MARVIN MANDEL, Governor

1879

TERMINATION OF THE POLICY OF A MEMBER DOES NOT
RELIEVE THE MEMBER OF HIS CONTINGENT LIABILITY FOR HIS
PROPORTION, IF ANY, OF THE OBLIGATIONS OF THE INSURER
WHICH ACCRUED WHILE THE POLICY HAS IN FORCE.

(C) UNREALIZED CONTINGENT LIABILITY NOT AN ASSET.

THE UNREALIZED CONTINGENT LIABILITY OF A MEMBER DOES
NOT CONSTITUTE AN ASSET OF THE INSURER IN A DETERMINATION
OF ITS FINANCIAL CONDITION.

REVISOR'S NOTE: This section presently appears as
Art. 48A, §259.

The only changes are in style.

6-510. LEVY OF CONTINGENT LIABILITY.

(A)   WHEN ASSESSMENT LEVIED.

THE DIRECTORS OF A DOMESTIC MUTUAL INSURER SHALL
LEVY AN ASSESSMENT ON ITS MEMBERS WHO, AT ANY TIME WITHIN
THE 36 MONTHS BEFORE THE NOTICE OF THE ASSESSMENT IS
MAILED TO THEM, HELD POLICIES PROVIDING FOR CONTINGENT
LIABILITY, IF THE ASSETS OF THE INSURER ARE AT ANY TIME:

(1)    LESS THAN THE SUM OF ITS LIABILITIES AND
THE MINIMUM AMOUNT OF SURPLUS REQUIRED TO BE MAINTAINED
TO TRANSACT THE KIND OF INSURANCE BEING TRANSACTED; AND

(2)    THE DEFICIENCY IS NOT BEING CURED FROM
OTHER SOURCES.

(B)   [[MEMBERS LIABLE]] LIABILITY OF MEMBERS.

MEMBERS ON WHOM AN ASSESSMENT IS LEVIED IN
ACCORDANCE WITH THIS SECTION ARE LIABLE TO THE INSURER
FOR THE AMOUNT ASSESSED.

(C)   AMOUNT OF [[TOTAL]] ASSESSMENT.

[[THE ASSESSMENT IS]] (1) THE TOTAL OF ASSESSMENTS
SHALL BE FOR THE AMOUNT REQUIRED TO CURE THE DEFICIENCY
AND TO PROVIDE A REASONABLE AMOUNT OF WORKING FUNDS ABOVE
THE MINIMUM AMOUNT OF SURPLUS. HOWEVER, THE WORKING
FUNDS MAY NOT EXCEED 5 PERCENT OF THE INSURER'S
LIABILITIES AS OF THE DATE FOR WHICH THE AMOUNT OF THE
DEFICIENCY WAS DETERMINED.

(2) THE ASSESSMENT ON A MEMBER MAY NOT
EXCEED THE LESSER OF:

(I) ONE POLICY PREMIUM; 08