SENATE BILL NO. 377
INTRODUCED BY S. STANG
A BILL FOR AN ACT ENTITLED: "AN ACT SUBMITTING TO THE QUALIFIED ELECTORS A PROVISION SETTING THE MONTANA INSURANCE GUARANTY ASSOCIATION ASSESSMENT AT 2 PERCENT OF NET DIRECT WRITTEN PREMIUMS; AMENDING SECTION 33-10-116, MCA; AND PROVIDING AN EFFECTIVE DATE."
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 33-10-116, MCA, is amended to read:
"33-10-116. Assessment. (1) The association shall assess insurers amounts necessary to pay the obligations of the association under 33-10-105(1)(a) subsequent to an insolvency, the expenses of handling covered claims subsequent to an insolvency, the cost of examinations under 33-10-108, and other expenses authorized by this part.
(2) The assessments of each member insurer shall must be in the proportion that the net direct written premiums of the
member insurer for the preceding calendar year bear to the net direct written premiums of all member insurers for the
preceding calendar year. Each member insurer shall must be notified of the assessment not later than 30 days before it is
due. No member insurer may be assessed in any year an amount greater than Each year, the association shall assess 2% of
that member insurer's net direct written premiums for the preceding calendar year. IF THE ASSOCIATION
DETERMINES THAT THERE IS A SURPLUS OVER WHAT THE BOARD OF DIRECTORS HAS DETERMINED IS
NECESSARY, THE ASSOCIATION MAY REFUND, ABATE, OR OTHERWISE CREDIT THE SURPLUS TO THE
INSURER MEMBER.
(3) If the maximum assessment, together with the other assets of the association, does not provide in any one 1 year an
amount sufficient to make all necessary payments, the funds available shall must be prorated and the unpaid portion shall
must be paid as soon thereafter as funds become available.
(4) The association may exempt or defer, in whole or in part, the assessment of any member insurer, if the assessment would cause the member insurer's financial statement to reflect amounts of capital or surplus less than the minimum amounts required for a certificate of authority by any jurisdiction in which the member insurer is authorized to transact insurance.
(5) Each member insurer may set off against any assessment authorized payments made on covered claims and expenses
incurred in the payment of such claims by the member insurer."
NEW SECTION. Section 2. Submission to electorate. This amendment shall be submitted to the qualified electors of Montana at the tax election to be held in 1999 by printing on the ballot the full title of this act and the following:
SHALL THE MONTANA INSURANCE GUARANTY ASSOCIATION ASSESSMENT FEE TAX BE INCREASED
ANNUALLY TO 2% OF NET DIRECT WRITTEN PREMIUMS BY IMPOSING AN ANNUAL FIXED 2%
ASSESSMENT ON A MEMBER INSURANCE COMPANY'S NET DIRECT WRITTEN PREMIUMS TO COVER
COSTS OF THE ASSOCIATION, TO INCLUDE PAYING VALID CLAIMS OF MONTANA CITIZENS WHEN AN
INSURANCE COMPANY IS FINANCIALLY UNABLE TO PAY CLAIMS IN THE FOLLOWING MANNER?
[] FOR setting the Montana insurance guaranty association assessment at an annual 2% of net direct written premiums
ASSESSING PROPERTY AND CASUALTY INSURANCE COMPANIES 2% OF ANNUAL PREMIUMS TO PAY
VALID CONSUMER CLAIMS IN MONTANA ON BEHALF OF FINANCIALLY IMPAIRED INSURANCE
COMPANIES.
[] AGAINST setting the Montana insurance guaranty association assessment at an annual 2% of net direct written
premiums ASSESSING PROPERTY AND CASUALTY INSURANCE COMPANIES 2% OF ANNUAL PREMIUMS TO
PAY VALID CONSUMER CLAIMS IN MONTANA ON BEHALF OF FINANCIALLY IMPAIRED INSURANCE
COMPANIES.
NEW SECTION. Section 3. Effective date. If approved by the electorate, this act is effective July 1, 1999.
- END -
Latest Version of SB 377 (SB0377.02)
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