Ch. 11

1996 LAWS OF MARYLAND

"apply the appropriate parts of the certified assessment to the private
passenger auto and commercial auto divisions of the Insufficiency Assessment
Reserve Fund" is substituted for the former references to the "pay[ment of]
the certified assessment into the respective insufficiency assessment reserve
fund" and the "deposit of the annual assessment payments into the respective
insufficiency assessment reserve fund", in light of the fact that only one
Insufficiency Assessment Reserve Fund exists. Assessments for commercial
auto loss and private passenger auto loss are accounted for separately within
the Insufficiency Assessment Reserve Fund.

Defined terms: "Association member" § 20-101
"Board of Directors" § 20-101
"Commissioner" § 1-101
"Fund" § 20-101

"Motor vehicle liability insurance" § 20-101
"Physical damage insurance" § 20-101
"Policy" § 1-101
"Premium" § 1-101

20-406. IMPOSITION OF ASSESSMENT SURCHARGES.

(A)     IN GENERAL.

(1)     THE COMMISSIONER PROMPTLY SHALL REVIEW THE ASSESSMENT
ALLOCATION PERCENTAGES CALCULATED BY THE ASSOCIATION.

(2)     UNLESS THE COMMISSIONER FINDS THE CALCULATION TO BE
INACCURATE, THE COMMISSIONER SHALL AUTHORIZE EACH ASSOCIATION
MEMBER TO IMPOSE AN ASSESSMENT SURCHARGE ON EACH POLICY OF MOTOR
VEHICLE LIABILITY INSURANCE OR PHYSICAL DAMAGE INSURANCE THAT IS
WRITTEN OR RENEWED IN THE STATE DURING THE 1-YEAR PERIOD BEGINNING ON
THE NEXT JULY 1 FOLLOWING NOTICE OF THE ASSESSMENT.

(3)      SUBJECT TO § 20-407 OF THIS SUBTITLE, THE ASSESSMENT
SURCHARGE SHALL BE CALCULATED BY APPLYING THE APPROPRIATE ASSESSMENT
ALLOCATION PERCENTAGE THAT IS ADJUSTED FOR ANY EXCESS OR SHORTFALL TO
THE PREMIUM AT THE INCEPTION OR RENEWAL OF THE POLICY.

(4)     THE ASSESSMENT SURCHARGE MAY NOT BE:

(I)      SUBJECT TO CHANGE OR REFUND; OR

(II)     CONSIDERED PREMIUM INCOME FOR THE STATE PREMIUM
TAX OR THE PAYMENT OF. COMMISSIONS.

(B)     POLICYHOLDERS OF FUND.

(1) IN CONFORMITY WITH §§ 20-405 THROUGH 20-409 OF THIS SUBTITLE,
EACH YEAR THE FUND SHALL IMPOSE AN ASSESSMENT SURCHARGE ON ALL OF ITS
POLICYHOLDERS AS IF THE FUND WERE A MEMBER OF THE ASSOCIATION.

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