{"data":{"id":"us-ok/okla.-stat.-tit.-36-36-2007","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 36, § 36-2007","heading":"Powers and duties of Association","body":"A. The Oklahoma Property and Casualty Insurance Guaranty\n\nAssociation shall:\n\n1. Be obligated to pay the covered claims existing prior to the\n\ndetermination of insolvency if the claims arise within thirty (30)\n\ndays after the determination of insolvency, or before the policy\n\nexpiration date if less than thirty (30) days after the\n\ndetermination, or before the insured replaces the policy or causes\n\nits cancellation, if the insured does so within thirty (30) days of\n\nthe determination. The obligation shall be satisfied by paying to\n\nthe claimant an amount as follows:\n\na. the full amount of a covered claim for benefits under\n\na workers' compensation insurance coverage,\n\nb. an amount not exceeding Ten Thousand Dollars\n\n($10,000.00) per policy for a covered claim for the\n\nreturn of unearned premium,\n\nc. an amount not exceeding One Hundred Fifty Thousand\n\nDollars ($150,000.00) per claimant for all other\n\ncovered claims except for claims relating to a\n\ncybersecurity insurance policy, and\n\nd. in no event shall the Association be obligated to pay\n\nan amount in excess of Three Hundred Thousand Dollars\n\n($300,000.00) for all first- and third-party claims\n\nunder a policy or endorsement providing, or that is\n\nfound to provide, cybersecurity insurance coverage and\n\narising out of or related to a single insured event,\n\nregardless of the number of claims made or the number\n\nof claimants.\n\nIn no event shall the Association be obligated to pay a claimant\n\nan amount in excess of the obligation of the insolvent insurer under\n\nthe policy or coverage from which the claim arises or in excess of\n\nthe limits of the obligation of the Association existing on the date\n\non which the order of liquidation is filed with the court clerk;\n\n2. Any obligation of the Association to defend an insured shall\n\ncease upon the payment or tender by the Association of an amount\n\nequal to the lesser of the covered claim obligation limit of the\n\nAssociation or the applicable policy limit;\n\n3. As payor of last resort, have all rights, duties and\n\nobligations of the insolvent insurer as if the insurer had not\n\nbecome insolvent including, but not limited to, the right to pursue\n\nand retain salvage and subrogation recoverable on covered claim\n\nobligations to the extent paid by the Association. The Association\n\nshall not be deemed the insolvent insurer for the purpose of\n\nconferring jurisdiction;\n\n4. Allocate claims paid and expenses incurred among the three\n\naccounts set out in Section 2005 of this title separately, and\n\nassess member insurers separately for each account amounts necessary\n\nto pay the obligations of the Association under this section\n\nsubsequent to a member insurer becoming an insolvent insurer, the\n\nexpenses of handling covered claims subsequent to an insolvency, and\n\nother expenses authorized by the Oklahoma Property and Casualty\n\nInsurance Guaranty Association Act, Sections 2001 through 2020 of\n\nthis title and Sections 2020.1 and 2020.2 of this title. The\n\nassessments of each member insurer shall be in the proportion that\n\nthe net direct written premiums of the member insurer for the\n\ncalendar year preceding the assessment on the kinds of insurance in\n\nthe account bear to the net direct written premiums of all\n\nparticipating insurers for the calendar year preceding the\n\nassessment on the kinds of insurance in the account. Each member\n\ninsurer shall be notified in writing of the assessment not later\n\nthan thirty (30) days before it is due. No member insurer may be\n\nassessed in any year an amount greater than two percent (2%) of the\n\nnet direct written premiums of that member or one percent (1%) of\n\nthat surplus of the member insurer as regards policyholders for the\n\ncalendar year preceding the assessment on the kinds of insurance in\n\nthe account, whichever is less. If the maximum assessment, together\n\nwith the other assets of the Association, does not provide in any\nin any year an amount greater than two percent (2%) of the\n\nnet direct written premiums of that member or one percent (1%) of\n\nthat surplus of the member insurer as regards policyholders for the\n\ncalendar year preceding the assessment on the kinds of insurance in\n\nthe account, whichever is less. If the maximum assessment, together\n\nwith the other assets of the Association, does not provide in any\n\none (1) year in any account an amount sufficient to make all\n\nnecessary payments from that account, the funds available may be\n\nprorated and the unpaid portion shall be paid as soon thereafter as\n\nfunds become available. The Association shall pay claims in any\n\norder which it deems reasonable, including the payment of claims as\n\nthe claims are received from the claimants or in groups or\n\ncategories of claims. The Association may exempt or defer, in whole\n\nor in part, the assessment of any member insurer, if the assessment\n\nwould cause the financial statement of the member insurer to reflect\n\namounts of capital or surplus less than the minimum amounts required\n\nfor a certificate of authority by any jurisdiction in which the\n\nmember insurer is authorized to transact insurance. During the\n\nperiod of deferment, no dividends shall be paid to shareholders or\n\npolicyholders. Deferred assessments shall be paid when the payments\n\nwill not reduce capital or surplus below required minimums. The\n\npayments may be refunded to those companies receiving larger\n\nassessments by virtue of the deferment, or, at the election of any\n\ncompany credited against future assessments. Each member insurer\n\nserving as a servicing facility may set off against any assessment\n\nauthorized payments made on covered claims and expenses incurred in\n\nthe payment of covered claims by a member insurer if they are\n\nchargeable to the account for which the assessment is made;\n\n5. Investigate claims brought against the Association and\n\nadjust, compromise, settle and pay covered claims to the extent of\n\nthe obligation of the Association and deny all other claims. The\n\nAssociation shall pay claims in any order that it may deem\n\nreasonable, including, but not limited to, the payment of claims as\n\nthey are received from claimants or in groups of categories of\n\nclaims. The Association shall have the right to select and to\n\ndirect legal counsel under liability insurance policies for the\n\ndefense of covered claims;\n\n6. Notify claimants in this state as deemed necessary by the\n\nCommissioner and upon the request of the Commissioner, to the extent\n\nrecords are available to the Association. Notification may include,\n\nbut shall not be limited to, a legal posting on the website of the\n\nAssociation;\n\n7. a. Handle claims through employees or through one or more\n\ninsurers or other persons designated as servicing\n\nfacilities. Designation of a servicing facility is\n\nsubject to approval of the Commissioner, but such\n\ndesignation may be declined by a member insurer.\n\nb. The Association shall have the right to review and\n\ncontest as set forth in this paragraph, settlements,\n\nreleases, compromises, waivers and judgments to which\n\nthe insolvent insurer or its insureds were parties\n\nprior to the entry of the order of liquidation. In an\n\naction to enforce settlements, releases and judgments\n\nto which the insolvent insurer or its insureds were\n\nparties prior to the entry of the order of\n\nliquidation, the Association shall have the right to\n\nassert the following defenses:\n\n(1) the Association shall not be bound by a\n\nsettlement, release, compromise or waiver\n\nexecuted by an insured or the insurer, or any\n\njudgment entered against the insured or the\n\ninsurer by consent or through a failure to\n\nexhaust all appeals, if the settlement, release,\n\ncompromise waiver or judgment was:\nr of\n\nliquidation, the Association shall have the right to\n\nassert the following defenses:\n\n(1) the Association shall not be bound by a\n\nsettlement, release, compromise or waiver\n\nexecuted by an insured or the insurer, or any\n\njudgment entered against the insured or the\n\ninsurer by consent or through a failure to\n\nexhaust all appeals, if the settlement, release,\n\ncompromise waiver or judgment was:\n\n(a) executed or entered within one hundred\n\ntwenty (120) days prior to the entry of an\n\norder of liquidation, and the insured or the\n\ninsurer did not use reasonable care in\n\nentering into the settlement, release,\n\ncompromise, waiver or judgment, or did not\n\npursue all reasonable appeals of an adverse\n\njudgment, or\n\n(b) executed by or taken against an insured or\n\nthe insurer based on default, fraud,\n\ncollusion or the failure of the insurer to\n\ndefend,\n\n(2) if a court of competent jurisdiction finds that\n\nthe Association is not bound by a settlement,\n\nrelease, compromise, waiver or judgment for the\n\nreleases provided for in division (1) of\n\nsubparagraph b of this paragraph, the settlement,\n\nrelease, compromise, waiver or judgment shall be\n\nset aside and the Association shall be permitted\n\nto defend any covered claim on the merits. The\n\nsettlement, release, compromise, waiver or\n\njudgment shall not be considered as evidence of\n\nliability in connection with any claim brought\n\nagainst the Association or any other party\n\npursuant to the Oklahoma Property and Casualty\n\nInsurance Guaranty Association Act, and\n\n(3) the Association shall have the right to assert\n\nany statutory defenses or rights of offset\n\nagainst any settlement, release, compromise or\n\nwaiver executed by an insured or the insurer, or\n\nany judgment taken against the insured or the\n\ninsurer.\n\nc. As to any covered claims arising from a judgment under\n\nany decision, verdict or finding based on the default\n\nof the insolvent insurer or its failure to defend, the\n\nAssociation, either on its own behalf or on behalf of\n\nan insured, may apply to have the judgment, order,\n\ndecision, verdict or finding set aside by the same\n\ncourt or administrator that entered the judgment,\n\nclaim, decision, verdict or finding and shall be\n\npermitted to defend on the merits;\n\n8. Reimburse each servicing facility for obligations of the\n\nAssociation paid by the facility and for reasonable expenses\n\nincurred by the facility while handling claims on behalf of the\n\nAssociation and pay the other expenses of the Association authorized\n\nby the Oklahoma Property and Casualty Insurance Guaranty Association\n\nAct;\n\n9. Have standing to appear before any court of this state which\n\nhas jurisdiction over an impaired or insolvent insurer for whom the\n\nAssociation is or may become obligated pursuant to the provisions of\n\nthe Oklahoma Property and Casualty Insurance Guaranty Association\n\nAct. Standing shall extend to all matters germane to the powers and\n\nduties of the Association including, but not limited to, proposals\n\nfor rehabilitation, acquisition, merger, reinsuring, or guaranteeing\n\nthe covered policies of the impaired or insolvent insurer, and the\n\ndetermination of covered policies and contractual obligations of the\n\nimpaired or insolvent insurer; and\n\n10. Notwithstanding any other provision of the Oklahoma\n\nProperty and Casualty Insurance Guaranty Association Act, an\n\ninsurance policy issued by a member insurer and later allocated,\n\ntransferred, assumed by or otherwise made the sole responsibility of\n\nanother insurer pursuant to any provision of law providing for the\n\ndivision of an insurance company, or the statutory assumption or\n\ntransfer of designated policies under which there is no remaining\n\nobligation to the transferring entity, shall be considered to have\n\nbeen issued by a member insurer which is an insolvent insurer for\n\nthe purposes of this act in the event that the insurer to which the\nther insurer pursuant to any provision of law providing for the\n\ndivision of an insurance company, or the statutory assumption or\n\ntransfer of designated policies under which there is no remaining\n\nobligation to the transferring entity, shall be considered to have\n\nbeen issued by a member insurer which is an insolvent insurer for\n\nthe purposes of this act in the event that the insurer to which the\n\npolicy has been allocated, transferred, assumed or otherwise made\n\nthe sole responsibility of is placed in liquidation. An insurance\n\npolicy that was issued by an insurer who is not a member insurer and\n\nsubsequently allocated, transferred, assumed by or otherwise made\n\nthe sole responsibility of a member insurer under any provision of\n\nlaw providing for the division of an insurance company shall not be\n\nconsidered to have been issued by a member insurer pursuant to this\n\nact.\n\nB. The Association may:\n\n1. Employ or retain persons as are necessary to handle claims\n\nand perform other duties of the Association;\n\n2. Borrow funds necessary to effect the purposes of the\n\nOklahoma Property and Casualty Insurance Guaranty Association Act in\n\naccordance with the plan of operation;\n\n3. Sue or be sued;\n\n4. Negotiate and become a party to contracts as are necessary\n\nto carry out the purpose of the Oklahoma Property and Casualty\n\nInsurance Guaranty Association Act;\n\n5. Refund to member insurers in proportion to the contribution\n\nof each member insurer that amount by which the assets of the\n\nAssociation exceed its liabilities, if at the end of any calendar\n\nyear the board of directors finds that the assets of the Association\n\nexceed the liabilities as estimated by the board of directors for\n\nthe coming year;\n\n6. Lend monies to an insurer declared to be impaired by the\n\nCommissioner. The Association, with approval of the Commissioner,\n\nshall approve the amount, length and terms of the loan. \"Impaired\n\nInsurer\" for purposes of this section shall mean an insurer\n\npotentially unable to fulfill its contractual obligations, but shall\n\nnot mean an insolvent insurer;\n\n7. Perform other acts as are necessary or proper to effectuate\n\nthe purpose of the Oklahoma Property and Casualty Insurance Guaranty\n\nAssociation Act;\n\n8. Intervene as a party in interest in any supervision,\n\nconservation, liquidation, rehabilitation, impairment or\n\nreceivership in which policyholders' interests and interests of the\n\nAssociation may be or are affected; and\n\n9. Be designated or may contract as a servicing facility for\n\nany entity which may be recommended by the board of directors of the\n\nAssociation and shall be approved by the Commissioner.","path":["OK Code","Title 36"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os36.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"65483319b8cbda5998d8b9e96f2a7c36ea53f3f336642e97b18f6a34cf116720","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-36-36-2006","next":"us-ok/okla.-stat.-tit.-36-36-2008"},"notice":"GroundRules: Original legal text. Not legal advice."}