of the corporate privileges, to be enforced as provided by law. If the indebtedness of any corporation shall exceed the amount of indebtedness permitted by law, the directors and officers of such corporation knowingly consenting thereto shall be personally and individually liable to the creditors of such corporation for such excess. [C. 73, §§ 1074-5; K, §§ 1167-8; C. '51, §§ 690-1.] Sec. 1623. Keeping false accounts. The intentional keeping of false books or accounts shall be a misdemeanor on the part of any officer, agent or employe of the corporation guilty thereof, or of any one whose duty it is to see that such books or accounts are correctly kept, [Same.] FALSE ENTRIES UPON BOOKS OF EMPLOYERS, ETC. S. F. 402 AN ACT to punish the making of any false entries upon the books of a corporation or other employer by any officer, agent or employe of such corporation or employer. Be It Enacted by the General Assemhly of the State of Iowa: Section 1. Books of Corporation, etc. — False entries — felony — punishment. Any officer, agent or employe of any corporation who shall knowingly make or knowingly authorize to be made false entries upon the books of such corporation, and any employe of another who shall kno^vingly make or cause to be made false entries upon the books of his employer, shall be guilty of a felony, and upon conviction shall be punished by imprisonment not to exceed two (2) years, or by a fine not to exceed five thousand dollars ($5,000.00), or by both such fine and imprisonment. [38 G. A., ch. 210.] Approved April 11, A. D. 1919. Sec. 1624. By-laws posted. A copy of the by-laws of the cor- poration, w^ith the names of all of its officers, must be posted in the principal places of business subject to public inspection. The secretary of each corporation shall, upon a written request, fur- nish to the stockholders of said corporation a printed or type- written list, giving the names of the stockholders and their post- office address, and the number of shares owned by each stock- holder. Said list shall be prepared and ready for delivery upon said request not later than thirty days prior to the annual meet- ing of the stockholders and not more than sixty days prior to said annual meeting. Said written request must be made at least fortv davs prior to said annual meeting. [39 G. A., H. F. 740; C. 73, §^1076; R., § 1161; C. '51, § 684.] 12 174 APPENDIX (Corporations) Sec. 1625. Statement of stock and indebtedness. A statement of the amount of capital stock subscribed, the amount of capital actually paid in, and the amount of the indebtedness in a general way, must also be kept posted in like manner, which shall be cor- rected as often as any material change takes place in relation to any part of the subiject-matter thereof. [C. 73, § 1077; R., § 1162; C. '51, § 685.] Sec. 1626. Transfer of shares. The transfer of shares is not valid, except as between the parties thereto, until regularly en- tered upon the books of the company, showing the name of the person by and to whom transferred, the numbers or other desig- nation of the shares, and the date of the transfer ; but such trans- fer shall not exempt the person making it from any liability of said corporation created prior thereto. Its books must be so kept as to shoAv the original stockholders, their interests, the amount paid on their shares, and all transfers 1 hereof; which books, or a copy thereof, so far as the items mentioned in this section are concerned, shall be subject to the inspection of an}-- person desiring the same. When any shares of stock shall be transferred to any person, firm or corporation as collateral se- curity, such person, firm or corporation may notify in writing the secretary of the corporation whose stock is transferred as aforesaid, and from the time of such notice, and until written notice that said stock shall have ceased to be held as collateral security, said stock so transferred and noticed as aforesaid shall be considered in law as transferred on the books of the corpora- tion which issued said stock, without any actual transfer on the books of such corporation of such stock. In such case, it shall be the duty of the secretary or cashier of the corporation or of the person or firm to which such stock shall have been transferred as collateral security at once, upon its ceasing to be so held, to inform the secretary of the corporation issuing such stock of such fact. The secretary of the company whose stock is trans- ferred as collateral shall keep a record showing such notice of transfer as collateral, and notice of discharge as collateral, sub- ject to public inspection. No holder of stock as collateral secur- ity shall be liable for assessments on the same. [26 G. A., ch. si ; C. '73, § 1078; R., § 1169; C. '51, § 692.] Sec. 1627. Amount paid in. No certificate or shares of stock shall be issued, delivered or transferred by any corporation, of- ficer or agent thereof, or by the owner of such certificate or shares, without having indorsed on the face thereof Avhat amount or portion of the par value has been paid to the corporation issu- ing the same, and whether such payment has been in money or property. Any person violating the provisions of this section, or knowingly making a false statement on such certificate, shall be fined not less than one hundred dollars nor more than five hun- APPENDIX (Corporations) 175 dred dollars, and shall stand committed to the county jail until such fine and costs are paid. This section shall not apply to railway or quasi public corporations organized before the lirst day of October, eighteen hundred ninety-seven. [28 G. A., ch. 57, § L] Sec. 1628. Non-user— repeal. [38 G. A., ch. 374, § 1.] 8ec. 1629. Expiration. Corporations whose charters expire by limitation or the voluntary act of the stockholders may never- theless continue to act lor the purpose of winding up their affairs. [C. 73, § 1080; K., § 1171; C. '51, § 69i.J Sec. 1630. Sinking fund. For the purpose of repairs, rebuild- ing, enlarging, or to meet contingencies, or for the purpose of creating a sinking fund, the corporation may set apart a sum which it may loan, and take proper securities therefor. [C. '73, § 1081; K., § 1176; 0. '51, ^ 699.] Sec. 1631. Liability of stockholders. Neither anything in this chapter contained, nor any provisions in the articles of incorpora- tion, shall exempt the stockholders from individual liability to the amount of the unpaid installments on the stock owned by them, or transferred by them for the purpose of defrauding creditors ; and execution against the company may, to that extent, be levied upon the private property of any such individual. In none of the cases contemplated in this chapter can the private property of the stockholders be levied upon for the payment of corporate debts w^hile corporate property can be found with which to satisfy the same ; but it will be sufficient proof that no property can be found, if an execution has issued on a judgment against the corporation, and a demand has been thereon made of some one of the last acting officers of the body for a property on which to levy, and he neglects to point out any such property. In suits by creditors to recover unpaid installments upon shares of stock against any person who has in any manner obtained such stock of the corporation, the stockholder shall be liable for the difference between the amount paid by him to the corpor- ation for said stock and the face value thereof. [C. '73, § 1082; R., 1172; C. '51, § 695.] Sec. 1632. Corporate property exhausted. Before any stock- holder can be charged Avith the payment of a judgment renaered for a corporate debt, an action shall be brought against him, in any stage of which he may point out corporate property subject to levy; and, upon his satisfying the court of the existence of such property, by affidavit or otherwise, the cause may be con- tinued, or execution against him stayed, until the property can be levied upon and sold, and the court may subsequently render judgment for anj^ balance which there may be after disposing of 176 APPENDIX (Corporations) the corporate property ; but if a demand of property has been made as contemplated in the preceding section, the costs of said action shall, in any event, be paid by the company or the de- fendant therein, but he shall not be permitted to controvert the validity of the judgment rendered against the corporation, unless it was rendered through fraud and collusion. [C. '73, §§ 1083-4; K., 1173-4; C. '51, §§ 696-7.] Sec. 1633. Indemnity — contribution. When the property of a stockholder is taken for a corporate debt, he may maintain an action against the corporation for indemnity, and against any of the other stockholders for contribution. [C. '73, § 1085 ; R., § 1175; C. '51, § 698.] Sec. 1634. Franchise sold on execution. The franchise of a corporation may be levied upon under execution and sold, but the corporation shall not become thereby dissolved, and no dissolu- tion of the original corporation shall effect the franchise, and the purchaser becomes vested with all the powers of the corpora- tion therefor. Such franchise shall be sold without appraisement. [C. '73, § 1086; R., § 1177; C. '51, § 700.] Sec. 1635. Production of books. In proceedings by or against a corporation or a stockholder to charge his private property, or the dividends received by him, the court may, upon motion of either party, upon cause shown for that purpose, compel the officers or agents of the corporation to produce the books and records of the corporation. [C. '73, § 1087; R., § 1178; C. '51, § 701.] Sec. 1636. Estopped. No person or persons acting as a cor- poration shall be permitted to set up the want of a legal organi- zation as a defense to an action against them as a corporation, nor shall any person sued on a contract made with such an act- ing corporation, or sued for an injury to its property, or a wrong done to its interests, be permitted to set up a want of such legal organization in his defense. [C. '73, § 1089; R., § 1181; C. '51, § 704.] FOREIGN CORPORATIONS TITLE IX, CHAPTER 1, CODE OF IOWA. Sec. 1637. Foreign corporations — filing articles — process — ap^ plication — increase of capital — fees. Any corporatioh for pecuni- ary profit organized under the laws of another state, or of any territory of the United States, or of any foreign country, which has transacted business in the state of Iowa since the first day of September, eighteen hundred eighty-six, or desires hereafter to APPENDIX (Corporations) 177 transact business in this state, and which has not a permit to do such business shall file with the secretary of state a certified copy of its articles of incorporation, duly attested by the sec- retary of state or other state officer m whose office the original articles were filed, accompanied by a resolution of its board of directors or stockholders authorizing the filing thereof, and also authorizing service of process to be made upon any of its officers or agents in this state engaged in transacting its business, and requesting the issuance to such corporation of a permit to transact business in this state ; said application to contain a stipulation that such permit shall be subject to the provisions of this chapter. Said application sliall also contain a statement subscribed and sworn to by at least two of the principal officers of the corpora^ tion, setting forth the following facts, to-wit : 1. The total authorized capital of the corporation; 2. The total paid up capital of the corporation; 3. The total value of all assets of the corporation, including mone}'- and property other than money, represented by capital, surplus, undivided profits, bonds, promissory notes, certificates of indebtedness or other designation, whether carried as money on hand or in bank real estate or personal property of any de- scrij3tion ; 4. The total value of money and all other propert}^ the cor- poration has in use or held as investment in the state of Iowa, at the time the statement is made (if any) ; 5. The total value of money and all other property the cor- poration proposes or expects to make use of in the state of Iowa, during the ensuing year ; 6. Certified copy of the resolution of the board of directors of said corporation giving name and address in Iowa of a resident agent on whom the service of original notice of civil suit in the courts of this state may be served. Failing which, or in the event such agent may not be found within the state, service of such process may then be made upon said corporation through the secretary of the state of Iowa by sending the original and two copies thereof to him, and on the original of which he shall accept service on behalf of said corporation, retain one copy for his files and send the other by registered mail to the corporation at the address of its home office as shown by the records in his office, which service shall have the same force and effect as if law- fully made upon said corporation within the county where such civil suit could be maintained against it under the laws of this state ; The secretary of state can make such independent and further investigation as to the property within this state owned by any 178 APPENDIX (Corporations) such corporatiou as lie may desire, and upon tlie true facts de- termine the value thereof, and fix the fee to be paid by such company. Before a permit is issued authorizing such corporation to transact business in the state of Iowa, said corporation shall pay to the secretary of state a fee of ten cents per one hundred words for recording the certified copy of the articles of incorpor- ation, with resolution and statement as previously set forth, and a filing fee of twenty-five dollars upon ten thousand dollars or less of money and property of such company actually within the state of Iowa, and of one dollar for each one thousand dollars of such money or property within this state in excess of ten thou- sand dollars. If from time to time the amount of money or other propert}^ in use in the state of Iowa by said foreign corporation is increased, said corporation shall at the time of said increase, or at the time of making annual report to the secretary of state, in July of each year, file with the secretary of state a sworn statement showing the amount of such increase, and shall pay a filing fee thereon of one dollar for each one thousand dollars or fraction thereof of such increase, together with a recording fee of ten cents per one hundred words, but not less than fifty cents. The secretary of state shall upon request furnish a blank upon which to make report of such increase of capital in use within the state. Any corporation transacting business in this state prior to the first day of September, eighteen hundred eighty-six, shall be exempt from the payment of the fees required under the provisions of this section. The secretary of state shall thereupon issue to such corporation, a permit, in such form as he may pre- scribe, for the transaction of the business of such corporation, and upon the receipt of such permit said corporation shall be permitted and authorized to conduct and carry on its business in this state. No foreign stock corporation doing business in this state shall maintain any action in this state upon any con- tract made by it in this state unless prior to the making of such contract it shall have procured such permit. This prohibition shall also apply to any assignee of such foreign stock corpora- tion and to any person claiming under such assignee of such for- eign corporation or under either of them. [39 G. A., S. F. 413; 34 G. A., ch. 75, § 1; 33 G. A., ch. 104, § 7 ; 21 G. A., ch. 76, § l.j See. 1638. Permit. No foreign corporation which has not in good faith complied with the provisions of this chapter and taken out a permit shall possess the right to exercise the power of eminent domain, or exercise any of the rights and privileges conferred upon corporations, until it has so complied herewith and taken out such permit. [Same, § 2.] Sec. 1639. Penalty. Any foreign corporation that shall carry on its business in violation of the provisions of this chapter in the state of Iowa, by its officers, agents or otherwise, without APPENDIX ( Corporation K) 179 having complied with this statute and taken out and having a valid permit, shall forfeit and pay to the state, for each and every day in which such business is transacted and carried on, the sum of one hundred dollars, to be recovered by suit in any court having jurisdiction; and any agent, officer or employe who shall knowingly act or transact such business for such corpora- tion, when it has no valid permit as provided herein, shall be guilty of a misdemeanor, and for such offense shall be fined not to exceed one hundred dollars, or be imprisoned in the county jail not to exceed thirty days, or b}^ both such fine and imprisonment, and pay all costs of prosecution. Nothing contained in this chap- ter shall relieve any person, company, corporation, association or partnership from the performance of any duty or obligation now enjoined upon or required of it, or from the payment of any penalty or liability created by the statutes heretofore in force, and all foreign corporations, and the officers and agents thereof, doing business in this state shall be subject to all the liabilities, restrictions and duties that are or may be imposed upon corpora- tions of like character organized under the general laws of this state, and shall have no other or greater powers. [Same, § 4.] GENERAL CORPORATION PROVISIONS Section 1640. Dissolution — ^receiver. . Courts of equity shall have full power, on good cause shown, to dissolve or close up the business of any corporation, and to appoint a receiver therefor, who shall be a resident of the state of Iowa. An action therefor may be instituted by the attorney general in the name of the state, reserving, however, to the stockholders and creditors all rights now possessed by them. Sec. 1641. Ownership of property. Corporations organized in any foreign country or corporations organized in this country, the stock of which is owned in whole or in part by non-resident aliens, shall have the same rights, powers and privileges with regard to the purchase and ownership of real estate in this state as are granted to nonresident aliens in section twenty-eight hun- dred ninety of the code. [30 G. A., ch. 54.] Sec. 1641-a. Right to vote stock — attachment. Every execu- tor, administrator, guardian or trustee shall represent the stock in his hands at all corporate meetings, and may vote the same as a stockholder; and every person who shall pledge his stock, in the absence of a written agreement to the contrary, may repre- sent the same at all such meetings and vote accordingly. The owner of corporate stock levied upon by attachment or other pro- ceeding shall have the right to vote the same at all corporate meetings, until such time as that he shall have been divested of his title thereto bv execution sale. But nothing: contained in this 180 APPENDIX (Corporations) section shall in any manner conflict with any provision in the articles of incorporation, or the by-laws of the corporation issu- ing the stock. [30 G. A., ch. 55,] Sec. 1641-b. Capital stock — how issued — executive council to fix value — certain elements of value considered. That from and after the passage of this act no corporation organized under the laws of the state of Iowa, except building and loan associations as defined and provided for in chapter thirteen, title nine of the code, shall issue any capital stock or any certificate or certificates of shares of capital stock, or any substitute therefor, until the corporation has received the par value thereof.' If it is proposed to pay for said capital stock in property or in any other thing than money, the corporation proposing the same must, before issuing capital stock in any form, apply to the executive council of the state of Iowa for leave so to do. Such application shall state the amount of capital stock proposed to be issued for a consideration other than money, and set forth specifically the property or other thing to be received in payment for such stock. Thereupon, it shall be the duty of the executive council to make investigation, under such rules as it may prescribe, and to as- certain the real value of the property or other thing which the corporation is to receive for the stock; and shall enter its find- ing, fixing the value at which the corporation may receive the same in payment for capital stock ; and no corporation shall issue capital stock for the said property or thing in a greater amount than the value so fixed and determined by the executive council. Provided that for the purpose of encouraging the construction of new steam or electric railways, and manufacturing industries within this state, the labor performed in effecting the organiza- tion and promotion of such corporation, and the reasonable dis- count allowed or reasonable commission paid in negotiating and effecting the sale of bonds for the construction and equipment of such railroad or manufacturing plant, shall be taken into con- sideration as elements of value in fixing the amount of capital stock that may be issued. [34 G. A., ch. 76, ^ ; 32 G. A., ch. 71, § 1.1 [The above section is made applicable to certain public utility corpora- tions by § 1641-1 herein. — Editor.] Sec. 1641-c. Certificate filed with secretary of state. It shall be the duty of every corporation to file a certificate under oath with the secretary of state, within ten days after the issuance of any capital stock, stating the date of issue, the amount issued, the sum received therefor, if payment be made in money, or the property or thing taken, if such be the method of payment. [32 G. A., ch. 71, § 2.] [The above section is made applicable to certain public utility corpora- tions by § 1641-1 herein. — Editor.] APPENDIX (Corporations) l8l Sec. 1641-d. Cancellation of stock — reimbursement. The capi- tal stock of any corporation issued in violation of the terms and provisions hereof shall be void, and in a suit brought by the at- torney general on behalf of the state of Iowa in any court having jurisdiction, a decree of cancellation shall be entered ; and if the corporation has received any money or thing of value for the said stock, such money or thing of value shall be returned to the indi- vidual, firm, company or corporation from whom it was received, and if represented by labor or other service of intangible nature, the value thereof shall constitute a claim against the corporation issuing stock in exchange therefor. [33 G. A., ch. 104, § 4; 32 G. A., ch. 71, § 3.] Sec. 1641-e. Dissolution of corporation — distribution of assets. Any corporation violating the provisions hereof shall, upon the application of the attorney general, in behalf of the state, made to any court of competent jurisdiction, be dissolved, its affairs wound up, and its assets distributed among the stockholders other than those who have received the stock so unlawfully is- sued. [32 G. A., ch. 71, § 4.] Sec. 1641-f. Penalty. Any officer, agent or representative of a corporation who violates any of the provisions hereof shall, upon conviction, be fined not less than two hundred dollars nor more than ten hundred dollars, and be imprisoned in the county jail for not less than thirt}^ days nor more than six months. [32 G. A., ch. 71, § 5.] Sec. 1641-g. False statements — penalty. Every director, of- ficer or agent of any corporation or joint-stock association, who knowingly concurs in making, publishing or posting, either gen- erally or privately to the stockholders or other persons, any writ- ten report, exhibit, or statement of its affairs or pecuniary con- dition, or book or notice containing any material statement which is false, or any untrue or wilfully or fraudulently exaggerated report, prospectus, account, statement of operations, values, busi- ness, profits, expenditures, or prospects, or any other paper or document intended to produce or give, or having a tendency to produce or give, the shares of stock in such corporation a greater value or a less apparent or market value than they really possess, is guilty of a felony, and upon conviction thereof shall be pun- ished by imprisonment in the penitentiary not to exceed one year, or by imprisonment in the county jail not to exceed six months or a fine not exceeding five hundred dollars. [32 G. A., ch. 72.1 Sec. 1641-h. Political contributions prohibited. It shall be unlawful for any corporation doing business within the state, or any officer, agent or representative thereof acting for such cor- poration, to give or contribute any money, property, labor or 182 APPENDIX (Corporations) thing of value, directly or indirectly, to any member of any polit- ical committee, political party, or employe or representative thereof, or to any candidate for any public office or to the rei)re- sentative of such candidate, for campaign expenses or for any political purpose whatsoever, or to any person, partnership or corporation for the purpose of influencing or causing such per- son, partnership or corporation to influence any elector of the state to vote for or against any candidate for public office or for nomination for public office or to any public officer for the pur- pose of influencing his official action, but nothing in this act shall be construed to restrain or abridge the liberty of the press or prohibit the consideration and discussion therein of candidacies, * nominations, public officers or iDolitical questions. [32 G. A., ch. 73, § 1.] Sec. 1641-i. Solicitation from corporations prohibited. It shall be unlawful for any member of any political committee, political party, or employe or representative thereof, or candidate for any office or the representative of such candidate, to solicit, re- quest or knowingly receive from any corporation or any officer, agent or representative thereof, any money, property or thing of value belonging to such corporation, for campaign expenses or for any political purpose whatsoever. [32 G. A., ch, 73, § 2.] Sec. 1641- j. Testimony — immunity from prosecution. No per- son, and no agent or officer of any corporation within the pur- view of this act shall be privileged from testifying in relation to anything herein prohibited; and no person having so testified shall be liable to any prosecution or punishment for any offense concerning which he is required to give his testimony, provided that he shall not be exempted from prosecution and punishment for perjury committed in so testifying. [32 G. A., ch. 73, § 3.] Sec. 1641-k. Penalty. Any person convicted of a violation of any of the provisions of this act shall be punished by impris- onment in the county jail not less than six months or more than one year and in the discretion of the court, by fine not exceeding ten hundred dollars. [32 G. A., ch. 73, § 4.] Sec. 1641-1. Capital stock of foreign public utility corporations — how issued — laws made applicable. Section sixteen hundred forty-one-b of the supplement to the code, 1907, as amended by chapter seventy-six of the acts of the thirty-fourth general assem- blj^ of Iowa, section sixteen hundred forty-one-c of the supple- ment to the code, 1907, and section sixteen hundred thirty-seven of the code as amended by chapter one hundred and four of the acts of the thirty-third general assembly of Iowa and by chapter seventy-five of the acts of the thirty-fourth general assembly of Iowa, are hereby made applicable to any foreign corporation w^hich directly or indirectly owns, uses, operates, controls or is APPENDIX (Corporations) 183 concerned in the operation of any public gasworks, electric light plant, heating plant, waterworks, interurban or street railway located within the state of Iowa or the carrjing on of any gas, electi-ic light, electric power, heating business, waterworks, inter- urban or street railway business within the state of Iowa or that owns or controls, directly or indirectly, any of the capital stock of any corporation which owns, uses, operates or is concerned in the operation of any public gasworks, electric light plant, electric power plant, heating plant, waterworks, interurban or street railway located within the state of Iowa or any foreign corpora- tion that exercises any control in any way or in any manner over any of said works, plants, interurban or street railways or the business carried on by said works, plants, interurban or street railways by or through the ownership of the capital stock of any corporation or corporations or in any other manner what- soever, and the ownership, operation or control of any such works, plants, interurban or street railways or the business carried on by any of such works or plants or the ownership or control of the capital stock in any corporation OAvnins: or operating any of such works, plants, interurban or street railways by any foreign corporation in violation of the provisions of this act is hereby declared to be unlawful. [35 G. A., ch. 136, § 1.] Sec. 1641-m. Holdings companies — provisions made applicable to. The provisions hereof are hereby made applicable to all cor- porations, including so-called '^ holding companies'' which by or through the ownership of the capital stock in any other corpora- tion or corporations or a series of corporations owning or con- trolling the capital stock of each other can or may exercise con- trol over the capital stock of any corporation which owns, uses, operates or is concerned in the operation of any public gasworks, electric light plant, electric power plant, heating plant, water- works, interurban or street railway located in the state of loAva, or the business carried on bv such works or plants. [35 G. A., ch. 136, § 2.1 Sec. 1641-n. Annual report — fee. All corporations subject to the provisions of this act are hereby required to pay the annual fee and to make the annual report in the form and manner and at the time as specified in chapter one hundred and five of the acts of the thirtv-third general assemblj" of Iowa. [3o G. A., ch. 136, § 2-a.] Sec. 1641-0. Sale of capital stock — obligations. The pro- visions of this act are hereby made applicable to the sale of its own capital stock by any corporation subject to the provisions of this act, whether said ca])ital stock has been heretofore issued by said corporation or not, including the sale of so-called ''treas- .ury stock" or stock of the corporation in the hands of a trus- 184 APPENDIX (Corporations) tee or where the corporation participates in any way or manner in the benefits of said sales, and also to the sale of any of the obligations of any corporation subject to the provisions of this act, the payment of which is secured by the deposit or pledge of any of the capital stock of said corporation. [35 G. A., ch. 136^ § 3.] Sec. 1641-p. Violations — stock void. Shares of capital stock of any corporation owned or controlled in violation of the pro- visions of this act shall be void and the holder thereof shall not be entitled to exercise the powers of a shareholder of said cor- poration or permitted to participate in or be entitled to any of the benefits accruing to shareholders of said corporation, and section sixteen hundred thirty-nine of the code is hereby made appli- cable to violations of the provisions of this act; and courts and juries shall construe this act so as to prevent evasion and to ac- complish the intents and purposes hereof. [35 G. A., ch. 136, § 4.] Sec. 1641-q. Dissolution — powers of courts of equity — receiver. Courts of equity shall have full power to dissolve, close up or dispose of any business or property owned, operated or controlled in violation of the provisions of this act ; to dissolve any corpora- tion owning or controlling the capital stock of anv other corpor- ation in violation of the provisions of this act and to close up or dispose of the business or property of said corporation; and if the court finds that, in order to carry out the purposes of this act, it is necessary so to do, it may dissolve the corporation issuing the stock which is owned in violation of the provisions of this act, close up the business of said corporation and dispose of its property, and the court may -also appoint a receiver who shall be a resident of Iowa for any business or for any corporation which has violated the provisions of this act or of the corpora- tion issuing the stock which is held in violation of this act. Any action to enforce the provisions of this act may be instituted by the attorney general in the name of the state of Iowa or by a citizen in the name of the state of Iowa at his own owning capital stock not held in violation of this act all rights possessed by them. [35 G. A., ch. 136, § 5.] Sec. 1641-r. Acts in conflict repealed. All acts and parts of acts, so far as the same are in conflict herewith, are hereby re- pealed. [35 G. A., ch. 136, § 6.] WORIOIEN'S COMPENSA- TION LAW Workmen's Compensation Law TEXT OF STATUTE. Title XII, chapter 8-a, supplement to the code, 1913, !as amended b.y the Thirty-seventh and Thirtj^-eighth General Assemblies. PAET I. Section 2477-m. Employers — employes — exceptions, (a) Pre- sumption — employes excepted. Except as by this act otherwise provided, it shall be conclusively presumed that every employer as defined by this act has elected to provide, secure and paj^ compensation according to the terms, conditions, and provisions of this act for any and all personal injuries sustained by an employe arising out of and in the course of the employment; and in such cases the employer shall be relieved from other liability for recovery of damages or other compensation for such personal injury, unless by the terms of this act otherwise provided ; but this act shall not apply to any household or domestic servant, farm or other laborer engaged in agricultural pursuits, nor persons whose employment is of a casual nature. The provisions of this act shall not apply as between a municipal corporation, city or town and any person or persons receiving any benefits under, or who may be entitled to, benefits from any ''firemen's pension fund" or "policemen's pension fund" of any municipal corporation, city or town. The act held constitutional in Hunter vs. Colfax Consolidated Coal Company— 154 N. W. 1037. An employe while operating as an engineer and laborer a corn shredder for an employer under contract with a farmer to do such work is a "farm laborer" and not covered by the act. Slycord vs. Horn 162 N. W. 249. (b). Compulsory. Where the state, county, municipal corpora- tion, school district, cities under special charter or commission form of government is the employer, the terms, conditions and provisions of this act for the payment of compensation and amount thereof for such injury sustained by an employe of such employer shall be exclusive, compulsory and obligatory upon both employer and employe. APPENDIX (Compensation) 18? (c). Rejection of terms — reasons for. An employer having the right under the provisions of this act to elect to reject the terms, conditions and provisions thereof and (who) in such case exercises the right in the manner and form by this act provided, such employer shall not escape liability for persoral injury sus- tained by an employe of such employer when the injury sustained arises out of and in the usual course of the employment because : (1.) The employe assumed the risks inherent in or incidental to or arising out of his or her employment, or the risks arising from the failure of the employer to provide and maintain a reasonably safe place to work, or the risks arising from th6 failure of the employer to furnish reasonably safe tools or appli- ances, or because the employer exercised reasonable care iil selecting reasonably competent employes in the business; (2.) That the injury was caused by the negligence of the co-employe ; (3.) That the employe was negligent unless and except it shall appear that such negligence was wilful and with intent to cause the injury; or the result of intoxication on the part of the injured party ; (4.) [d]. Negligence presumed — burden of proof — notices of election to reject — presumption on failure to give notice. In actions by an employe against an employer for personal injury sustained arising out of and in the course of the employment where the employer has elected to reject the provisions of this act, it shall be presumed that the injury to the employe was the direct result and growing out of the negligence of the employer ; and that such negligence was the proximate cause of the injury; and in such cases the burden of proof shall rest upon the employer to rebut the presumption of negligence. The provisions of the act establishing the presumption that tlie injury was the result of the employer's negligence does not abolish the defence of contributory negligence. It merely forces the employer to affirmatively show that he is blameless. Hunter vs. Colfax Consolidated Coal Co., 154 N. W. 1037. Every such emploj^er shall be conclusively presumed to have elected to provide, secure and pay compensation to employes for injuries sustained arising out of and in the course of the employment according to the provisions of this act, unless and until notice in writing of an election to the contrary shall have been given to the employes by posting the same in some conspic- uous place at the place where the business is carried on, and also by filing notice with the Iowa industrial commissioner with return thereon by affidavit showing the date that notice was posted as by this act provided. Provided, however, that any employer beginning business after the taking effect of this act 18§ APPENDIX (Compensation) and giving notice at once of his desire not to come under the provisions of this act shall not be considered as under the act ; provided, however, that such employer shall not be relieved of the payment of compensation as by this act provided until thirty days after the filing of such notice with the Iowa industrial com- missioner, Avhicli notice shall be substantially in the following form: EMPLOYERS' NOTICE TO REJECT To the employes of the undersigned, and the Iowa industrial commis- sioner: You and each of you are hereby notified that the undersigned rejects the terms, conditions and provisions to provide, secure and pay compen- sation to employes of the undersigned for injuries received as provided in the acts of the (thirty-fifth) general assembly known as chap- ter (one hundred forty-seven), and elects to pay damages for personal injuries received by such employe under the common law and statutes of this state modified by subdivisions one, two, three and four of section one, chapter (one hundred forty-seven) of the acts of the (thirty-fifth) general assembly and acts amenda- tory thereto. Signed State of Iowa, County, ss : The undersigned being first duly sworn deposes and says that a true, correct and verbatim copy of the foregoing notice was on the day of , 19..,., posted at (State fully place where posted) Subscribed and sworn to before me by , this day of , 19 Notary Public. The employer shall keep such notice posted in some conspicuous place which shall applj^ to the employes subsequently employed by the employer, with the same force and effect and to the same extent and in like manner as emploj^es in the employ at the time the notice was given. Where the employer and employe have not given notice of an election to reject the terms of this act, every contract of hire, express or implied, shall 'be construed as an implied agreement between them and a part of the contract on the part of the employer to provide, secure and pay, and on the part of the employe to accept compensation in the manner as by this act provided for all personal injuries sustained arising out of and in the course of the emplojanent. An employer, by his void contract illegally employing a minor under 14 yeaio of age, even though the minor makes misstatement of age in order to secure work, can not limit his liability for any injury to the compensation fixed by the act, to which the minor was incapable of giving consent. Sechlick vs. Harris-Emery Company, 169 N. W. 325. Sec. 2477-ml. Wilful injury — intoxication. No compensation under this act shall be allowed for an injury caused : APPENDIX (Compensatioi}) 1S9 (a). By tlie employe's wilful intention to injure himself or to wilfully injure another; nor shall compensation be paid to an injured employe if injury .is sustained where intoxication of the employe was the proximate cause of the injury. Sec. 2477-m2. Rights of employe — notice to reject, (a) Exclu- sive of other rights — presumption — notice. The rights and remedies provided in this act for an employe on account of injury shall be exclusive of all other rights and remedies of such emploA^e, his personal or legal representatives, dependents or next of kin, at common law or otherwise, on account of such injury, and all employes affected by this act shall be conclusively pre- sumed to have elected to take compensation in accordance with the terms, conditions and provisions of this act until notice in writing shall have been served upon his employer, and also on tlie Iowa industrial commissioner, with return thereon by affidavit showing the date upon which notice was served upon the employer. A servant, having accepted compensation under the act, can have no standing in court to assert the employer's further liability to him for exemplary damages on the ground of gross and reckless negligence. Striclken vs. Pearson Construction Company, 169 N. W. 673. (b). Rejection — procedure — oath — form — undue influence. In the event such employe elects to reject the terms, conditions and provisions of this act, the rights and remedies thereof shall not apply where an emploj^e brings an action or takes proceedings to recover damages or compensation for injuries received growing out of and in the course of his employment, except as otherwise provided by this act; and in such actions where the employe has rejected the terms of this act the employer shall have the right to plead and rely upon am^ and all defenses, including those of common law, and the rules and defenses of contributory negli- gence, assumption of risk and fellow-servant shall apply and be available to the employer as hy statute authorized unless other- wise provided in this act. Provided, however, that if an employe sustains an injury as the result of the employer's failure to furnish or failure to exercise reasonable care to keep or main- tain any safety device required by statute or rule, or violation of any of the statutory provisions or rules and regulations now or hereafter in force relating to safety of employes, the doctrine of assumed risk in such case growing out of the negligence of the employer shall not apply or be available as defensive matter to such offending party. The notice required to be given by an employe shall be substantially in the following form: 13 190 APPENDIX (Compensation) EMPLOYES' NOTICE TO REJECT To and the (Name of employer) Iowa industrial commissioner: You and each of you are hereby notified that the undersigned hereby elects to reject the terms, conditions and provisions of an act for the pay- ment of compensation as provided by (chapter one hundred forty-seven of) the acts of the (thirty-fifth; general assembly and acts amenda- tory thereto, and elects to rely upon the common law as modified by section three of (chapter one hundred forty-seven of) the acts of the (thirty-fifth) general assembly for the right to recover for per- sonal injury which I may receive, if any, growing out of and arising from the employment while in line of duty for my employer above named. Dated this day of ,19 Signed State of Iowa County, ss : The undersigned being first duly sworn deposes and says that the written notice was on the day of , 19 .... , served on the within named employer of the undersigned by delivering to a true, correct and verbatim copy thereof. (Name of person served) Subscribed and sworn (or offirmed) to before me by the said this day of , 19 . . Notary Public. Ill any case where an employe or one who is an applicant for employment elects to reject the terms, conditions and provisions of this act, he shall, in addition to the notice required by sub- division (b) of section three of this act, state in an affidavit to be filed with said notice who, if any person, requested, suggested, or demands of such person to exercise the right to reject the provi- sions of this act. And if request, suggestion, or demand has been made of such employe by aiw person, such employe shall give and state the name of the person who made the request, suggestion, or demand, and all of the circumstances relating thereto, the date and place when and where made, and persons present, and if it be found that the employer of such employe, or an employer to whom an applicant for employment, or an}^ person a member of the firm, association, corporation, or agent or official of such employer, made a request, suggestion or demand of such employe or applicant for employment to reject the terms, conditions and provisions of this act, such request, suggestion or demand if made under such conditions, sliall be conclusively presumed to have been sufficient to have unduly influenced such employe or an applicant for employment to exercise the right to reject the terms of this act, and the rejec- tion made under such circumstances shall be conclusively pre- sumed to have been procured through fraud and thereby fraud- ulently procured, and such rejection shall be null and void and of no effect. No person interested in the business of such emploj^er, finan- cialh' or otherwise, shall be permitted to administer the oatli APPENDIX (Compensation) 191 to the affidavit required in ease an employe or applicant for employment elects to exercise the ri^^ht to reject the provisions of this act. And the person administering such oath in making such affidavit shall carefully read the notice and affidavit to such person making such rejection, and shall explain that the purpose of the notice is to bar such person from recovering compensation in accordance with the schedule and terms of this act in the event that he sustains an injury in the course of such employment, all of which shall be shown b}' certificate of the person administering the oath herein contemplated. The Iowa industrial commissioner, or any person acting for such commis- sioner, shall refuse to file the notice and affidavit, unless such notice, affidavit and certificate fully, and in detail, comply with the requirements hereof. And if such rejection, affidavit and certificate is found insufficient for any cause, (it) shall be returned by mail or otherwise to the person who executed the instrument. Sec. 2477-m3. Tenure of election, (a) Until provisions complied with. When the employer or employe has given notice in compli- ance with this act electing to reject the terms thereof such election shall continue and be in force until such employer or employe shall thereafter elect to come under the provisions of this act as is provided in subdivision (b) of this section. (b). Notice — how filed. AVhen an employer or employe rejects the terms, conditions or provisions of this act, such party may at any time thereafter elect to waive the same by giving notice in writing in the same manner required of the party in electing to reject the provisions of the act and which shall become effec- tive when filed with the Iowa industrial commissioner. Notice of acceptance with Industrial commissioner where employer had previously filed notice of rejection, is not substantial compliance, without posting notice of acceptance. Paucher vs. Enterprise Coal Mining Company, 164 N. W. 1035. Sec. 2477-m4. Liability of employer after election to reject. Where the employer and employe elect to reject the terms, conditions and provisions of this act, the liability of the employer shall be the same as though the emploj'c had not rejected the terms, conditions and provisions thereof. Sec. 2477-m5. Subsequent election to reject — security for com- pensation. An employer having come under this act, who there- after elects to reject the terms, conditions and provisions thereof, shall not be relieved from the payment of compensation to such employe who sustains an injury in the course of the employment before the election to reject becomes eftective; and in such cases the employer shall be reciuired to secure the payment of any compensation due or that may become due to such workman, subject to the approval of the Iowa industrial commissioner. 192 APPENDIX (Compensation) Sec. 2477-m6. Liability of other than that of employer. Where an employe coming under the provisions of this act receives an injury for which compensation is payable under this act and which injury was caused under circumstances creating a legal liability in some person other than the employer, to pay damages in respect thereof: (a^ Proceedings against both parties. The employe or bene- ficiary may take proceedings both against that person to recover damages and against the employer for compensation, but the amount of the compensation to which he is entitled under this act shall be reduced by the amount of damages recovered. • (b) Indemnity — subrogation. If the employe or beneficiary in such case recovers compensation under this act, the employer by Avhom the compensation was paid or the party who has been called upon to pay the compensation, shall be entitled to indem- nity from the person so liable to pay damages as aforesaid, and shall be subrogated to the rights of the employe to recover therefor. Sec. 2477-m7. Contract to relieve not operative. No contract, rule, regulation or device whatsoever shall operate to relieve the employer, in whole or in part, from any liability created by this act except as herein provided. Sec. 2477-m8. Notice of injury — form — failure to give. Unless the employer or representative of such employer shall have actual knowledge of the occurrence of an injury, or unless the employe or someone on his behalf, or some of the dependents or someone on their behalf, shall give notice thereof to the employer within fifteen days of the occurrence of the injury, then no compensa- tion shall be paid until and from the date such notice is given or knowledge obtained; but if notice is given or the knowledge obtained within thirty days from the occurrence of the injury, no want, failure or inaccuracy of a notice shall be a bar to obtaining compensation, unless the employer shall show that he was preju- diced b}^ such want, defect or inaccuracy, and then only to the ex- tent of such prejudice. Provided, that if the emploj^e or benefi- ciary shall show that his failure to give prior notice was due to mistake, inadvertance, ignorance of fact or law, or inability or to the fraud, misrepresentation or deceit of another or to any other reasonable cause or excuse, then compensation may be allowed, unless and then to the extent only that the employer shall show that he was prejudiced by failure to receive such notice. Pro- vided, further, unless knowledge is obtained or notice given within ninety clays after the occurrence of the injury, no compen- sation shall be allowed. No form of notice shall be required, but may substantially conform to the following form: APPENDIX (Compensation) 193 FORM OF NOTICE To You are hereby notified that on or about the day of , 19 .... , personal injury was sustained by while in your employ at (Give name of place employed and point where located when injury occurred.) and that compensation will be claimed therefor. Signed but 110 variation from this form of notice shall be material if the notice is sufficient to advise the employer that a certain employe, b}^ name, received an injury in the course of his employment on or about a specified time at or near a certain place. Notice served upon one (upon) whom an original notice may be served in civil cases shall be a compliance with this act. The notice required to be given to the employer may be served by any person over sixteen years of age, who shall make return upon a copy of the notice, properly sworn to, showing the date of service where and upon whom served, but no special form of the return of service of the notice shall be required. It shall be sufficient if tlie facts therefrom can be reasonably ascertained. The return of service may be amended at any time. Sec. 2477-m9. Compensation schedule. If any employe has not given notice to reject the terms, conditions and provisions of this act, or has given such notice and waived the same as by this act provided, and the employer has not rejected the terms, condi- tions and provisions of the act or has given such notice and waived the same and the employe receives a personal injury arising out of and in the course of the employment, compensation shall be paid as herein provided: (a) The compensation provided for in this act shall be paid in accordance with the schedule unless otherwise provided. (b) At the time of the injury and thereafter during tlie dis- ability, but not exceeding four weeks of incapacity, the employer, if so requested by the employe, or any one for him, or if so ordered by the court or Iowa industrial commissioner, sliall fur- nish reasonable sitrgical, medical and hospital jjervices, and supplies therefor, not exceeding one hundred ($100.00) dollars. Provided, however, that in exceptional cases, an application may be made in writing to the Iowa industrial commissioner for addi- tional surgical, medical and hospital services, and supplies there- for, in which case a copy of such application shall be mailed to the employer or his insurer. If such application is approved by the commissioner, then the emploj'er shall furnish such additional services and supplies for such period, and in such amount as the 194 APPENDIX (Compensation) Iowa industrial commissioner shall order, but in no event to exceed one hundred ($100.00) dollars. (c) Where the injury causes death the compensation under this act shall be as follows : The employer shall in addition to any other compensation pay the reasonable expense of the employe's last sickness and burial not to exceed one hundred dollars. If the employe leaves no dependents this shall be the only compensation. (d) If death results from the injury, the employer shall pay the dependents of the emploA^e wholly dependent upon his earn- ings for support at the time of the injury, a Aveekly payment equal to sixty per cent of his average weekly wages, but not more than fifteen ($15.00) dollars nor less than six ($6.00) dollars per week for a period of three hundred weeks. (e) If the employe leaves dependents only partially dependent upon his earnings for support at the time of the injury, the weekly compensation to be paid as aforesaid shall be equal to the same proportion of the weekly payments for the benefit of persons wholh^ dependent as the amount contributed by the emplo3^e to such partial dependents bears to the annual earnings of the deceased at the time of the injury. When weekly pay- ments have been made to an injured employe before his death, the compensation to dependents shall begin from the date of the last of such payments, but shall not continue more than three hundred weeks from the date of the injury. (f) AVhere injury causes death to an employe, a minor, whose earnings Avere received by the parent, the compensation to be paid the parent shall be two-thirds of the amount provided for paA'ment in subdivision (d) section ten (nine). (g) No compensation shall be paid for an injury which does not incapacitate the employe for a period of at least two weeks from earning full wages ; provided, however, that this provision shall not apply to those injuries resulting in disability partial in character and permanent in quality and compensated according to the schedule found in section twenty-four hundred seventy- seven-m-9 (J) 2477-m-9-j), supplement to the code, 1913. Should such incapacity extend beyond a period of two weeks, compensa- tion shall begin on the fifteenth day after the injury ; provided, however, that if the period of incapacity extends beyond the thirty-fifth day following the date of the injury, then the com- pensation for the fifth week of incapacity sliall be increased by adding thereto an amount equal to two-thirds (2-3") of the weekly compensation ; if the period of incapacity extends bej^ond the forty-second (42) day following the date of the injury, then the compensation for the sixth week of incapacity shall be increased APPENDIX (Compensation) 195 by adding thereto an amount e(iual to two-thirds (2-3) of the wcM^kly compensation; il* th(> period of incapacity extends beyond the forty-ninth (49th) day foih)wing llie date of the injury, then the compensation for the seventh week of incapacity shall be increased by adding thereto an amount equal to two-thirds (2-3) of the weekly compensation; if the period of incapacity extends beyond the forty-ninth (49th) day follow^ing the date of the injury, then the compensation thereafter shall be only the weekl}^ compensation provided for in this law. (h) For injur}' producing temporarj^ disability, sixty per cent of the average weekly wages received at the time of the injury, subject to a maximum compensation of fifteen dollars, and a minimum of six dollars per week ; provided, that if at the time of injury the employe receives wages less than six dollars per week, then he shall receive the full amount of wages per week. This compensation shall be paid during the period of such disability, not, however, beyond three hundred weeks. (i) For disability total in character and permanent in quality, sixty per cent of the average weekly wages received at the time of the injury, subject to a maximum compensation of fifteen dollars per week, and a minimum of six dollars per week, pro- vided that if at the time of injury the employe receives wages less than six dollars per week, then he shall receive the full amount of wages per week. This compensation shall be paid during the period of such disabilitj^, not, how^ever, beyond four hundred weeks. (j) For disabilit}^ partial in character and permanent in quality, the compensation shall be as follows : For all cases included in the following schedule compensation shall be paid as follows, to-wit : (1.) For the loss of a thumb, sixty per cent of daily wages dur- ing forty weeks. (2.) For the loss of a first finger, commonly called the index finger, sixty per cent of daily wages during thirty weeks. (3.) For the loss of a second finger, sixty per cent of daily wages during twent3'-five weeks. (4.) For the loss of a third finger, sixty per cent of daily wages during twenty weeks. (5.) For the loss of a fourth finger, commonly called the little finger, sixty per cent of daily wages for fifteen weeks. (6.) For the loss of the first phalange of the thumb or of any finger shall be considered to be equal to the loss of one-half of such thumb or finger, and compensation shall be one-half of the amounts above specified. 196 APPENDIX (Compensation) (7.) The loss of more than one phalange shall be considered as the loss of the entire finger or thumb ; provided, however, that in no case shall the amount received for more than one finger exceed the amount provided in this schedule for the loss of a hand. (8.) For the loss of a great toe, sixty per cent of daily wages during twenty-five weeks. (9.) For the loss of one of the toes other than the great toe, sixty per cent of daily wages during fifteen wrecks. (10.) For the loss of the first phalange of am^ toe shall be considered to be equal to the loss of one-half of such toe, and the compensation shall be one-half of the amount above specified. (11.) The loss of more than one phalange shall be con- sidered as the loss of the entire toe. (12.) For the loss of a hand, sixty per cent of daily wages during one hundred fift}" weeks. (13.) The loss of two-thirds of that part of an arm between the shoulder joint and the elbow joint shall constitute the loss of an arm, and the compensation therefor shall be sixty (60) per cent of the average weekly wages during two hundred twent}^- five (225) weeks. (14.) For the loss of a foot, sixty per cent of daily wages dur- ing one hundred twentj^-five weeks. (15.) The loss of two-thirds of that part of a leg between the hip joint and the knee joint shall constitute the loss of a leg, and the compensation therefor shall be sixty (60) per cent of the average weekl}^ wages during two hundred (200) weeks. (16.) For the loss of an eye, sixty per cent of daily wages during one hundred weeks. (a) For the loss of a second or last eye, the other eye having been lost prior to the injury resulting in the loss of the second eye, sixty (60) per cent of the average weekly wages during two hundred (200) weeks. (17.) For the loss of hearing in one ear, sixty (60) per cent of dail}^ wages during fifty (50) weeks, and for the loss of hearing in both ears, sixty (60) per cent of the daily wages during one hundred fifty (150) weeks. (18.) The loss of both arms, or both hands, or both feet, or both legs, or both eyes, or of anj^ two thereof, caused by a single accident shall constitute total and permanent disability, to be compensated according to the provisions of section twenty-four hundred seventv-seven-m-9 (1) (2477-m-9-i), supplement to the code, 1913. APPENDIX (Compensation) 197 (19.) In all other cases in this, clause (j), the compensation shall bear such relation to the amount stated in the above schedule as the disability bears to those produced by the injuries named in the schedule. Should the employe and employer be unable to agree upon the amount of compensation to be paid in cases not specifically covered by the schedule, the amount of compensation shall be settled according to provisions of this act as in other cases of disagreement. (20.) The amounts specified in this, clause (j) and subdivisions thereof, shall be subject to the same limitations as to maximum and minimum weekly payments as are stated in clause (h), section ten (nine) hereof. Sec. 2477-mlO. Death — payment of unpaid balance. "Where an employe is entitled to compensation under this act for an injury received and death ensues from any cause not resulting from the injury for which he was entitled to the compensation, payments of the unpaid balance for such injury shall cease and all liability therefor shall terminate. Sec. 2477-mll. Examination of injured employe — suspension of compensation. After an injury, the employe, if so requested by his employer, shall submit himself for examination at some reasonable time and place within the state and as often as may be reasonably requested, to a physician or physicians authorized to practice under the laws of this state, without cost to the employe; but if the employe request, he shall, at his own cost, be entitled to have a physician or physicians of his own selection present to participate in such examination. The refusal of the employe to submit to such examination shall deprive him of the risrht to compensation during the continuance of such refusal. When a right to compensation is thus suspended no compensation shall be payable in respect to the period of suspension. Sec. 2477-ml2. Contributions from employes — no reduction of employer's responsibility. The compensation herein provided sliall be the measure of the responsibility which the employer has assumed for injuries or death that may occur to employes in his employment, subject to the provisions of this act, and it shall not be in any wise reduced by contribution from employes. Sec. 2477-ml3. Trustees for minors and those mentally incapaci- tated — reports^ When; an in ju*red minor, em^)loye or .a minor de- pendent or one physically or mentally incapacitated from earning is entitled to compensation under this act, payment shall be made to a trustee appointed by the judge of the district court for eacli county in the respective judicial districts, and the money coming into the hands of the said trustees shall be expended for the use and benefit of the person entitled thereto under the direction and orders of the judge during term time or in vacation. The 198 APPENDIX (Compensation) trustee shall make animal reports to the court of all money or property received and expended for each person, and for services rendered as trustee shall be paid such compensation by the county as the court may direct by written order directed to the auditor of the county, who shall issue a warrant therefor upon the treasurer of the county in which the appointment is made. If the judge making the appointment deems it advisable, a trustee may be appointed to serve for more than one county in the district and the expenses shall be paid ratably by each county according to the amount of work performed in each county. The trustee shall qualify and give bond in such amount as the judge may direct, which may be increased or diminished from time to time as the court may deem best. In case a deceased employe for whose injury or death compensation is payable leaves surviving him an alien dependent or dependents residing outside the United States, the consul-general, consul, vice-consul or consular agent of the nation of which the said dependent or dependents are citizens shall be regarded as the exclusive repre- sentative of such dependent or dependents. Such consular officer, or his duly appointed representative residing in the state of Iowa, shall have the exclusive right in behalf of such nonresident dependent or dependents to present, prosecute, litigate, adjust and settle all claims for compensation provided by this act, and to receive for distribution to such dependent or dependents all com- pensation arising -thereunder. Such consular officer or his duly appointed representative shall file with the industrial commissioner a copy of his exequatur or evidence of his authority, and the industrial commissioner shall notify such consular officer or his said representative of the death of all employes leaving alien dependent or dependents residing in the country of said consular officer, so far as the same shall come to his knowledge ; provided, however, that nothing herein shall abridge the right of any relative of such decedent who may reside in the state of Iowa to take out administration upon the estate of such decedent, and as such receive the funds due said estate; and provided further that before said consular agent or his representative shall have the right to receive funds due tlie estate of said decedent he shall regularly take out administration in the county where decedent last resided, and give bond as administrator for the protection of such funds as provided hy law. Sec. 2477-ml4. Commutation of future payments — discretion of court. In any ease where the period of compensation can be determined definitely either party may, upon due notice to the other, apply to any judge of the district court for the county in which the accident occurred for an order commuting future payments to a lump sum; provided, however, that no judg'e of APPENDIX ( Compensation ) 199 the district court shall consider any such application until there is endorsed thereon by the Iowa industrial commissioner his approval of such commutation, and no order shall be issued by such judge contrary to the endorsement of said industrial commissioner. And such judge may make such an order when it shall be shown to his satisfaction that the payment of a lump sum in lieu of future monthly or weekly payments, as the case may be, will be for the best interest of the person or persons receiving or dependent upon said compensation, or that the continuance of periodical payments will, as compared with lump sum payments, entail undue expense or undue hardship upon the employer liable therefor. Where the commutation is ordered, the court shall fix the lump sum to be paid at an amount which will equal the total sum of the probable future payments capi. talized at their present value and upon the basis of interest, calculated at five per cent per annum. Upon the payment of such amount the employer shall be discharged from all further liability on account of such injury or death, for which said com- pensation was being paid, and be entitled to a duly executed release, upon filing which the liability of such employer under any agreement, award, finding or judgment shall be discharged of record. Sec. 2477-ml5 Schedule of computation. The basis for com- puting compensation provided for in this act shall be as follows : (a) The compensation shall be computed on tlie basis of the annual earnings which the injured person received as salary, wages or earnings in the employment of the same employer during the year next preceding the injury. (b) Employment b}^ the same employer shall be taken to mean employment by the same employer in the grade in which the emploj^e was employed at the time of the accident, uninter- rupted by absence from work due to illness or any otlier unavoid- able cause. (c) The annual earnings, if not otherwise determinable, shall be regarded as three hundred times the average daily earnings in such computation. (d) If the injured person has not been engaged in the employ- ment for a full year immediately preceding the accident, the compensation shall be computed according to the annual earn- ings which persons of the same class in the same or in neighbor- ing employments of the same kind have earned during such period. And if this basis of computation is impossible, or should appear to be unreasonable, three hundred times the amount which the injured person earned on an average of those days when he was working during the year next preceding the accident, shall be used as a basis for the computation. 200 APPENDIX (Compensation) (e) In case of injured employes who earn either no wages or less than three hundred times the usual daily wage or earnings of the adult da}' laborer in the same line of industry of that locality, the yearly wage shall be reckoned as three hundred times the average dail}^ local wages of the average wage earner in that particular kind or class of work ; or if information of that class is not obtainable, then of the class or kindred or similarity in the same general employment in the same neighborhood. (f ) As to employes employed in a business or enterprise which customarily shuts down and ceases operation during a season of each year, the number of working days which it is the custom of such business or enterprise to operate each year shall be used instead of three hundred as a basis for computing the annual earnings, provided the minimum number of days which shall be used as a basis for the year's work shall not be less than two hundred. (g) Earnings, for the purpose of this section, shall be based on the earnings for the number of hours commonly regarded as a day's work for that employment, and shall exclude overtime earnings. The earnings shall not include any sum which the employer has been accustomed to pay the employe to cover any special expense entailed on him by the nature of the employment. "Earnings" received by an injured employe do not include money paid by a miner for powder and blacksmith work, which must be deducted from the acual total amount received for the year. Richards vs. Central Iowa Fuel Company, 166 N. W. 1059. (h) In computing the compensation to be paid to any employe who, before the accident for which he claims com^pensation, was disabled and drawing compensation under tlie terms of this act, the compensation for each subsequent injury shall be apportioned according to the proportion of incapacity and disability caused by the respective injuries which he may have suffered. Sec. 2477-ml6. Terms defined. In this act unless the context otherwise requires : (a) '*Emplo3^er" includes and applies to any person, firm, association or corporation, and includes state, counties, municipal corporations, cities under special charter and under commission form of government, and shall include school districts and the legal representatives of a deceased employer. Whenever neces- sary^ to give effect to section seven of this act, it includes a prin- cipal or intermediate contractor. (b) ''AVorkman" is used synonymously with "employe," and means any person who has entered into the emploj^ment of, or works under contract of service, express or implied, or apprentice- ship for an employer, except a person whose employment is purely APPENDIX (Compensation) 201 casual or not for the purpose of the employer's trade or business or those engaged in clerical work only, but clerical work shall not include one who may be subjected to the lia/ards ol; tlie business, or one holding an official position or standing in a repre- sentative capacity of the employer, or an official elected or ap- pointed by the state, county, school district, municipal corpora- tion, cities under special charter and commission form of govern- ment, provided that one who sustains the relation of contractor with any person, firm, association, corporation or the state, count}', school district, municipal corporation, cities under special charter or commission form of government shall not be considered an employe thereof. Workmen's compensation must be presumed to have used the word "contractor" in the sense it is commonly employed, and in which it has been defined by the courts. Pace vs. Appanoose county — 168 N. W. 916. Whether one is an employe or an independent contractor depends on whether he represents the master as to the result of the work or only as to the means, and, if representing the master only as to result, and selecting the means, he is an independent contractor. Pace vs. Appanoose county — 168 N. W, 916. The manner of payment, though often significant, is not necessarily controlling as to whether one is an employe or an independent contractor. Pace vs. Appanoose county — 168 N. W. 916. If a contract gives the employer no control over the details of the work, but leaves that to the party undertaking the work, such party is an inde- pendent contractor. Pace vs. Appanoose county — 168 N. W. 916. The test of a contractor is that he render services in course of inde- pendent occupation following employer's desires in results but not in means; but the employer's authoritative control is to be, distinguished from mere suggestions as to detail, or necessary co-operation where work is part of larger undertaking. Pace vs. Appanoose county — 168 N. W. 916. One employed to remove 62 trees preparatory to grading a street, to be paid in a lump sum, he furnishing his own tools, controlling his own time, and being responsible for nothing except the accomplishment of the removal of trees, was a contractor within the meaning of the act. Storm vs. Thompson— 170 N. W. 403. The term "workman" shall include the singular and plural of both sexes. Any reference to a workman who has been injured shall, wliere the workman is dead, include a reference to his dependents as herein defined, legal representatives, or where the workman is a minor or incompetent to his guardian or next friend. (c) The following shall be conclusively presumed to be wholly dependent upon a deceased employe. (1.) The surviving spouse, unless it be shown that the survivor wilfully deserted deceased without fault upon the part of the deceased; and if it be shown that the survivor deserted deceased 202 APPENDIX (Compensation) without fault upon the part of deceased, the survivor shall not be regarded as a dependent in any degree. No surviving spouse .shall be entitled to the benefits of this act unless she shall have been married to the deceased at the time of the injury, and should the deceased employe leave no dependent children, and should the surviving spouse remarr}^, then all compensation payable to her shall terminate on the date of such remarriage. (2.) A child or children under sixteen years of age (and over said age if physically or mentally incapacitated from earning) whether actually dependent for support or not upon the parent at the time of his or her death. (3.) A parent of a minor entitled to the earnings of the em- ploye at the time when the injury occurred, subject to provisions of subdivision (f), section ten (nine) hereof. (4.) If the deceased emploj^e leaves dependent surviving spouse, the full compensation shall be paid to such spouse ; but if the dependent surviving spouse dies before payment is made in full, the balance remaining shall be paid to the person or persons wholly dependent, if any, share and share alike. If there be no person or persons whollj^ dependent, then payment shall be made to partial dependents. (5.) In all other cases, questions of dependency in whole or in part shall be determined in accordance with the fact as the fact may be at the time of the injury ; and in such other cases if there is more than one person wholly dependent, the death benefit shall be equally divided among them, and persons partially dependent, if any, shall receive no part thereof. If there is no one wholly dependent and more than one person partially dependent, the death benefit shall be divided among them according to the relative extent of their dependency. Provided, however, that when a lump sum is paid as contemplated by this act, the court or commissioner, in making distribution thereof, shall take into consideration the contingent rights of partial beneficiaries or the rights of those who may become such after a wholly depend- ent child or children become sixteen years of age. (6.) Step-parents shall be regarded in this act as parents. (7.) Adopted child or children or stepchild or children shall be regarded in this act the same as if issue of the body. (d) ''Injury" or "personal injury" includes death resulting from injury. (e) The words "personal injury arising out of and in the course of such employment" shall include injuries to employes whose services are being performed on, in or about the premises which are occupied, used or controlled by the employer, and also APPENDIX (Compensation) 208 injuries to those who are engaged elsewhere in phiees where their employer's business requires their presence and subjects them to dangers incident to the business. Employment is not responsible for lightning injuries unless it increases the hazard from lightning. Injury by lightning after working hours and while employe was sitting in boarding tent at site of work, furnished by employer, did not arise out of employment. Griffith vs. Cole— 165 N. W. 577. If an employe has reached his employer's premises on his way to work or is still on the premises on his Avay home from work, when an accident occurs, it is an accident arising out of the employment. Pace vs. Appanoose county — 168 N. W. 916. Act held to have extra territorial effect. Pierce vs. Bekins Van and Storage Co. — 172 N. W. 191. (f) The words "injury" and "personal injury" shall not include injury caused by tlie wilful act of a third person directed against an employe for reasons personal to such employe or because of his employment. (g) They shall not include a disease except as it shall result from the injury. (h) The word "court" whenever used in this act, unless the context shows otherwise, shall be taken to mean the district court. Sec. 2477-ml7. Insurance against compensation prohibited — penalty, (a) Any contract of employment, relief benefit or insurance or other device whereby the employe is required to pay any premium or premiums for insurance against the com- pensation provided for in this act shall be null and void ; and any employer Avithholding from the wages of any employe any amount for the purpose of paying any such premium shall be guilty of a misdemeanor and punishable by a fine not less than ten dollars nor more than fifty dollars for each offense, in the discre- tion of the court. No employe or beneficiary shall have power to waive any of the provisions of this act in regard to the amount of compensation which may be payable to such employe or beneficiary hereunder to whom the act applies. Sec. 2477-ml8. Contract respecting claim for injury deemed fraudulent. Any contract or agreement made by any employer or his agent or attorney with any employe or any other benefi- ciary of any claim under the provisions of this act within twelve days after tlie injury siiall be presumed to be frauduh'iit. Sec. 2477-m20. Attorney's lien — subject to approval. No claim of an attorney at law for services in securing a recovery under 204 APPENDIX (Compensation) this act shall be an enforceable lien thereon unless the amount of the same be approved in writing by a judge of a court of record or the Iowa industrial commissioner, which approval may be made in term time or vacation. Sec. 2477-in21. Applicable to intrastate and interstate com- merce. The provisions of this act shall apply to employers and employes as defined in this act engaged in intrastate commerce and also those engaged in interstate or foreign commerce for wliom a rule or method of compensation has been or may be established by the congress of the United States, only to the extent that their mutual connection with intrastate work or foreign commerce shall be clearly separable and distinguishable from interstate or foreign commerce ; provided, that any such employer and workman of such employer working only in this state may, subject to the approval of the Iowa indifstrial com- missioner, and so far as not forbidden by any act of congress or permitted, voluntarily by written agreement, accept and become bound by the proA^sions of this act in like manner and with the same force and effect in every respect as b}^ this act provided for other employers and employes. The mere allegation of the employer that the servant was engaged in interstate commerce, and hence recovery could be had only under the federal act, does not deprive the industrial commissioner or the board of arbitration of jurisdiction since that is a mere question of fact for their decision. Des Moines Union vs. Punk— 164 N. W. 648. PART II. Sec. 2477-m22. Iowa industrial commissioner — appointment — term. There is hereby created the office of Iowa industrial com- missioner, to be appointed by the governor, by and with the consent of the senate. The term of office of the commissioner shall be six years. An appointment may be made to fill a vacancy or otherwise when the senate is not in session, but shall be acted upon at the next session thereof. The Iowa industrial commissioner shall appoint a deputy, for whose acts he shall be held responsible, who shall hold office during the pleasure of said industrial commissioner. Such appointment shall be made in writing, and must be approved by the executive council of the state of Iowa. The deputy, in the absence or disabilitj^ of the Iowa industrial commissioner, shall have all the poA\^ers and perform all of the duties of the indus- trial commissioner pertaining to his office, and shall receive an annual salary of twenty-four hundred dollars, payable in equal monthly installments, out of the state treasury and in the same manner as are the salaries of other state officials. APPENDIX (Compensation) 205 Sec. 2477-m23. Salary — expenses — office — seal — assistants — accounts — political activity — annual appropriation. The salary and actual necessary expenses of the commissioner shall be paid by the state, and he shall be provided with adequate and necessary office rooms, furniture, equipment, supplies and other necessaries in the transaction of the business. The annual salary of the commissioner shall be thirty-three hundred dollars. The commissioner, by and with the consent of the executive council, may fix the salary and appoint a secretary and other assistants and clerical help as may be required and needed, provided that the salary of the secretary shall not exceed eighteen hundred dollars per annum. The salary and actual personal expense account of the commissioner shall be itemized and sworn to and filed as other current bills as provided by statute, and warrant therefor shall be issued by the auditor upon the treasury of the state for the payment thereof at the end of each calendar month ; provided, however, that the expense account may be audited, allowed and paid at the end of each week. The commissioner shall provide himself with a seal, which shall be used to authenticate his orders, decisions and other proceedino-s deemed necessary, upon which shall be inscribed the words ''Iowa Industrial Commis- sioner's Seal" and the date of organization. All other accounts made by, through or under the commissioner for salaries (and) expenditures, unless otherwise by this act provided, shall be item- ized and sworn to by the parties entitled thereto, audited by the commissioner, attested by the secretary, filed as other bills are required by statute, and a Avarrant shall issue therefor by the auditor of state upon the treasurer, who shall pay the same out of the funds appropriated for the use of the commissioner as by this act provided. The salaries of all persons under the commis- sioner shall be audited, allowed and paid at the end of each month, and expense accounts may be audited, alloAved and paid at the end of each Aveek. The commissioner shall have the power to remove the secretary or any other person appointed to an office by him at any time the commissioner may see fit. It shall be unlawful for any appointee by the commissioner to espouse the election or appointment of any candidate for or to any political office, or contribute to the campaign fund of any political party, or to the campaign fund of any person who is a candidate for election or appointment to any political office, and any person performing the duties as an appointee under the commissioner violating the provisions of this act shall be sufficient cause for dismissal and removal from office. Before entering upon his duties the commissioner shall qualify by taking the oath of his office, that he will support the constitu- tion of the United States and of the state of Iowa, and will faithfully and impartially, without fraud, fear or favor, dis- charge the duties of his office incumbent upon him, as provided 14 206 APPENDIX (Compensation) by the law of the state of Iowa, to the best of his ability and understanding. There is hereby appropriated out of any money not otherwise appropriated for the use of the commissioner, as contemplated Avit]iin the terms of this act or acts amendatory thereof, or other statutes relating to the commissioner, his duties and responsi- bilities empowered by law, the sum of twenty thousand dollars annually, and in addition thereto the executive council shall pro- vide and furnish the commissioner with such printing as may be necessary in the transaction of the business within the con- templation of the law. Sec. 2477-m24. Powers — rules — witnesses — reports. The com- missioner may make rules and regulations not inconsistent with this act for carrying out the provisions of the act. The employer shall furnish upon request of an injured employe or dependent or any legal representative acting for such person, a statement of the earnings, wages, or salary and other matters relating to sucli earnings, wages, or salary during the year or part of the year that such employe was in the employment of such employer for the 3^ear preceding the injury. Provided, however, that not more than one report shall be required for each on account of any one injury. Process and procedure under this act shall be as summar}^ as reasonably may be. While sitting as an arbitra- tion committee, or when conducting a hearing upon review, or in the making of any investigation or inquiry, neither the com- missioner nor the arbitration committee shall be bound by com- mon law or statutory rules of evidence, or by technical or formal rules of procedure, but may hold such arbitra- tions or conduct such hearings and make such investigations and inquiries in the manner best suited to ascertain the substan- tial rights of the parties. The commissioner shall have the power to subpoena witnesses, administer oaths and to examine such books and records of the parties to a proceeding or investigation as relate to questions in dispute or under investigation. The fees for attending as a witness before the industrial commissioner shall be one dollar and tifty cents per diem ; for attending before an arbitration committee, one dollar per diem; in both cases five cents per mile for traveling to and from the place of hearing. The district court is hereby empowered to enforce by proper pro- ceedings the provisions of this section relating to the attendance and testimony of witnesses and the examination of books and records. The deposition of any witness may be taken and used as evidence in any hearing pending before a board of arbitration in workmen's compensation proceeding in connection herewith. That such deposition shall be taken in the same manner as pro- vided for the taking of depositions in the district court, and when so taken shall be admissible in evidence in such hearings in the APPENDIX (Compensation) 207 same manner subject to the same rules governing the admission of evidence in the district court. Application for permission to take depositions in such case shall be filed in the district court of the county wherein the case for arbitration shall be heard. The commissioner shall make biennial reports to the governor who shall transmit the same to the general assembly, in which, among other things, the commissioner shall recommend such changes in the law covered by this act as he may deem necessary. Sec. 2477-m25. Compensation agreements — approval. If the emploj'Cr and the employe reach an agreement in regard to the compensation under this act, a memorandum thereof shall be filed with the Iowa industrial commissioner by the employer or employe, and unless the commissioner shall, within twenty days, notify the employer and employe of his disapproval of the agree- ment by registered letter sent to their addresses as given on the memorandum filed, the agreement shall stand as approved and be enforceable for all purposes under the provisions of this act. In case the injured employe is a minor, either he or the trustee provided for in section twenty-four hundred seventy-seven-m-18 (2477-m-13), supplement to the code, 1913, may execute the mem- orandum of agreement provided for herein, and may give a valid and binding release for the compensation paid on his ac- count under the terms of this act. Such agreement shall be ap- proved by said commissioner only when the terms conform to the provisons of this act. Employer's ignorance of the law is not such mistake as will authorize the setting aside of a partly performed settlement made under the com- pensation act between employer and employes. Bach vs. Inter Urban Ry Co.— 171 N. W. 134. Sec. 2477-m26. Committee of arbitration. If the employer and the injured employe or representatives or dependents fail to reach an agreement in regard to compensation under this act, either party may notify the industrial commissioner, who shall there- upon call for the formation of a committee of arbitration. The arl)itration committee shall consist of three persons, one of whom shall be the industrial commissioner who shall act as chairman. The other two shall be named, respectively, by the two parties. If a vacancy occurs it shall be filled by the party whose repre- sentative is unable to act. The applicant for Workmen's compensation has the burden of proving by a preponderance of the evidence that the injuries arose out of employ- ment. Griffith vs. Cole— 165 N. W. 577. Plaintiff seeking compensation under workmen's compensation act has burden of showing that injuries arose out of and in the course of the employment within the act. Rish vs. Iowa Portland Cement Company — 170 X. W. 532. 208 APPENDIX (Compensatior ) Sec. 2477-m27. Oath of arbitrators. Tlie arbitrators appointed by the parties shall be sworn by the chairman to take the follow- ing oath : I, , do solemnly swear (or affirm) that I will faithfully perform my duties as arbitrator and will not be influenced in my decision by any feeling of friendship or partiality toward either party. ( Signed; Sec. 2477-m28. Appointment of arbitrators. It shall be the duty of the industrial commissioner, upon notification that the parties have failed to reach an agreement, to request both parties to appoint their respective representatives on the committee of arbitration. The commissioner shall act as chairman, and if either party does not appoint its member on this committee within seven days after notification as above provided, or after a vacancy has occurred, the commissioner shall fill the vacancy and notify the parties to that effect. Sec. 2477-m29. Powers of committee — hearings — decision. The committee of arbitration shall make such inquiries and in- vestigations as it shall deem necessary. The hearings of the committee shall be in the city, town or place where the injury occurred, if within the state. If the injury occurred outside this state the hearings of the committee shall be held in the county seat of this state which is nearest to the place where the injury occurred unless the interested parties and the Iowa industrial commissioner mutually agree by written stipulation that the same ma}^ be held at some other place. The decision of the com- mittee, together with the statement of evidence submitted be- fore it, its findings of fact, rulings of laAV and any other matters pertinent to questions arising before it shall be filed with the industrial commissioner. Unless a claim for review is filed by either party within five days from the date of filing the decision with said commissioner, such decision shall be enforceable under the provisions of this chapter. Sec. 2477-m30. Examination by physician — fee — evidence. The industrial commissioner may apoint a duly qualified impar- tial phjssician to examine the injured employe and make report. The fee for this service shall be five dollars, to be paid by the industrial commissioner, together with traveling expenses, but the commissioner may allow additional reasonable amounts in ex- traordinary cases. Any physician so examining any injured em- ploye shall not be prohibited from testifying before the Iowa industrial commissioner or any other person, commission or court, as to the results of his examination or the condition of the in- jured employe. Sec. 2477-m31. Compensation of arbitrators — costs. The ar- bitrators named by or for the parties to the dispute shall each APPENDIX (Compensation) 209 receive five dollars as a fee for his services, but the industrial commissioner may allow additional reasonable amounts in ex- traordinary cases. The fees shall be paid by the employer who may deduct an amount equal to one-half of the sum from any compensation found due the employe. And all other costs in- curred in the hearing before the board of arbitration shall be taxed to the losing party, or an equitable apportioinnent made thereof by the committee according to the facts. Sec. 2477-m32. Review — second hearing. If a claim for re- view is filed, the industrial commissioner shall hear the parties and may hear evidence in regard to any or all matters pertinent thereto and may revise the decision of the committee in whole or in part, or may refer the matter back to the committee for further findings of fact, and shall file its decision with the records of the proceedings and notify the parties thereof. No party shall as a matter of right be entitled to a second hearing upon any question of fact. Sec. 2477-m33. Any party in interest may present a certified copy of an order or decision of the commissioner, or an award of an arbitration committee from which no claim for review has been filed within the time allowed therefor, or a memorandum of agreement approved by the commissioner, and all papers in con- nection therewith, to the district court of the county in which the injury occurred, whereupon said court shall render a decree in accordance therewith and notify the parties. Such decree, in the absence of an appeal from the decision of the industrial commissioner, shall have the same effect and in all proceedings in relation thereto shall thereafter be the same as though ren- dered in a suit duly heard and determined by said court. Upon the presentation to the court of a certified copy of a decision of the industrial commissioner, ending, diminishing or increasing .a weekly payment under the provisions of this act, the court shall revoke or modify the decree to conform to such decision. Complaint may not be made on appeal for the first time of any error in computation of the accumulated unpaid award under the act, which the court order^ paid. Fischer vs. Priebe & Company — 160 N. W. 48. No order or award of an arbitration committee is appealable direct to the courts, but if any party in interest is aggrieved thereby, he may within five (5) days from the date thereof aj^ply to the industrial commissioner for a review of the same by sueli industrial commissioner in the manner as hereinbefore provided. If any such party is aggrieved by reason of an order or decree of the Iowa industrial commissioner, such party may appeal therefrom to the district court of Iowa, only in the manner and upon the grounds following: 210 APPENDIX (CompensatioK) The five day period for applying for a review of an arbitration commit- tee's decision by tlie commissioner starts to run on the date that the com- mittee's award is filed with the commissioner. Herbig vs. Walton Auto Company— 171 N. W. 154. Within thirty (30) days from the date of such order or decree of the industrial commissioner, the party aggrieved may file an application in writing with the Iowa industrial commissioner ask- ing for an appeal from such order or decree, stating generally the grounds upon which such appeal is sought. In the event such application is filed as hereinbefore provided, the industrial com- missioner shall, within thirty days from the filing of same, cause certified copies of all documents and papers than on file in his office in the matter, and a transcript of all testimony taken therein, to be transmitted with his findings and order or decree to the clerk of the district court of Iowa in and for that county wherein the injury occurred. The application for such appeal may thereupon be brought on for hearing before said district court upon such record by either party on ten (10) days written notice to the other; subject, however, to the provisions of law^ for a change of the place of trial or the calling of another judge. The findings of fact made by the industrial commissioner within his powers shall, in the absence of fraud, be conclusive, but upon such hearing the court may confirm or set aside such order or de- cree of the industrial commissioner, if he finds : (1) That the industrial commissioner acted without or in excess of his powers ; or (2) That the order or decree was procured by fraud; or (3) That the facts found by the industrial commissioner do not support the order or decree. (4) That there is not sufficient competent evidence in the record to warrant the industrial commissioner in making the" order or decree complained of. The courts may not interfere with the findings of fact made by the industrial commissioner when they are supported hf evidence, even though it may be thought that there is error. Pace vs. Appanoose county — 168 N. W. 916. The district court may confirm or set aside the order of the industrial commissioner if he finds the commissioner has committed error in one or more of the particulars designated by act. Herbig vs. Walton Auto Company — 171 N. W. 154. The supreme court is limited in its review upon appeal to questions decided by the lower court. Herbig vs. Walton Auto Company — 171 N. W. 154. No order or decree of the industrial commissioner shall be set aside by the court upon other than the grounds just stated. APP?:NDIX (Compensation) 211 Upon the setting aside of any sneli order or deeree, the court may recommit the controversy to the industrial commissioner for further hearing" or proceedings, or it may enter the proper judg- ment upon the findings, as the nature of the case may demand. Such decree shall have the same effect and in all proceedings in relation thereto shall thereafter be the same as though rendered in a suit duly heard and determined by said court. An abstract of the judgment entered by the trial court upon the appeal from any order or decree shall be made by the clerk thereof upon the docket entry of any judgment which may hereinbefore have been rendered upon it. Such order or decree and transcript of such abstract may thereupon be obtained for like entry upon the dockets of the courts of other counties within the state. Any party in interest who is aggrieved by a judgment entered by the district court upon the appeal of an order or decree, may appeal therefrom within the time and in the manner provided for in appeal from the orders, judgments and decrees of the dis- trict court of Iowa; but all such appeals shall be placed on the calendar of the supreme court and brought to a hearing in the same manner as criminal causes on such calendar. No fee shall be charged by the clerk of any district court for the performance of any official service required by this act, ex- cept for the docketing of judgments and for certified copies or transcripts thereof. In proceeding on appeal from an order or decree, costs as between the parties shall be allowed or not, in the discretion of the court. Sec. 2477-m34. Review of Payment — notice, (a) Any pay- ment required to be made under this act, which has not been com- muted, may be reviewed by the industrial commissioner at the request of the employer or of the employe, and if on such review the commissioner finds the condition of the employe warrants such action, he may end, diminish or increase the compensation, subject to the maximum or minimum amounts provided for in this act. All hearings upon review of the Iowa industrial com- missioner under the provisions of this section, or under section twenty-four hundred seventy-seven-m-32 (2477-m-82), suiiplement to the code, 1913, shall be held at Des Moines, Iowa, unless the interested parties and the Iowa industrial commissioner mutually agree by written stipulation that the same may be held at some other place. Where an award under act limited to a period not exceeding 300 weeks, is made subject to reduction, if employe's condition improves so that he can earn part wages, the burden as to change or continuance of condition, in proceedings to enforce payment, is on the employer. Fischer vs. Priebe & Company — 160 N. W. 48. Upon the presentation to the court of a certified co])y of a decision of the industrial commissioner ending, diminishing or in- 212 APPENDIX (Compensation) creasing a weekly payment under the provisions of this act, the court shall revoke or modify any judgment or decree then on record in his court to conform to such decision. (b) Any notice to be given by the commissioner or court provided for in this act shall be in writing but service thereof shall be sufficient if registered and deposited in the mail, ad- dressed to the last known address of the parties. Sec. 2477-in35. Fees subject to approval. Fees of attorneys and physicians for services under this act shall be subject to the approval of the industrial commissioner unless otherwise pro- vided in this act. Sec. 2477-m36. Reports by employers — records — inspection. Every employer shall hereafter keep a record of all injuries, fatal or otherwise, sustained by his employes in the course of their employment and resulting in incapacity for a longer period than one day. Within forty-eight hours, not counting Sundays and legal holidays, after the employer has knowledge of the oc- currence of an accident resulting in personal injary causing in- capacity for a longer period than one day, a report shall be made in writing by the employer to the industrial commissioner on blanks to be procured from the commissioner for that purpose. Upon the termination of the disability of the injured employe, or if such disability extends beyond a period of sixty days, at the expiration of such period, the employer shall make a supple- mental report on blanks to be procured from the commissioner for that purpose. The said reports shall contain the name and nature of the business of the employer, the location of the estab- lishment, the name, age, sex and occupation of the injured em- ploye, and shall state the date and hour of the accident, the na- ture and cause of the injury, and such other information as may be required by the commissioner. Any employer who refuses or neglects to make the report required by this section shall be punished by a fine of not more than fifty dollars for each offense. All books, records and pay rolls of the employers, coming under this act showing or reflecting in any Avay upon the amount of wage expenditure of such employer, shall always be open for in- spection by the industrial commissioner, or any of his represen- tatives presenting a certificate of authority from said commis- sioner for the purpose of ascertaining the correctness of the wage expenditure; the number of men employed and such other infor- mation as may be necessary for the uses and purposes of the com- missioner in his administration of the law. But information ob- tained within the contemplation of this act shall be used for no other purpose than the information of the commissioner or in- surance association with reference to the duties imposed upon APPENDIX (Compensation) 213 such commissioner. A refusal on the part of the employer to submit his books, records or pay rolls for the inspection of the commissioner, or his authorized representatives presenting writ- ten authority from the commissioner, shall subject the employer to a penalty of one hundred dollars for each such offense, to be collected by civil action in the name of the state, and paid into the state treasury. Sec. 2477-m37. Political activity and contributions prohibited — penalty. It shall be unlawful for the commissioner, during his term of office, to serve upon any committee of any political party or espouse the election or appointment of any person for any polit- ical office or contribute to any campaign fund of any political party, or to the campaign fund of any person who is a candidate for election or appointed to any political office. A violation of this section shall be deemed a misdemeanor and uj^on conviction shall be fined one hundred dollars. See. 2477-m38. Candidates for commissioner — political prom- ises prohibited — penalty. It shall be unlawful for any person who is a candidate for the appointment as commissioner to make any promise to another, expressed of implied, in consideration of any assistance or influence given or recommendation made that the candidate will, if appointed as commissioner, vote to ap- point such person or one whom he may recommend to an office within the power of the commissioner to appoint. A violation thereof shall be deemed a misdemeanor and upon conviction thereof shall be fined one hundred dollars. Sec. 2477-m39. Recommendations of candidates to be in writ- ing — record — public inspection — financial interest prohibited — penalty. All recommendations made by any person to the com- missioner asking the appointment of another as commissioner shall be reduced to writing signed by the person presenting the same, which shall be filed by the governor in his office, and open at all reasonable times for public inspection, and all recommenda- tions made by any person to the commissioner for the appoint- ment of another within the power of the commissioner to ap- point, shall be reduced to writing, signed by the person pre- senting the same and filed by the commissioner and open for public inspection at all reasonable times and hours. If any per- son recommending the appointment of another within the con- templation of this act refuse to reduce the same to writing, it shall be the duty of the person to whom the recommendation is made, to make a brief memorandum thereof, stating the name of the person recommended and the name of the person who made the same, which shall be filed as by this act in other cases pro- vided. It shall be unlawful for the commissioner to be financialh' interested in any business enterprise coming under or affected by this act during his term of office, and if he offend this statute, it 214 APPENDIX (Compensation) shall be sufficient grounds for his removal from office and in such case the ofovernor shall at once declare the office >acant and ap- point another to fill the vacancy. Sec. 2477-m40. Removal from office — filings of charges — execu- tive council shall hear. The governor shall remove from office the commissioner on the grounds of inefficiency, neglect of duty, or malfeasance in office, upon written charges having been filed with the executive council and sustained by proofs; but written notice of such charges, together with a copy thereof, shall be served upon the accused ten days before the time fixed for hear- ing. The executive council shall have jurisdiction to hear the case, and shall make such finding in accordance with justice and the law. The finding shall be reduced to writing, and report and finding filed with the governor. PART III. Sec. 2477-m41. Insurance of liability. Every employer, sub- ject to the provisions of this act, shall insure his liability there- under in some corporation, association or organization approved b}^ the state department of insurance. Every such employer shall within thirty days after this act goes into effect exhibit on de- mand of the state insurance department evidence of his compli- ance with this section; and if such employer refuses or neglects to comply with this section, he shall be liable in case of injury to any workman in his employ under the common law as modified by statute, and in the same manner and to the same extent as though such employer had legally exercised his right to reject the compensation provisions of chapter eight (8) -a, title XII, supplement to the code, 1913. Any employer who fails to insure his liability as required herein shall post and keep posted a sign of sufficient size and so placed as to be easily seen by his employes in the immediate vicin- ity where working, which sign shall read as follows: NOTICE TO EMPLOYES You are hereby notified that the undersigned employer has failed to insure his liability to pay compensation as required by law, and that because of such failure he is liable to his employes in damages for per- sonal injuries sustained by his employes in the same manner and to the same extent as though he had legally exercised his right to reject the compensation provisions of chapter eight-a (8-a), title XII, supple- ment to the code, 1913. ( Signed ) Any employer coming under the provisions of this act who fails to comply with this section or to post and keep posted the above APPENDIX (Compensation) 215 notice in the manner and form herein required shall be guilty of a misdemeanor. Sec. 2477-m42. Mutual companies — conditions. For the pur- pose of complying' with the foregoing section, groups of employ- ers by themselves or in an association with any or all of their workmen, may form insurance associations as hereafter provided, subject to such reasonable conditions and restrictions as may be fixed by the state insurance department and membership in such mutual insurance organization as approved, together with evi- dence of the payment of premiums due, shall be evidence of compliance with the preceding section. Sec. 2477-m43. Benefit insurance — approval. Subject to the approval of the Iowa industrial commissioner, any employer or group of employers may enter -into or continue an agreement with his or their workmen to provide a scheme of compensation, benefit or insurance in lieu of the compensation and insurance^ provided by this act ; but such scheme shall in no instance provide less than the benefits here secured nor vary the period of com- pensation provided for disability or for death, or the provisions of this act with respect to periodic payments, or the percentage that such payments shall bear to weekly wages, except that the sums required may be increased; provided, further, that the ap- proval of the Iowa industrial commissioner shall be granted, if the scheme provides for contribution by workmen, only when it confers benefits in addition to those required by this act commen- surate with such contributions. Sec. 2477-m44. Certificate of approval. Whenever such scheme or plan is approved by the Iowa industrial commissioner, he shall issue a certificate to that effect, whereupon it shall be legal for such employer, or group of employers, to contract with any or all of his or their workmen to substitute such scheme or plan for the provisions of this act during a period of time fixed by said department. Sec. 2477-m45. Termination — appeal to district court. Such scheme or plan may be terminated by the Iowa industrial com- missioirer on reasonable notice to the interested parties if it shall appear that the same is not fairly administered, or if its opera- tion shall disclose latent defects threatening its solvency, or if for any substantial reason it fails to accomplish the purpose of this act, but from any such order of said Iowa industrial commis- sioner the parties affected, whether employer or workman, may, upon the giving of proper bond to protect the interests involved, appeal for e(}uitable relief to the district court of this state. Sec. 2477-m46. Maximum commission or compensation for re- insurance. No insurer of any obligation under this act shall 216 APPENDIX (Compensation) either by himself or through another, either directly or indi- .rectly, charge or accept as a commission or compensation for plac- ing or renewing any insurance under this act more than fifteen per cent of the premium charged. Sec. 2477-m47. Policy requirements. Every policy issued by any insurance corporation, association or organization to assure the payment of compensation under this act shall contain a clause providing that between any employer and the insurer, notice to and knowledge of the occurrence of injury or death on the part of the insured shall be notice and knowledge on the part of the insurer ; and jurisdiction of the insured for the purpose of this act shall be jurisdiction of the insurer and the insurer shall be bound by every agreement, adjudgment, award or judgment ren- dere'd against the insured. • Sec. 2477-m48. Insolvency clause prohibited — lien of insured. No polic}^ of insurance issued under this act shall contain any provisions relieving the insurer from payment if the insured be- comes insolvent or discharged in bankruptcy during the period that the policy is in operation, or the compensation, or any part of it, is due and unpaid. Every policy shall provide that the workman shall have a first lien upon any amount becoming due on account of such policy to the insured from the insurer, and that in case of the legal incapacity, inability or disability ot: the insured to receive the amount due and pa^^ it over to the in- sured-workman, or his dependents, said insurer shall pay the same directlj' to such workman, his agent, or to a trustee for him or his dependents, to the extent of discharging any obligations of the insured to said workman or his dependents. Sec. 2477-m49. Proof of solvency — ^revocation of approval. Where an employer coming under this act furnishes proofs to the insurance department satisfactor}^ to the insurance department and Iowa industrial commissioner, of such employer's solvenc}^ and financial ability to pay the compensation and benefits as by this act provided and to make such payments to the parties when entitled thereto, or when such emploj^er deposits with such in- surance department security satisfactory to such insurance de- partment and the Iowa industrial commissioner as will* secure the payment of such compensation, such employer shall be re- lieved of the provision of section forty-two of this act ; provided that such employer shall from time to time, as may be required by such insurance department and Iowa industrial commissioner, furnish such additional proof of solvency and financial ability to pay as by this section of this act provided. The insurance department and Iowa industrial commissioner may, at any time, upon reasonable notice to such employer and upon hearing, revoke for cause any order or approval theretofore APPENDIX (Compensation) 217 made, as by this act provided and within the contemplation of this section. Sec. 2477-m50. When effective. Part one of this act shall take effect from and after July first, nineteen hundred fourteen, and parts two and three July fourth, nineteen liundred tliirteen, and any employer or employe who serves the notice to reject the terms of the act as by the act provided not less than thirty days before part one thereof takes effect, such notice for the purpose of rejecting the terms of the act shall have the same force and effect as though part one had taken effect July fourth, nineteen hundred thirteen. Sec. 2477-m51. When applicable. That the law enacted hy the thirty-fifth general assembly known as senate file number three relating to employers' liability for personal injury sus-» tained by employes in line of duty, and fixing compensation therefor, shall not apply to an injury sustained by such employe of such employer which occurs prior to the time when such act takes effect in all of its parts ; but the law and procedure in force at the time such injury occurs, if before such act takes effect in all of its parts, shall be the same as though such act had not been enacted, whether such action is brought before or after such act takes effect in all of its parts. Index Index Actions: (See suit or actions). Advertisements : May not advertise authorized capital, § 1783-g. Penalty, § 1783-h. Misleading statements, § 175 8-f. Penalty, § 1758-g. Soliciting agents. Life, § 1815. Other than life, § 1749. Agents : Assessment life associations. License, § 1800. Penalty, § 1801. Recovery, § 1802. Praternals, § 1833. False representations by officers or agents, § 1838. Illegal business, § 1837. Penalty for soliciting new business after revocation of au- thority, § 183 9-f. Life insurance companies. Advertisements — who deemed agents, § 1815. Fraud in procuring insurance, § 1816. Misrepresentations prohibited, § 1820-b. Penalty § 1820-c. Provisions applicable, § 1815. Other than life companies. Advertisements of agents, § 1749. May advertise individual business without mentioning name of company, § 1758-h. Misleading statements, § 175 8-f. Penalty, § 1758-g. Must have certificate, § 1725. Resident agent — foreign fire companies, § 1739. Penalty, § 1740. Soliciting agents defined, § 1749. Who deemed agents, § 17 5 0. Provisions of general applicability. License, § 1821-k. Penalty, § 1821-1. Must have certificate, § 1800. Penalty, § 1801. Recovery, § 1802. Rebating and discrimination, § 1782. Penalty, § 1783. Service of notice of suit on agent, § 3530 (Miscl. Sections). Page 142. Solicitation of business after revocation of authority, § 1821-f. Solicitation of proxies, § 182 1-y. Penalty, § 18 21-z. Reciprocals, § 13, Ch. 180, 37th G. A. (Miscl. Sections). Page 137. State and county mutuals. Agents licensed for state mutuals, § 15, Ch. 120, 39 G. A. Page 67. INDEX 221 Penalty for acting without license, § 15, ibid. Page 67. Revocation of license, ^ 15, ibid. Page 67. Amortization oi' Securities: Life companies and associations, Ch. 198, 39 G. A. Page 80. Annual Statcnionts: Assessment life, accident and health associations, § 1790. Convention form, § 18 20-d. Fraternals, § 1830. Child insurance, special annual statement, § 1822. Foreign companies. Other than life, § 1716. Life, §§ 1773, 1799. Penalty for violation of provisions, §§ 1801, 1802. Life companies, §§ 1773 and 1799. Convention form, § 1820-d. Penalty for failure to file, §§ 1776 and 1801. Other than life, § 1714. Printed form, §§ 1819 and 1820-d. Reciprocals, § 7, Ch. 180, 37 G. A. (Miscl. Sections). Page 136. State and county mutuals, § 5, Ch. 120, 39th G. A. Page 64. Application : Assessment life associations. Should be attached to policy, § 1819. Fraternals. Should be attached to certificate, § 182 6. Life companies. Should be attached to policy, § 1819. Other than life companies. Should be attached to policy, § 1741. Arbitration: Other than life, § 1743. Articles of incorporation: (See promotion and organization and capital stock). Assessment, accident and health associations, approved of by commissioner, § 1785, Fraternals. Approved by commissioner, § 1832. Foreign associations must file, § 1829. Life companies — approved by the commissioner, § 1768. Other than life — incorporation of, § 16 84. Approval by the commissioner, § 168 5. Recording of, §§ 1686 and 1688. State and county mutuals — approval by commissioner, § 3. Cli. ' 120, 39th G. A. Page 62. Provisions bearing on articles of incorporation. Proportionate representation, stock companies, 5? lS21-v-w. Voting by proxies, § 1821-x. Assessment Life, Accident and Health Associations: Agents licensed, § 1821-k. Penalty for violation, § 1821-1. Applicability of chapter 8-a, § 1821-i. Applicability of chapter 8-b, § 1821-m. Approval of policy forms, 5^ 1787. Approval of articles and by-laws by commissioner, ^ 1785. Assessments, § 1788. Assignment of policies, § 1789. Beneficiaries, § 1789. Certificate of compliance, § 179 6. 15 222 INDEX Certificate of membership are policies, § 1785. Conditions precedent to doing business, § 1787. Defined, § 1784, Deposit with commissioner of insurance, § 1791. Change of securities, § 1792. Collection of interest, § 17 93. Distribution of surplus, § 1797. Foreign assessment associations, § 179 4. Insurable age, § 1789. Investment of accumulations, § 1791. Name shall not be similar to the name of another assn, §1786. Officers and directors shall not gain through investment of com- pany's funds, § 13, Ch. 348, 38 G. A. (Miscl. Sections). Page 133. Organization or authorization prohibited, § 17 98-a. Proceedings to control or wind up, § 1795. Provisions applicable to accident and health association. Consolidation — expense — penalty, § 1821-r-t-u. Provisions applicable to life associations. Agent's certificate, § 1800. Penalty, § 1801. Recovery, § 1802. Consolidation of associations, § 1821-n-o-p-Q. With unauthorized companies, § 1821-s. Penalty — violation of consolidation provisions, § 1821-u. Expenses of proceedings for approval of consolidation, § 1821-t. Re-incorporation as legal reserve company, § 17 9 8-b. Service of process, § 1798. Service on Agent of association, § 3530 (Miscl. Sections). Page 142. Shall not loan funds, nor invest its funds on property owned by officers or directors or members of their immediate family. Sec. 13, Chap. 348, 38th G. A. (Miscl. Sections). Page 133. Soliciting proxies by agent, § 1821-y. Penalty, § 1821-z. Surrender values, § 1797. Valuation of policies, § 1798-a. Voting by proxies, § 182 1-x. Where suit may be brought, § 3499. (Miscl. Sections). Page 141. Blue Sky L.avvs: Promotion of companies, Ch. 22 4, 39 G. A. Page 2. Sale of Stock with policies, Ch. 181, 39 G. A. Page 109. Board of Supervisors: May insure county buildings, § 4 22 (Miscl. Sections). Page 139. May spend money received from insurance for reconstruction, of of buildings destroyed, S 425 (Miscl. Sections). Fage 139. By-Laws : Assessment life, accident and health associations. Approved by commissioner, § 17 85. Fraternals — approval by commissioner, § 1832. Foreign fraternals must file, § 1829. State and county mutuals — Approval by commissioner, Sec. 3, Ch. 120, 39th G. A. Page 62. Capital Stock: (See Articles of Incorporation and Promotion and Or- ganization) . Advertisements — foreign fire companies, §§ 1739, 1740. Advertisements and publications, § 1783-g. Violation — penalty, § 1783-h. Amount stated in articles — life companies, § 1768. INDEX 22:J Foreign companies — other than life, — capital required. § 1721. Impairment — other than life — dissolution, §§ 1731, 1732. Life insurance companies — amount, § 1769- Deposit, §§ 1769, 1806. Investments, 1803, 1806, 1807. Officers or directors not to profit from loans or investments, § 3, Ch. 348, 38 G. A. (Miscl. Sections). Page 133. Loans to officers and directors — other than life, § 1783-e. Other Than Life Companies. Amount, §§ 1691 and 1783-e. (Part of § 1691 repealed by implication by amendment to § 1783-e by 39th G. A.) Examination — statement of capital, § 1700. Increase in capital, § 1701. Investment of, § 1699. Subscription to, § 1694. Taxation of capital — domestic companies, § 1310. Transfer of stock pending investigation, §§ 1734, 1821-c. Casualty Insurance: Authorized, § 1709. (See Other Than Life Insurance, Mutual Companies, Stock Companies) . Certiftcate of Authority: Assessment life, health and accident associations, § 1796. Proceedings for control or windup, § 1795. Fraternals, § 183 2. Revocation of authority, § 1839-d. Life companies. Annual certificate, § 1775. Revocation, § 1775, Mutual companies, § 1770. Stock companies, § 1769. Other Than Life. Refused, § 1715. If name is similar to name of another company, ^ 16 87. Revocation of — foreign companies, § 1735 — domestic com- panies § 182 1-d. Revocation generally, § 1755 — Appeal, § 175 6. Reciprocals, § 9, Ch. 180, 37 G. A. (Miscl. Sections). Page 136. Refusal or revocation, § 11, ibid. Page 13 7. State and county mutuals, § 3, Ch. 120, 39 G. A. Page 62. Dissolution, § 8, ibid. Page 65. Expiration of certificate, § 14,. ibid. Page 67. Certificate of Compliance: Publication — Other Than Life, § 1737. Children's Insurance: Fraternals, — conditions, § 1822. Co-Insurance: .Other Than Life, § 1746. Commissioner of Insurance: Additional clerks and assistants. § 1683-r2. Appointment, confirmation, removal, term, vacancy, § 1683-r. Bond of Commissioner, § 1683-r. Deputy — bond — appointment — term, § 1683-r 2. Expenses and salaries, § 1683-r2. Fees — paid to, 8 1683-r5. Powers and duties generally, § 1683-r3. Promotion and organization of companies — duties, Ch. 22 4, 39th G. A. Page 2. Transfer of records, securities and equipment to, § 1083-r4. Various powers and duties specified. 224 INDEX Assessment life, accident and health associations. Approval of Articles and By-Laws, § 1785. Approval of Bonds of Officers, § 1790. Approval of Policj^ Forms, § 17 8 7, Annual Statement, § 1790. Certificate of Compliance, § 1796. Change of Securities, § 1792. Collection of interest, § 17 93. Examinations — expenses, § 1790. Examination of foreign associations, § 1794. Deposits, § 1791. Power of Attorney, § 1798. Proceedings to control or wind up, § 1795. Service of process, § 1798. Fraternal Societies. Annual Certificate, § 1832. Annual Report, § 1830. Appointment of Receiver on Application of Attorney General only, § 1839-m. Approval of Articles and By-Laws, § 18 32. Approval of Plan of Consolidation or Reinsurance, § 18 39-g. Expenses, § 1839-h. Penalt5% § 1839-i. Examinations — assistants — compensation, § 1839-b. Expenses, § 1839-e. Officers of Societies to assist, § 183 9-c. Examination pending receivership, § 1839-n. Examination report not public until after hearing, § 1839-0. Fees, § 1832. Foreign Fraternals must file By-Laws, § 1829. May examine society applying for admission, § 1829. Proceedings for violation of statutes. § 1836. Revocation or suspension of authority, § 18 39-d. Revocation of authority — improper investments, § 18 39-1. Real estate held in trust for members, § 1839-k. Service of process, § 1831. Transfer to legal reserve, level premium company, Ch. 302, 38 G. A. Page 130. Valuation of Policies, § 1839-j. Guarantee Companies. Certificates for Guarantee Companies acting as surety, 3 60 (Miscl. Sections). Page 138. Service of Process, 362 (Miscl. Sections). Page 139. Life Companies. Annual Certificate, § 1775. Annual Report, § 1781. Approval of Articles and all Amendments, § 1768. Approval of Policies, § 1783-a. Certificate of Authority. Mutual, § 1770. Stock, § 1769. Consolidation of Companies, § 1821-n-o-p-q. Expenses, § 1821-p. Penalty, S 1821-u. With unauthorized companies, prohibited, § 182 1-s. Dissolution, §§ 1776, 1777. Discretion in calculation of valuation of securities, Ch. 198, 39th G. A. Page 80. Examination, § 1777. Fees, § 1818. INDKX 225 Real estate held in trust by, § 1806. Commissioner to determine value of real estate, § 180 0. Receiver, § 1777. Sale of stock with policies prohibited, — Power of Commissioner Ch. 181, 39 G. A. Page 109. Service of process, ;^?i 1808. 1809. Valuation of Policies, § 1774. Other Than Life Companies. Acceptance of Service, 8 1722. Agent's Certificate of Authority, §§ 17 25, 1821-k. Penalty, 5^ 1821-1- Annual Report, § 1720-a. Annual Statement, § 1714. Printed Form, § 1719. Applicability of Chapter 8-A to all classes of companies, ^5 1821-1. Approval of Articles of Incorporation, § 1G85. Approval of Policy Forms, § 174.5. Certificate of Authority, § 1700. Refused, § 1715. Revocation of. § 1821-d. Certificate of foreign companies, 5^ 17 24. Certificates of Compliance — Publication, § 173 7. Consolidation of Companies, § 1821-r. Expenses, § 1821-t. Penalty, § 1821-u. With unauthorized companies prohibited, § 1821-s. Examination, § 1700. Biennial examination, § 1821-a. Companies to assist, § 1821-d. Dissolution, § 1731. Evidence, § 1757. Examiner's compensation and expenses, § 1821-c. Foreign companies, § 1753. Publication of results, § 1821-d. Non-resident companies, § 1821-h. Fees, § 1752. _ Mutual Companies — Assessment for deficiency, § (, Ch. 4- J, 37 G. A. Page 8. Repayment of loans to Directors and Officers, § 8, ibid. Page 8- Name of Company — Must not be similar. § 168 <. Organization of Mutual Companies. § 169 2. Refusal to be examined — Penalty. § 1821-g. Requisition on Stockholders, § 1732. Revocation of Certificate of Foreign Companies, !i 1 ''^;'- . Sale of Stock with Policy prohibited,— Powers of Commissioner, Ch. 181, 39th G. A. Page 109. Service of Process, § 1722. Short Rate Table, § 1729. Reciprocals, (Ch. 180, 37th G. A.) (Miscl. Sections). Annual Statement. § 7. Page 13 6. Approval of Policies, S 14. Page 138. Certificate of Authority, § 9. Page 13 6. Examination, § 7. Page 13 6. Preliminary Showing. ^ 3. Page 133. Refusal or Revocation of Certificate, 5i U- Page 137. Service of Process. S 4. Page 134. State and County Mutuals. (Ch. 120. 39th G. A.) Agents — License and Control of, ij 15. Page 67. Annual State. § 5. Page 64. Approval of Investments and Real Estate, § 4. Page 63. 226 INDEX Approval of Articles, By-laws, Policies, § 3. Page 62. Bonds of Officers, Approval, § 10. Page 6 6. Certificate of Authority — Conditions precedent, § 3. Page 62. Dissolution, § 8. Page 65. Examinations, §§ 8, 12. Pages 65 and 67. Consolidation of Companies: Fraternals, § 1839-g-h-i. Life companies and associations, § 1821-n-o-p-q-s-t-u. Other Than Life, § 1821-r-s-t-u. County Mutuals: (See State and County Mutuals). Deposit of Securities: (With Insurance Commissioner). Assessment life, accident and health associations, § 1791. Change of securities, § 1792. Collection of interest, § 1793. Fraternal Societies, § 1839-1. Life Insurance Companies, §§ 1769, 1806. Change of securities, § 1779. Collection of interest, § 1780. Defaulting or insolvent companies, § 1778. Foreign companies — deposit in home state, § 1772. Reserves — valuation of policies, § 1774. Directors and Officers: Advancement of funds — mutual companies, § 8, h. 429, 37 G. A. Page 8. Assessment associations — bonds of officers, §§ 1787, 1790. Attorney in fact — reciprocals, § 2, Ch. 180, 37 G. A- (Miscl. Section). Page 133. Capital stock fund not to be loaned or invested in property of directors or officer or member of immediate family, § 13, Ch. 348, 38th G. A. (Miscl. Sections). Page 133. Discrimination and rebating, § 1782. Penalty, § 1783. Doing business without compliance, § 1747. Officers punished, § 1748. Election of, § 1696. Fraternal societies. False representations by officers or agents, § 1838. Illegal business, § 1837. Officers to assist in examination, § 1839-c. Penalty for soliciting business after revocation of authority, §§ 1839-f. Penalty for violation of certain sections, § 1839-i. Life companies. Advertisements, § 1815. Fraud in procuring insurance, § 1816. May not borrow from capital stock, § 176 9. Misrepresentations prohibited, § 1820-b. Management of companies — directors, § 169 5. Misleading statements, § 175 8-f. Penalty, §175 8-g. No part of capital to be loaned to officer or stockholder, § 1783-e. Officers or directors shall not profit from investment of companies funds, § 13, Ch. 348, 38th G. A. (Miscl. Sections). Page 133. Officers to assist in examination, § 182 1-b. Power of directors, § 1697. Power to declare dividends, § 1702. Prorportionate representation, §§ 1821-v, 1821-w. Revocation of authority, § 1755, appeal, § 175 6. INDEX 22' Sale of stock with policies prohibited, Ch. 181, 39th G. A. Page 109. Secretary and officers — duty, § 1698. Soliciting business after revocation of authority, § 18 21-f. Solicitation of proxies, §§ 1821-y, 1821-z. State and county miUtuals. Bonds — Approval of — § 10, Ch. 120, 39th G. A. Page 66. Who deemed agents, § 1750. Discriniination and Robatinj;', § 1782. Penalty, § 1783. Dissolution of Companies and Associations: Assessment, life, accident and health associations, proceedings to control or wind up, § 1795. Fraternals, § 1839 m-n-o. Life companies, §§ 1777, 1778. Failure to make deposit or file statement, § 1776. Other than life, § 1731. Mutual companies, § 1733. Requisition on stockholders, § 1732. Provisions of general applicability. Refusal to be examined, § 182 1-g. Reciprocals — refusal or revocation of certificate, § 10, Ch. ISO, 37th G. A. (Miscl. Sections). Page 136. State and county mutals, § 8, Ch. 120, 39th G. A. Page 65. Dividends: Other than life, § 1702. Evidence of Value: Other than life, § 1742. State and county mutuals, § 7, Ch. 120, 39th G. A. Page 65. Examination of Companies and Associations: Assessment, life, accident and health association, § 1790. Expenses, 1790. Foreign associations, § 1794. Fraternals. All societies, § 1839-b. Expenses, §§ 1839-b, 1839-e. Officers of the society to assist, § 1839-c. Foreign fraternals, § 182 9. General provisions relative to. Appointment of examiners, § 1821-c. Appointment of receiver following examination, § 1821-d. Comxpanies to assist, § 1821-b. Compensation of examiners, § 1821-c. , Expenses of examiners, § 1821-c. Examination at least biennially, § 1821-a. Examination of non-resident companies, § 1821-h. Publication of results of examination, § 1821-d. Refusal to be examined. § 1821-g. Transfer of stock pending examination, § lS21-e. Life companies and associations, § 1777. Consolidation, § 1821-q. Dissolution, §§ 1776, 1777. Receiver, § 1777. Other than life, § 1700. Consolidations, § 1821-r. Dissolution, § 1731. Expenses, § 1753. Revocation of authority, § 1755. Appeal, § 1756. Evidence, § 1757. 228 INDEX Reciprocals, § 7, Ch. 180, 37th G. A. (Miscl. Sections). Page 136. State and county mutuals, § 12, Cli. 120, 39th G. A. Page 67. Exemption of Pi'ococmIs of Policy and Cei-tificate: Fraternals, § 1828. Life and accident companies and associations, § 3313. (Miscl. Sections). Page 140. Fees : Assessment life, accident and health association, §§ 1790, 1794. Fraternals, § 1832. Life, § 1818. Other than life, § 1752. Paid to commissioner, § 1683-r5. Reciprocals, § 13, Ch. 18*0, 3 7th G. A. (Miscl. Sections). Page 137. State and county mutuals, Sec. 14, Ch. 120, 39th G. A. Page 67. Fire Oompanies: (See also other than life). Additional riders permitted, § 175 8-a. Advertisements, § 174 9. Agents' licensed, §§ 1821-k, 1821-1. Annual report — convention form, § 1820d. Applicability of chapter 8-a, § 1821-i. Application — copy attached to policy, § 1741. Approval of Policy forms, § 1745. Arbitration, § 17 43. Biennial examination, § 1821-a. Compensation and expenses of examiners, § 1821-c. Coinsurance, § 1746. Combinations and agreements, § 17 54. Consolidation, § 1821-r-s-t-u. Coverage defined, Sub-Sec. 1, §1709. Doing business without compliance, § 174 7. Officers punished, § 1748. Dividends, § 1702. Evidence of value, § 1742. Examinations of companies, §§ 1700, 1821-a. Company to assist, § 1821-b. Evidence, § 1757. Expenses, I 1753. Foreign companies, § 1753. Non-resident companies, § 182.1-h. Publication of results, §1821-d. Fees, 1752. Funds not to be loaned to or invested on property owned by officers, directors, or member of immediate family, S 13, Ch. 348, 38th G. A. (Miscl. Sections). Page 133. Misleading statements § 175 8-f. Penalty, § 1758-g. Notice of loss, § 1744. Officer or director not to profit from investment of company, § 13, Ch. 348, 38th G. A. (Miscl. Sections). Page 133. Organization of fire companies (see other than life insurance). Policy conditions and provisions generally, § 1743. Policy miust appear in name of issuing company, § 1758-e. Proof of loss, §§ 1742, 1742-a, 1744. Proportionate representation in stock companies, §§ 1821-v, 1821-w. Refusal to be examined, § 1821-f. Reserves, S 1702. INDEX 229 Revocation of authority, §§ 1755, 182 1-d. Appeal, 1756. Sale of stock and polices together prohibited, Ch. 181, 3'Jth. G. A. Page 10 9. Soliciting Agents defined, § 1749. Soliciting business after revocation of authority, § 182 1-f. Standard Fire Policy, <5 175 8-b. Violation, § 1758-e. Taxation. Domestic companies, § 1333-d (Miscl. Sections. Page 145. Foreign companies, § 1333 (Miscl. Sections). Page 14 3. Mutuals 5} 20, Ch. 429, 37th G. A. Page 9. Time for bringing action, § 1744. Transfer of stock pending examination, § 17 21-e. Unauthorized companies — insurance in, § 1758. Voting by proxies, § 1821-x-y-z. Who deemed agents, § 1750. Wilful burning of property. Penalty, § 4784 (Miscl. Sections). Page 142. Foi-eigli Campjinies: Life companies. Advertisements — who deemed agents, S 1815. May not advertise authorized capital, § 1783-g. Penalty, § 1783-h. Agents certificate, § 1800. ' Penalty, § 1801. Recovery, § 1802. Annual certificates, § 1775. Annual statement, §§ 1773, 1799. Penalty, § 1801. Recovery, § 1802. Application — copy attached to policy, § 1819. Commissioner's annual report, § 17 81. Conspiracy to defraud, § 1817. Defenses to action on policies, § 1811. Discrimination and rebating, § 1782. Penalty, § 1783. Dissolution, 1^5} 1776, 1777. Examination, § 1777. Fees, § 1818. Fraud in procuring insurance, ij 1816. Group accident and health and liability insurance authorized, *i 1783-d. Group life insurance authorized. Ch. 19 7, 3 8th G. A. Page 77. Industrial insurance authorized, 1783-b. Illegal business, § 1814. Investment of capital and or surplus, «^ 1772. Limitation to action, § 1820 . Medical examination, § 1783-b. Misrepresentation of age, § 1813. Misrepresentations prohibited, § 1820-b. Penalty, § 1820-c. Physician's certificate, § 1812. Policies exempt from execution. § 1805. Policy forms filed for approval, § 17 83-a. Penalty, § 1783-c. Receiver, § 1777. Retaliation — laws of other states, § 1810. Service of process, §§ 1808-1809. 230 INDEX Other than life companies. Additional riders permitted, § 1758-a. Advertisements, § 1749. ^ > Agent's certificates, § 1725. Annual statement, § 1716. Application — copy attached to policy, § 17 41. Arbitration, § 1743. Cancellation of policy, § 172 8. Capital stock, § 1721. Certificate of authority, § 1724. Revocation, § 1735. Certificate of compliance, publication, § 173 7. Coinsurance, § 1746. Combinations and agreements, § 1754. Conditions of authorization, §§ 1722, 1723. Doing business without compliance, § 1747. Officers punished, § 1748. Evidence of value, § 1742. Examinations, 1753. Evidence, § 1757. Expenses, § 1753. Dissolution, § 1731. False statement of assets, fire companies, § 1738. Penalty, § 1740. Fees, § 1752. Forfeiture of policy, § 1727. Inquiry by commissioner, § 1718. Insurance notes, § 1726. Misleading statements, § 1758-f. Penalty, § 175 8-g. ' , . Notice of loss, § 1744. Policy, conditions and provisions generally, § 174 2. Approval of, § 1745. Policy must appear in name of issuing company, § 1758-e. Policy restored — payment of sum due, § 1730. Printed form' — annual statement, § 1719. Proof of loss, §§ 1742-a, 1742, 1744. Requisition on stockholders, § 1732. Resident agent — foreign fire companies, § 17 39. Penalty, § 1740. Retaliation — laws of other states, § 173 6. Revocation of authority, § 175 5. Appeal, 175 6. Service of process, § 1722. Short rate table, § 172 9. Soliciting agent defined, § 1749. Standard fire policy, §§ 1758-b, 1758-c. Statement of capital and surplus. Foreign fire companies, § 1739. Penalty, § 1740. Time for bringing action, § 1744. Transfer of stock pending investigation, § 17 34. Unauthorized companies — insurance in, § 175 8. Who deemed agent, § 1750. Provisions of general applicability. Agents licensed, §§ 1821-k, 1821-1. Annual report — convention form, § 1820-d. Applicability of chapter 8-a, §1821-i. Compensation and expenses of examiners, §1821-c. Consolidations, § 1821-n-o-p-q-r-s-t-u. Examinations, § 1821-h. INDEX 231 Guarantee companies — release from liability as surety, *^ 361 (Miscl. Sections). Page 139. Publication of results of examination, § 182 1-d. Refusal to be examined, § 182 1-g. Revocation of certificate, § 1821-d. Sale of stock with policies, prohibited, Ch. 181, 39th G. A. Page 109. Service of notice on agent, 3530 (Miscl. Sections). Page 142. Soliciting business after revocation of authority, S 1821-s. Suit on bond of guarantee company, § 362 (Miscl. Sections). Page 139. Taxation, § 1333 (Miscl. Sections). Page 143. When guarantee company may be accepted as surety — condi- tions, § 3 60 (Miscl. Sections). Page 13 8. Where suit may be brought, § 3499 (Miscl. Sections). Page 141. 1^^'aternals, Beneficiary Societies, Order.s oi* Asso$ 174 3. Policy form, §§ 1689, 1712. Approval of, § 1745. Policy must appear in name of issuing company, § 175 8-e. Policy restored — payment of sum due, § 1730. Printed form — annual statement, § 1719. Proof of loss, §§ 1742, 1742-a, 1744. 240 INDEX Promotion expense, domestic companies, Ch. 224, 39th G. A. Page 2. Penalty for violation of law, ibid. Proportionate representation stock companies, § 1821-v-w. Proxies — voting by, § 1821-x-y-z. Reinsurance, § 1711. Requisition on stockholders, § 1732. Reserves, § 1702. Retaliation — laws of other states, § 1736. Revocation of certificate, § 1721-d. Revocation of authority, §§ 1755, 1756. Sale of stock with policies prohibited, Ch. 181, 39th G. A, Page 109. Service of notice on agent, § 3530 (Miscl. Sections). Page 142. Service of process, § 17 22. Soliciting business after revocation of authority, § 1821-f. Solicitation of application, 1694. Standard fire policy, § 1758-b. Statement of capital and surplus — foreign fire company, § 1739. Penalty, § 1740. State and county mutuals (See state and county mutuals). Subscriptions to stock-conditions precedent, § 1694. Stock or mutual comtpany. Cannot operate on both plans, § 1690. Must indicate kind of company on policy form, § 1689. Surplus, § 1783-e. Foreign mutual companies, § 17 23. Suit on bond of guarantee company — notice, § 362 (Miscl. Sec- tions). Page 139. Taxation. Domestic companies, § 1333-d (Miscl. Sections). Page 145. Foreign companies, § 1333 (Miscl. Sections). Mutual fire and casualty companies, § 20, Ch. 429, 37th G. A. Page 9. Time for bringing actions, § 1744. Transfer of stock, § 1713. ^ Pending examination, § 1821-e. Pending investigation, § 173 4. Unauthorized companies — insurance in, § 1758. Waiver in interest of insured, § 1758-d. When guarantee company may be accepted as surety, § 3 60 (Miscl. Sections). Page 138. Release from liability as surety, § 361 (Miscl. Sections). Page 139. Where action may be brought, § 3499 (Miscl. Sections). Page 141. Physicians, Diniggists, Dentists and Graduate Nurses Insurance: Au- thorized, sub-section 5, § 1709. Mutual insurance companies authorized, Ch. 286, 38th G. A. Page 59. Policy Foi'ms: Assessment life, accident and health companies. Application, § 1819. Approval of policy by commissioner, § 1787, Certificate of membership is policy, § 1785. Fraternal societies. Application, § 1826. May issue term, whole life or limited payment plan policy, § 1822. INDEX 241 Life companies. Application, § 1819. Approval by the commissioner, § 17S3-a. Failure to file policy— penalty, S 1783-c. Group life insurance policies, Ch. 197, 38th G. A. Page 77. Limitation of actions, § 1820. Medical examinations, §1783-b. Misrepresentation of age, § 1813. Physician's certificate, § 1812. Other than life. Additional riders and clauses permitted, § iTHS-a. Application — copy to be attached to policy, § 1741. Approval by coniimissioner, § 17 4"). Arbitration, § 1743. Cancellation of, § 1728. Coinsurance clause, § 174 6. Conditions and provisions generally, § 1743. Evidence of value under, ^ 1742. Forfeiture of, § 172 7. Mutual policies to conform with provisions effecting stock com- panies, § 10, Ch. 429, 37th G. A. Page 9. Must appear in name of issuing company, § 1758-e. Must indicate on first page, whether stock or mutual companies, § 1689. Notice of loss, § 17 44. Policy restored — payment of sum due, § 1730. Proof of loss under, §§ 1742, 1742-a, 1744. Seal and countersignature by officers, S 1712. Soliciting agents of foreign fire company must be resident, § 1739. Penalty, § 1740. Standard fire policy, § 1758-b. Violation of provisions, $ 1768-c. Time for bringing action, S 1744. Waiver in interest of insured, § 1758-b. Reciprocals, § 14, Ch. 180, 37th G. A. (Miscl. Sections). Page 138. State and county mutuals, § 1, Ch. 120, 39th G. A. Page 62. Approval by the commissioner, § 3. Page 62. Cancellation of, § 9. Page 65. Notice of loss, § 6. Page 64. Proof of loss, § 6. Page 64. Time for bringing suit, § 6. Page 64. Powei' of Attorney: Assessment life, accident and health companies, S 1798. Foreign companies other than life, S 1722. Fraternal societies, § 1831. Guarantee companies, S 362 (Miscl. Sections). Page 139. Life insurance companies, Si^ 1808, 1809. Reciprocals, § 4, Ch. 180, 37th G. A. (Miscl. Sections). Page 134. Premiiuns aiid assessments: Assessment life, accident and health associations — assessments, 8 1788. Articles of incorporation and by-laws and notice of assessment to state purpose of assessment, § 1788. Foreign associations, § 1794. When commencing business, § 1787. Fraternal societies — assessments, § 1823. Mortuary assessment rates, § 1839-j. 242 INDEX Life companies. Mis-statement of age — premium purchases in correct amount, § 1813. On level premium plan, § 17 68. Mutual companies, § 1770. Recovery of premium — insolvent company, § 1814. Other than life insurance companies. Mutual companies, § 1692. Assessments, § 7, Ch. 429, 37th G. A. Collect cash premium when organizing, § 1692. Foreign companies — level premiums and assessments, § 1723. Maximum premiums, § 5, Ch. 429, 37th G. A. Page 8. Unearned premiums, § 6, ibid. Page 8. Non-payment of premium — forfeiture, § 172 7. Policy restored — payment of premium, § 1730. Return of unearned premium^ — cancellation, § 1728. Short rates, § 1729. Unearned premium, reserve, § 1702. Rebating and discrimination prohibited, § 1782. Penalty, § 1783. State and county mutuals, § 4, Ch. 120, 39th G. A. Page 63. Taxation of premium income. Domestic companies, § 1333-d (Miscl. Sections). Page 145. Foreign companies, § 1333 (Miscl. Sections). Page 143. Mutual fire and casualty companies, § 20, Ch. 42 9, 37th G. A. Page9. Pi'oceeds of Policy: Life, accident and health insurance, § 3313 (Miscel. Sections). Page 140. When death or disability caused by beneficiary, § 33 86 (Miscel. Sections). Page 141. Pi'omotion and Organization of Domestic Companies: (See Articles of incorporation and capital stock.) Sale of stock with policies prohibited, Ch. 181, 39th G. A. Page 109. Supervision by the insurance department, Ch. 22 4, 39th G. A. Page 2. (For specific conditions precedent to issuance of certificate of au- thority, see life, other than life, mutual companies, etc.) Proof of Loss: Life, disability insurance, § 1820. Other than life, §§ 1742, 1742-a, 1744. State and county mutuals, § 6, Ch. 120, 39th G. A. Page 64. Proxies: Solicitation of proxies, § 1821-z. Vo,ting — conditions, § 1821-x. Publications: Certificate of compliance to be published, § 1737. Railway Cori)orations : Acceptance of insurance shall not constitute a bar to action against railway for negligence, S 2071 (Miscl. Sections). Page 140. Rebating and Discrimination: Prohibited, § 17 82. Penalty, § 1783. INDEX 243 H«ciprocals or Inter-lntersurance Exchanges: (All section references are to Ch. 180, 37th G. A. (Mlscl. Sections). Actions — venue — service of process — judgment, § 4. Page 134. Annual statement, § 7. Page 136. Bonds of attorney, § 12. Page 137. Certificate of authority, § 9. Page 136. Examination by the commissioner, 55 7. Page 136. Execution of contract — place of business of attorney, ^ 2. Page 133. Form of contract, approval by commissioner, § 14. Page 138. Laws applicable, § 16. Page 138. Limitations on risks — report, § 5. Page 13 5. Penalty for violation of law, § 10. Page 136. Preliminary showing, § 3. Page 133. Reciprocal contracts authorized, § 1. Page 133. Refusal or revocation of certificate of authority, § 11. Page 137. Reinsurance, § 15. Page 138. Service of notice on agent, § 3 530 (Miscl. Sections). Page 14 2. Standard of solvency, § 6. Page 135. Taxes and fees, § 13. Page 13 7. Where action may be brought, § 3499 (Miscl. Sections). Page 141. Reinsurance: (See also consolidation). Life, § 1821-n. Other than life, §§ 1711. (1710). Reciprocals, § 15, Ch. 180, 37th G. A. (Miscl. Setcions). Page 138 State and county mutuals, § 1, Ch. 120, 39th G. A. Page 62. With unauthorized companies — prohibited, § 1821-s. Religious Societies: May comply with chapter 9, § 1822-a. Reserves : Fraternals, § 1822. Child insurance, § 1822. Life companies — valuation of policies — deposit, § 17 74. Other than life, § 1702. Reciprocals, § Ch. 180, 37th G. A. (Miscl. Sections). Page 135. State and county mutuals, § 4, Ch. 120, 39th G. A. Page 63. Retaliation: (Law of other states). Life insurance companies, § 1810. Other than life insurance companies, § 1736. Service of Notice, on Agent, § 3530 (Miscl. Sections). Page 142. For service on commissioner of insurance, see 'Power of Attor- ney.' School Boards: May insure school property — payment from contin- gent fund, § 2783 (Miscl. Sections). Page 140. Short Rate Table, § 1729 (For table, see appendix). State and county Mutuals: (Section reference to Ch. 120, 39th G. A.) Agents, § 15. Page 67. Penalty for acting without license, § 15. Page 67. Annual meeting, § 11. Page 66. Annual statement, § 5. Page 64. Articles and by-laws — approval by commissioner, § 3. Page 62. Bonds of officers — approval by commissioner, § 10. Page 66. Cancellation of policy. § 9. Page 65. Certain terms to be incorporated in name, § 2. Page 62. 244 INDEX Conditions precedent to issuance of certificate of authority, § 3. Page 62. Consolidation — state mutuals, §§ 1821-r-s-t-u. Creation of emergency fund, § 4. Page 64. Defined, § 2. Page 62. Dissolution, § 8. Page 65. Evidence of value, § 7. Page 65. Examination, § 12. Page 67. Pees, § 14. Page 67. Inquiry by the commissioner, § 8. Page 65. Investments, § 4. Page 63. Kinds of insurance authorized, § 1. Page 62. Level premium policy, § 4. Page 6 3. Limitation. of actions, § 6. Page 64. Maximum liability of members, § 4. Page 63. Maximum risks, § 3. Page 62. Method of doing business, § 4. Page 63. Notice of loss, § 6. Page 64. Policy form. What to contain, § 1. Page 62. Approved by the commissioner, § 3. Page 62. Proof of loss, § 6. Page 64. Reinsurance authorized, § 1. Page 62. Reserves, § 4. Page 63. Taxes, § 12. Page 67. Voting by Proxies — state mutuals, §§ 1821-x-y-z. Stock Companies: Life companies. Accident and health and liability insurance, separate depart- ment, § 1783-d. Advertisen^ents — authorized capital — may not advertise, § 1783-1. Who deemed agents, § 1815. Agents' certificates, § 1800. Penalty, §§ 1801, 1802. Amortization of securities, Ch. 198, 39th G. A. Page 80. Annual certificates, § 1775. Annual report — convention form^ § 182 0-d. Annual statement, §§ 1773, 1799. Penalty, §§ 1801, 1802. Application — copy attached to policy, § 1819. Approval of articles and amendments, § 1768. Approval of policies, § 1783-a. Penalty for failure to file, § 1783-c. Change in securities, § 1779. Commissioner's annual report, § 1781. Certificate of authority, § 176 9. Conditions precedent to incorporation, § 176 8. Conditions precedent to doing business, § 1769. Consolidation, §§ 1821-n-o-p-q-s-t-u. Conspiracy to defraud, § 1817. Defenses to action on policy, § 1811. Deposit, § 1774. Discrimiination and rebating, § 1782. Disbursements — domestic companies, § 182 0-a. Dissolution, §§ 1776, 1777. Examination, § 1777. Failure to deposit or file statement, § 177 6. Fees, § 1818. Fraud in procuring insurance, § 1816. INDEX 24f Group accident and health insurance authorized, § 17 83-d. Group life insurance authorized — conditions, Ch. 19 7, 38th G. A. Page 77. Illegal business, § 1814. Industiial insurance authorized, § 17 83-b. Interest collected, S 17 80. Investment of funds, § 1806 Capital and surplus. Donxestic companies, § 17G9. ' Foreign companies, § 1772. Land and buildings, § 1807. Real estate, §§ 1803, 1806. When to be sold, § 1804. Limitations of actions, § 1820. Medical examination, § 17 83-b. Misrepresentation of age, § 1813. Misrepresentations prohibited, § 1820-b, Penalty, § 1820-c. Physician's certificate, § 1812. Policies exempt from execution, § 1805, Power to hold funds in trust, Ch. 304, 38th G. A. Page 79. Receiver, § 1777. Retaliation — laws of other states, § 1810. Securities of defaulting or insolvent companies, § 1778. Service of process, §§ 1808, 1809. Valuations of policies, § 1774. Other than life companies. Additional riders and clauses permitted, § 17;j8-a. Advertisements, § 1749. Agent must have certificate, § 1725. Resident agent — foreign company, § 173 9. Penalty, § 1740. Soliciting agents defined, § 1749. Who deemed agents, § 1750. Annual meetings, § 1696. Annual statement, § 1714. Printed form, § 1719. Application — copy to be attached to policy, § 1741. Approval of policy forms, § 1745. Arbitration, § 174 3. Cancellation of policy, § 1728. Capital stock, §§ 1691, 1783-e. Foreign companies, § 1721. Fully paid up, § 1783-e. Increase in, § 1783-e. Not to be loaned to officers or stockholders, § 1783-e. Statement of — foreign fire companies, S 17.'5!». Penalty, § 1740. Certificate of compliance — publication, ^i 1737. Certificate — foreign companies, >$ 1724. Revocation of, § 1735. Co-insurance, § 1746. Combinations and agreements, § 1754. Consolidation, §>i 1821-r-s-t-u. Directors — election of, 5{ 1696. Dissolution — after examination, S 1731. Dividends, § 1702. Doing business without compliance. Jj 1747. Officers punished. § 1748. Evidence of value, § 1742. 246 INDEX Examinations, §1700. Foreign companies, § 175 3. Evidence, § 1757. Expenses, § 1753. False statements of assets — fire companies, § 1738. Penalty, § 1740. Fees, § 1752. Forfeiture of policy, § 172 7. Inquiry by commissioner, § 1718. Insurance authorized, § 1709 (See insurance authorized). Insurance notes, § 172 6. Investment of funds, § 1699. Real estate, § 1703. Kinds of risks — combinations permitted, § 1710. Maximum risks, § 1710. Management of companies — directors, 1695. Misleading statements, § 1758-f. Penalty, § 175 8-g. Notice of loss, § 1744. Policy conditions, generally, § 1743. Policy form — approval of, § 1745. Must indicate whether stock or mutual company, § 1689. Seal, § 1712. Signatures, § 1712. Policy must appear in the name of issuing company, § 1758-e. Policy restored — payment of sum due, § 1730. Proof of loss, §§ 1742, 1742-a, 1744. Reinsurance, § 1711. Release from liability as surety, § 361 (Miscl. Sections). Page 139. Requisition on stockholder, § 1732. Reserves, § 1702. Retaliation, laws of other state, § 17 36. Revocation of authority, § 175 5. Appeal, § 1756. Short rate table, § 1727. Standard fire policy, § 1758-b. Failure to use, § 1758-c. Suit on bond of guarantee company, § 3 62 (Miscl. Sections). Page 139. Surplus, § 1783-e. Time for bringing action, § 1744. ^ Transfer of stock, § 1713. Pending investigation, § 1734. Unauthorized companies — insurance in, ?! 17 58. When guarantee company may be accepted as surety, § 360 (Miscl. Sections). Page 138. Provisions of general applicability. Agents' licenses, §§ 1821-k, 1821-1. Applicability of chapter 8-a, § 1821-i. Biennial examination, § 1821-a. Companies to assist, § 1821-b. Expenses, § 1821-c. Non-resident companies, § 182 1-h. Publication of results, § 1821-d. Refusal to be examined, § 182 1-g. Funds not to be loaned for profit of officers or directors, § 13, Ch. 348, 38th G. A. (Miscl. Sections). Page 133. Officers and directors shall not profit from investments, § 13, Ch. 348, 38th G. A. (Miscl. Sections). Page 133. INDEX 247 Promotion and organization of companies, Ch. 224, 39th G. A. Page 2. Proportionate representation, §§ 1821-v-w. Revocation of certificate of authority, ^ 1821-d. Sale of stock with policies prohibited, Ch. 181, 39th G. A. Page 109. Service of notice on agents, § 3530 (Miscl. Sections). Page 142. Soliciting business after revocation of authority, § 1821-f. Taxation. Domestic companies, § 1333-d (Miscl. Sections). Page 145. Foreign companies, § 1333 (Miscl. Sections). Page 14 5. Transfer of stock pending examination, § 182 1-e. Voting by proxies, §§ 1821-x-y-z. Where action may be brought, § 3499 (Miscl. Sections). Page 141. Stockliolders : Other than life insurance companies. Annual meeting, § 1696. Deficiency in capital, § 1731. Requisition — new certificates, § 1732. Election of directors, § 1695 Subscription to stock, § 1694. Transfer of stock, § 1713. Pending investigation, liability, § 1734. Provisions of general applicability. Loans of capital to, prohibited, § 17 83-e. Violation, penalty, § 1783-h. Minority representation on board of directors, § 1821-v. Notice of sale of stock for taxes, § 1333-a. Proxies, § 1821-x. Solicitation by agents, forbidden, § 1821-y. Violation, penalty, § 1821-z. Reinsurance consolidatioti — violation of the provisions, § 182 1-u. Suit or Actions: Fraternals — where suable, § 1827. Guarantee companies — suit on bonds, § 362 (Miscl. Sections). Page 139. Life companies. Copy of application, § 1819. Defenses to actions on policies, § 1811. Limitations of actions, § 1820. Misrepresentation of age, § 1813. Physician's certificate, § 1812. Other than life companies — time for bringing suit, § 17 44. Reciprocals — venue — service of process — Judgment, § 4, Ch. ISO, 37th G. A. (Miscl. Sections). Page 134. Service on agent, § 3530 (Miscl. Sections). Page 142. Service of process, see power of attorney. State and county mutuals — time for bringing suit, § 6, Ch. 12 0, 39th G. A. Page 64. Where suit may be brought, § 3499 (Miscl. Sections). Page 141. Surplus : Amount required for admission — foreign mutual life companies, § 1772. Amount required for admission — foreign mutual other than life company, § 1723. Amount required for admission — other than life stock company, § 1783-e. 248 INDEX Amount required for mutual other than life company to write level premium policies, § 5, Ch. 429, 37th G. A. Page 8. Investments — see funds of comt)anies. Taxation of Insurance Com,panies: Domestic companies, § 1333-d (Miscl. Sections). Page 145. Fraternals and county mutuals exempt, ibid. Fraternals exempt from taxation, § 1304 (Miscl. Sections). Page 139. Foreign companies, § 1333. Page 143. Assessment associations and fraternals exempt from taxation, ibid. Laws of other states — retaliation, §§ 1736, 1810. Mutual, fire and casualty companies, § 20, Ch. 429, 37th G. A. Page 9. Payment from surplus or emergency fund, § 1821. Reciprocals, § 13, Ch. 180, 37th G. A. (Miscl. Sections). Page 137. State and county mutuals, § 12, Ch. 120, 39th G. A., Page 67. Statement to be furnished local assessor, § 1333-b- (Miscl. Sec- tions). Page 14 4. Valuation of property by assessor, § 1333-c (Miscl. Sections). Page 145. Unauthorized Insurance : Consolidation with unauthorized company, § 182 1-s. Other than life insurance, § 1758. Soliciting business after revocation of authority, § 1821-f. Waiver of Interest for Insured: Other than life insurance, § 1758-d. Workmen's Compensation: (Appendix). General provisions, Ch. 8-a, title XII, §§ 2477-m, 2477-m51. Insurance provisions (for provisions applicable to companies writ- ing this insurance, see other than life insurance companies.) Agents' commissions limited, § 2477-m46. Authorized — other than life, sub-section 5, § 1709. Life — conditions, 1783-d. Benevolent insurance — plan — approval, § 2477-m43. Certificate of approval — industrial commissioner, § 2 477-m44. Revocation of certificate, § 2 4 77-m4 5. Termination of certificate, § 24 77-m!4 5. Failure to insure, § 2477-m41. Notice to employees, ibid. Insurance of liability, § 24 77-m41. Lien of insured against employer, § 2477-m48. Mutual companies — conditions of authorization, § 2 4 77-m42. Policy requirements, § 2477-m47. Insolvency clause prohibited, § 24 77-m4 8. Release from act — proof of solvency, § 2477-ni49. Deposit of security, ibid. Revocation of approval, ibid. When law applicable, § 2477-m51. a. «/v>'"«^wv«^ ^f 4933r)3 UNIVERSITY OF CALIFORNIA LIBRARY