Section 29. Insurance for indemnification of directors and officers

(a)
  Subject to subdivision (b) of this section,  a  cooperative  shall  have
  power to purchase and maintain insurance:
    (1) to indemnify the cooperative for any obligation which it incurs as
  a  result  of  the  indemnification  of directors and officers under the
  provisions of this article, and
    (2) to indemnify directors and officers in instances in which they may
  be indemnified by the cooperative under the provisions of this  article,
  and
    (3) to indemnify directors and officers in instances in which they may
  not  otherwise be indemnified by the cooperative under the provisions of
  this article provided the contract of insurance covering such  directors
  and  officers  provides, in a manner acceptable to the superintendent of
  insurance, for a retention amount and for co-insurance.
    (b) No insurance under subdivision (a) of this section may provide for
  any payment, other than cost of defense, to or on behalf of any director
  or officer:
    (1) if a judgment or other final adjudication adverse to  the  insured
  director  or  officer  establishes  that  his  or her acts of active and
  deliberate  dishonesty  were  material  to  the  cause  of   action   so
  adjudicated,  or  that  he  or she personally gained in fact a financial
  profit or other advantage to which he or she was not  legally  entitled,
  or
    (2) in relation to any risk the insurance of which is prohibited under
  the insurance law of this state.
    (c)  Insurance  under paragraphs one, two and three of subdivision (a)
  of this section may be included  in  a  single  contract  or  supplement
  thereto.  Retrospective rated contracts are prohibited.
    (d) The corporation shall, within the time and to the persons provided
  in  subdivision  (c)  of  section  twenty-eight  of this article, mail a
  statement in respect to any insurance it has purchased or renewed  under
  this  section,  specifying  the insurance carrier, date of the contract,
  cost of the insurance, corporate  positions  insured,  and  a  statement
  explaining  all sums, not previously reported in a statement to members,
  paid under any indemnification insurance contract.
    (e) This section is the public policy of this state to spread the risk
  of cooperative management, notwithstanding any other general or  special
  law  of  this  state or of any other jurisdiction, including the federal
  government.