PARRIS N. GLENDENING, Governor

Ch. 36

5.        COMPLY WITH THE WRITTEN UNDERWRITING AND
RATING STANDARDS ESTABLISHED BY THE AUTHORIZED INSURER FOR THE
ACCEPTANCE, REJECTION, OR CESSION OF ALL RISKS;

6.        PROVIDE ANNUALLY TO THE REINSURER A STATEMENT
OF THE REINSURANCE MANAGER'S FINANCIAL CONDITION PREPARED BY AN
INDEPENDENT CERTIFIED ACCOUNTANT; AND

7.        DISCLOSE TO THE REINSURER ANY RELATIONSHIP OF
THE REINSURANCE MANAGER WITH AN AUTHORIZED INSURER BEFORE CEDING OR
ASSUMING BUSINESS WITH THE AUTHORIZED INSURER IN ACCORDANCE WITH THE
REINSURANCE CONTRACT.

(D) SETTLEMENT OF CLAIMS.

(1) IF THE CONTRACT REQUIRED BY THIS SECTION ALLOWS THE
REINSURANCE MANAGER TO SETTLE CLAIMS FOR THE REINSURER:

(I)       ALL CLAIMS SHALL BE REPORTED TO THE REINSURER IN A
TIMELY MANNER;

(II)     THE REINSURANCE MANAGER SHALL PROVIDE THE
REINSURER WITH A COPY OF EACH CLAIM FILE THAT:

1.        IS REQUESTED BY THE REINSURER;

2.        INVOLVES A COVERAGE DISPUTE;

3.        MAY EXCEED THE REINSURANCE MANAGER'S
SETTLEMENT AUTHORITY;

4.        REMAINS OPEN FOR MORE THAN 6 MONTHS AFTER THE
DATE THE REINSURANCE MANAGER RECEIVES THE CLAIM;

5.        HAS THE POTENTIAL TO EXCEED THE LESSER OF AN
AMOUNT DETERMINED BY THE COMMISSIONER OR A LIMIT SET BY THE REINSURER;
OR

6.        IS CLOSED BY PAYMENT OF THE LESSER OF THE AMOUNT
DETERMINED BY THE COMMISSIONER OR THE LIMIT SET BY THE REINSURER;

(III)    1. THE SETTLEMENT AUTHORITY GRANTED TO A
REINSURANCE MANAGER UNDER THE CONTRACT MAY BE TERMINATED FOR CAUSE
ON 30 DAYS' NOTICE FROM THE REINSURER TO THE REINSURANCE MANAGER OR
ON TERMINATION OF THE CONTRACT; AND

2. THE REINSURER MAY SUSPEND THE SETTLEMENT
AUTHORITY OF THE REINSURANCE MANAGER DURING THE PENDENCY OF A
DISPUTE ABOUT THE CAUSE FOR TERMINATION;

(IV)    EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS SUBSECTION,
ALL CLAIM FILES ARE JOINT PROPERTY OF THE REINSURER AND REINSURANCE
MANAGER; AND

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