Ch. 223 LAWS OF MARYLAND

(4) FILE WITH THE SECRETARY A SURETY BOND OR AN
IRREVOCABLE LETTER OF CREDIT FROM A FEDERALLY INSURED
FINANCIAL INSTITUTION IN AN AMOUNT SET BY THE SECRETARY, BUT
NOT LESS THAN $100,000, FOR THE BENEFIT OF OWNERS INJURED BY THE
FAILURE OF THE NEW HOME WARRANTY SECURITY PLAN TO PAY
CLAIMS AS REQUIRED UNDER THIS SUBTITLE;

(5) PROVIDE WITHIN THE NEW HOME WARRANTY
DOCUMENTS THE PERFORMANCE STANDARDS THAT DESCRIBE THE
BUILDER'S OBLIGATIONS FOR DEFECTS WARRANTED UNDER THIS
SUBTITLE;

(6) PROVIDE FOR THE MEDIATION OF DISPUTES BETWEEN AN
OWNER AND A BUILDER BEFORE A CLAIM WILL BE PAID BY THE
BUILDER'S NEW HOME WARRANTY SECURITY PLAN; AND

(7) MEET ANY OTHER REQUIREMENTS DETERMINED BY THE
SECRETARY AND BE APPROVED BY THE SECRETARY.

(B) (1) THE SECRETARY MAY REVOKE OR SUSPEND APPROVAL
FOR A NEW HOME WARRANTY SECURITY PLAN IF THE SECRETARY
DETERMINES THAT THE PLAN:

(I) IS UNABLE TO MEET ITS OBLIGATIONS UNDER A NEW
HOME WARRANTY; OR

(II) IS ADMINISTERED IN A MANNER THAT DENIES
OWNERS THE WARRANTY COVERAGE REQUIRED UNDER THIS SUBTITLE.

(2) EXCEPT FOR NEW HOMES THAT WERE ENROLLED
REGISTERED IN THE NEW HOME WARRANTY SECURITY PLAN PRIOR TO
THE REVOCATION OR SUSPENSION AND FOR WHICH A PURCHASE OR
CONSTRUCTION CONTRACT HAS BEEN EXECUTED, DURING THE TIME
PERIOD THAT APPROVAL FOR A NEW HOME WARRANTY SECURITY PLAN
IS REVOKED OR SUSPENDED BY THE SECRETARY, THE NEW HOME
WARRANTY SECURITY PLAN MAY NOT PROVIDE WARRANTY COVERAGE
FOR ANY NEW HOMES BUILT IN MARYLAND.

(C) (1) UNLESS THE SECRETARY DETERMINES THAT A SHORTER
NOTICE PERIOD IS NEEDED TO PROTECT THE INTERESTS OF THE
BUILDERS AND OWNERS, THE SECRETARY SHALL GIVE A NEW HOME
WARRANTY SECURITY PLAN AT LEAST 90 DAYS NOTICE THAT THE
SECRETARY'S APPROVAL OF THE PLAN IS BEING REVOKED OR
SUSPENDED; AND

(2) A NEW HOME WARRANTY SECURITY PLAN SHALL GIVE TO
ITS PARTICIPATING BUILDERS AT LEAST 60 DAYS' NOTICE OF THE PLAN'S
REVOCATION OR SUSPENSION, OR SUCH SHORTER TIME AS SPECIFIED
BY THE SECRETARY IF THE PLAN RECEIVES LESS THAN 90 DAYS' NOTICE.

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