WILLIAM DONALD SCHAEFER, Governor                     Ch. 11

2. Arise out of surety bonds issued by
the insolvent insurer for the protection of third parties, who
are residents of this State;

(ii) Were unpaid by the insolvent insurer;

(iii) Are presented as a claim to the receiver
in this State or the [Association] CORPORATION on or before the
last date fixed for the filing of claims in the domiciliary
delinquency proceedings;

(iv) 1. Except for surety bond claims, were
incurred or existed prior to, on, or within 30 days after the
determination of insolvency; or

2. For surety bond claims arising under
surety bonds issued by a domestic insurer were incurred or
existed prior to, on, or within 18 months after the determination
of insolvency, whether or not the surety bonds are issued for no
stated period or for a stated period; and

(v) Arise out of policy contracts or surety
bonds of the insolvent insurer issued for the kinds of insurance
to which this subtitle applies.

(2) "Covered claim" does not include any amount due
any reinsurer, insurer, insurance pool, or underwriting
association, as subrogation recoveries or otherwise. No insurer
shall assert a claim of subrogation against an insured of an
insolvent insurance company but may assert any claim it may have
against the receiver of the insolvent insurance company.

508.

(a) The Corporation shall:

(1) (i) Except as to surety bonds, be obligated to
the extent of the covered claims existing prior to the
determination of insolvency and arising within 30 days after the
determination of insolvency, or before the policy expiration date
if less than 30 days after the determination, or before the
insured replaces the policy or causes its cancellation, if he
does so within 30 days of the determination, but such obligation
shall include only that amount of each covered claim which is in
excess of $100 and less than $300,000. However, the
[Association] CORPORATION shall pay the full amount of any
covered claim arising out of a workmen's compensation policy. In
no event shall the Corporation be obligated to a policyholder or
claimant in an amount in excess of the obligation of the
insolvent insurer under the policy from which the claim arises.

(ii) With respect to surety bonds, be obligated
to the extent of the covered claims existing prior to the

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