Okla. Stat. tit. 51, § 51-172

Insurance.

A. The governing body of any corporation organized not for

profit for the primary purpose of developing and providing rural

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water supply and sewage disposal facilities to serve rural residents

and districts formed pursuant to the Rural Water, Sewer, Gas and

Solid Waste Management Districts Act, Section 1324.1 et seq. of

Title 82 of the Oklahoma Statutes, may:

1. Insure said entity against all or any part of any liability

it may incur for death, injury or disability of any person or for

damage to property, either real or personal;

2. Insure any employee of said entity against all or any part

of his liability for injury or damage resulting from an act or

omission in the scope of employment;

3. Insure against the expense of defending a claim against said

entity or its employee, whether or not liability exists on such

claim;

4. Insure said entity or its employee against any loss, damage

or liability as provided by Sections 702 through 708 of Title 36 of

the Oklahoma Statutes; or

5. Provide other forms of insurance provided for in Title 36 of

the Oklahoma Statutes.

The cost or premium of any such insurance is a proper

expenditure of said entity.

As used in this subsection, "employee" means any person who has

acted in behalf of said entity, whether that person is acting on a

permanent or temporary basis with or without being compensated or on

a full-time or part-time basis. The term "employee" shall also

include but not be limited to all elected or appointed officers,

members of governing bodies of said entity, and other persons

designated by said entity to act in its behalf.

B. Any insurance authorized by law to be purchased, obtained or

provided by said entity may be provided by:

1. Self-insurance, which may be, but is not required to be,

funded by appropriations to establish or maintain reserves for self-

insurance purposes;

2. Insurance with any insurer authorized to transact insurance

in this state;

3. Insurance secured in accordance with any other method

provided by law; or

4. Any combination of insurance authorized by this section.

C. Two or more said entities or public agencies, by interlocal

agreement made pursuant to Section 1001 et seq. of Title 74 of the

Oklahoma Statutes, may provide insurance for any purpose by any one

or more of the methods specified in this section. The pooling of

self-insured reserves, claims or losses among said entities as

authorized in this act shall not be construed to be transacting

insurance nor otherwise subject to the provisions of the laws of

this state regulating insurance or insurance companies. Two or more

said entities may also be insured under a master policy or contract

of insurance. Premium costs may be set individually for each entity

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or apportioned among participating entities as provided by the

master policy or contract.