| (a) Should a deficit occur in the Association, the Association shall assess member insurers to cover such deficit. The Association shall determine annually any deficit or surplus for each calendar year period that the Association is operational or has outstanding liabilities. (b) In addition to the start-up assessment authority provided by §5.9922(c) of this subchapter (relating to Relationship with Member Insurers), the Governing Committee may at any time levy an interim assessment against member insurers to provide necessary operating funds. (c) Each member insurer may recoup assessments levied against it under subsections (a), (b) and (d) of this section and §5.9922 of this subchapter by adding a premium surcharge on every property insurance policy issued or renewed for a three year period beginning ninety days after the date of the assessment by the Association. The amount of the surcharge shall be calculated on the basis of a uniform percentage of the premium on such policies equal to one-third of the ratio of the amount of an insurer's assessment to the amount of its direct earned premiums as reported on Statutory Page 14 in its annual financial statement to the department for the calendar year immediately preceding the year in which the assessment is made, such that over the period of three years the aggregate of all such surcharges by an insurer shall be equal to the amount of the assessment of such insurer. The minimum surcharges on a policy may be $1; all surcharges may be rounded to the nearest dollar (50 cents and higher rounded up to next dollar and 49 cents or less rounded down). A surcharge is not subject to premium tax unless so determined by the Comptroller of Public Accounts. (d) If any member insurer fails to pay the assessment for its proportionate part of any loss or expense because the member insurer is insolvent, and the Governing Committee determines that the assessment cannot be collected within a reasonable period of time, the unpaid assessment shall be paid by the remaining member insurers, each contributing in the manner provided by Insurance Code Article 21.49A, sec. 3 (e) (2), but without regard to the premium writings of the insolvent member insurer. The insolvent member insurer shall remain liable to the Association for the full amount of the assessment. If the insolvent member insurer later pays any or all of its assessment, the Association shall credit or reimburse the remaining members insurers in the same proportion as used in calculating each member insurer's contribution toward the unpaid assessment. (e) No refund which would otherwise be paid under the plan of operation shall be paid to a member if it is no longer a member because it withdrew from writing residential property insurance in Texas, or to the liquidator, receiver, conservator, or statutory successor of a member insurer until the assessment of the member insurer has been paid in full. Any refund shall be first applied as a set-off against any assessment or other monies owed to the Association. Any balance remaining after the set-off shall be paid to the member insurer or its liquidator, receiver, conservator, or statutory successor of the member insurer. (f) If a member ceases writing residential property insurance in Texas, it shall remain liable for any assessments that have already been made, and it shall be liable for any assessment that will be made covering the calendar year in which it had any direct earned premium for residential property insurance in Texas and/or any prior calendar years. Assessments will be based on the last year the company had written premiums. It shall not be liable for any assessments covering the calendar year next following the calendar year that it last had direct earned premium for residential property insurance in Texas. (g) Each insurer shall remit to the Association payment in full of its assessed amount within 30 days of the receipt of notice of assessment. If an insurer fails to remit its assessed amount after the 40th day the Association shall report the failure to the Commissioner who shall immediately take action to suspend or revoke such insurer's certificate of authority to transact the business of insurance in the State of Texas until such time as the Association certifies to the Commissioner that such assessment has been paid in full. Suspension of an insurer's certificate of authority to transact business in the State of Texas shall not affect the right of the Association to proceed against such insurer in any court for any remedy provided by law or contract to the Association, including, the right to collect such insurer's assessment. In addition to any other remedy, the Governing Committee may offset assessments due from an insurer against any amounts in any account of such delinquent insurer. A member by mailing payment of its allocated amount of assessment, as provided herein, shall not waive any right it may have to contest the computation of its allocated amount of assessment. Such contest shall not, however, toll the time within which assessments shall be paid or the report to be made to the Commissioner or the action to be taken by the Commissioner upon receipt of such report. |
