Marvin Mandel, Governor                          1499

such claims by the member insurer if they are chargeable to the
account for which the assessment is made.

(4) Investigate claims brought against the Association and ad-
just, compromise, settle, and pay covered claims to the extent of the
Association's obligation and deny all other claims and may review
settlements, releases and judgments to which the insolvent insurer
or its insureds were parties to determine the extent to which such
settlements, releases and judgments may be properly contested.

(5)    Notify such persons as the Commissioner directs under Sec-
tion 510 (b)(1).

(6)    Handle claims through its employees or through one or more
insurers or other persons designated as servicing facilities. Designa-
tion of a servicing facility if subject to the approval of the Com-
missioner, but such designation may be declined by a member insurer.

(7)    Reimburse each servicing facility for obligations of the As-
sociation paid by the facility and for expenses incurred by the
facility while handling claims on behalf of the Association and shall
pay the other expenses of the Association authorized by this Act.

(b) The Association may:

(1)    Employ or retain such persons as are necessary to handle
claims and perform other duties of the Association.

(2)    Borrow funds necessary to effect the purposes of this Act in
accord with the plan of operation.

(3)    Sue or be sued.

(4) Negotiate and become a party to such contracts as are neces-
sary to carry out the purpose of this Act.

(5)    Perform such other acts as are necessary or proper to effec-
tuate the purpose of this Act.

(6)    Refund to the member insurers in proportion of the contribu-
tion of each member insurer to that account that amount by which
the assets of the account exceed the liabilities if, at the end of any
calendar year, the board of directors finds that the assets of the
Association in any account exceed the liabilities of that account as
estimated by the board of directors for the coming year.

509. Plan of Operation.

(a)(1) The Association shall submit to the Commissioner a plan
of operation and any amendments thereto necessary or suitable to
assure the fair, reasonable, and equitable administration of the As-
sociation. The plan of operation and any amendments thereto shall
become effective upon approval in writing by the Commissioner.

(2) If the Association fails to submit a suitable plan of operation
within 90 days following the effective date of this Act or if at. any
time thereafter the Association fails to submit suitable amendments
to the plan, the Commissioner shall, after notice and hearing adopt
and promulgate such reasonable rules as are necessary or advisable
to effectuate the provisions of this Act. Such rules shall continue in