§ 26-17-128 — Insurance for associations

(a) The lives of a group of individuals may be insured
under a policy issued to an association or a trust or the
trustee of a fund established or adopted for the benefit of
members of one (1) or more associations. The association shall
have at the time the policy is first issued a minimum of fifty
(50) persons eligible for insurance, shall have been organized
and maintained in good faith for purposes other than that of
obtaining insurance, shall have been in active existence for at
least one (1) year and shall have a constitution and bylaws
which provide that:
(i) The association holds regular meetings not less
than annually to further the members' purposes;
(ii) Except for credit unions, the association
collects dues or solicits contributions from members; and
(iii) The members have voting privileges and
representation on the governing board and committees.
(b) The policy allowed by subsection (a) of this section
is subject to the following requirements:
(i) The policy may insure one (1) or more of the
following or all of any class of the following for the benefit
of persons other than the employee's employer:
(A) Members of the association;
(B) Employees of the association; or
(C) Employees of members.
(ii) If the covered person does not pay any part of
the premium for his insurance, the policy shall insure all
eligible persons, except those who reject the coverage in
writing and except as provided in paragraph (iii) of this
subsection; and
(iii) An insurer may exclude or limit the coverage on
any person if evidence of individual insurability does not
satisfy the insurer.