§ 23-96-115 - Assessments -- Tax credits.
               	 		
23-96-115.    Assessments -- Tax credits.
    A.    (1)  For  the purpose of providing the funds necessary to carry out the powers  and duties of the Association, the Association's board of directors  shall assess the member insurers, separately for each account, at such  time and for such amounts as the board of directors finds necessary.
      (2)  Assessments  shall be due not less than thirty (30) days after prior written notice  to the member insurers and shall accrue interest at ten percent (10%)  per annum on and after the due date.
B.  There shall be two (2) classes of assessments, as follows:
      (1)  Class  A assessments shall be authorized and called for the purpose of meeting  administrative and legal costs and other expenses. Class A assessments  may be authorized and called whether or not related to a particular  impaired or insolvent insurer.
      (2)  Class  B assessments shall be authorized and called to the extent necessary to  carry out the powers and duties of the Association under       23-96-106(B), 23-96-110 -- 23-96-114, and 23-96-120 with regard to an  impaired or an insolvent insurer.
C.    (1)    (a)  The  amount of a Class A assessment shall be determined by the board of  directors and may be authorized and called on a pro rata or non-pro rata  basis. If pro rata, the board of directors may provide that it be  credited against future Class B assessments. The total of all non-pro  rata assessments shall not exceed one hundred fifty dollars ($150) per  member insurer in any one (1) calendar year.
            (b)  The  amount of a Class B assessment shall be allocated for assessment  purposes among the accounts pursuant to an allocation formula which may  be based on the premiums or reserves of the impaired or insolvent  insurer or any other standard deemed by the board of directors in its  sole discretion as being fair and reasonable under the circumstances.
      (2)  Class  B assessments against member insurers for each account shall be in the  proportion that the premiums received on business in this state by each  assessed member insurer or policies or contracts covered by each account  for the three (3) most recent calendar years for which information is  available preceding the year in which the insurer became insolvent (or  in the case of an assessment with respect to an impaired insurer, the  three (3) most recent calendar years for which information is available  preceding the year in which the insurer became impaired) bears to such  premiums received on business in this state for such calendar years by  all assessed member insurers.
      (3)  Assessments  for funds to meet the requirements of the Association with respect to  an impaired or insolvent insurer shall not be authorized or called until  necessary to implement the purpose of this chapter.
D.  Classification  of assessments under subsection (B) of this section and computation of  assessments under subsection (C) of this section shall be made with a  reasonable degree of accuracy, recognizing that exact determinations may  not always be possible. The Association shall notify each member  insurer of its anticipated pro rata share of an authorized assessment  not yet called within one hundred eighty (180) days after the assessment  is authorized.
E.  The Association  may abate or defer, in whole or in part, the assessment of a member  insurer if, in the opinion of the board of directors, payment of the  assessment would endanger the ability of the member insurer to fulfill  its contractual obligations. In the event an assessment against a member  insurer is abated or deferred in whole or in part, the amount by which  such assessment is abated or deferred may be assessed against the other  member insurers in a manner consistent with the basis for assessments  set forth in this section. Once the conditions that caused a deferral  have been removed or rectified, the member insurer shall pay all  assessments that were deferred pursuant to a repayment plan approved by  the Association.
F.    (1)    (a)  Subject  to the provisions of paragraph (1)(b) of this subsection, the total of  all assessments authorized by the Association with respect to a member  insurer for each subaccount of the life insurance and annuity account  and for the accident and health account shall not in any one (1)  calendar year exceed two percent (2%) of such insurer's average annual  premiums received in this state on the policies and contracts covered by  the subaccount or account during the three (3) calendar years preceding  the year in which the insurer became an impaired or insolvent insurer.
            (b)  If  two (2) or more assessments are authorized in one (1) calendar year  with respect to insurers that become impaired or insolvent in different  calendar years, the average annual premiums for purposes of the  aggregate assessment percentage limitation referenced in paragraph  (1)(a) of this subsection shall be equal and limited to the higher of  the three-year average annual premiums for the applicable subaccount or  account as calculated pursuant to this section.
            (c)  If  the maximum assessment, together with the other assets of the  Association in any account, does not provide in any one (1) year in  either account an amount sufficient to carry out the responsibilities of  the Association, the necessary additional funds shall be assessed as  soon thereafter as permitted by this chapter.
      (2)  The  board of directors may provide in the plan of operation a method of  allocating funds among claims, whether relating to one (1) or more  impaired or insolvent insurers, when the maximum assessment will be  insufficient to cover anticipated claims.
      (3)  If  the maximum assessment for any subaccount of the life and annuity  account in any one (1) year does not provide an amount sufficient to  carry out the responsibilities of the Association, then pursuant to  paragraph (C)(2) of this section, the board of directors shall assess  the other subaccounts of the life and annuity account for the necessary  additional amount, subject to the maximum stated in paragraph (1) of  this subsection.
G.  The board of  directors may, by an equitable method as established in the plan of  operation, refund to member insurers, in proportion to the contribution  of each insurer to that account, the amount by which the assets of the  account exceed the amount the board of directors finds is necessary to  carry out during the coming year the obligations of the Association with  regard to that account, including assets accruing from assignment,  subrogation, net realized gains, and income from investments. A  reasonable amount may be retained in any account to provide funds for  the continuing expenses of the Association and for future losses claims.
H.  It  shall be proper for any member insurer, in determining its premium  rates and policyholder dividends as to any kind of insurance within the  scope of this chapter, to consider the amount reasonably necessary to  meet its assessment obligations under this chapter.
I.    (1)  The  Association shall issue to each insurer paying an assessment under this  chapter, other than Class A assessment, a certificate of contribution,  in a form prescribed by the commissioner, for the amount of the  assessment so paid.
      (2)  All outstanding certificates shall be of equal dignity and priority without reference to amounts or dates of issue.
      (3)  A  certificate of contribution may be shown by the insurer in its  financial statement as an asset in such form and for such amount, if  any, and period of time as the commissioner may approve.
J.    (1)    (a)  A  member insurer may offset against its premium tax liability to this  state an assessment described in subsection (I) of this section to the  extent of twenty percent (20%) of the amount of such assessment for each  of the five (5) calendar years following the year in which such  assessment was paid.
            (b)  In  the event a member insurer should cease doing business, all uncredited  assessments may be credited against its premium tax liability for the  year it ceases doing business.
      (2)    (a)  Any  sums which are acquired by refund, pursuant to subsection (G) of this  section, from the Association by member insurers and which have  theretofore been offset against premium taxes as provided in paragraph  (1)(a) of this subsection, shall be paid by such insurers to this state  in such manner as the tax authorities may require.
            (b)  The Association shall notify the commissioner that such refunds have been made.