Mass. Gen. Laws ch. 175 § 83
If a mutual fire company is not possessed of assets above its unearned premiums sufficient for the payment of incurred losses and expenses, it shall make an assessment upon its members liable to assessment therefor, in proportion to their several liabilities, for the amount needed to pay such losses and expenses.
The company shall cause to be recorded in a book kept therefor the order for such assessment, with a statement setting forth the condition of the company at the date of the order, the amount of its cash assets and of its deposit notes or other contingent funds liable to the assessment, the amount which the assessment calls for, and the particular losses or other liabilities for which it is to provide. The said record shall be made and signed by the directors voting for the order, before any part of the assessment is collected, and any person liable to the assessment may inspect and take a copy of the same.
If by reason of any depreciation or loss of its funds or otherwise the assets of such a company, after providing for its other debts, are less than the unearned premiums upon its policies, it shall make good the deficiency by assessment in the mode above provided; or the directors may, instead of such assessment, make two assessments, the first determining what each policyholder must equitably pay or receive in case of his withdrawal from the company and the cancellation of his policy, the second determining what further amount each must pay to continue the policy for its unexpired term, and being for such proportion of the unearned premium as the directors may fix by vote, but in no event to exceed the amount of such unearned premium. Each policyholder shall pay or receive according to the first assessment, and his policy shall then be cancelled unless he pays the further amount determined by the second assessment, in which case his policy shall continue in force for its unexpired term; but in neither case shall a policyholder receive or have credited to him more than he would have received on having his policy cancelled by the company in accordance with the terms of the policy.
If within two months after such alternative assessments have become collectible the amount of the policies whose holders have settled for both assessments is less than one million dollars, the company shall cease to issue policies; and all policies whose holders have not settled for both assessments shall be void, and the company shall continue only for the purpose of adjusting the deficiency or excess of premiums among the members and settling outstanding claims.
Each policyholder shall be liable to pay his proportional part of any assessments laid by the company in accordance with law and his contract, on account of losses and expenses incurred while a member, if he is notified of such assessment within one year after the expiration or cancellation of his policy; and when an assessment is ordered, the directors shall forthwith cause written notice and demand for payment to be made upon each person subject thereto, by mail or personal service.
In the case of a company which issues both assessable and nonassessable policies, any assessment shall be for the exclusive benefit of holders of policies who are subject to assessment, and such policyholders shall not be liable to assessment in an amount greater in proportion to the total deficiency than the ratio that the deficiency attributable to the assessable business bears to the total deficiency.
Mass. Gen. Laws ch. 175, § 83