<section article="gin" article_name="Insurance" number="20-101" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="1" subtitle_name="Definitions"> <level label="a"> <text>In this title the following words have the meanings indicated.</text> </level> <level label="b"> <text>“Association” means the Industry Automobile Insurance Association.</text> </level> <level label="c"> <level label="1"> <text>“Association member” means an insurer that is licensed to write motor vehicle liability insurance or motor vehicle physical damage insurance in the State.</text> </level> <level label="2"> <text>“Association member” does not include the Fund.</text> </level> </level> <level label="d"> <text>“Board of Directors” means the Board of Directors of the Association.</text> </level> <level label="e"> <text>“Board of Trustees” means the Board of Trustees of the Fund.</text> </level> <level label="f"> <text>“Executive Director” means the Executive Director of the Fund.</text> </level> <level label="g"> <text>“Fund” means the Maryland Automobile Insurance Fund.</text> </level> <level label="h"> <text>“Motor vehicle liability insurance” means insurance coverage that is reported as private passenger auto no-fault, other private passenger auto liability, commercial auto no-fault, or other commercial auto liability on the exhibit of premiums and losses page of the annual statement that Association members are required to file with the Commissioner.</text> </level> <level label="i"> <text>“Motor vehicle physical damage insurance” means insurance coverage that is reported as private passenger auto physical damage or commercial auto physical damage on the exhibit of premiums and losses page of the annual statement that Association members are required to file with the Commissioner.</text> </level> <level label="j"> <text>“Person” includes a governmental unit.</text> </level> <level label="k"> <text>“Uninsured Division” means the unit within the Fund that is responsible for claims under Subtitle 6 of this title and activities related to reducing the rate of uninsured motorists in the State.</text> </level> <level label="l"> <text>“Uninsured motor vehicle” means a motor vehicle for which:</text> <level label="1"> <text>the security required under § 17–103 of the Transportation Article is not in force; or</text> </level> <level label="2"> <text>the security required under § 17–103 of the Transportation Article is in force but a receiver or conservator has been appointed by a court for the insurer that issued the security.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-201" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="2" subtitle_name="Administration of Fund"> <level label="a"> <text>There is a Maryland Automobile Insurance Fund.</text> </level> <level label="b"> <text>The Fund is independent of all State units.</text> </level> <level label="c"> <text>The Fund is a member of the Property and Casualty Insurance Guaranty Corporation.</text> </level> <level label="d"> <level label="1"> <text>Except as otherwise provided by law, the Fund is subject to the provisions of this article.</text> </level> <level label="2"> <text>Except as provided in paragraph (3) of this subsection, the Fund is not subject to any law, including § 6–106 of the State Government Article, that affects governmental units.</text> </level> <level label="3"> <text>The Fund is subject to:</text> <level label="i"> <text>Title 4 of the General Provisions Article;</text> </level> <level label="ii"> <text>the Maryland Public Ethics Law;</text> </level> <level label="iii"> <text>Title 10, Subtitle 1 of the State Government Article with respect to regulations adopted under Subtitle 6 of this title;</text> </level> <level label="iv"> <text>Title 12 of the State Government Article; and</text> </level> <level label="v"> <text>Title 5, Subtitle 3 of the State Personnel and Pensions Article.</text> </level> </level> <level label="4"> <text>Paragraph (2) of this subsection does not affect the exemption from property tax under § 7–210 of the Tax – Property Article.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-202" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="2" subtitle_name="Administration of Fund"> <level label="a"> <text>There is a Board of Trustees of the Fund.</text> </level> <level label="b"> <level label="1"> <text>The Board of Trustees consists of nine members appointed by the Governor with the advice and consent of the Senate.</text> </level> <level label="2"> <text>Of the nine members:</text> <level label="i"> <text>at least three shall have insurance industry expertise; and</text> </level> <level label="ii"> <text>at least two shall have financial management expertise.</text> </level> </level> <level label="3"> <text>Of the members described in paragraph (2)(i) of this subsection, at least one shall be appointed from a list of two or more individuals recommended by the Board of Directors.</text> </level> </level> <level label="c"> <text>A member may not be actively affiliated with an insurance agency, insurance producer, insurer, or premium finance company that does business with the Fund.</text> </level> <level label="d"> <level label="1"> <text>Each member shall be a resident of the State.</text> </level> <level label="2"> <text>In deciding which individuals to appoint, the Governor, to the extent practicable, shall consider the geographic and demographic, including race and gender, diversity of the State.</text> </level> </level> <level label="e"> <text>Before taking office, each appointee to the Board of Trustees shall take the oath required by Article I, § 9 of the Maryland Constitution.</text> </level> <level label="f"> <level label="1"> <text>The term of a member is 5 years.</text> </level> <level label="2"> <text>The terms of members are staggered as required by the terms provided for members of the Board of Trustees on October 1, 2013.</text> </level> <level label="3"> <text>At the end of a term, a member continues to serve until a successor is appointed and qualifies.</text> </level> <level label="4"> <text>A member may not serve for more than:</text> <level label="i"> <text>two full terms; or</text> </level> <level label="ii"> <text>a total of 10 years.</text> </level> </level> <level label="5"> <text>If a member of the Board of Trustees ceases to be a member of the Board, the Governor shall appoint a successor for the unexpired term.</text> </level> </level> <level label="g"> <text>The Board of Trustees shall choose a chair from among its members.</text> </level> <level label="h"> <text>The Governor may remove a member of the Board of Trustees for incompetence or misconduct.</text> </level> <level label="i"> <level label="1"> <text>Each member of the Board of Trustees is entitled to:</text> <level label="i"> <text>reasonable compensation:</text> <level label="1"> <text>in the form of salary for work performed for the benefit of the Fund; and</text> </level> <level label="2"> <text>as provided in the budget of the Board of Trustees; and</text> </level> </level> <level label="ii"> <text>reimbursement for expenses:</text> <level label="1"> <text>incurred in the performance of the member’s duties; and</text> </level> <level label="2"> <text>as provided in the budget of the Board of Trustees.</text> </level> </level> </level> <level label="2"> <text>Nothing in paragraph (1)(i) of this subsection requires a member of the Board of Trustees to take compensation if the member has a conflict of interest with other employment that precludes the member from taking compensation for work performed for the benefit of the Fund.</text> </level> </level> <level label="j"> <text>The Board of Trustees:</text> <level label="1"> <text>shall adopt rules, bylaws, and procedures; and</text> </level> <level label="2"> <text>may adopt any policy to carry out this title.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-203" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="2" subtitle_name="Administration of Fund"> <level label="a"> <level label="1"> <text>The Board of Trustees shall:</text> <level label="i"> <text>appoint the Executive Director of the Fund; and</text> </level> <level label="ii"> <text>employ attorneys to advise and represent the Fund in all legal matters and, where necessary, to sue or defend suits in the name of the Fund.</text> </level> </level> <level label="2"> <text>The Executive Director serves at the pleasure of the Board of Trustees.</text> </level> <level label="3"> <text>If the Board of Trustees fails to agree on a successor Executive Director, the Governor shall appoint the successor.</text> </level> </level> <level label="b"> <level label="1"> <text>The Executive Director:</text> <level label="i"> <text>is the administrative head of the Fund; and</text> </level> <level label="ii"> <text>shall exercise the powers and perform the duties conferred on the Fund by this title, except for those powers and duties conferred on the Board of Trustees.</text> </level> </level> <level label="2"> <text>The Board of Trustees shall advise the Executive Director on the exercise of the powers and duties conferred on the Executive Director by this title.</text> </level> </level> <level label="c"> <text>The Board of Trustees shall determine the compensation of the Executive Director.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-204" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="2" subtitle_name="Administration of Fund"> <level label="a"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection, employees of the Fund are not in the State Personnel Management System.</text> </level> <level label="2"> <text>A skilled service employee of the Fund hired before July 1, 2013, in a nonprofessional or nontechnical position shall remain in the skilled service in the State Personnel Management System or its equivalent as long as the employee remains in a nonprofessional or nontechnical position with the Fund.</text> </level> <level label="3"> <text>The Executive Director shall appoint and remove employees of the Fund in accordance with the policies of the Board of Trustees.</text> </level> <level label="4"> <text>Notwithstanding any other provision of law, the Executive Director may appoint claims adjusters, attorneys, and other necessary personnel directly as employees or on a contract basis.</text> </level> </level> <level label="b"> <text>The Executive Director shall determine and administer the compensation of the employees of the Fund with the approval of the Board of Trustees.</text> </level> <level label="c"> <text>Except as otherwise provided in this subtitle, an employee of the Fund is not subject to any law, regulation, or executive order governing State employee compensation, including furloughs, salary reductions, and any other General Fund cost–saving measure.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-301" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="3" subtitle_name="Purpose and General Provisions"> <level label="a"> <text>The purpose of the Fund is to provide the financial security required under § 17–103 of the Transportation Article to those eligible persons that are unable to obtain it from an Association member.</text> </level> <level label="b"> <text>Money of the Fund consists of revenues, premiums, and other receipts provided by law.</text> </level> <level label="c"> <level label="1"> <text>All operating expenses of the Fund shall be paid from the money collected by or for the Fund.</text> </level> <level label="2"> <level label="i"> <text>Subject to subparagraphs (ii) through (iv) of this paragraph, money and property available to the Fund may be used for the general purposes of the Fund.</text> </level> <level label="ii"> <text>Premiums collected and income accruing from those premiums may be used only for the payment of claims arising under policies issued by the Fund and for the administrative expenses of the Fund.</text> </level> <level label="iii"> <text>The Fund shall keep separate records of any income and expenses directly attributable to the Uninsured Division, including the processing and payment of unsatisfied claims under Subtitle 6 of this title.</text> </level> <level label="iv"> <text>The Fund shall keep separate records of any income and expenses directly attributable to its commercial policy and claims operations.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-302" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="3" subtitle_name="Purpose and General Provisions"> <level label="a"> <text>The account of the Fund is a special fund account and is not a part of the State Treasury.</text> </level> <level label="b"> <text>The State may not provide General Fund appropriations to the Fund.</text> </level> <level label="c"> <text>The debts and obligations of the Fund are not a debt of the State or a pledge of the credit of the State.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-303" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="3" subtitle_name="Purpose and General Provisions"> <level label="a"> <level label="1"> <text>A financial management committee of the Fund shall manage and invest all money collected by or for the Fund through premiums, earnings from investments, or from other sources.</text> </level> <level label="2"> <text>The financial management committee consists of the Executive Director and two members of the Board of Trustees who have financial management expertise, chosen by the Board of Trustees.</text> </level> </level> <level label="b"> <level label="1"> <text>Whenever the amount of money in the Fund exceeds the amount that the Executive Director believes is likely to be required immediately, the financial management committee may manage the excess as it considers appropriate and invest the excess in investments legal for casualty insurers under §§ 5–601 through 5–609 of this article.</text> </level> <level label="2"> <text>If use of the excess becomes necessary or expedient, the financial management committee may collect, sell, or otherwise realize on the investment and any accrued interest.</text> </level> </level> <level label="c"> <level label="1"> <level label="i"> <text>Consistent with minority business purchasing standards applicable to units of State government under the State Finance and Procurement Article and consistent with the fiduciary duties of the financial management committee, the financial management committee shall attempt to use to the greatest extent feasible minority business enterprises to provide brokerage and investment management services to the committee.</text> </level> <level label="ii"> <text>For purposes of this subsection, brokerage and investment management services shall include services relating to all allocated asset classes.</text> </level> </level> <level label="2"> <level label="i"> <text>To assist it in achieving the goal described under paragraph (1) of this subsection, the financial management committee shall undertake measures to remove any barriers that limit full participation by minority business enterprises in brokerage and investment management services opportunities afforded by the Fund.</text> </level> <level label="ii"> <text>The measures undertaken by the financial management committee shall include the use of a wide variety of media, including the Fund’s website, to provide notice to a broad and varied range of potential providers about the brokerage and investment management services opportunities afforded by the Fund.</text> </level> </level> <level label="3"> <text>In conjunction with the Governor’s Office of Small, Minority, and Women Business Affairs, the financial management committee shall develop guidelines to assist the committee in identifying and evaluating qualified minority business enterprises in order to help the Fund achieve the objective for greater use of minority business enterprises for brokerage and investment management services.</text> </level> <level label="4"> <text>On or before September 1 each year, the financial management committee shall submit a report to the Governor’s Office of Small, Minority, and Women Business Affairs and, subject to § 2–1257 of the State Government Article, the General Assembly on:</text> <level label="i"> <text>the identity of the minority business enterprise brokerage and investment management services firms used by the financial management committee in the immediately preceding fiscal year;</text> </level> <level label="ii"> <text>the percentage and dollar value of the Fund assets that are under the investment control of minority business enterprise brokerage and investment management services firms in each allocated asset class; and</text> </level> <level label="iii"> <text>the measures the financial management committee undertook in the immediately preceding fiscal year in accordance with paragraph (2)(ii) of this subsection.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-304" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="3" subtitle_name="Purpose and General Provisions"> <level label="a"> <level label="1"> <text>An audit committee, composed of members of the Board of Trustees, shall require the Fund’s internal auditor to conduct fiscal compliance and fiscal audits of the accounts and transactions of the Fund each year.</text> </level> <level label="2"> <text>A fiscal compliance audit shall:</text> <level label="i"> <text>examine financial transactions and records and internal controls;</text> </level> <level label="ii"> <text>evaluate compliance with applicable laws and regulations; and</text> </level> <level label="iii"> <text>examine electronic data processing operations.</text> </level> </level> </level> <level label="b"> <text>If an independent auditor conducts a fiscal audit of the Fund, the audit committee shall direct the Fund’s internal auditors not to duplicate the fiscal audit for the same period.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-305" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="3" subtitle_name="Purpose and General Provisions"> <level label="a"> <text>The Fund shall provide each commercial policyholder with a notice stating the expiration date of the current policy at least 45 days before the expiration of the current policy.</text> </level> <level label="b"> <text>If a commercial policyholder requests a rewritten policy with the Fund and the policyholder’s fund producer is unable to generate a new rewritten policy quote without the assistance of the Fund, the Fund shall provide the policyholder’s fund producer with a rewritten policy quote within 7 days after the Fund has received all necessary information from the fund producer.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-306" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="3" subtitle_name="Purpose and General Provisions"> <level label="a"> <text>In this section, “company action level RBC” has the meaning stated in § 4–301(n)(1) of this article.</text> </level> <level label="b"> <text>The Fund shall calculate and report its RBC level in accordance with Title 4, Subtitle 3 of this article.</text> </level> <level label="c"> <text>Beginning December 31, 2026, the Fund shall maintain total adjusted capital, as defined in § 4–301(r) of this article, in an amount that is greater than or equal to its company action level RBC.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-401" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <text>There is an Industry Automobile Insurance Association.</text> </section> <section article="gin" article_name="Insurance" number="20-402" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <text>The Association consists of all insurers except for the Fund that are licensed to write on a direct basis motor vehicle liability insurance or motor vehicle physical damage insurance in the State.</text> </level> <level label="b"> <text>As a condition of its authority to write motor vehicle liability insurance or motor vehicle physical damage insurance in the State, an insurer must be and remain an Association member.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-403" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <text>There is a Board of Directors to administer the Association.</text> </level> <level label="b"> <level label="1"> <text>The Board of Directors consists of nine members elected by Association members.</text> </level> <level label="2"> <text>Of the nine members of the Board of Directors:</text> <level label="i"> <text>four shall be nominated by the American Property Casualty Insurance Association;</text> </level> <level label="ii"> <text>one shall be associated with a domestic insurer that is not affiliated with the American Property Casualty Insurance Association;</text> </level> <level label="iii"> <text>two may not be affiliated with a member company of the American Property Casualty Insurance Association or with a domestic insurer that is otherwise represented on the Board of Directors; and</text> </level> <level label="iv"> <text>two shall be nominated by the members of the Board of Directors selected under items (i) through (iii) of this paragraph.</text> </level> </level> <level label="3"> <text>The term of a member of the Board of Directors is 1 year.</text> </level> <level label="4"> <text>If the American Property Casualty Insurance Association fails to submit the name of a nominee at least 10 days before the election, the requirement that four directors be from among nominees of that group need not be met for that year.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-404" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <text>On or before March 15 of each year, the Fund shall determine and the Board of Trustees shall certify to the Board of Directors the information required under subsections (b) and (c) of this section.</text> </level> <level label="b"> <text>Subject to subsection (f) of this section, the following information certified to the Board of Directors shall be separately identified by commercial auto and private passenger auto results:</text> <level label="1"> <text>the statutory operating loss for the immediately preceding calendar year;</text> </level> <level label="2"> <text>a calculation to yield a private passenger auto assessment limit that is determined by subtracting the year–end total surplus of the Fund for the immediately preceding calendar year from an amount equal to 25% of the average of net direct written private passenger auto premiums of the Fund for each of the three immediately preceding calendar years; and</text> </level> <level label="3"> <text>a calculation to yield a commercial auto assessment limit that is determined by subtracting the year–end commercial auto surplus of the Fund for the immediately preceding calendar year from an amount equal to 25% of the average of net direct written commercial auto premiums of the Fund for each of the 3 immediately preceding calendar years.</text> </level> </level> <level label="c"> <text>The assessment certified to the Board of Directors shall be equal to:</text> <level label="1"> <text>subject to subsection (d) of this section, the assessment limit, if the assessment limit is less than or equal to the statutory operating loss; or</text> </level> <level label="2"> <text>the statutory operating loss, if the assessment limit is greater than the statutory operating loss.</text> </level> </level> <level label="d"> <text>If the calculation under subsection (b)(2) of this section yields a number that is less than or equal to zero, the assessment limit is zero.</text> </level> <level label="e"> <text>The statutory operating loss or assessment certified to the Board of Directors may not include:</text> <level label="1"> <text>assessment money received for a prior year; or</text> </level> <level label="2"> <text>money transferred between the commercial auto and private passenger auto divisions within the Fund.</text> </level> </level> <level label="f"> <text>In a calculation made under this section, income or expenses not clearly attributable to either commercial auto or private passenger auto may be allocated pro rata for that year.</text> </level> <level label="g"> <text>Promptly after the certification of an assessment by the Board of Trustees for commercial auto or private passenger auto under subsection (c) of this section the Board of Directors shall notify the Commissioner of the certification.</text> </level> <level label="h"> <text>On the Commissioner’s verification of the Board of Trustees’ certification, the Board of Directors shall authorize the Fund to withdraw:</text> <level label="1"> <text>an amount equal to the commercial auto or private passenger auto assessment, if the assessment balance for that portion exceeds the assessment; or</text> </level> <level label="2"> <text>the entire commercial auto or private passenger auto balance, if the assessment equals or exceeds the balance for that portion.</text> </level> </level> <level label="i"> <text>Association members may not be subject to an annual assessment if the amount of money held by the Fund from a prior overassessment is equal to or greater than the assessment.</text> </level> <level label="j"> <text>Association members are subject to an annual assessment under § 20–405 of this subtitle if the amount of money held by the Fund from a prior overassessment is less than the assessment, based on the difference between:</text> <level label="1"> <text>the commercial auto assessment or private passenger auto assessment; and</text> </level> <level label="2"> <text>the applicable amount of money held by the Fund from a prior overassessment.</text> </level> </level> <level label="k"> <level label="1"> <text>On June 1, 2023, the Board of Directors shall authorize the Fund to withdraw from the money held by the Fund from a prior overassessment.</text> </level> <level label="2"> <text>The funds withdrawn:</text> <level label="i"> <text>shall be allocated to the surplus of the Fund; and</text> </level> <level label="ii"> <text>may not be credited to Association members.</text> </level> </level> </level> <level label="l"> <text>On or before July 1, 2023, the Fund shall submit a report to the General Assembly, in accordance with § 2–1257 of the State Government Article, on the application of the funds withdrawn under this section and all fund balances in the Fund’s Insured and Uninsured Divisions.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-405" future_version_removed="true" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <text>In this section, “net direct written premiums” means direct gross premiums written on all policies of motor vehicle liability insurance and motor vehicle physical damage insurance less return premiums or dividends paid or credited to policyholders with respect to those policies.</text> </level> <level label="b"> <text>On or before June 30 of each year in which the Board of Directors receives the certification of an actual commercial auto or private passenger auto assessment for a preceding calendar year, the Board of Directors shall perform the duties specified in this section.</text> </level> <level label="c"> <text>The Board of Directors shall obtain from the Commissioner the aggregate net direct written premiums of all Association members during the most recent calendar year determined by the Commissioner for commercial auto and private passenger auto divisions of motor vehicle liability insurance and motor vehicle physical damage insurance.</text> </level> <level label="d"> <level label="1"> <text>The Board of Directors shall calculate assessment allocation percentages for commercial auto and private passenger auto divisions by dividing the most recent certified assessment for commercial auto and private passenger auto divisions by the total of:</text> <level label="i"> <text>the respective aggregate net direct written premiums obtained under subsection (c) of this section; and</text> </level> <level label="ii"> <text>the respective total net direct written premiums of the Fund for the same period.</text> </level> </level> <level label="2"> <text>The assessment allocation percentage for the private passenger auto division may not exceed 3%.</text> </level> </level> <level label="e"> <text>The Board of Directors shall give notice of the assessment allocation percentages determined under this section to the Fund, the Commissioner, and all Association members.</text> </level> <level label="f"> <text>The Board of Directors promptly shall assess and collect from each Association member for the commercial auto and private passenger auto divisions an assessment obtained by:</text> <level label="1"> <text>multiplying the Association member’s net direct written premiums in each division for the most recent calendar year determined by the Commissioner by the appropriate assessment allocation percentage, calculated under subsection (d) of this section; and</text> </level> <level label="2"> <text>adjusting the resulting product for any shortfall experienced by the Association member for the previous applicable surcharge year.</text> </level> </level> <level label="g"> <text>An Association member may deduct an assessment payment from a retaliatory tax but may not deduct the payment from any other assessment or tax required by law.</text> </level> <level label="h"> <level label="1"> <text>The Association:</text> <level label="i"> <text>first, shall deposit the certified assessment into the Insufficiency Assessment Reserve Fund that is created under § 20–410 of this subtitle and apply the appropriate parts of the certified assessment to the private passenger auto and commercial auto divisions of the Insufficiency Assessment Reserve Fund; and</text> </level> <level label="ii"> <text>then, shall pay to the Fund the entire certified assessment in one sum, less the part of the certified assessment allocated to the Fund.</text> </level> </level> <level label="2"> <text>Any money in the Insufficiency Assessment Reserve Fund from a previous year shall be paid to the Fund on December 31 of each year.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-406" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <level label="1"> <text>The Commissioner promptly shall review the assessment allocation percentages calculated by the Association.</text> </level> <level label="2"> <text>Unless the Commissioner finds the calculation to be inaccurate, the Commissioner shall authorize each Association member to impose an assessment surcharge on each policy of motor vehicle liability insurance or motor vehicle physical damage insurance that is written or renewed in the State during the 1-year period beginning on the next July 1 following notice of the assessment.</text> </level> <level label="3"> <text>Subject to § 20-407 of this subtitle, the assessment surcharge shall be calculated by applying the appropriate assessment allocation percentage that is adjusted for any excess or shortfall to the premium at the inception or renewal of the policy.</text> </level> <level label="4"> <text>The assessment surcharge may not be:</text> <level label="i"> <text>subject to change or refund; or</text> </level> <level label="ii"> <text>considered premium income for the State premium tax or the payment of commissions.</text> </level> </level> </level> <level label="b"> <level label="1"> <text>In conformity with §§ 20-405 through 20-409 of this subtitle, each year the Fund shall impose an assessment surcharge on all of its policyholders as if the Fund were a member of the Association.</text> </level> <level label="2"> <text>The Fund may not make a payment to the Insufficiency Assessment Reserve Fund.</text> </level> <level label="3"> <text>The Fund shall account separately for the assessment surcharges that the Fund assesses and receives.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-407" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <text>On or before June 30 of each year, each Association member shall elect whether to recoup its share of the assessment for the immediately preceding year by imposing an assessment surcharge, where appropriate, on each of the Association member’s commercial auto policyholders or private passenger auto policyholders, or both.</text> </level> <level label="b"> <text>An Association member that does not elect on or before June 30 to recoup its share of an assessment is considered to have recouped that assessment and to have waived its option to impose an assessment surcharge on its policyholders.</text> </level> <level label="c"> <level label="1"> <text>This section does not deny an Association member the right to:</text> <level label="i"> <text>absorb an annual assessment; or</text> </level> <level label="ii"> <text>recover all or part of an annual assessment as costs in rate filings made under this article.</text> </level> </level> <level label="2"> <text>An Association member that recovers assessments as costs in rate filings shall identify the assessment on any premium billing to the policyholder.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-408" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <level label="1"> <text>Each Association member shall apply and collect any assessment surcharge that the Association member elects to recoup under § 20-407 of this subtitle.</text> </level> <level label="2"> <text>Policyholders of an Association member shall receive any excess surcharge credits and may be charged for any surcharge shortfall that the Association member receives from or is charged by the Association.</text> </level> </level> <level label="b"> <level label="1"> <text>If an Association member elects on or before June 30 to recoup its share of an assessment, the Association member must identify clearly the assessment surcharge imposed on its policyholders by stating on the premium billing of each policyholder: “Recoupment of MAIF assessment, $_____”.</text> </level> <level label="2"> <text>No other statement may accompany the premium billing.</text> </level> </level> <level label="c"> <text>Each Association member shall:</text> <level label="1"> <text>report quarterly to the Association; and</text> </level> <level label="2"> <text>require an officer of the Association member to certify, in the manner required by the Board of Directors, that any amounts collected and paid are an accurate accounting of the assessment surcharges of the Association member.</text> </level> </level> <level label="d"> <level label="1"> <text>Each Association member may keep separate and detailed records of any expenses actually incurred that are directly attributable to collection of the assessment surcharge authorized under subsection (a) of this section.</text> </level> <level label="2"> <text>The Commissioner shall consider verified and relevant expenses to be appropriate cost items in a subsequent rate filing by the Association member.</text> </level> </level> <level label="e"> <text>If a policyholder fails to pay the assessment surcharge when due, the Association member may cancel the policy in accordance with the terms of the policy for nonpayment of premium.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-409" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <text>If the aggregate amount of assessment surcharges received by an Association member during a surcharge year is less than that Association member’s assessment payment, the Association member’s assessment surcharge authorized under § 20–406 of this subtitle shall be increased accordingly for the next appropriate surcharge year.</text> </level> <level label="b"> <level label="1"> <text>If the aggregate amount of assessment surcharges received by an Association member during a recoupment year exceeds the Association member’s assessment payment, the Association shall promptly return the excess to the association member.</text> </level> <level label="2"> <text>An Association member to whom an excess is returned under paragraph (1) of this subsection shall:</text> <level label="i"> <text>refund the excess to the policyholders who paid the excess; or</text> </level> <level label="ii"> <text>apply the excess as an expense reduction in a subsequent rate filing.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-410" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <text>There is an Insufficiency Assessment Reserve Fund.</text> </level> <level label="b"> <text>The Insufficiency Assessment Reserve Fund shall be maintained by the Association and shall consist of assessment payments collected by the Association and interest, if any.</text> </level> <level label="c"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection, the Association shall hold money of the Insufficiency Assessment Reserve Fund in trust in a separate interest–bearing account in a financial institution in the State for the use of the Fund.</text> </level> <level label="2"> <text>The Association may authorize the financial institution where the money is deposited to invest all or part of the money in investments allowed for casualty insurers, as provided in §§ 5–601 through 5–609 of this article.</text> </level> </level> <level label="d"> <text>An Association member shall deposit with the Association any gross excess surcharges received because of a future assessment not later than October 15 after the surcharge year in which the gross excess surcharge was received.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-411" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="4" subtitle_name="Industry Automobile Insurance Association"> <level label="a"> <text>All money that the Fund receives from the Association to pay an assessment during the calendar year shall be considered a direct contribution to surplus for purposes of the annual statement.</text> </level> <level label="b"> <level label="1"> <text>The Fund shall include in its annual statement to the Commissioner an accounting of all money received during the preceding calendar year from the Insufficiency Assessment Reserve Fund.</text> </level> <level label="2"> <text>When filing a rate with the Commissioner, the Fund may not consider money that is received from or that remains in the Insufficiency Assessment Reserve Fund.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-501" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>In this subtitle, “covered vehicle” means a vehicle for which the Fund is required to provide coverage under this subtitle.</text> </level> <level label="b"> <text>“Covered vehicle” includes:</text> <level label="1"> <text>any motor vehicle required to be registered under Title 13 of the Transportation Article;</text> </level> <level label="2"> <text>a moped; and</text> </level> <level label="3"> <text>a motor scooter.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-502" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>On payment of the premium set by the Fund, the Fund is authorized to and shall sell, issue, and deliver a policy that provides the security required under § 17–103 of the Transportation Article to a person:</text> <level label="1"> <text>that owns a covered vehicle registered with the Motor Vehicle Administration, has a license issued by the Motor Vehicle Administration to drive a covered vehicle, or is a lessee under a “lease not intended as security”, as defined in § 11–127.2(b) of the Transportation Article;</text> </level> <level label="2"> <text>that does not owe to the Fund:</text> <level label="i"> <text>an unpaid premium with respect to a policy that has expired or been canceled; or</text> </level> <level label="ii"> <text>a claim payment obtained by fraud;</text> </level> </level> <level label="3"> <text>that:</text> <level label="i"> <text>has attempted in good faith to obtain a policy that provides the security required under § 17–103 of the Transportation Article from at least two Association members and has been rejected or refused the policy by two Association members for any reason other than nonpayment of premiums;</text> </level> <level label="ii"> <text>has had a policy that provides the security required under § 17–103 of the Transportation Article canceled or nonrenewed by an Association member for any reason other than nonpayment of premiums; or</text> </level> <level label="iii"> <text>has had a motor vehicle liability insurance policy but has been uninsured for a continuous period of 12 months or more immediately preceding the effective date of the Fund policy, as verified by a commercial third–party database or a State agency; and</text> </level> </level> <level label="4"> <text>that meets the requirements of subsection (b) of this section.</text> </level> </level> <level label="b"> <text>To be eligible for a policy issued under this subtitle, a person must:</text> <level label="1"> <text>be domiciled in the State;</text> </level> <level label="2"> <text>own, lease, or rent a primary place of residence in the State and, regardless of the person’s domicile, reside in the State for more than 1 year;</text> </level> <level label="3"> <text>maintain a main or branch office or warehouse facility in the State, and base and operate motor vehicles intrastate in the State;</text> </level> <level label="4"> <text>have filed as a State resident for income tax purposes; or</text> </level> <level label="5"> <text>have a nonresident permit issued under § 13–402.1(e) of the Transportation Article.</text> </level> </level> <level label="c"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection, this section does not apply to a person to the extent that the person:</text> <level label="i"> <text>leases a covered vehicle that is a private passenger vehicle to an individual who does not meet the requirements of subsection (b) of this section; or</text> </level> <level label="ii"> <text>garages the covered vehicle principally outside of the State.</text> </level> </level> <level label="2"> <text>This section applies to a person described in paragraph (1) of this subsection who is:</text> <level label="i"> <text>a member, on active duty, of the uniformed services; or</text> </level> <level label="ii"> <text>a student enrolled in an accredited school, college, or university or serving a medical internship.</text> </level> </level> </level> <level label="d"> <text>The eligibility of an applicant for insurance from the Fund shall be certified at a time and in a manner approved by the Fund.</text> </level> <level label="e"> <level label="1"> <text>If a prospective insured fails to qualify under this section, any policy issued is void and a commission may not be paid by the Fund to a fund producer.</text> </level> <level label="2"> <level label="i"> <text>Subject to the provisions of subparagraph (ii) of this paragraph, if a person fails to meet the requirements of subsection (b) of this section, the Fund may charge and collect the greater of:</text> <level label="1"> <text>a policy processing fee to cover its expenses; or</text> </level> <level label="2"> <text>the amount that the person would have received after the Fund returns to a fund producer, or any other person other than the person who fails to meet the requirements of subsection (b) of this section, any gross unearned premiums that are due under the policy.</text> </level> </level> <level label="ii"> <text>Prior to charging and collecting a policy processing fee or the amount allowed under subparagraph (i) of this paragraph, the Fund shall refer to the Insurance Fraud Division in the Administration for investigation and possible prosecution of the person who fails to meet the requirements of subsection (b) of this section.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-503" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>Each policy issued by the Fund shall contain the minimum coverages required under Title 19, Subtitle 5 of this article and may contain other provisions determined by the Executive Director and approved by the Board of Trustees and the Commissioner.</text> </level> <level label="b"> <text>At the time a policy of private passenger auto liability insurance is issued to an applicant, the Fund shall include in the policy a written notice to the applicant that contains the following disclosures:</text> <level label="1"> <text>the time and the conditions under which the applicant is eligible to seek insurance from an Association member;</text> </level> <level label="2"> <text>that if the applicant seeks insurance from an Association member, the Association member may not refuse to underwrite the private passenger auto liability insurance risk solely because the applicant or named insured previously obtained insurance from the Fund; and</text> </level> <level label="3"> <text>that if the applicant seeks insurance from an Association member and the Association member refuses to underwrite the applicant solely because the applicant or named insured previously obtained insurance from the Fund, the applicant may file a complaint with the Commissioner against that Association member.</text> </level> </level> <level label="c"> <text>Whenever the Fund issues a policy of commercial auto liability insurance under this subtitle, the Fund:</text> <level label="1"> <text>may provide coverages in addition to and in excess of the minimum coverages required by Title 19, Subtitle 5 of this article and by Title 17 of the Transportation Article; but</text> </level> <level label="2"> <text>is not required to provide coverages in addition to and in excess of the required minimum coverages except to the extent that reinsurance for the additional or excess coverage is available and acceptable to the Fund.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-504" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <level label="1"> <text>In this section, “add–on coverage” means coverages or services sold in connection with a policy issued by the Fund, other than coverages authorized to be offered by the Fund under this subtitle.</text> </level> <level label="2"> <text>“Add–on coverage” includes:</text> <level label="i"> <text>rental reimbursement coverage;</text> </level> <level label="ii"> <text>personal effects theft coverage;</text> </level> <level label="iii"> <text>collision and comprehensive deductible waiver coverage, other than collision and comprehensive coverages provided by the Fund or other authorized insurers;</text> </level> <level label="iv"> <text>supplemental hospital benefit coverage;</text> </level> <level label="v"> <text>emergency living expense coverage;</text> </level> <level label="vi"> <text>vehicle towing coverage;</text> </level> <level label="vii"> <text>emergency vehicle repair service coverage; and</text> </level> <level label="viii"> <text>motor club services.</text> </level> </level> <level label="3"> <text>“Add–on coverage” does not include fire, life, and health insurance coverages that are not directly related to the underlying motor vehicle insurance coverage and are written by an authorized insurer.</text> </level> </level> <level label="b"> <level label="1"> <text>At the time coverage provided by the Fund is bound and before any add–on coverage is sold, a fund producer shall provide a clear and conspicuous written disclosure, in the form approved by the Commissioner, that:</text> <level label="i"> <text>states that the cost of add–on coverage is not part of the premium for the related policy issued by the Fund;</text> </level> <level label="ii"> <text>includes an itemized list of any add–on coverages to be sold to the insured;</text> </level> <level label="iii"> <text>states the nature and cost of each add–on coverage to be sold; and</text> </level> <level label="iv"> <text>states that add–on coverage is optional and is not required under § 17–103 of the Transportation Article.</text> </level> </level> <level label="2"> <text>Before an insured may purchase add–on coverage, the insured shall expressly consent to the purchase by signing the disclosure form.</text> </level> </level> <level label="c"> <text>On continuation of a policy that includes add–on coverage, an insured need not sign a disclosure form if:</text> <level label="1"> <text>the number and type of add–on coverages under the continuation do not change from the preceding policy; and</text> </level> <level label="2"> <text>the insured has signed the original disclosure form.</text> </level> </level> <level label="d"> <level label="1"> <text>A fund producer may not:</text> <level label="i"> <text>require an insured or prospective insured to purchase an add–on coverage as a condition to purchasing the related policy issued by the Fund; or</text> </level> <level label="ii"> <text>sell add–on coverage or any combination of add–on coverages in an amount that exceeds $200 per covered vehicle in connection with a private passenger auto insurance policy.</text> </level> </level> <level label="2"> <text>A pattern or practice of violations of this section by a fund producer is subject to the same penalties as a violation of § 20–513 of this subtitle.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-505" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>The Executive Director shall settle, compromise, or defend claims against the Fund.</text> </level> <level label="b"> <text>Notwithstanding § 9-602 of the Criminal Law Article, the Executive Director may authorize an employee of the Fund to record a telephone conversation with a policyholder, witness, claimant, investigating officer, or other interested party if:</text> <level label="1"> <text>the conversation is relevant to an accident or claim;</text> </level> <level label="2"> <text>the party to be recorded has or might have information that is relevant to the accident or claim; and</text> </level> <level label="3"> <text>before recording, the party to be recorded is advised of and consents to the recording.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-506" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>The Executive Director shall:</text> <level label="1"> <text>establish and maintain reasonable and adequate reserves for payment of claims against the Fund; and</text> </level> <level label="2"> <text>use the same criteria as is required for use by an Association member in determining the amount of reserves that are necessary.</text> </level> </level> <level label="b"> <text>At least annually, the Board of Trustees shall review the reasonableness and adequacy of reserves.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-507" future_version_removed="true" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>Subject to the authority of the Commissioner to determine whether rates are excessive, inadequate, or unfairly discriminatory, as provided in Title 11, Subtitle 2 or Subtitle 3 of this article, the Executive Director shall determine the premiums to be charged on policies issued by the Fund.</text> </level> <level label="b"> <level label="1"> <text>Except as provided in subsections (c) and (d) of this section, the provisions of Title 11, Subtitle 3 of this article apply to the determination of premiums by the Executive Director and the filing of rates with the Commissioner.</text> </level> <level label="2"> <text>Notwithstanding Title 11, Subtitle 2 or Subtitle 3 of this article or any other provision of this title, the Executive Director may base premiums on one or both of the following items:</text> <level label="i"> <text>the number of points accumulated by an insured or applicant for insurance under the point system provided for in Title 16, Subtitle 4 of the Transportation Article; or</text> </level> <level label="ii"> <text>the prior claims experience of an insured or applicant for insurance.</text> </level> </level> </level> <level label="c"> <text>The provisions of Title 11, Subtitle 2 of this article apply to the determination of premiums by the Executive Director and the filing of rates with the Commissioner:</text> <level label="1"> <text>between July 1, 2025, and December 31, 2025, both inclusive; and</text> </level> <level label="2"> <text>beginning January 1, 2026, if the Fund’s total adjusted capital is less than the amount required under § 20–306(c) of this title.</text> </level> </level> <level label="d"> <level label="1"> <text>Premiums for all commercial coverage shall be determined in accordance with this section and § 20–508 of this subtitle.</text> </level> <level label="2"> <text>Notwithstanding paragraph (1) of this subsection, the rating principles under subsection (e) of this section may not be used to determine the premium for commercial coverage.</text> </level> </level> <level label="e"> <text>In reviewing rates filed by the Fund, the Commissioner shall consider not only the rating principles under Title 11, Subtitle 2 or Subtitle 3 of this article but also the statutory purpose of the Fund under § 20–301 of this title.</text> </level> <level label="f"> <level label="1"> <text>The Motor Vehicle Administration and Executive Director may arrange for the Motor Vehicle Administration to collect premiums on policies issued by the Fund when the Motor Vehicle Administration issues a driver’s license or certificate of registration.</text> </level> <level label="2"> <text>A premium collected under this subsection shall be paid to the State Treasurer for the account of the Fund.</text> </level> </level> <level label="g"> <level label="1"> <text>The Fund may not provide directly or indirectly for the financing of premiums.</text> </level> <level label="2"> <text>A premium may be financed only by a premium finance company registered with the Commissioner in accordance with § 23–201 of this article.</text> </level> <level label="3"> <text>If a prospective insured’s initial payment to the Fund, a fund producer, or premium finance company is not honored, a policy or endorsement issued in reliance on that payment is void.</text> </level> </level> <level label="h"> <level label="1"> <level label="i"> <text>Subject to the approval of the Commissioner and in accordance with this subsection, the Fund may accept premiums on an installment payment basis.</text> </level> <level label="ii"> <text>In approving the Fund’s plan for accepting premiums on an installment payment basis, the Commissioner shall:</text> <level label="1"> <text>consider as factors:</text> </level> <level label="A"> <text>the percentage of the initial premium payment in comparison to the total premium under the policy;</text> </level> <level label="B"> <text>the number of installment premium payments accepted on a policy under the installment payment plan; and</text> </level> <level label="C"> <text>the overall affordability of the installment payment plan in comparison to other payment options available to the policyholder; and</text> </level> <level label="2"> <text>ensure that the Fund’s installment payment plan</text> <text>meets the requirements of § 27–216 of this article.</text> </level> </level> </level> <level label="2"> <text>The Fund may not discriminate among insureds by charging different premiums to insureds who select, as a payment option, the Fund’s installment payment plan instead of a premium finance agreement.</text> </level> <level label="3"> <text>In determining commissions paid to a fund producer, the Fund may not consider whether the fund producer placed an insured in an installment payment plan.</text> </level> <level label="4"> <level label="i"> <text>In accordance with this paragraph, written and electronic communications, including the Fund’s website, affecting the placement of coverage by the Fund or a fund producer shall include a statement, on a form approved by the Commissioner, advising an applicant or an insured of the payment options available to the applicant or insured.</text> </level> <level label="ii"> <text>The statement shall state that the applicant or insured has the following payment options:</text> <level label="1"> <text>the Fund’s installment payment plan;</text> </level> <level label="2"> <text>a premium finance agreement; or</text> </level> <level label="3"> <text>payment of the policy in full.</text> </level> </level> <level label="iii"> <text>The statement shall be included on written or electronic communications at the time the applicant or insured:</text> <level label="1"> <text>is issued a new policy; or</text> </level> <level label="2"> <text>is issued a reissuance, rewrite, or renewal of an existing policy.</text> </level> </level> <level label="iv"> <text>The statement shall state that the applicant or insured should consult a fund producer who will fully describe the terms of each payment option.</text> </level> </level> </level> <level label="i"> <level label="1"> <text>If the Fund makes a change to its plan for accepting premiums on an installment payment basis, within 90 days after the change, the Commissioner shall submit a report to the General Assembly providing the reason for the change.</text> </level> <level label="2"> <text>The report required under paragraph (1) of this subsection shall:</text> <level label="i"> <text>include the effect the change will have on the required factors for consideration under subsection (h)(1)(ii)1 of this section; and</text> </level> <level label="ii"> <text>be submitted in accordance with § 2–1257 of the State Government Article.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-508" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>A policyholder is entitled to continuation of coverage from the Fund at rates that are reasonably comparable to those charged by standard insurers and approved by the Commissioner if, for 3 continuous years of coverage under a policy issued by the Fund, the policyholder has not:</text> <level label="1"> <text>been charged with a moving traffic violation;</text> </level> <level label="2"> <text>had a chargeable traffic accident; and</text> </level> <level label="3"> <text>been assessed more than one point by the Motor Vehicle Administration.</text> </level> </level> <level label="b"> <text>A policyholder who meets the requirements of subsection (a) of this section is not entitled to a safe driver credit as defined in the rules and rate schedules of the Fund filed with the Commissioner.</text> </level> <level label="c"> <text>In determining eligibility for rates that are reasonably comparable to those charged by standard insurers, the Fund may not consider:</text> <level label="1"> <text>a lapse in coverage of 30 days or less; and</text> </level> <level label="2"> <text>the addition of a driver to the policy who has certified in a manner approved by the Fund for the immediately preceding 3 continuous years that the driver has not had a moving traffic violation, has not been assessed more than one point, and has not had a chargeable traffic accident.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-509" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <level label="1"> <text>Subject to this section and the policies adopted by the Board of Trustees that relate to the binding of coverage, a fund producer may bind the minimum required coverage for an applicant in the Fund if the applicant submits an application to the fund producer and pays the appropriate premium.</text> </level> <level label="2"> <text>To effect coverage, the fund producer must receive payment of the appropriate premium required under the policies adopted by the Board of Trustees that relate to the binding of coverage.</text> </level> <level label="3"> <text>Payment of the appropriate premium does not occur so as to effect coverage if payment of all or part of the premium is made by an instrument that is later dishonored.</text> </level> </level> <level label="b"> <level label="1"> <text>The Board of Trustees shall adopt and make available to each fund producer reasonable policies that relate to the authority of fund producers to bind coverage.</text> </level> <level label="2"> <text>The policies shall include:</text> <level label="i"> <text>the amount of premium to be collected;</text> </level> <level label="ii"> <text>the evidence necessary to establish the qualification of an applicant to be insured by the Fund;</text> </level> <level label="iii"> <text>procedures for notifying the Fund of the binding of coverage; and</text> </level> <level label="iv"> <text>the time within which the fund producer is to give notice.</text> </level> </level> </level> <level label="c"> <text>The Fund:</text> <level label="1"> <text>may refuse to grant the authority of a fund producer to an insurance producer that has been previously terminated as a fund producer or that has had its license previously revoked or surrendered; and</text> </level> <level label="2"> <text>subject to the hearing provisions of § 20-514 of this subtitle, may discipline a fund producer that:</text> <level label="i"> <text>employs or otherwise retains a person described in item (1) of this subsection; and</text> </level> <level label="ii"> <text>allows the person to become involved in the fund producer’s operations or management contrary to a requirement of this article or order of the Administration.</text> </level> </level> </level> <level label="d"> <text>Subject to subsection (e) of this section, the Fund is liable for coverage from the date that the fund producer binds coverage.</text> </level> <level label="e"> <level label="1"> <text>On review of an application, the Fund may cancel coverage and refuse to issue a policy if the Fund finds that:</text> <level label="i"> <text>the applicant is not qualified for insurance issued by the Fund;</text> </level> <level label="ii"> <text>the applicant has not paid the appropriate premium; or</text> </level> <level label="iii"> <text>the Fund is authorized to reject the application under § 20-516 of this subtitle.</text> </level> </level> <level label="2"> <text>Cancellation of coverage may occur not later than 60 days after coverage is effective.</text> </level> </level> <level label="f"> <text>Whenever coverage is canceled:</text> <level label="1"> <text>the Fund promptly shall notify the applicant, fund producer, and Motor Vehicle Administration of the cancellation;</text> </level> <level label="2"> <text>the applicant has the right of appeal under § 20-517 of this subtitle; and</text> </level> <level label="3"> <text>if the cancellation occurred because an applicant did not pay the appropriate premium, the Fund shall give the applicant a reasonable opportunity to pay the appropriate premium.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-510" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>Each fund producer is a fiduciary as to all premiums, return premiums, or other money that the fund producer receives from any person in connection with a policy or policy application issued by, to be issued by, or bound in the Fund.</text> </level> <level label="b"> <text>Each fund producer shall deposit as trust money into an account for premiums all money received under subsection (a) of this section to be accounted for and paid over to the Fund as the law requires.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-511" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <level label="1"> <text>On application to the Fund for appointment as a fund producer, an applicant shall file with the Fund a bond for the benefit of the Fund for the balance of the current year.</text> </level> <level label="2"> <text>On or before December 31 of each year, each fund producer shall file with the Fund a bond for the benefit of the Fund for the next succeeding year.</text> </level> </level> <level label="b"> <text>A bond required under this section shall be:</text> <level label="1"> <text>in the amount of $10,000;</text> </level> <level label="2"> <text>executed by an authorized surety insurer; and</text> </level> <level label="3"> <text>conditioned that the fund producer will account for and pay over to the person entitled to it all money belonging to the person that comes into the fund producer’s possession in accordance with this subtitle and the regulations that relate to the binding of coverage.</text> </level> </level> <level label="c"> <level label="1"> <text>A fund producer is considered to have complied with this section if an Association member certifies to the Fund that:</text> <level label="i"> <text>the Association member has a bond in effect that covers the fund producer and complies with the requirements of this section; and</text> </level> <level label="ii"> <text>the bond coverage extends to the Fund when persons apply to the Fund for coverage through the fund producer.</text> </level> </level> <level label="2"> <text>The certification shall be made by an authorized representative of the Association member.</text> </level> <level label="3"> <text>A copy of the certification shall be mailed promptly to the Fund.</text> </level> </level> <level label="d"> <text>A fund producer’s authority to bind coverage in the Fund may be terminated on 10 days’ written notice if the bond is not:</text> <level label="1"> <text>filed with the Fund in a timely manner; or</text> </level> <level label="2"> <text>continuously maintained in effect while the fund producer has authority to bind coverage in the Fund.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-512" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>Except as provided in subsection (b) of this section, the Fund shall pay to a fund producer of a policyholder to whom a policy is issued a commission:</text> <level label="1"> <text>for private passenger auto insurance issued by the Fund, at a rate determined by the Fund but not less than 5% and not to exceed 15% of the total premium; and</text> </level> <level label="2"> <text>for any other insurance issued by the Fund, at a rate determined by the Fund but not to exceed 10% of the total premium.</text> </level> </level> <level label="b"> <text>The Fund may not pay a commission:</text> <level label="1"> <text>on a fully earned basis;</text> </level> <level label="2"> <text>if a prospective insured fails to qualify under § 20–502 of this subtitle;</text> </level> <level label="3"> <text>if a prospective insured’s initial payment to the Fund, a fund producer, or premium finance company is not honored; or</text> </level> <level label="4"> <text>on a policy written directly by the Fund without the involvement of a fund producer.</text> </level> </level> <level label="c"> <text>If a policy issued by the Fund is canceled, the Fund shall refund any unearned commissions.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-513" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <text>The Fund may refuse to accept further applications from a fund producer or may terminate the authority of the fund producer to bind coverage or both if:</text> <level label="1"> <text>the Fund finds that the fund producer has engaged in the practice of binding coverage in the Fund in violation of policies adopted by the Board of Trustees; or</text> </level> <level label="2"> <text>after demand has been made by the Fund, the fund producer fails to pay money owed the Fund as a result of:</text> <level label="i"> <text>the binding or change of coverage; or</text> </level> <level label="ii"> <text>a commission paid to the fund producer on a policy that is canceled after the effective date of coverage.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-514" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>Except as provided in subsection (b) of this section, the Fund shall give prior written notice to a fund producer of its intended action under § 20–513 of this subtitle and give the fund producer an opportunity for a hearing before taking the action.</text> </level> <level label="b"> <level label="1"> <text>The Fund may exercise immediately any option under § 20–513 of this subtitle if the Fund determines that there is a likelihood of substantial and immediate harm to the Fund, its policyholders, or others because of:</text> <level label="i"> <text>a violation of a policy adopted by the Board of Trustees that relates to the binding of coverage; or</text> </level> <level label="ii"> <text>a failure to pay money owed.</text> </level> </level> <level label="2"> <text>After taking an action under § 20–513 of this subtitle, the Fund promptly shall give notice to the fund producer and hold a hearing within 10 working days before a member of the Board of Trustees.</text> </level> </level> <level label="c"> <text>The Board of Trustees shall adopt policies to provide procedures for notice and hearings under this section.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-515" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>The Fund may use the Maryland Tax Refund Intercept Program to recover money owed to the Fund by a fund producer if the Fund makes a demand for the money and the fund producer does not make payment.</text> </level> <level label="b"> <level label="1"> <text>If the Fund makes payment to a claimant, the Fund is subrogated to the rights of the claimant against a responsible party and is entitled to recover all money that the Fund paid out and actual collection costs, including reasonable attorney’s fees.</text> </level> <level label="2"> <text>The Fund may recover from its insureds all past-due premiums and from the responsible party all money that the Fund paid out under this subtitle in any manner provided by law, including the Maryland Tax Refund Intercept Program.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-516" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>Subject to § 20-517 of this subtitle, the Fund:</text> <level label="1"> <text>may reject an application of insurance if the applicant owes to the Fund an unpaid premium on an expired or canceled policy;</text> </level> <level label="2"> <text>at any time may cancel a policy for nonpayment of premiums; or</text> </level> <level label="3"> <text>may reject an application of insurance or at any time may cancel a policy if it is found that the driver’s license of the applicant or policyholder is:</text> <level label="i"> <text>suspended, unless the suspension is for a first offense under § 16-205.1 of the Transportation Article for driving with an alcohol concentration of 0.08 or more; or</text> </level> <level label="ii"> <text>revoked.</text> </level> </level> </level> <level label="b"> <text>The Fund shall notify the applicant or policyholder promptly after the Fund rejects an application or cancels a policy.</text> </level> <level label="c"> <text>If a person does not have a valid license or other privilege to drive a covered vehicle in the State, or is otherwise ineligible to be insured by the Fund, the Fund may issue the appropriate policy with an excluded driver endorsement under § 27-609 of this article.</text> </level> <level label="d"> <level label="1"> <text>The Fund may cancel a policy if:</text> <level label="i"> <text>the temporary registration issued for the covered vehicle under § 13-405 or § 23-107(b) of the Transportation Article has expired; and</text> </level> <level label="ii"> <text>the covered vehicle is not otherwise validly registered in the State.</text> </level> </level> <level label="2"> <text>The cancellation may not take effect until the day after the temporary registration of the covered vehicle expires.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-517" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>An applicant whose application for insurance has been rejected or a policyholder whose policy has been canceled for a reason other than nonpayment of premiums may appeal the decision to a special board within 10 days after receipt of notice of the rejection or cancellation.</text> </level> <level label="b"> <level label="1"> <text>The special board consists of two members of the Board of Trustees and the Commissioner or designee of the Commissioner.</text> </level> <level label="2"> <text>The Executive Director may not sit on the special board.</text> </level> </level> <level label="c"> <level label="1"> <text>The special board:</text> <level label="i"> <text>may affirm, reverse, or modify the decision on the record; or</text> </level> <level label="ii"> <text>on at least 10 days’ written notice to the applicant, may hold a hearing and then affirm, reverse, or modify the decision.</text> </level> </level> <level label="2"> <text>The current policy of a policyholder who appeals the decision to the special board remains in effect until the special board decides the appeal.</text> </level> </level> <level label="d"> <text>The Fund shall notify the Motor Vehicle Administration immediately after:</text> <level label="1"> <text>the Fund cancels a policy or terminates coverage of an insured; or</text> </level> <level label="2"> <text>the Fund rejects an application for insurance and the action is final because:</text> <level label="i"> <text>the rejection was not appealed to the special board; or</text> </level> <level label="ii"> <text>the special board does not reverse or modify the decision to cancel as to require issuance of a policy.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-518" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <level label="1"> <text>The Executive Director shall refer the status of an insured’s driver’s license to the Motor Vehicle Administration for a determination whenever the Executive Director finds that the insured, in the last 12-month period, had three or more chargeable accidents under the rules and rate schedules of the Fund filed with the Commissioner involving third-party liability, regardless of the number of points assessed for those accidents.</text> </level> <level label="2"> <text>The Executive Director may refer any other matter about an insured’s driving record to the Motor Vehicle Administration for a determination.</text> </level> </level> <level label="b"> <text>If, after a hearing, the Motor Vehicle Administration suspends or revokes the insured’s driver’s license, the Executive Director shall cancel or refuse to continue the coverage after having given the notice required under § 27-602 of this article.</text> </level> <level label="c"> <text>If the Motor Vehicle Administration does not suspend or revoke the insured’s driver’s license under subsection (b) of this section, the Executive Director may not cancel or refuse to continue the coverage of the insured.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-519" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <text>If a policy covers a spouse or other household member of the family of the policyholder:</text> <level label="1"> <text>cancellation of the policy of an insured whose driver’s license is suspended or revoked does not result in the cancellation of the coverage of the spouse or other family member whose driver’s license is not suspended or revoked; and</text> </level> <level label="2"> <text>the Fund shall reclassify the rate of risk of the spouse or other family member for the purpose of setting the premium.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-520" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles"> <level label="a"> <text>Except as provided in subsection (b) of this section, an insurer that issues, sells, or delivers private passenger motor vehicle insurance in the State may not refuse to issue a policy of private passenger motor vehicle insurance to any person who, for the immediately preceding 3 continuous years:</text> <level label="1"> <text>has been insured by the Fund;</text> </level> <level label="2"> <text>has not had a moving traffic violation; and</text> </level> <level label="3"> <text>has not had a chargeable traffic accident.</text> </level> </level> <level label="b"> <text>Subject to § 27-501 of this article, an insurer may refuse to issue a policy under subsection (a) of this section if the person does not satisfy the insurer’s eligibility or underwriting standards.</text> </level> <level label="c"> <text>A person who is entitled to insurance under subsection (a) of this section:</text> <level label="1"> <text>shall be rated by the insurer in the same manner as any other policyholder not previously insured by the Fund having the same risk characteristics; and</text> </level> <level label="2"> <text>may not be surcharged or rated by the insurer solely because the person was insured by the Fund.</text> </level> </level> <level label="d"> <level label="1"> <text>At least 60 days before expiration or renewal of a policy of private passenger motor vehicle insurance, the Fund shall provide written notice to each person entitled to insurance under subsection (a) of this section.</text> </level> <level label="2"> <text>The notice shall:</text> <level label="i"> <text>inform the person of the person’s right to insurance under subsection (a) of this section;</text> </level> <level label="ii"> <text>advise the person to contact the fund producer that bound the person’s coverage with the Fund during the most recent coverage period;</text> </level> <level label="iii"> <text>include a copy of a sample rate guide produced by the Administration; and</text> </level> <level label="iv"> <text>provide the toll-free telephone number established under § 2-109 of this article.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-521" future_version_removed="true" future_effective_date="EFFECTIVE UNTIL JUNE 30, 2029 PER CHAPTERS 741 AND 742 OF 2026" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="5" subtitle_name="Policies for Covered Vehicles" /> <section article="gin" article_name="Insurance" number="20-601" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <level label="1"> <text>In this section, “qualified person” means:</text> <level label="i"> <text>a resident of the State;</text> </level> <level label="ii"> <text>the owner of a motor vehicle registered in the State, unless the owner is not a resident of the State and the motor vehicle bears temporary registration plates issued under Title 13, Subtitle 6, Part I of the Transportation Article;</text> </level> <level label="iii"> <text>a resident of another state or foreign country that affords recourse to residents of this State that is substantially similar to that provided under this title; or</text> </level> <level label="iv"> <text>an individual injured by an uninsured motorist who later files for bankruptcy or other protection from creditors that bars the Fund from a subrogation recovery.</text> </level> </level> <level label="2"> <text>“Qualified person” does not include:</text> <level label="i"> <text>an automobile collision insurer or other insurer that seeks by subrogation to recover payment for damages to a motor vehicle or real or other personal property, or injuries to individuals under any insurance coverages, including collision, fire, theft, medical payments, and uninsured motorist coverages;</text> </level> <level label="ii"> <text>a holder of a certificate of self-insurance under this article; or</text> </level> <level label="iii"> <text>an insured under a policy provision that:</text> <level label="1"> <text>provides coverage for damages sustained by the insured as a result of the operation of an uninsured motor vehicle; and</text> </level> <level label="2"> <text>is authorized to be included in an automobile liability policy delivered or issued for delivery in the State.</text> </level> </level> </level> </level> <level label="b"> <text>To the extent that a policy of motor vehicle liability insurance does not provide coverage, a claim that arises out of circumstances described in subsection (c), (d), or (e) of this section may be made against the Fund if:</text> <level label="1"> <text>the claim is for:</text> <level label="i"> <text>damage to property greater than $250; or</text> </level> <level label="ii"> <text>the death of or personal injury to a qualified person;</text> </level> </level> <level label="2"> <level label="i"> <text>at the time of the accident, the claimant was not driving or riding in an uninsured motor vehicle owned by the claimant or a member of the claimant’s family who resides in the claimant’s household; and</text> </level> <level label="ii"> <text>the claimant is not the personal representative of the individual who was driving or riding in the uninsured motor vehicle; and</text> </level> </level> <level label="3"> <level label="i"> <text>at the time of the accident, the claimant was not driving a motor vehicle with a certificate of registration that was suspended, canceled, or revoked, or was holding a driver’s license that was suspended, canceled, or revoked; and</text> </level> <level label="ii"> <text>the claimant is not the personal representative or a member of the family who resides in the household of the individual who was driving the motor vehicle.</text> </level> </level> </level> <level label="c"> <text>A claim that arises out of the ownership, maintenance, or use of a motor vehicle in the State may be made against the Fund if:</text> <level label="1"> <text>the requirements of subsection (b) of this section are met;</text> </level> <level label="2"> <level label="i"> <text>the identity of the motor vehicle and of its driver and owner cannot be established; or</text> </level> <level label="ii"> <text>the identity of the individual who was driving the motor vehicle cannot be established and it is established that, at the time of the accident, the motor vehicle was in the possession of an individual other than the owner without the owner’s consent;</text> </level> </level> <level label="3"> <text>the claimant has a cause of action against the driver or owner of the motor vehicle; and</text> </level> <level label="4"> <text>all reasonable efforts to establish the identity of the motor vehicle and of its owner and driver are unsuccessful.</text> </level> </level> <level label="d"> <text>A claim that arises out of ownership, maintenance, or use of a motor vehicle in the State may be made against the Fund if:</text> <level label="1"> <text>the requirements of subsection (b) of this section are met;</text> </level> <level label="2"> <text>the claimant has a cause of action against the driver or owner of the motor vehicle;</text> </level> <level label="3"> <text>despite all reasonable efforts, the driver or owner of the motor vehicle cannot be located; and</text> </level> <level label="4"> <level label="i"> <text>at the time of the accident the motor vehicle was an uninsured motor vehicle; or</text> </level> <level label="ii"> <text>despite all reasonable efforts, it is impossible to establish whether the motor vehicle was insured.</text> </level> </level> </level> <level label="e"> <level label="1"> <text>Subject to paragraph (2) of this subsection, a claim that arises out of the ownership, maintenance, or use of a motor vehicle in the State may be made against the Fund if:</text> <level label="i"> <text>the requirements of subsection (b) of this section are met;</text> </level> <level label="ii"> <text>the driver or owner of the motor vehicle is uninsured and can be located for service of process;</text> </level> <level label="iii"> <level label="1"> <text>the claimant is not the uninsured driver’s spouse who resides in the uninsured driver’s household or another family member who resides in the uninsured driver’s household; and</text> </level> <level label="2"> <text>the claimant is not the personal representative of the spouse who resided in that household;</text> </level> </level> <level label="iv"> <text>the claim is not made for damage to or destruction of an uninsured motor vehicle owned wholly or partly by the claimant; and</text> </level> <level label="v"> <text>the claimant is not eligible to make a claim arising from the same accident against the Property and Casualty Insurance Guaranty Corporation under Title 9, Subtitle 3 of this article.</text> </level> </level> <level label="2"> <text>A claim under this subsection may not be made by or for:</text> <level label="i"> <text>an insurer under a policy that makes the insurer liable to pay, wholly or partly, the amount of the claim; or</text> </level> <level label="ii"> <text>an insurer for any amount sought or claimed for damages or destruction to the property of the claimant or an insured by reason of:</text> <level label="1"> <text>collision with a motor vehicle or other object, or by upset of the motor vehicle; or</text> </level> <level label="2"> <text>coverage of the insured that provides indemnification from injury or damages caused by uninsured motorists.</text> </level> </level> </level> <level label="3"> <text>The amount to be paid out of the Fund may not be sought, wholly or partly, to:</text> <level label="i"> <text>take the place of making a claim or receiving a payment that is payable under a policy specified in paragraph (2)(i) of this subsection; or</text> </level> <level label="ii"> <text>reimburse or otherwise indemnify an insurer for an amount paid or payable under a policy specified in paragraph (2)(i) of this subsection.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-602" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <text>The maximum amount payable from the Fund, exclusive of interest and costs, for claims filed under this subtitle arising from one accident is:</text> <level label="1"> <text>$30,000 on account of injury to or death of one individual;</text> </level> <level label="2"> <text>subject to the limit specified in item (1) of this subsection, $60,000 on account of injury to or death of more than one individual; and</text> </level> <level label="3"> <text>$15,000 for damages to property.</text> </level> </level> <level label="b"> <level label="1"> <text>The following deductions shall be made from the smaller of the applicable maximum amount under subsection (a) of this section and the amount of the judgment:</text> <level label="i"> <text>$250 from a judgment or part of a judgment for damages to property; and</text> </level> <level label="ii"> <text>the total amount that the claimant has received or is likely to receive:</text> <level label="1"> <text>from any source toward payment of the settlement or judgment;</text> </level> <level label="2"> <text>toward payment of a judgment against a person against whom the claimant has a cause of action, arising out of the same accident, for damages for bodily injury or death or damage to property;</text> </level> <level label="3"> <text>under a policy affording indemnity for damage to or destruction of property of the applicant; and</text> </level> <level label="4"> <text>by reason of the accident out of which the claim arises under any workers’ compensation law.</text> </level> </level> </level> <level label="2"> <text>For the purposes of this subtitle, medical, hospital, funeral, or other benefits paid or payable for the applicant under the Maryland Workers’ Compensation Act shall be considered to be received or receivable by the claimant.</text> </level> </level> <level label="c"> <text>The Fund may recover any amount paid out of the Fund that exceeds the amount authorized under this subtitle by bringing an action against the person that received the excess payment.</text> </level> <level label="d"> <level label="1"> <text>Notwithstanding any workers’ compensation law or similar law to the contrary, whenever the amount of a payment by the Fund has been reduced by the amount of benefits paid or to be paid in accordance with a workers’ compensation law or similar law, the employer of an injured person or decedent and the insurer of that employer is not entitled to a lien on payment from the Fund.</text> </level> <level label="2"> <text>Workers’ compensation benefits may not be reduced because of the reduced payment from the Fund.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-603" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <level label="1"> <text>Except as provided in paragraph (2) of this subsection, notice of a claim for damages must be filed with the Fund within 180 days after the accident out of which the cause of action arises before a person may apply or sue for payment from the Fund under this subtitle.</text> </level> <level label="2"> <text>If notice of a claim is not filed within the time required under paragraph (1) of this subsection, a claim or suit may not be filed or maintained unless the claimant provides proof:</text> <level label="i"> <text>that the claimant was physically incapable of filing notice within the time required and filed notice within 30 days after becoming physically capable of doing so or, if the claimant did not become capable of filing notice, that a notice was filed for the claimant within a reasonable period;</text> </level> <level label="ii"> <text>that the claimant filed notice within 30 days after having received notice that an insurer had disclaimed on a policy and thus removed or withdrew liability insurance coverage for the claim against a defendant; or</text> </level> <level label="iii"> <text>that the claimant gave the notice required under paragraph (1) of this subsection within 30 days after receiving notice that the insurer of the defendant was insolvent if:</text> <level label="1"> <text>the insurer of the defendant is not authorized to transact insurance business in the State; and</text> </level> <level label="2"> <text>the claimant is not eligible to make a claim against the Property and Casualty Insurance Guaranty Corporation.</text> </level> </level> </level> </level> <level label="b"> <text>The notice of a claim shall contain:</text> <level label="1"> <text>evidence that the claimant:</text> <level label="i"> <text>has fulfilled all requirements to file a claim; and</text> </level> <level label="ii"> <text>is not eligible for uninsured motorist coverage benefits from a policy issued to the claimant or a family member who resides in the claimant’s household;</text> </level> </level> <level label="2"> <text>certification by the claimant’s employer of all lost wages incurred up to the filing of notice of a claim;</text> </level> <level label="3"> <text>evidence of all medical expenses incurred up to the filing of notice of a claim;</text> </level> <level label="4"> <text>all reports of medical treatment and consultation for injuries sustained;</text> </level> <level label="5"> <text>evidence of all other damages claimed up to the filing of the notice of claim;</text> </level> <level label="6"> <text>all available police or other accident reports; and</text> </level> <level label="7"> <text>additional information that the Executive Director requires by regulation.</text> </level> </level> <level label="c"> <text>To the extent practicable, information required in notice of a claim shall be submitted in one filing.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-604" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <level label="1"> <text>The Executive Director shall adopt regulations and the Supreme Court of Maryland shall adopt rules that set forth procedural requirements for claims and actions against the Fund filed under this subtitle.</text> </level> <level label="2"> <text>Before the Fund becomes liable under this subtitle, a claimant must comply with each procedural requirement for claims and actions against the Fund.</text> </level> <level label="3"> <text>On behalf of the Fund, the Executive Director or designee of the Executive Director may stipulate that the procedural requirements have been met and consent to the claimant bringing an action against the Fund.</text> </level> <level label="4"> <text>A stipulation or consent does not waive any defense that the Fund may have with respect to the case.</text> </level> </level> <level label="b"> <level label="1"> <text>At any time and without filing a petition for payment or other court approval, the Fund may settle, compromise, and pay claims and actions brought and judgments obtained under this subtitle.</text> </level> <level label="2"> <text>The Executive Director shall adopt regulations setting forth the procedure for settlement or payment.</text> </level> <level label="3"> <text>Interest shall accrue from the date of judgment in accordance with § 11–107 of the Courts Article.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-605" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <level label="1"> <text>After the Fund negotiates with a plaintiff or claimant a settlement offer that the Fund finds reasonable, the Fund shall give notice to the defendant or uninsured party of the offer in accordance with regulations of the Fund.</text> </level> <level label="2"> <text>If a defendant or uninsured party approves the settlement offer, the plaintiff or claimant shall proceed to settlement in accordance with regulations of the Fund and the Maryland Rules.</text> </level> </level> <level label="b"> <level label="1"> <text>If a defendant or uninsured party rejects a settlement offer, the Fund shall cause notice to be served on the defendant or uninsured party by any lawful manner, including:</text> <level label="i"> <text>a sheriff;</text> </level> <level label="ii"> <text>a private process server; and</text> </level> <level label="iii"> <text>certified mail bearing a postmark from the United States Postal Service to the last known address of the defendant or uninsured party or the last address on file with the Motor Vehicle Administration of this State or the state where the defendant or uninsured was last known to reside.</text> </level> </level> <level label="2"> <text>The notice served under this subsection shall state that:</text> <level label="i"> <text>without further notice, the Fund will withdraw from the claim or action 30 days after the date of the notice;</text> </level> <level label="ii"> <text>within 30 days after the date of the notice, an appearance may be entered by the defendant or uninsured party or by defense counsel whom the defendant or uninsured party chooses; and</text> </level> <level label="iii"> <text>if the provisions of item (ii) of this paragraph are not met, at any time after 30 days following the date of the notice and without further notice, suit may be filed or judgment may be entered against the defendant or uninsured party in the amount of the settlement offer.</text> </level> </level> </level> <level label="c"> <text>After the end of the 30-day period following notice served to a defendant or uninsured party under subsection (b) of this section, the Fund may settle the claim, file suit, or request the court to set the action for an expedited hearing.</text> </level> <level label="d"> <text>At a hearing authorized under subsection (c) of this section, the court may proceed in a summary manner and, if satisfied that each applicable provision of this title has been met, enter judgment in favor of the plaintiff or Fund in the amount of the settlement offer.</text> </level> <level label="e"> <level label="1"> <text>The defendant or uninsured party may file an appeal within 10 days after the date of entry of the judgment.</text> </level> <level label="2"> <text>Absent proof of fraud, mutual mistake, or obvious irregularity, the judgment is not subject to appeal, amendment, or other action of the court after the period for filing an appeal has expired.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-606" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <text>When a claim subject to this subtitle results in a default judgment that is entered for want of a plea by a defendant other than the Fund, or in a judgment that is entered with the consent of the defendant without the knowledge and approval of the Fund, the Fund shall answer or apply for relief against the judgment and for permission to answer and defend the claim within 30 days after receipt of actual notice of the judgment.</text> </level> <level label="b"> <level label="1"> <text>The Fund may elect to intervene in or defend a claim subject to this subtitle.</text> </level> <level label="2"> <text>The Fund is entitled to each defense that would have been or is available to the uninsured owner or driver.</text> </level> </level> <level label="c"> <level label="1"> <text>A defendant shall cooperate with the Fund in defense of a claim in which the Fund has intervened under this subtitle.</text> </level> <level label="2"> <text>If the defendant fails to cooperate, the Fund may apply to the court for an order that directs cooperation or proceed as provided under this subtitle.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-607" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <text>An appeal to the appropriate court may be taken from a final order, decree, or judgment of a court made under this subtitle:</text> <level label="1"> <text>that debars a claimant from further proceeding against the Fund or denies the claim;</text> </level> <level label="2"> <text>that awards the claimant less than that to which the claimant believes the claimant is entitled; or</text> </level> <level label="3"> <text>except as provided in § 20-605 of this subtitle, that causes the defendant, the uninsured party, the Fund, or other party to be aggrieved.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-608" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <text>All money paid out by the Fund under this subtitle may be recovered by the Fund from the uninsured party at fault in any manner provided by law, including the Maryland Tax Refund Intercept Program.</text> </level> <level label="b"> <text>A judgment that is assigned to or obtained by the Fund:</text> <level label="1"> <text>is considered in its entirety as taken for the use of the State; and</text> </level> <level label="2"> <text>shall be indexed in the appropriate court records in the name of the State of Maryland, Maryland Automobile Insurance Fund.</text> </level> </level> <level label="c"> <text>If the Fund brings suit to enforce a judgment obtained under this subtitle against an uninsured party at fault, the Fund may recover the actual costs of collection, including reasonable attorney’s fees.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-609" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <text>Whenever the Fund makes payment in an action brought or claim made under this subtitle, the Fund shall be subrogated to the cause of action of the claimant receiving the payment against the driver or owner of the motor vehicle by which the accident was occasioned.</text> </level> <level label="b"> <text>The Fund:</text> <level label="1"> <text>if the identity and whereabouts are established of the person that is the driver or owner, may bring an action against that person for the amount of damage the claimant sustains; and</text> </level> <level label="2"> <text>may recover that amount out of any money payable with respect to death or injury under any policy in force when the accident occurred.</text> </level> </level> <level label="c"> <text>If the amount recovered in an action under subsection (b) of this section is greater than the amount paid out of the Fund, the Fund:</text> <level label="1"> <text>first, shall reimburse itself as provided in § 20-608 of this subtitle; and</text> </level> <level label="2"> <text>second:</text> <level label="i"> <text>shall collect and pay the unpaid balance to the claimant; or</text> </level> <level label="ii"> <text>shall assign and transfer to the claimant any judgment, note, or other right, interest, or cause of action that the Fund has against the uninsured driver or owner.</text> </level> </level> </level> <level label="d"> <text>Notwithstanding any other statute of limitations, the Fund may bring an action against the person that is the driver or owner within 6 months after the identity and whereabouts of that person are established.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-610" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <text>The General Assembly finds and declares that: </text> <level label="1"> <text>there is an unacceptably large number of uninsured motorists in the State;</text> </level> <level label="2"> <text>uninsured motorists cause harm to insured drivers by increasing the cost of automobile insurance for everyone required to purchase uninsured motorist coverage;</text> </level> <level label="3"> <text>uninsured motorists are a financial drain on the State and require substantial funding for the Uninsured Division of the Fund to cover legitimate claims of innocent pedestrians, passengers, and drivers who are injured by uninsured motorists;</text> </level> <level label="4"> <text>to encourage uninsured motorists to become insured, the law for many years has provided financial penalties to be imposed on uninsured motorists and a substantial number of penalties are issued every year;</text> </level> <level label="5"> <text>to further address the rate of uninsured motorists, the General Assembly passed legislation (Chapter 446 of the Acts of 2016) to require the Motor Vehicle Administration to conduct a program that waived substantial portions of delinquent uninsured motorist fines as an incentive for eligible participants to become insured, but less than 4% of eligible uninsured motorists actually entered the program;</text> </level> <level label="6"> <text>the General Assembly also passed legislation (Chapter 401 of the Acts of 2016) to require drivers to carry proof of automobile insurance;</text> </level> <level label="7"> <text>despite these statutory efforts, the rate of uninsured motorists has remained stubbornly high, hovering at about 12% according to the Insurance Research Council;</text> </level> <level label="8"> <text>it is in the best interests of the State to address the rate of uninsured motorists in the State in a comprehensive and coordinated fashion;</text> </level> <level label="9"> <text>the Fund was established in 1973 to provide the financial security required under the Maryland Vehicle Law to individuals who are unable to obtain automobile insurance from private insurers;</text> </level> <level label="10"> <text>in addition to the Fund, motor vehicle liability insurance in the State is provided through a system of private insurers, insurance producers, and independent insurance producers;</text> </level> <level label="11"> <text>the Uninsured Division is uniquely positioned to reduce the rate of uninsured motorists by conducting outreach and incentivizing, educating, and encouraging uninsured motorists to obtain automobile insurance from private insurers or the Fund; and</text> </level> <level label="12"> <text>the effort to reduce the rate of uninsured motorists would be greatly enhanced by making the Uninsured Division the primary State agency with responsibility to conduct outreach and incentivize, educate, and encourage uninsured motorists to become insured.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-611" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <text>In this section, “Uninsured Motorist Fund” means the Uninsured Motorist Education and Enforcement Fund.</text> </level> <level label="b"> <text>There is an Uninsured Motorist Education and Enforcement Fund.</text> </level> <level label="c"> <text>The purpose of the Uninsured Motorist Fund is to provide funding for the education of drivers about, and the enforcement of, the security requirements for motor vehicles under the Maryland Vehicle Law.</text> </level> <level label="d"> <text>The Uninsured Division shall administer the Uninsured Motorist Fund.</text> </level> <level label="e"> <text>The Uninsured Motorist Fund is a special, nonlapsing fund that is not subject to § 7–302 of the State Finance and Procurement Article.</text> </level> <level label="f"> <text>The Uninsured Motorist Fund consists of:</text> <level label="1"> <text>revenues deposited to the Uninsured Motorist Fund under § 17–104.2 of the Transportation Article;</text> </level> <level label="2"> <text>interest and investment earnings of the Uninsured Motorist Fund; and</text> </level> <level label="3"> <text>any other money from any other source accepted for the benefit of the Uninsured Motorist Fund.</text> </level> </level> <level label="g"> <text>Money in the Uninsured Motorist Fund shall be used solely for:</text> <level label="1"> <text>the administration of the Uninsured Motorist Fund; and</text> </level> <level label="2"> <text>the education of drivers and the public about:</text> <level label="i"> <text>the security requirements under the Maryland Vehicle Law; and</text> </level> <level label="ii"> <text>the sources of automobile insurance in the State, including private insurers and the Fund.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-612" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <level label="1"> <text>In this section the following words have the meanings indicated.</text> </level> <level label="2"> <text>“Central Collection Unit fee” means the fee the Central Collection Unit in the Department of Budget and Management is authorized under § 3–304 of the State Finance and Procurement Article to assess on debts or claims collected.</text> </level> <level label="3"> <text>“Program” means the Program to Incentivize and Enable Uninsured Vehicle Owners to Be Insured established under subsection (b)(1) of this section.</text> </level> <level label="4"> <text>“Program period” means the period during which vehicle owners may have a portion of delinquent uninsured vehicle penalties waived under the Program.</text> </level> <level label="5"> <text>“Uninsured vehicle penalty” means the fine the Motor Vehicle Administration may assess a vehicle owner under § 17–106 of the Transportation Article for a lapse of the required security on a vehicle during a registration year.</text> </level> </level> <level label="b"> <level label="1"> <text>There is a Program to Incentivize and Enable Uninsured Vehicle Owners to Be Insured in the Uninsured Division.</text> </level> <level label="2"> <text>The Program is administered by the Uninsured Division.</text> </level> <level label="3"> <text>The purpose of the Program is to reduce the number of uninsured vehicles in the State by incentivizing and enabling individuals with delinquent uninsured vehicle penalties to become:</text> <level label="i"> <text>eligible to register a vehicle in the State; and</text> </level> <level label="ii"> <text>insured after paying a reduced uninsured vehicle penalty.</text> </level> </level> </level> <level label="c"> <text>The Program period:</text> <level label="1"> <text>may not exceed 180 calendar days; and</text> </level> <level label="2"> <text>shall begin not earlier than July 1, 2018, and end not later than December 31, 2019.</text> </level> </level> <level label="d"> <text>An individual is eligible to participate in the Program if the individual:</text> <level label="1"> <text>is a State resident;</text> </level> <level label="2"> <text>has delinquent uninsured vehicle penalties that became delinquent on or before December 31, 2016;</text> </level> <level label="3"> <text>does not have the required insurance on any vehicle owned by the individual; and</text> </level> <level label="4"> <text>has not been issued a judgment by the Central Collection Unit.</text> </level> </level> <level label="e"> <level label="1"> <text>The Motor Vehicle Administration and the Central Collection Unit shall provide the Uninsured Division with contact information and the total amount of delinquent uninsured vehicle penalties of each individual who may be eligible to participate in the Program.</text> </level> <level label="2"> <text>The Uninsured Division shall notify individuals who may be eligible to participate in the Program at the individual’s last known address.</text> </level> <level label="3"> <text>The notification required under paragraph (2) of this subsection shall include:</text> <level label="i"> <text>the website addresses of the Motor Vehicle Administration, the Fund, and the Administration, where individuals may find contact information for insurers that write motor vehicle liability insurance in the State and other information about motor vehicle insurance; and</text> </level> <level label="ii"> <text>the total amount of delinquent uninsured vehicle penalties that the individual owes and the amount of the penalties that may be waived under the Program.</text> </level> </level> </level> <level label="f"> <level label="1"> <text>On notification by the Uninsured Division that an applicant meets the eligibility requirements for the Program, the Motor Vehicle Administration shall waive 80% of an eligible individual’s delinquent uninsured vehicle penalties that became delinquent on or before December 31, 2016.</text> </level> <level label="2"> <level label="i"> <text>As a condition of receiving a waiver under paragraph (1) of this subsection, the eligible individual shall pay the balance of the delinquent uninsured vehicle penalties owed after subtracting the waived amount under paragraph (1) of this subsection.</text> </level> <level label="ii"> <text>If a claim against an eligible individual has been sent to the Central Collection Unit, in addition to the balance owed under subparagraph (i) of this paragraph, the eligible individual shall pay a Central Collection Unit fee calculated as a percentage of the amount of the balance owed under subparagraph (i) of this paragraph.</text> </level> <level label="iii"> <level label="1"> <text>Except as provided in subsubparagraph 2 of this subparagraph, an eligible individual shall pay the balance owed under subparagraph (i) of this paragraph and any Central Collection Unit fee owed under subparagraph (ii) of this paragraph before the end of the Program period.</text> </level> <level label="2"> <text>An eligible individual may pay the balance owed under subparagraph (i) of this paragraph and any Central Collection Unit fee owed under subparagraph (ii) of this paragraph using a monthly installment payment plan that extends payments beyond the end of the Program period if the terms of the monthly installment payment plan require:</text> </level> <level label="A"> <text>the first payment to be due on entry into the Program; and</text> </level> <level label="B"> <text>the remaining balance owed to be paid within 6 months after entry into the Program.</text> </level> </level> </level> <level label="3"> <level label="i"> <text>As a condition of receiving a waiver under paragraph (1) of this subsection, an eligible individual who owns a vehicle at the time of the waiver, or an eligible individual who does not own a vehicle at the time of the waiver but subsequently registers a vehicle, shall purchase and maintain the required security on the vehicle for the period of time specified in subparagraph (ii) of this paragraph.</text> </level> <level label="ii"> <text>The eligible individual shall maintain the required security on the vehicle for a period of:</text> <level label="1"> <text>at least 6 months; or</text> </level> <level label="2"> <text>at least 1 year if the waived amount under paragraph (1) of this subsection exceeds $3,000.</text> </level> </level> </level> </level> <level label="g"> <level label="1"> <text>On behalf of the State, the Uninsured Division may collect the amount of the delinquent uninsured vehicle penalties due together with any Central Collection Unit fee that is due and transmit the money that is owed to the Motor Vehicle Administration and the Central Collection Unit.</text> </level> <level label="2"> <text>On notification from the Uninsured Division that the required amount of the uninsured vehicle penalties and Central Collection Unit fees have been received from an eligible individual, the Motor Vehicle Administration and the Central Collection Unit shall take the necessary steps to allow the eligible individual to register a vehicle.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-613" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <text>An applicant for a policy from the Fund who is participating in the Program under § 20–612 of this subtitle may:</text> <level label="1"> <text>be considered by the Fund to have met the requirements of § 20–502(a)(3) of this title; and</text> </level> <level label="2"> <text>pay the premium for the policy in installments in accordance with § 20–507(g)(1)(ii)1B of this title, regardless of the amount of the premium.</text> </level> </section> <section article="gin" article_name="Insurance" number="20-614" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="6" subtitle_name="Unsatisfied Claims"> <level label="a"> <text>If the Uninsured Division receives information from the Motor Vehicle Administration as required under § 17–106 of the Transportation Article regarding an owner of a vehicle who has been notified by the Motor Vehicle Administration that the registration of the vehicle has been suspended, the Uninsured Division may not, in any fashion, contact the owner until at least 60 days after the effective date of the final termination or lapse of the required security, as reported to the Motor Vehicle Administration by an insurer.</text> </level> <level label="b"> <text>If the Uninsured Division uses the information received from the Motor Vehicle Administration under § 17–106 of the Transportation Article to contact an owner, the Uninsured Division shall send a notice to the owner that:</text> <level label="1"> <text>provides the website addresses of the Motor Vehicle Administration, the Fund, and the Administration where the owner may find contact information for insurers that write motor vehicle liability insurance in the State and other information about motor vehicle liability insurance; and</text> </level> <level label="2"> <text>advises the owner that the owner may contact the owner’s insurance producer, if any, or the owner’s prior insurer to determine whether motor vehicle liability insurance may be placed for the owner by the insurance producer or the insurer.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="20-701" title_number="20" title_name="Maryland Automobile Insurance Fund" subtitle_number="7"> <level label="a"> <text>A person may not knowingly file with the Fund a notice or document required under this title that is false or that contains a material misstatement of fact.</text> </level> <level label="b"> <text>A person that violates this section is guilty of a misdemeanor and on conviction is subject to a fine not exceeding $500 or imprisonment not exceeding 30 days or both.</text> </level> </section>