806 KAR 39:040.

Governmental units excluded.

 

      RELATES TO: KRS

304.39-080

      STATUTORY

AUTHORITY: KRS 304.2-110, 304.39-300

      NECESSITY,

FUNCTION, AND CONFORMITY: KRS Chapter 304, Subtitle 39, requires all other

owners to either accept limitation on their tort rights and obligations or to

affirmatively reject such limitations, but in the case of governmental units

should take if they desire to become obligated governments.

 

      Section 1.

Governmental units, as described in KRS 304.39-080(3) and (4), are not subject

to KRS Chapter 304, Subtitle 39, and need not take any affirmative action

thereunder unless, and until, by appropriate action, they elect to become

obligated governments.

 

      Section 2. Any

governmental unit, which by appropriate action elects to become an obligated

government, may meet its obligations by:

      (1) Providing

security by acquiring a contract of insurance, or

      (2) By providing

security merely by obligating itself to pay basic reparation benefits in

accordance with KRS Chapter 304, Subtitle 39.

 

      Section 3. Any

governmental unit purchasing a contract of insurance needs to do nothing

further to be an obligated government. However, if for any reason such

insurance should be terminated by the insurer, the insurer must give the

governmental unit not less than sixty (60) days notice prior to the termination

thereof, so that the governmental unit may take appropriate action either to

purchase other insurance, to withdraw from its obligation and duties under KRS

Chapter 304, Subtitle 39, or to become an obligated government by taking the

appropriate steps to lawfully obligate itself to pay basic reparation benefits.

 

      Section 4.

Obligated governments who have not acquired a contract of insurance may have

rights and duties under KRS 304.39-290 and should make the appropriate contacts

with the Kentucky Arbitration Association in order that they may protect such

rights and duties. (1 Ky.R. 879; eff. 5-14-75.)