1996 Alaska Statutes
TITLE 21 INSURANCE
Chapter 21.79. ALASKA LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION ACT
Sec. 21.79.070. Assessments.

(a) For the purpose of providing funds necessary to carry out the powers and duties of the association, the Board of Governors shall assess the member insurers, separately for each account, at a time and for an amount that the board finds necessary. Assessments are due not less than 30 days after prior written notice to the member insurers and accrue interest at 10 percent a year from the date payment is due.

(b) There shall be two assessments as follows:

(1) class A assessments shall be made for the purpose of meeting administrative and legal costs and other expenses and examinations conducted under the authority of AS 21.79.060 ; class A assessments may be made whether or not related to a particular impaired or insolvent insurer;

(2) class B assessments are post assessment charges and shall be made only as necessary to carry out the powers and duties of the association with regard to an impaired or an insolvent insurer.

(c) The amount of a class A assessment shall be determined by the board and may be made on a pro rata or nonpro rata basis. If a pro rata assessment is made, the board may provide that it be credited against future class B assessments. A nonpro rata assessment may not exceed $250 per member insurer in a calendar year. The amount of a class B assessment shall be allocated for assessment purposes among the accounts under an allocation formula that may be based on the premiums or reserves of the impaired or insolvent insurer or by another standard determined by the board as being fair and reasonable under the circumstances.

(d) Class B assessments shall be based on the premiums received on business in this state by each assessed member insurer or for policies or contracts covered by each account in proportion to the premiums received on business in this state by all assessed member insurers during the three calendar years preceding the year in which the insolvency or impairment occurred.

(e) The association may abate or defer, in whole or in part, the assessment of a member insurer if a payment of the assessment would endanger the ability of the member insurer to fulfill its contractual obligations. The amount by which an assessment against a member insurer is abated or deferred may be assessed against the other member insurers in a manner consistent with the basis for assessments set forth in (c) of this section.

(f) The total of all assessments on a member insurer for the life and annuity account and for each subaccount may not in any one calendar year exceed two percent. The total of all assessments on a member insurer for the health account may not in any one calendar year exceed two percent of the insurer's average premiums received in this state on a policy or contract covered by the account during the three calendar years preceding the year in which the insurer became an impaired or insolvent insurer. If the maximum assessment, together with the other assets of the association in an account, does not provide in any one year in either account an amount sufficient to carry out the responsibilities of the association, the necessary additional funds shall be assessed as soon as permitted by this chapter.

(g) The board may provide in the plan of operation a method of allocating funds among claims, whether relating to one or more impaired or insolvent insurers, when the maximum assessment will be insufficient to cover anticipated claims.

(h) If a one percent assessment for a subaccount of the life and annuity account in any one year does not provide an amount sufficient to carry out the responsibilities of the association, the board shall, as provided under (d) of this section, assess all subaccounts of the life and annuity account for the necessary additional amount, subject to the assessment limit provided in (f) of this section.