Every such association shall establish a minimum guarantee fund of twelve thousand dollars ($12,000.00). Such fund, if not accumulated prior to January second, one thousand nine hundred and thirty-seven, shall be accumulated by equal cash contributions from all members of the association, who shall number not less than one hundred, before the association may undertake to grant death, sickness or accident disability benefits. Such fund may be held in cash or may be invested in bonds issued by or guaranteed by the government of the United States. The guarantee fund shall be deposited in trust with a bank of this State and funds therefrom shall be disbursed only for the payment of claims for benefits under its outstanding certificates, but only on certification of the president and secretary of the association, after notice to the Commissioner of Banking and Insurance, that the benefit fund hereinafter provided for is insufficient to meet existing claims payable therefrom or that payment of such claims would result in the impairment of the reserve fund hereinafter provided for. In the event that the guarantee fund is reduced by such disbursements to less than the amount required by this chapter, the deficiency therein shall be made good by an assessment on all members within six months after the notice above provided for and the by-laws of the association shall establish the procedure to be adopted in making such assessment.

Amended by L.1950, c. 148, p. 307, s. 3.