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304.36-090 Plan of operation.
(1)
(2)
(3)
(4)
(a)
The association shall submit to the commissioner a plan of operation and
any amendments thereto necessary or suitable to assure the fair,
reasonable, and equitable administration of the association. The plan of
operation and any amendments thereto shall become effective upon
approval in writing by the commissioner.
(b) If the association fails to submit a suitable plan of operation within ninety
(90) days following June 16, 1972, or if at any time thereafter the
association fails to submit suitable amendments to the plan, the
commissioner shall, after notice and hearing, adopt and promulgate such
reasonable rules as are necessary or advisable to effectuate the
provisions of this subtitle. Such rules shall continue in force until modified
by the commissioner or superseded by a plan submitted by the
association and approved by the commissioner.
All member insurers shall comply with the plan of operation.
The plan of operation shall:
(a) Establish the procedures whereby all the powers and duties of the
association under KRS 304.36-080 will be performed;
(b) Establish procedures for handling assets of the association;
(c) Establish the amount and method of reimbursing members of the board
of directors under KRS 304.36-070;
(d) Establish procedures by which claims may be filed with the association
and establish acceptable forms of proof of covered claims. Notice of
claims to the receiver or liquidator of the insolvent insurer shall be
deemed notice to the association or its agent, and a list of such claims
shall be periodically submitted to the association or similar organization in
another state by the receiver or liquidator;
(e) Establish regular places and times for meetings of the board of directors;
(f) Establish procedures for records to be kept of all financial transactions of
the association, its agents, and the board of directors;
(g) Provide that any member insurer aggrieved by any final action or decision
of the association may appeal to the commissioner within thirty (30) days
after the action or decision;
(h) Establish the procedures whereby selections for the board of directors will
be submitted to the commissioner; and
(i) Contain additional provisions necessary or proper for the execution of the
powers and duties of the association.
The plan of operation may provide that any or all powers and duties of the
association, except those under KRS 304.36-080(1)(d) and (2)(c), are
delegated to a corporation, association, or other organization which performs
or will perform functions similar to those of this association, or its equivalent, in
two (2) or more states. Such a corporation, association, or organization shall
be reimbursed as a servicing facility would be reimbursed and shall be paid for
its performance of any other functions of the association. A delegation under
this subsection shall take effect only with the approval of both the board of
(5)
directors and the commissioner, and may be made only to a corporation,
association, or organization which extends protection not substantially less
favorable and effective than that provided by this subtitle.
The plan of operation may establish procedures by which claims may be filed
with the association and establish acceptable forms of proof of covered claims.
Notice of claims to the receiver or liquidator of the insolvent insurer shall be
deemed notice to the association or its agent, and a list of claims shall be
periodically submitted to the association or similar organization in another state
by the receiver or liquidator.
Effective:July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 1467, effective July 15, 2010. -Amended 1998 Ky. Acts ch. 99, sec. 6, effective July 15, 1998. -- Created 1972
Ky. Acts ch. 137, sec. 9, effective June 16, 1972.
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