MARVIN MANDEL, Governor

2615

551.

(A)    WITHIN 30 DAYS FOLLOWING THE EFFECTIVE DATE OF
THE ACT CREATING THIS SUBTITLE, THE GOVERNING COMMITTEE
SHALL SUBMIT TO THE COMMISSIONER FOR HIS REVIEW A
PROPOSED PROGRAM OF OPERATION, CONSISTENT WITH THE
PROVISIONS OF THIS SUBTITLE, WHICH SHALL PROVIDE FOR
ECONOMICAL, FAIR AND NONDISCRIMINATORY ADMINISTRATION AND
WHICH SHALL CONTAIN OTHER MATTERS INCLUDING, BUT NOT
LIMITED TO, PRELIMINARY ASSESSMENT OF ALL MEMBERS FOR
INITIAL EXPENSES NECESSARY TO COMMENCE OPERATIONS,
ESTABLISHMENT OF NECESSARY FACILITIES, EXPANDED
MANAGEMENT OF THE ASSOCIATION, ASSESSMENT OF MEMBERS TO
DEFRAY LOSSES AND EXPENSES, COMMISSION ARRANGEMENTS,
REASONABLE AND OBJECTIVE UNDERWRITING STANDARDS,
ACCEPTANCE AND CESSION OF REINSURANCE AND PROCEDURES FOR
DETERMINING AMOUNTS OF INSURANCE TO BE PROVIDED. THE
PROGRAM OF OPERATION SHALL BE SUBJECT TO APPROVAL BY THE
COMMISSIONER AFTER CONSULTATION WITH AFFECTED INDIVIDUALS
AND ORGANIZATIONS, AND SHALL TAKE EFFECT TEN DAYS AFTER
HAVING BEEN APPROVED BY HIM. IF THE COMMISSIONER
DISAPPROVES ALL OR ANY PART OF THE PROPOSED PROGRAM OF
OPERATION, THE GOVERNING COMMITTEE SHALL WITHIN 30 DAYS
SUBMIT FOR REVIEW AN APPROPRIATELY REVISED PLAN OF
OPERATION OR PART THEREOF, AND, IF THE GOVERNING
COMMITTEE FAILS TO DO SO, THE COMMISSIONER SHALL
PROMULGATE A PROGRAM OF OPERATION.

(B)    THE ASSOCIATION MAY, ON ITS OWN INITIATIVE,
WITH THE APPROVAL OF THE COMMISSIONER, AMEND THE PROGRAM
OF OPERATION; HOWEVER, AMENDMENTS TO THE PROGRAM OF
OPERATION MUST BE VOTED ON AND APPROVED BY THE MEMBERS OF
THE ASSOCIATION. VOTES SHALL BE CAST AND COUNTED ON A
WEIGHTED BASIS IN ACCORDANCE WITH THE PREMIUMS WRITTEN OF
EACH MEMBER, AN AMENDMENT TO THE PROGRAM OF OPERATION
SHALL NOT BECOME EFFECTIVE UNTIL APPROVED BY AT LEAST A
MAJORITY OF THE VOTES CAST ON SUCH WEIGHTED BASIS.

(C)    THE COMMISSIONER MAY AUTHORIZE THE PROGRAM OF
OPERATION TO CONTAIN PROVISIONS FOR A SPECIAL RESERVE
FUND TO SUPPLEMENT FUNDS IN THE POOL AS A CONDITION OF
OBTAINING COVERAGE. THE PROVISIONS RELATING TO THE
SPECIAL RESERVE FUND SHALL BE SUBJECT TO THE
COMMISSIONER'S APPROVAL. IF A SPECIAL RESERVE FUND IS
ESTABLISHED. EACH INSURED MAY BE REQUIRED TO PAY AN
ANNUAL CHARGE IN ADDITION TO THE ANNUAL PREMIUM, BASED ON
AN APPROPRIATE PERCENTAGE OF THE PREMIUM FOR EACH POLICY.
THE PROCEEDS FROM THIS ANNUAL CHARGE SHALL BE CREDITED TO
THE SPECIAL RESERVE FUND. THIS PERCENTAGE SHALL BE
ANNUALLY DETERMINED BY THE GOVERNING COMMITTEE. SUBJECT
TO THE APPROVAL OF THE COMMISSIONER, AND SHALL BE BASED
ON THE AMOUNT IN THE SPECIAL RESERVE FUND PLUS ANY
REINSURANCE WHICH MAY BE AVAILABLE.