Section 9-310.1 - Obligations of Corporation to cease. - Maryland Statutes

§ 9-310.1. Obligations of Corporation to cease.
 

(a)  In general.- Any obligation of the Corporation to defend an insured shall cease on payment by the Corporation, by settlement releasing the insured or on a judgment, of an amount equal to the lesser of the Corporation's covered claim obligation limit or the applicable policy limit. 

(b)  On payment of $10,000,000.-  

(1) In this subsection, "affiliate" means a person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with another person. 

(2) Notwithstanding any other provision of this subtitle, except for a claim for benefits under workers' compensation coverage, any obligation of the Corporation to any and all persons shall cease when $10,000,000 has been paid in the aggregate: 

(i) by the Corporation and one or more insurance guaranty corporations or associations similar to the Corporation in other states or property casualty insurance security funds that obtain contributions from insurers on a pre-insolvency basis in other states; 

(ii) to or on behalf of an insured and its affiliates; and 

(iii) on covered claims or on claims allowed arising under one or more policies of one insolvent insurer. 

(3) If the Corporation determines that there may be more than one claimant with a covered claim or allowed claim against the Corporation or any insurance guaranty corporations or associations similar to the Corporation in other states or any property casualty insurance security funds in other states, arising under one or more policies of one insolvent insurer, the Corporation may establish a plan to allocate amounts payable by the Corporation in the manner that the Corporation in its discretion considers equitable. 
 

[1997, ch. 682.]