Ch. 35

1997 LAWS OF MARYLAND

(1) EACH CARRIER SHALL ELECT TO BECOME EITHER A
RISK-ASSUMING CARRIER OR REINSURING CARRIER.

(2) THE NOTIFICATION OF ELECTION TO BECOME A RISK-ASSUMING
CARRIER SHALL INCLUDE AN APPROPRIATE OPINION BY AN INDEPENDENT
QUALIFIED ACTUARY THAT THE RISK-ASSUMING CARRIER IS ABLE TO ASSUME AND
MANAGE THE RISK OF ENROLLING GROUPS UNDER THIS SUBTITLE WITHOUT THE
PROTECTION OF THE POOL.

(B) DURATION OF ELECTION; NEW CARRIERS.

(1) THE INITIAL ELECTION UNDER THIS SECTION IS BINDING FOR 3

YEARS.

(2) AFTER THE INITIAL 3 YEARS, AND EVERY 5 YEARS THEREAFTER,
EACH CARRIER SHALL AGAIN ELECT TO BE EITHER A RISK-ASSUMING OR
REINSURING CARRIER.

(3) EACH SUBSEQUENT ELECTION IS BINDING FOR 5 YEARS.

(4) THE COMMISSIONER MAY ALLOW A NEW CARRIER TO MAKE AN
ELECTION UNDER CONDITIONS ESTABLISHED BY THE COMMISSIONER.

(C) CHANGE OF ELECTION.

(1) THE COMMISSIONER MAY ALLOW A CARRIER TO CHANGE ITS
ELECTION AT ANY TIME FOR GOOD CAUSE SHOWN.

(2) IN DETERMINING WHETHER TO APPROVE AN APPLICATION BY A
CARRIER TO CHANGE ITS ELECTION, THE COMMISSIONER SHALL CONSIDER:

(I) THE APPLICANT'S FINANCIAL CONDITION AND THE FINANCIAL
CONDITION OF ANY PARENT OR GUARANTEEING CORPORATION;

(II) THE APPLICANT'S HISTORY OF ASSUMING AND MANAGING

RISK;

(III) THE APPLICANT'S COMMITMENT TO MARKET FAIRLY TO ALL
SMALL EMPLOYERS IN THE STATE OR IN THE APPLICANT'S SERVICE AREA;

(IV) THE APPLICANT'S ABILITY TO ASSUME AND MANAGE THE RISK
OF ENROLLING GROUPS UNDER THIS SUBTITLE WITHOUT THE PROTECTION OF THE
POOL; AND

(V) THE EFFECT OF APPROVAL OF THE APPLICATION ON THE
FINANCIAL VIABILITY OF THE POOL.

(3) WHILE THE COMMISSIONER IS CONSIDERING AN APPLICATION
UNDER THIS SUBSECTION, THE CARRIER MAY REQUEST A HEARING AS PROVIDED
UNDER TITLE 11, SUBTITLE 5 OF THIS ARTICLE.

REVISOR'S NOTE: This section is new language derived without substantive
change from former Art. 48A, § 706(a)(1) and (3), (b), (c), and (d).

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