Kentucky has long permitted local governments to impose premium taxes on insured lives or risks located within the local government's jurisdiction. Hundreds of Kentucky political subdivisions have enacted local government premium taxes with widely varying rates, and insurers must collect and remit the appropriate premium tax to each such jurisdiction. The practical difficulties in doing so for many underwriters have resulted in regulatory examinations that are now being used by the plaintiffs' bar to bring class actions on behalf of both the local governments involved and classes of individual policyholders.

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