PARRIS N. GLENDENING, Governor

Ch. 11

THE COMMISSIONER SHALL TERMINATE BY ORDER THE OPERATION OF THE
CORPORATION AS TO A KIND OF INSURANCE COVERED BY THIS SUBTITLE FOR
WHICH THE COMMISSIONER HAS FOUND AFTER A HEARING THAT THERE IS IN
EFFECT A STATUTORY OR VOLUNTARY PLAN:

(1)      THAT IS PERMANENT AND IS ADEQUATELY FUNDED OR FOR WHICH
ADEQUATE FUNDING IS PROVIDED; AND

(2)      THAT EXTENDS OR WILL EXTEND TO POLICYHOLDERS AND
RESIDENTS PROTECTION AND BENEFITS WITH RESPECT TO INSOLVENT INSURERS
NOT SUBSTANTIALLY LESS FAVORABLE AND EFFECTIVE TO THOSE POLICYHOLDERS
AND RESIDENTS THAN THE PROTECTION AND BENEFITS PROVIDED UNDER THIS
SUBTITLE FOR THAT KIND OF INSURANCE.

(B)      SAME — AUTHORITY TO STOP FUTURE PAYMENTS.

(1)      BY AN ORDER ISSUED UNDER SUBSECTION (A) OF THIS SECTION,
THE COMMISSIONER SHALL AUTHORIZE INSURERS TO STOP PAYING THE
CORPORATION AS TO THE SAME KIND OF INSURANCE FOR WHICH THE OPERATION
OF THE CORPORATION IS TERMINATED UNDER THE ORDER.

(2)      NOTWITHSTANDING PARAGRAPH (1) OF THIS SUBSECTION,
ASSESSMENTS AND PAYMENTS SHALL CONTINUE AS NECESSARY TO LIQUIDATE
COVERED CLAIMS OF INSURERS DETERMINED TO BE INSOLVENT BEFORE THE
ORDER AND TO LIQUIDATE THE RELATED EXPENSES NOT COVERED BY THE OTHER
PLAN.

(C)     TERMINATION AS TO ALL KINDS OF INSURANCE; EXPIRATION OF
SUBTITLE.

(1)      IF THE COMMISSIONER ORDERS THE TERMINATION OF THE
OPERATION OF THE CORPORATION AS TO ALL KINDS OF INSURANCE WITHIN ITS
SCOPE, THE CORPORATION AS SOON AS POSSIBLE AFTER THE TERMINATION SHALL:

(I)       DISCHARGE FIRST THE FUNCTIONS OF THE CORPORATION AS
TO PRIOR INSURER INSOLVENCIES NOT COVERED BY THE OTHER PLAN, INCLUDING
THE PAYMENT OF EXPENSES RELATED TO THE DISCHARGE OF THESE FUNCTIONS;
AND

(II)     DISTRIBUTE, IN ACCORDANCE WITH PARAGRAPH (2) OF THIS
SUBSECTION, THE BALANCE OF MONEYS AND ASSETS REMAINING TO THE INSURERS
THAT ARE THEN WRITING IN THE STATE POLICIES OF THE KINDS OF INSURANCE
COVERED BY THIS SUBTITLE AND THAT HAD MADE PAYMENTS TO THE
CORPORATION.

(2)      THE CORPORATION SHALL DISTRIBUTE THE BALANCE OF MONEYS
AND ASSETS REMAINING TO THE INSURERS PRO RATA ON THE BASIS OF THE
AGGREGATE OF THE PAYMENTS MADE BY THE RESPECTIVE INSURERS DURING THE
PERIOD OF 5 YEARS IMMEDIATELY PRECEDING THE DATE OF THE ORDER.

(3)      WHEN THE DISTRIBUTION AS TO ALL KINDS OF INSURANCE
COVERED BY THIS SUBTITLE IS COMPLETE, THIS SUBTITLE SHALL TERMINATE.

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