BLAIR LEE III, Acting Governor

2335

(Senate Bill 190)

AN ACT concerning

Insolvent Insurance Companies - Rehabilitation and
Liquidation

FOR the purpose of establishing the procedure for the
disbursement to insurance guaranty associations of
certain assets of insolvent insurers.

BY adding to

Article 48A - Insurance Code

Section 162A

Annotated Code of Maryland

(1972 Replacement Volume and 1977 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That section(s) of the Annotated Code of Maryland
be repealed, amended, or enacted to read as follows:

Article 48A — Insurance Code

162A.

(A)    WITHIN 120 DAYS OF A FINAL DETERMINATION OF
INSOLVENCY OF A COMPANY BY A COURT OF COMPETENT JURISDICTION
OF THIS STATE, THE COMMISSIONER AS RECEIVER SHALL MAKE
APPLICATION TO THE COURT FOR APPROVAL OF A PROPOSAL TO
DISBURSE UNSECURED ASSETS OUT OF THE COMPANY'S MARSHALLED
ASSETS, FROM TIME TO TIME AS SUCH ASSETS BECOME AVAILABLE,
TO THE MARYLAND INSURANCE GUARANTY ASSOCIATION AND THE
MARYLAND LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION AND
TO ANY SIMILAR ORGANIZATION IN ANOTHER STATE. (THE MARYLAND
INSURANCE GUARANTY ASSOCIATION AND THE MARYLAND LIFE AND
HEALTH GUARANTY ASSOCIATION AND ANY SIMILAR ORGANIZATIONS IN
OTHER STATES SHALL HEREINAFTER BE REFERRED TO COLLECTIVELY
AS THE "ASSOCIATIONS".)

(B)    THE PROPOSAL SHALL AT LEAST INCLUDE PROVISION
FOR:

(1)    RESERVING AMOUNTS ADEQUATE CASH RESERVES
FOR THE PAYMENT OF THE EXPENSES OF ADMINISTRATION AND
PRIORITY CLAIMS.

(2)    DISBURSEMENTS OF THE ASSETS MARSHALLED TO
DATE AND SUBSEQUENT DISBURSEMENTS OF ASSETS AS THEY BECOME
AVAILABLE.

(3)    EQUITABLE ALLOCATION OF DISBURSEMENTS TO
EACH OF THE ASSOCIATIONS ENTITLED THERETO; AND

(4)    THE SECURING BY THE COMMISSIONER FROM EACH
OF THE ASSOCIATIONS ENTITLED TO DISBURSEMENTS PURSUANT TO
THIS SECTION AN AGREEMENT TO RETURN TO THE COMMISSIONER SUCH