24-A §3367. Nonassessable policies; limits of assessability; use of funds; combination operation - Maine Statutes

Title 24-A: MAINE INSURANCE CODE

Chapter 47: ORGANIZATION, CORPORATE POWERS, PROCEDURES OF DOMESTIC LEGAL RESERVE STOCK AND MUTUAL INSURERS

Subchapter 2: PROVISIONS APPLYING ONLY TO MUTUAL INSURERS

§3367. Nonassessable policies; limits of assessability; use of funds; combination operation

1. A domestic mutual insurer may extinguish the contingent liability to assessment of its members as to cash premium plan policies in force and may omit provisions imposing contingent liability in such policies currently issued while it has and maintains surplus, as determined by its financial statement filed with the superintendent as of the year end next preceding, of not less than $100,000 as to an insurer formed prior to January 1, 1968, and of not less than $200,000 as to an insurer formed after January 1, 1968.

[ 1973, c. 585, §12 (AMD) .]

2. If the insurer after qualifying to issue such a nonassessable policy fails to maintain the applicable above requirement, it shall cease to issue nonassessable policies until it has again met and maintained the requirement for a period of one year.

[ 1969, c. 132, §1 (NEW) .]

3. Any assessment levied under the contingent liability provisions of the policy shall be for the exclusive benefit of the holders of policies subject to contingent liability, and such policyholders shall not be liable to assessment in an amount greater in proportion to the total deficiency than the ratio that the deficiency attributable to the contingently liable business bears to the total deficiency. An assessment shall apply only to the holders of the type of policy or plan under which the deficiency occurred, and funds received from the assessment shall be for the exclusive benefit of such holders.

[ 1969, c. 132, §1 (NEW) .]

4. Nothing in this chapter shall be deemed to prohibit a domestic mutual insurer formed prior to January 1, 1968 from at any one time transacting, in respective departments or divisions of its operations, insurance business on any two or all of the following bases:

A. Cash premium plan, without contingent liability to assessment, and issuance of nonassessable policies if qualified therefor as above provided in this section; [1969, c. 132, §1 (NEW).]

B. Cash premium plan, with contingent liability to assessment; and [1969, c. 132, §1 (NEW).]

C. Assessment plan. [1969, c. 132, §1 (NEW).]

[ 1969, c. 132, §1 (NEW) .]

SECTION HISTORY

1969, c. 132, §1 (NEW). 1973, c. 585, §12 (AMD).