<section article="gin" article_name="Insurance" number="24-201" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <text>In this subtitle the following words have the meanings indicated.</text> </level> <level label="b"> <text>“Health care facility” has the meaning stated in § 19–114 of the Health – General Article.</text> </level> <level label="c"> <text>“Health care provider” means a person licensed or authorized to practice a health occupation.</text> </level> <level label="d"> <text>“Physician” means an individual who:</text> <level label="1"> <text>is licensed to practice medicine in the State; or</text> </level> <level label="2"> <text>lawfully practices medicine without a license under § 14–302 (a)(1) through (4) of the Health Occupations Article.</text> </level> </level> <level label="e"> <text>“Practice medicine” has the meaning stated in § 14–101 of the Health Occupations Article.</text> </level> <level label="f"> <text>“Society” means the Medical Mutual Liability Insurance Society of Maryland.</text> </level> <level label="g"> <text>“Surplus” does not include debt of the Society incurred in accordance with § 3–116(a)(1) of this article to enable it to comply with a surplus requirement.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-202" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <text>Subject to the limitations and immunities of this subtitle, the purpose of this subtitle is to provide:</text> <level label="1"> <text>for the payment of indemnities to persons that suffer injuries arising out of the rendering of or failure to render professional services by physicians or other health care providers;</text> </level> <level label="2"> <text>a means for physicians or other health care providers to obtain insurance against liability for injuries arising out of the rendering of or failure to render professional services; and</text> </level> <level label="3"> <text>property insurance and casualty insurance related to the provision of health care or to health care facilities used by physicians or other health care providers.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-203" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <level label="1"> <text>There is a Medical Mutual Liability Insurance Society of Maryland.</text> </level> <level label="2"> <text>The Society is a nonstock corporation.</text> </level> </level> <level label="b"> <text>Except as otherwise provided in this subtitle, the Society has the powers, privileges, and immunities granted by and is subject to the provisions imposed on mutual insurers by this article and by the applicable provisions of the Corporations and Associations Article.</text> </level> <level label="c"> <text>The Society is a member of the Joint Insurance Association and the Property and Casualty Insurance Guaranty Corporation.</text> </level> <level label="d"> <level label="1"> <text>The Society is not and may not be deemed a department, unit, agency, or instrumentality of the State for any purpose.</text> </level> <level label="2"> <text>All debts, claims, obligations, and liabilities of the Society, whenever incurred, shall be the debts, claims, obligations, and liabilities of the Society only and not of the State or the State’s agencies, instrumentalities, officers, or employees.</text> </level> </level> <level label="e"> <level label="1"> <text>The money of the Society is not part of the General Fund of the State.</text> </level> <level label="2"> <text>The State may not budget for or provide General Fund appropriations to the Society.</text> </level> <level label="3"> <text>The debts, claims, obligations, and liabilities of the Society are not a debt of the State or a pledge of the credit of the State.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-204" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <text>There is a Board of Directors of the Society.</text> </level> <level label="b"> <level label="1"> <text>There shall be at least 11 directors on the Board.</text> </level> <level label="2"> <text>The directors shall be elected by the members of the Society in accordance with the articles of incorporation and bylaws of the Society.</text> </level> <level label="3"> <text>The bylaws of the Society shall provide that:</text> <level label="i"> <text>not more than five directors may be licensed physicians;</text> </level> <level label="ii"> <text>at least two directors must have had substantial experience as an officer or employee of an insurer;</text> </level> <level label="iii"> <text>at least two directors must be officers and employees of the Society who are responsible for the daily management of the Society; and</text> </level> <level label="iv"> <text>the Board of Directors must consist of individuals who live in different geographical areas of the State.</text> </level> </level> </level> <level label="c"> <text>The Board of Directors governs the Society and exercises the corporate powers of the Society.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-205" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <level label="1"> <text>If the Board of Directors determines that the affairs of the Society may be administered suitably and efficiently, the Society may enter into a contract with a licensed insurer or licensed nonprofit health service plan to administer the affairs of the Society, subject to the continuing direction of the Board of Directors specified in the articles of incorporation and bylaws of the Society and the contract.</text> </level> <level label="2"> <text>A contract may not exceed 5 years.</text> </level> </level> <level label="b"> <level label="1"> <text>On execution of the contract, the Society promptly shall file a true copy of the contract with the Commissioner.</text> </level> <level label="2"> <text>The contract is effective 30 days after the date of filing unless, before the effective date, the Commissioner disapproves the contract as contrary to law or public policy or as unduly onerous and states the reasons for the disapproval.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-206" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <text>On approval of the application for a certificate of authority, the Commissioner shall issue to the Society a certificate of authority that authorizes the Society to issue:</text> <level label="1"> <text>the following policies of casualty insurance:</text> <level label="i"> <text>insurance against the liability of physicians or other health care providers for injury arising out of the rendering of or failure to render professional services by the insured;</text> </level> <level label="ii"> <text>insurance against the liability of a person for whose acts or omissions a physician or other health care provider is responsible under item (i) of this item or with whom the physician or other health care provider is associated, including partners, employees, employers, associates, consultants, or a professional service corporation whose stock the insured owns; and</text> </level> <level label="iii"> <text>insurance against other liability for injury by persons employed in, by property used in, or by activities incidental to, practicing medicine or practicing another health occupation by the named insured, when issued as incidental coverage with or supplemental to insurance specified in item (i) of this item; and</text> </level> </level> <level label="2"> <text>policies of property insurance and casualty insurance that are related to the provision of health care or to health care facilities that physicians or other health care providers use where health care is practiced on a regular basis.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-207" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <text>Each policyholder is subject to assessment as provided in §§ 3-110, 3-111, and 3-112 of this article.</text> </level> <level label="b"> <text>Notwithstanding subsection (a) of this section, if the Society meets all applicable requirements of this article about the sale of nonassessable policies, including the requirements of §§ 4-104, 4-105, and 4-106 of this article, the Society may issue nonassessable policies subject to:</text> <level label="1"> <text>§ 3-113 of this article;</text> </level> <level label="2"> <text>all other applicable provisions of this article; and</text> </level> <level label="3"> <text>the Corporations and Associations Article.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-208" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <text>The directors of the Society may establish membership fees in amounts they consider reasonable, to be paid by the members of the Society.</text> </level> <level label="b"> <text>Each physician who paid the special one-time tax imposed by former Article 48A, § 552(b) of the Code shall be credited with the amount of the tax paid against the liability of the physician for the membership fee.</text> </level> <level label="c"> <text>On payment of the membership fee, a physician or other health care provider may be insured by the Society for any and all hazards customarily insured by the Society, subject to any coverage limitations specified by the Society in accordance with policy limitations, exclusions, conditions, deductibles, and loss-sharing requirements.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-209" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <text>Policies that the Society issues to each class of physicians and other health care providers shall be essentially uniform in terms and conditions of coverage.</text> </level> <level label="b"> <text>Notwithstanding subsection (a) of this section, the Society may:</text> <level label="1"> <text>establish reasonable classifications of physicians and other health care providers, insured activities, and exposures based on a good faith determination of relative exposures and hazards among classifications;</text> </level> <level label="2"> <text>vary the limits, coverages, exclusions, conditions, and loss-sharing provisions among classifications; and</text> </level> <level label="3"> <text>establish, for an individual physician or other health care provider within a classification, reasonable variations in the terms of coverage, including deductibles and loss-sharing provisions, based on the insured’s prior loss experience and current professional training and capability.</text> </level> </level> <level label="c"> <level label="1"> <text>In this subsection, “nursing facility” has the meaning stated in § 19-301 of the Health - General Article.</text> </level> <level label="2"> <text>The Society may not deny, cancel, or refuse to renew medical professional liability insurance coverage for a physician, based solely on the physician’s:</text> <level label="i"> <text>employment by, or provision of health care services at, an assisted living or nursing facility;</text> </level> <level label="ii"> <text>provision of mammography services; or</text> </level> <level label="iii"> <text>provision of services in an emergency room.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-210" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <text>Notwithstanding any other provision of this subtitle, the Society may establish, own, or control a subsidiary for any business purpose.</text> </level> <level label="b"> <text>A subsidiary that is established, owned, or controlled by the Society is not subject to this subtitle.</text> </level> <level label="c"> <level label="1"> <text>A subsidiary of the Society is not and may not be deemed a department, unit, agency, or instrumentality of the State for any purpose.</text> </level> <level label="2"> <text>The State may not be held in any way liable or responsible for any of the debts, claims, obligations, or liabilities of a subsidiary of the Society or the Society.</text> </level> </level> <level label="d"> <text>Without the prior approval of the Board of Directors, including at least 80% of the physician members of the Board of Directors, the Society may not directly or indirectly capitalize, transfer moneys to, or purchase stock in an insurance subsidiary beyond the $3,250,000 used by the Society before December 31, 1989, to capitalize the insurance subsidiaries.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-211" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <level label="1"> <text>Not later than June 30 of each year, the Society shall report to the Commissioner and to the General Assembly:</text> <level label="i"> <text>salaries and other compensation paid to officers, executives, and directors for the preceding calendar year;</text> </level> <level label="ii"> <text>a summary and detailed financial statement for the four preceding calendar years indicating amounts for and changes in:</text> <level label="1"> <text>insurance reserves and losses;</text> </level> <level label="2"> <text>assets and liabilities;</text> </level> <level label="3"> <text>income and expenses; and</text> </level> <level label="4"> <text>return on invested surplus; and</text> </level> </level> <level label="iii"> <text>management’s evaluation of the financial position of the Society.</text> </level> </level> <level label="2"> <text>The evaluation under paragraph (1)(iii) of this subsection shall include an analysis indicating whether sufficient resources exist to justify providing a dividend or similar distribution to members in the current year and, if not, how the current circumstances vary from prior years in which such distributions have been made.</text> </level> </level> <level label="b"> <text>Any rate filing by the Society shall include the information required under subsection (a) of this section.</text> </level> <level label="c"> <level label="1"> <text>Before the Society may pay to its members a dividend or similar distribution, the Society shall provide to the Commissioner, using a methodology prescribed by the Commissioner, an analysis indicating the extent to which the distribution results from any excess of premiums collected over accumulated losses for incidents arising in any premium year during which the State provided financial assistance.</text> </level> <level label="2"> <level label="i"> <text>To the extent the analysis required under paragraph (1) of this subsection determines that funds available for distribution are attributed to a year in which financial assistance is provided, the Commissioner shall order the Society to pay a portion of the distribution to the State.</text> </level> <level label="ii"> <text>The amount paid to the State shall be determined based on the ratio of State expenditures for financial assistance to total premiums earned for each premium year for which State financial assistance was made.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-212" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <text>If the Society requests a rate increase of more than 7.5% and, at the time of the rate filing, the Society’s surplus is more than 500% of its authorized control level risk-based capital, the Commissioner may determine whether the Society’s surplus is excessive.</text> </level> <level label="b"> <text>If, after a hearing, the Commissioner determines that the surplus is excessive, the Commissioner may order the rates filed to be reduced.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-213" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <level label="a"> <text>The Legislative Auditor shall conduct a fiscal and compliance audit of the accounts and transactions of the Society for each year in which the Society receives a disbursement from the Rate Stabilization Account under § 19–805 of this article.</text> </level> <level label="b"> <text>Within one year of the date of an audit report required under subsection (a) of this section, the Legislative Auditor shall conduct a follow–up audit to determine the status of any audit recommendations.</text> </level> <level label="c"> <text>The Society shall pay the cost of each audit.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-214" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="2" subtitle_name="Medical Mutual Liability Insurance Society of Maryland"> <text>For policies that take effect on or after January 11, 2005 and through December 31, 2009, the Society may not pay a commission at a rate that exceeds 5% of the premium.</text> </section> <section article="gin" article_name="Insurance" number="24-301" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <text>In this subtitle the following words have the meanings indicated.</text> </level> <level label="b"> <text>“Board” means the Board for the Chesapeake Employers’ Insurance Company.</text> </level> <level label="c"> <text>“Company” means the Chesapeake Employers’ Insurance Company.</text> </level> <level label="d"> <text>“Fund” means the Injured Workers’ Insurance Fund established under Title 10 of the Labor and Employment Article.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-302" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <text>The General Assembly finds and determines that:</text> <level label="1"> <text>employers’ access to affordable workers’ compensation insurance is of utmost importance to the economy of the State;</text> </level> <level label="2"> <text>the Fund has been the State’s insurer of last resort for workers’ compensation insurance since 1914;</text> </level> <level label="3"> <text>since its creation, the Fund was permitted to compete with the private insurance market; however, the Fund did not become an effective competitive insurer until the General Assembly exempted the Fund from most laws that apply to State government agencies and required the Fund to be a regulated insurer;</text> </level> <level label="4"> <text>the most effective way to ensure that Maryland’s workers’ compensation system remains stable and affordable is to encourage and create as much competition in the marketplace as possible;</text> </level> <level label="5"> <text>the long–term competitive success of the Fund would be enhanced if the final barriers to full competition were eliminated by converting the Fund into a fully competitive, fully regulated, private insurer;</text> </level> <level label="6"> <text>converting the Fund into a private, nonstock, nonprofit insurer would level the competitive playing field for all workers’ compensation insurers operating in the State;</text> </level> <level label="7"> <text>converting the Fund into a private, nonstock, nonprofit insurer would provide assurance to Maryland employers that the financial success of the Fund would inure to their benefit as policyholders through dividends and lower rates and that surplus funds could not be transferred to the State’s General Fund;</text> </level> <level label="8"> <text>the interests of the State would be protected if the Fund’s statutory purpose of insurer of last resort for workers’ compensation insurance is preserved and the Governor retains the right to appoint two members of the board of the new company;</text> </level> <level label="9"> <level label="i"> <text>the interests of the employees of the Fund would be satisfied by ensuring that current employees have the option to remain State employees of the Fund after the conversion of the Fund to a private, nonstock, nonprofit insurer; and</text> </level> <level label="ii"> <text>the interests of employees of the Fund would further be satisfied by ensuring that current long–term State employees who remain State employees of the Fund after the conversion of the Fund to a private, nonstock, nonprofit insurer shall remain in the State retirement system and, therefore, would not be unfairly penalized by being prematurely forced out of the State retirement system due to the conversion; and</text> </level> </level> <level label="10"> <text>the interests of the residents of the State, both employers and employees, will be best met by converting the Fund into a private, nonstock, nonprofit, fully regulated, competitive insurer.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-303" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <text>There is a Chesapeake Employers’ Insurance Company.</text> </level> <level label="b"> <text>The Company shall be:</text> <level label="1"> <text>a private, nonprofit, nonstock corporation organized under State law; and</text> </level> <level label="2"> <text>subject to the applicable provisions of the Corporations and Associations Article as a nonstock corporation.</text> </level> </level> <level label="c"> <text>Before October 1, 2013, the Company shall:</text> <level label="1"> <text>file articles of incorporation under the Corporations and Associations Article; and</text> </level> <level label="2"> <text>take all steps necessary to be a private, nonprofit, nonstock corporation organized under State law.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-304" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <text>Before October 1, 2013, the Company shall:</text> <level label="1"> <text>file an application for a certificate of authority under this article and a statement of the risk–based capital levels of the Company as of the date of the application prepared in accordance with § 4–303 of this article; and</text> </level> <level label="2"> <text>take all steps necessary to be an authorized domestic insurer under State law.</text> </level> </level> <level label="b"> <text>On approval of the application for a certificate of authority, the Commissioner shall issue to the Company a certificate of authority that authorizes the Company to issue policies under Title 9 of the Labor and Employment Article.</text> </level> <level label="c"> <text>Except as otherwise provided in this subtitle, the Company has the powers, privileges, and immunities granted by and is subject to the provisions applicable to insurers authorized to write workers’ compensation insurance under this article.</text> </level> <level label="d"> <text>The Company may issue policies for:</text> <level label="1"> <text>employer’s liability insurance; and</text> </level> <level label="2"> <text>insurance under a federal compensation law.</text> </level> </level> <level label="e"> <text>Except as otherwise provided in this subtitle, the Company shall be:</text> <level label="1"> <text>authorized, examined, and regulated by the Commissioner in the same manner and to the same extent as other authorized property and casualty insurers; and</text> </level> <level label="2"> <text>subject to each provision of this article that is applicable to other authorized property and casualty insurers.</text> </level> </level> <level label="f"> <text>The Company is a member of the Property and Casualty Insurance Guaranty Corporation.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-306" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <text>The Company:</text> <level label="1"> <text>shall be an authorized insurer; and</text> </level> <level label="2"> <text>on and after October 1, 2013, as a condition of being an authorized insurer, shall be the workers’ compensation insurer of last resort for employers covered under Title 9 of the Labor and Employment Article.</text> </level> </level> <level label="b"> <text>Before October 1, 2013, the Fund shall serve as the workers’ compensation insurer of last resort for workers’ compensation insurance and as a competitive workers’ compensation insurer under the same terms and conditions as the Fund served before October 1, 2012.</text> </level> <level label="c"> <text>The Company may not cancel or refuse to renew or issue a policy except for:</text> <level label="1"> <text>nonpayment of a premium for current or prior policies issued by the Fund or the Company;</text> </level> <level label="2"> <text>failure to provide payroll information to the Fund or the Company;</text> </level> <level label="3"> <text>failure to cooperate in any payroll audit conducted by the Fund or the Company; or</text> </level> <level label="4"> <text>failure to reimburse the Company under a policy with deductibles as required under § 19–404 of this article.</text> </level> </level> <level label="d"> <text>The Company may engage only in the business of workers’ compensation insurance in accordance with State law.</text> </level> <level label="e"> <text>Subject to the requirements of Title 7 of this article, the Company may establish, own, or acquire a subsidiary for any lawful purpose if the subsidiary:</text> <level label="1"> <text>is, or after acquisition will be, wholly owned by the Company;</text> </level> <level label="2"> <text>engages in a business activity that is ancillary to the workers’ compensation insurance business; and</text> </level> <level label="3"> <text>is operated for the purpose of benefiting the Company.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-307" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <level label="1"> <text>There is a Board for the Chesapeake Employers’ Insurance Company.</text> </level> <level label="2"> <text>The Board shall manage the business and affairs of the Company as a private, nonprofit corporation in accordance with State law.</text> </level> </level> <level label="b"> <level label="1"> <text>The Board shall consist of nine members, of which:</text> <level label="i"> <text>two members shall be appointed by the Governor; and</text> </level> <level label="ii"> <text>subject to paragraph (3) of this subsection, seven members shall be appointed by the policyholders of the Company under procedures provided in the bylaws of the Board.</text> </level> </level> <level label="2"> <text>To the extent practicable, the Board shall reflect the geographic and demographic, including race and gender, diversity of the State.</text> </level> <level label="3"> <text>Of the seven members appointed by the policyholders:</text> <level label="i"> <text>two members shall have substantial experience as officers or employees of an insurer, but may not be employed by an insurer that is in direct competition with the Company while serving on the Board;</text> </level> <level label="ii"> <text>one member shall be a policyholder of the Company;</text> </level> <level label="iii"> <text>one member shall have significant experience in the investment business;</text> </level> <level label="iv"> <text>one member shall have significant experience in the accounting or auditing field; and</text> </level> <level label="v"> <text>one member shall have significant experience as a representative, employee, or member of a labor union.</text> </level> </level> </level> <level label="c"> <text>Each member shall be a resident of the State.</text> </level> <level label="d"> <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 for the Fund on October 1, 2015.</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 who is appointed after a term has begun serves only for the rest of the term and until a successor is appointed and qualifies.</text> </level> <level label="5"> <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> <level label="e"> <level label="1"> <text>The Governor may remove a member appointed by the Governor for incompetence or misconduct.</text> </level> <level label="2"> <level label="i"> <text>The policyholders may remove a member appointed by the policyholders at any time, with or without cause, by the affirmative vote of a majority of all of the votes entitled to be cast generally in the election of directors.</text> </level> <level label="ii"> <text>The Commissioner may remove a member appointed by the policyholders for incompetence, misconduct, or malfeasance after notice and opportunity for a hearing under §§ 2–210 through 2–214 of this article.</text> </level> </level> </level> <level label="f"> <text>The Board shall adopt rules, bylaws, and procedures.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-308" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <text>Subject to subsection (b) of this section, the Board may declare a policyholder dividend in the form of a cash refund or credit to:</text> <level label="1"> <text>a policyholder based on the actual loss ratio that is better than the loss ratio used to calculate the policyholder’s premium; or</text> </level> <level label="2"> <text>all policyholders whose loss ratio contributed to the Company’s surplus for that year.</text> </level> </level> <level label="b"> <level label="1"> <text>The Board may not issue a policyholder dividend under subsection (a)(2) of this section unless the Commissioner has approved the policyholder dividend.</text> </level> <level label="2"> <text>In determining whether to approve the policyholder dividend under paragraph (1) of this subsection, the Commissioner shall consider:</text> <level label="i"> <text>the Company’s surplus;</text> </level> <level label="ii"> <text>material changes in premium rates, claims, market share, or types of insured risks;</text> </level> <level label="iii"> <text>the methodology the Board used to determine that policyholders are eligible for the policyholder dividend; and</text> </level> <level label="iv"> <text>any other factor the Commissioner considers relevant.</text> </level> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-309" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <text>The Company is not and may not be deemed to be a department, unit, agency, or instrumentality of the State for any purpose.</text> </level> <level label="b"> <text>Employees of the Company are not:</text> <level label="1"> <text>employees of the State; or</text> </level> <level label="2"> <text>members of the State Retirement and Pension System.</text> </level> </level> <level label="c"> <text>All debts, claims, obligations, and liabilities of the Company, whenever incurred, shall be the debts, claims, obligations, and liabilities of the Company only and not of the State or the State’s departments, units, agencies, instrumentalities, officers, or employees.</text> </level> <level label="d"> <level label="1"> <text>Money of the Company is not part of the General Fund of the State.</text> </level> <level label="2"> <text>The State may not budget for or provide General Fund appropriations to the Company.</text> </level> <level label="3"> <text>The debts, claims, obligations, and liabilities of the Company are not a debt of the State or a pledge of the credit of the State.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-310" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <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 Board, the Board shall attempt to use to the greatest extent feasible minority business enterprises to provide brokerage and investment management services to the Board.</text> </level> <level label="b"> <text>For purposes of this section, brokerage and investment management services shall include services relating to all allocated asset classes.</text> </level> <level label="c"> <level label="1"> <text>To assist the Board in achieving the goal described under subsection (a) of this section, the Board 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 Company.</text> </level> <level label="2"> <text>The measures undertaken by the Board shall include the use of a wide variety of media, including the Board’s Web site, to provide notice to a broad and varied range of potential providers about the brokerage and investment management services opportunities afforded by the Company.</text> </level> </level> <level label="d"> <text>In conjunction with the Governor’s Office of Small, Minority, and Women Business Affairs, the Board shall develop guidelines to assist it in identifying and evaluating qualified minority business enterprises in order to help the Company achieve the objective for greater use of minority business enterprises for brokerage and investment management services.</text> </level> <level label="e"> <text>On or before September 1 each year, the Board shall submit a report to the Governor’s Office of Small, Minority, and Women Business Affairs and, in accordance with § 2–1257 of the State Government Article, the General Assembly on:</text> <level label="1"> <text>the identity of the minority business enterprise brokerage and investment management services firms used by the Board in the immediately preceding fiscal year;</text> </level> <level label="2"> <text>the percentage and dollar value of the Company assets that are under the investment control of minority business enterprise brokerage and investment management services firms; and</text> </level> <level label="3"> <text>the measures the Board undertook in the immediately preceding fiscal year in accordance with subsection (c)(2) of this section.</text> </level> </level> </section> <section article="gin" article_name="Insurance" number="24-311" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <level label="a"> <text>Except as provided in subsections (b) and (c) of this section, on October 1, 2013, all the functions, powers, duties, assets, real and personal property, accounts, liabilities, contracts, and obligations of the Fund shall be irrevocably transferred to the Company, including liability for all claims, whether known or unknown, arising out of any insurance policy previously issued by the Fund.</text> </level> <level label="b"> <text>Any contract or agreement with the State for the third party administration of the State’s Self–Insured Workers’ Compensation Program for State Employees may not be transferred or assigned to the Company until the Fund no longer has employees.</text> </level> <level label="c"> <text>The Fund shall retain those assets necessary to perform its duties under Title 10 of the Labor and Employment Article.</text> </level> </section> <section article="gin" article_name="Insurance" number="24-312" title_number="24" title_name="State Created Mutual Societies and Other Entities" subtitle_number="3" subtitle_name="Chesapeake Employers' Insurance Company"> <text>The Company may not:</text> <level label="1"> <text>be converted to a mutual or stock company;</text> </level> <level label="2"> <text>be sold; or</text> </level> <level label="3"> <text>be dissolved.</text> </level> </section>