An Act
ENROLLED HOUSE
BILL NO. 4279 By: Sneed and Phillips of the
House
and
Quinn of the Senate
An Act relating to insurance; amending 36 O.S. 2021,
Sections 6413, 6414, 6415, 6417, and 6418, which
relate to the Market Assistance Associatio n Act;
modifying the definition of insurer; modifying the
definition of member; modifying policies of insurance
required by members to issue; clarifying that act
applies to homeowners' liability insurance; modifying
notification requirements of m ember insurers;
modifying procedure for amendments to the plan of
operation; modifying Market Assistance Association
Board of Directors membership; modifying the term of
members; specifying that the remaining Board of
Directors shall fill vacancies; directing that the
Board of Directors shall consider whether all
Association member insurers are fairly represented;
clarifying that the Ass ociation shall submit instead
of file a statement; clarifying that liabi lity
insurance means homeowners' liability insurance; and
providing an effective date.
SUBJECT: Insurance
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLA HOMA:
SECTION 1. AMENDATORY 36 O.S. 2021, Section 6413, is
amended to read as follows :
Section 6413. As used in the Market Assistance Association Act:
ENR. H. B. NO. 4279 Page 2
1. "Association" means the Market Assistance Associat ion
established pursuant to this act;
2. "Board" means the Board of Directors of the Market
Assistance Association;
3. "Commissioner" means the Insurance Commissioner;
4. "Insurer" means any entity licensed to issue homeowners ' or
homeowners' liability insurance; and
5. "Member" means all property and casualty insurers licensed
in the State of Oklahoma or writing homeowners' or liability
insurance in the this state for both property and casualty lines of
business. These entities are required to be a participant in the
Association as a condition of doing business i n Oklahoma.
SECTION 2. AMENDATORY 36 O.S. 2021, Section 6414, is
amended to read as follows:
Section 6414. A. The Association created pursuant to the
Market Assistance Associ ation Act shall have the power on behalf of
its members to:
1. Require members to issue policies of insurance , including
primary, excess, and incidental coverages, to applicants, subject to
limitations specified in the plan of operation required by the
Market Assistance Association Act; irregardless of the typ e of
insurance coverage, the limits of liability for homeowners'
liability insurance, shall be governed by the amounts specified in
subsection A of Section 154 of Title 51 of the Oklahoma Statutes;
and
2. Call upon member insurers who have expertise or fa miliarity
with a particular line of homeowners' liability insurance to assist
in underwriting such insurance.
B. The Board after consultation with the Association, the
Insurance Commissioner and other affected entities, shall promulgate
a plan of operation consistent with the provisions of this section,
to become effective no later than n inety (90) days after the date of
the inception of the Associa tion.
1. The plan of operation shall provide for economic, fair and
nondiscriminatory administration and for prompt and efficient ENR. H. B. NO. 4279 Page 3
provision of insurance, and shall contain other provisions
including, but not limited to, the following:
a. preliminary assessment of all members for initial
expenses necessary to commence operations of the
Association,
b. establishment of necessary facilities,
c. management of the Association,
d. assessment of member s, and assessment of policyholders
if a market assistance asso ciation for professionals
is declared, to defray losses and expenses,
e. establishment of committees as may b e necessary to
facilitate the administration of th e Association,
f. procedures providing that an insured shall have proof
that he or she has coverage that has been canceled or
nonrenewed by his or her current carrier and has
subsequently requested and been refused homeowners' or
homeowners' liability coverage from two insurers
licensed to do business in this state, or that his or
her premium has been increased by seventy -five percent
(75%) or more from the previous year, before
requesting insurance coverage from the Association,
g. appointment of members of the Association on a
rotating basis to provide homeowners' and homeowners'
liability insurance coverage based upon dire ct
premiums for homeowners' and homeowners' liability
insurance, written in the state in the preceding
calendar year,
h. procedures for determining amounts of insurance to be
provided by members of the Association, and
i. procedures for two or more member insu rers to share an
insured risk if coverage for that risk is beyond the
ability for one insurer,
j. procedures requiring member insurers to notify their
insureds not less than forty-five (45) days prior to
the renewal date for a policy, if the premium to be ENR. H. B. NO. 4279 Page 4
assessed will be increased to a rate greater than the
rate assessed for the prev ious year. If such
notification is not timely, then the premium shall be
the same as the premium which was assessed for the
coverage in the previous year .
2. The plan of operation shall provide that any balance
remaining in the funds of the Association at the close of its fiscal
year shall be added to the reserves of the Association and m ay be
used for expenses of the Association or any successor association.
3. Amendments to the plan of operation may be made by the
board, subject to the approval of the C ommissioner Board.
C. All insurers who are members of the Association shall
participate in the Association's writings, expenses, and losses in
the proportion that the net direct pre miums of each such member
written during the preceding calendar year bears to the aggregate
net direct premiums written in this state by all members of the
Association. Each insurer's proportion of participation in the
Association shall be determined annu ally on the basis of such net
direct premiums written during the preceding calendar year, as
reported in the annual statements and other reports filed by the
insurer that may be required by the board of directors. No member
shall be obligated in any one ( 1) year to write liability insurance
business from the Association which that would result in the member
insurer writing more than ten percent (10%) of its tot al annual
liability insurance, from all lines of liability insurance, from the
Association. Likewise, no member shall be obligated in any one (1)
year to write homeowners ' insurance business from the Association
which that would result in the member insur er writing more than ten
percent (10%) of its total annual homeowners ' insurance, from the
Association.
D. An applicable insurer ceasing to be licensed or authorized
to transact insurance business pursuant to the Insurance Code shall
automatically cease t o be a member of the Association effective at
12:01 a.m. on the day following the termination or e xpiration of its
certificate of authority and shall no longer be subject to the plan
of operation or requirements of the Association; provided, however,
such insurer shall remain liable for any annual assessments of the
Association based on expenses incur red by the Association while such
license or authority was in effect.
ENR. H. B. NO. 4279 Page 5
SECTION 3. AMENDATORY 36 O.S. 2021, Section 6415, is
amended to read as follows:
Section 6415. A. The business and functions of the Association
shall be managed and administered by a board Board of eleven (11)
directors composed of tw o directors selected by the American
Insurance Association, who are representatives of Association
members; two directors selected by the Alliance of American
Insurers, who are repre sentatives of Association members; two
directors selected by the National Association of Independent
Insurers, who are representatives of Association members; two
directors appointed by the Commissioner, who are representatives of
Oklahoma domestic insurer s who are Association members; one director
who shall be the President of the Oklahoma Surplus Lines
Association; and two directors appointed by the Commissio ner, who
are representatives of nonaffiliated foreign or alien insurers who
are Association member s eight (8) directors composed of four
directors representing Association members, two directors who are
representatives of Oklahoma domestic insurers who are Association
members, one director who represents a surplus lines carrier who is
an Association member, and the Oklahoma Insurance Commissioner or an
Oklahoma Insurance Dep artment staff member chosen as a designee by
the Oklahoma Insurance Commissioner. Each director shall designate
a full-time salaried employee of the insurer to represent the
director as an alternate in the absence of the director on the
Board. Each director shall serve for a term of two (2) years or
until the Association is terminated, whichever comes first. The
appointment to the board of directors shall be subject to approval
by the Commissioner. The term of office of each director shall
continue until the appointment and qualification of a successor.
Any vacancy on the Board shall b e filled for the remaining period of
the term by appointment by the appointing authority which orig inally
filled the vacant post, subject to the approval of the Commissione r
the remaining Board directors. If no directors are selected and
appointed within sixty (60) days after the effective date of the
inception of the Association, the Commissioner s hall appoint the
initial directors of the Board.
B. The chairman shall call all meetings of the Board and shall
give reasonable notice of meetings to all dire ctors. At any meeting
of the Board, each Board director or his predesignated alternate
shall have one vote. Six members of the Board or their
predesignated alternates shal l constitute a quorum for the
transaction of business an d the acts of a majorit y of the Board
members present at a meeting at which a quorum is present shall be ENR. H. B. NO. 4279 Page 6
the acts of the Board. The Board shall meet as often as may be
required to perform the general duties of administration of the
Association, but not les s frequently than annu ally.
C. In approving selections to the Board, the Commissioner Board
of Directors shall consider, among other things, whether all
Association member insurers are fairly repres ented.
D. Members of the Board and their predesignated alternates
shall serve without compensation but may be reimbursed from the
assets of the Association for all actual and necessary expenses
incurred by them in performance of their duties for the Board .
SECTION 4. AMENDATORY 36 O.S. 2021, Section 6417, is
amended to read as follows:
Section 6417. A. The Association shall file with submit to the
Insurance Commissioner, annu ally, from the date of its inception, a
statement prepared by an independent certified public accountant
which shall contain information with respect to its transactions,
condition, operations, and affairs during the preceding calendar
year. The statement shall contain such matters and information as
are prescribed and shall be in such form as is approved by the
Commissioner. The Commissioner may, at any time, require the
Association to furnish additional information with respect to it s
transactions, condition, operations, and affairs, or any matter
connected therewith considered to be material and of assistance in
evaluating the scope, operation and experience of the Association.
B. The books of account, records, reports and other doc uments
of the Association shall be open and free for examination to the
Commissioner at all reasonable times.
C. The books of account, records , reports and other documents
of the Association shall be open to inspection by the members at
such times and under such conditions a nd regulations as the Board
shall determine.
D. The Association shall provide for the making of detailed
reports of liability approved or canceled, for the drawing up of
annual budgets of the Association and for the rendering of accoun ts
to each member Board member at least every twelve (12) months .
SECTION 5. AMENDATORY 36 O.S. 2021, Section 6418, is
amended to read as follows: ENR. H. B. NO. 4279 Page 7
Section 6418. Each member insurer shall use the filed rate for
the homeowners' liability and homeowners' insurance being written.
Any variance from such rate, including a variance based upon debit,
shall be submitted or filed with th e Insurance Commissioner.
SECTION 6. This act shall become effective November 1, 2022.
ENR. H. B. NO. 4279 Page 8
Passed the House of Representatives the 19th day of May, 2022.
Presiding Officer of the House
of Representatives
Passed the Senate the 20th day of May, 2022.
Presiding Officer of the Senate
OFFICE OF THE GOVERNOR
Received by the Office of the Governor this ____________________
day of ___________________, 20_______, at _______ o'clock _______ M.
By: _________________________________
Approved by the Governor of the State of Oklahoma this _____ ____
day of ___________________, 20_______, at _______ o'clock _______ M.
_________________________________
Governor of the State of Oklahoma
OFFICE OF THE SECRETARY OF STATE
Received by the Office of the Secretary of State this __________
day of ___________________, 20_______, at _______ o'clock _______ M.
By: _________________________________