Tenn. Comp. R. & Regs. 0780-01-27-.04
All deposits of funds of withdrawable stockholders shall be insured at the time placed with the association and shall remain insured. Insurance shall be placed on all withdrawable accounts to the maximum amount possible. No association may accept any funds other than capital funds necessary to incorporate without first obtaining insurance. Failure to maintain or carry insurance on withdrawable stockholder accounts will be sufficient ground for the forfeiture of the charter. Each present and future association is hereby required to immediately purchase insurance to insure all withdrawable deposits and is authorized to make disbursements, necessary to do so. This includes the purchase of bonds or debentures, and stock from the insurance company when required to maintain coverage, however, the aggregate purchase should not exceed 2-1/2% of the building and loan association's savings and time deposits. An association can buy stock and debentures from an insurance company necessary to insure their deposits.
Tenn. Comp. R. & Regs. 0780-01-27-.04
Authority: T.C.A. §45-1303.