Ch. 35

1997 LAWS OF MARYLAND

ASSESSMENT AS CALCULATED AND LIMITED IN ACCORDANCE WITH THIS SUBTITLE
IF, WHILE THE SUBSCRIBER'S POLICY IS IN FORCE OR WITHIN 3 YEARS AFTER ITS
TERMINATION:

(1) THE SUBSCRIBER IS NOTIFIED BY THE ATTORNEY IN FACT OF THE
RECIPROCAL INSURER OR THE COMMISSIONER OF THE INTENT TO LEVY THE
ASSESSMENT; OR

(2) AN ORDER IS ISSUED THAT DIRECTS THE RECIPROCAL INSURER TO
SHOW CAUSE WHY A RECEIVER, CONSERVATOR, REHABILITATOR, OR LIQUIDATOR
OF THE RECIPROCAL INSURER SHOULD NOT BE APPOINTED.

(E) TOTAL LIABILITY.

ONE POLICY OR A SUBSCRIBER TO ONE POLICY MAY NOT BE ASSESSED OR
CHARGED WITH A TOTAL CONTINGENT LIABILITY FOR OBLIGATIONS INCURRED BY
A DOMESTIC RECIPROCAL INSURER IN ONE CALENDAR YEAR, IN EXCESS OF THE
AMOUNT SET FORTH IN THE POWER OF ATTORNEY OR SUBSCRIBERS' AGREEMENT
CALCULATED SOLELY ON THE PREMIUM EARNED ON THE POLICY DURING THAT
YEAR.

REVISOR'S NOTE: This section is new language derived without substantive
change from former Art. 48A, §§ 295, 296, and 297.

In subsections (a)(2) and (d)(2) of this section, the references to a
"reciprocal" insurer are added for specificity.

In subsection (b)(3) of this section, the cross-reference to "subsection (e) of
this section" is substituted for the former incorrect cross-reference to [Art.
48A] "§ 294" - now § 3-216 of this subtitle. Subsection (e) of this section
covers total contingent liability.

Defined terms: "Commissioner" § 1-101
"Domestic insurer" § 1-101
"Policy" § 1-101
"Premium" § 1-101
"Reciprocal insurer" § 1-101
"Subscriber" § 3-201

3-218. EXTINGUISHING SUBSCRIBERS' LIABILITY AND ISSUANCE OF NONASSESSABLE
POLICIES.

(A) IN GENERAL.

IF A RECIPROCAL INSURER HAS A SURPLUS OF ASSETS OVER ALL LIABILITIES
AT LEAST EQUAL TO THE MINIMUM CAPITAL STOCK AND SURPLUS REQUIRED OF A
DOMESTIC STOCK INSURER AUTHORIZED TO ENGAGE IN LIKE KINDS OF INSURANCE
BUSINESS, ON APPLICATION OF THE ATTORNEY IN FACT OF THE RECIPROCAL
INSURER AND AS APPROVED BY THE SUBSCRIBERS' ADVISORY COMMITTEE, THE
COMMISSIONER SHALL ISSUE A CERTIFICATE THAT AUTHORIZES THE RECIPROCAL
INSURER TO:

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