§435E-26 Involuntary termination of a member. The board of trustees shall have the right to terminate the membership of a participating member where the board of trustees determines that such termination is in the best interests of the interindemnity arrangement even though such person has complied with all of the provisions of the trust agreement. Such a termination may be effected only if at least two-thirds of the members of the board of trustees indicate in writing their decision so to terminate. If the board of trustees proposes to terminate a member, the member shall have the right to call a special meeting of all participating members for the purpose of voting on whether or not the member shall be so terminated. The member shall not be terminated if at least two-thirds of the participating members present indicate that the member should not be terminated. In the event a member is terminated, the person may elect either:

(1) To request the return of his or her initial contribution, in which case the same shall be repaid and the indemnity coverage shall thereupon terminate as to all claims then pending against such person and in respect to all occurrences prior to the date of such termination of membership. However, in the event the interindemnity arrangement is then providing legal defense services to such person, the interindemnity arrangement shall continue to provide those services for a period of thirty days to enable such person to assume his or her own defense; or

(2) To release all rights to the return of the initial contribution, in which case the indemnity coverage shall continue for the benefit of the member in respect of occurrences during the time the person was a participating member and the person shall have no responsibility for assessments levied following such termination. [L 1977, c 182, pt of §1]