GENERAL ASSEMBLY OF NORTH CAROLINA
1995 SESSION
CHAPTER 592
The General Assembly of North Carolina enacts:
Section 1. G.S. 58-45-25 reads as rewritten:
"§
58-45-25. Each member of Association to participate in its writings, expenses,
profits and losses in proportion to net direct premium of such member. profits,
and losses.
All members of the Association shall participate in its
writings, expenses, profits and losses in the proportion that the net direct
premium of such member written in this State during the preceding calendar year
bears to the aggregate net direct premiums written in this State by all members
of the Association, as certified to the Association by the Commissioner after
review of annual statements, other reports and any other statistics the
Commissioner shall deem necessary to provide the information herein required
and which the Commissioner is hereby authorized and empowered to obtain from
any member of the Association, provided, however, that a member shall annually
receive credit for essential property insurance voluntarily written in the
beach area and its participation in the writings in the Association shall be
reduced accordingly. Each member's participation in the Association shall
be determined annually in the same manner as the initial determination. All
members of the Association shall participate in its expenses, profits, and
losses and shall receive credit annually for essential property insurance
voluntarily written as determined by the directors of the Association, with the
approval of the Commissioner. Participation of each member in the losses
of the Association shall be reduced accordingly. Any insurer authorized to
write and engage in writing any insurance, the writing of which requires such
the insurer to be a member of the Association, pursuant to the
provisions of G.S. 58-45-10, who is authorized and engaged in writing
such insurance after April 17, 1969, shall become a member of the
Association on the January 1 immediately following such authorization
and the determination of such the insurer's participation in the
Association shall be made as of the date of such membership in the same
manner as for all other members of the Association."
Sec. 2. G.S. 58-45-5(6) is repealed.
Sec. 3. The directors of the North Carolina Insurance Underwriting Association (Beach Plan), in consultation with the Department of Insurance, shall develop a plan to revise the participation formula of the Plan in a manner that encourages insurance companies to write voluntary policies in the beach area or other areas of the State and to write themselves out of the losses of the Plan, to apply to the 1997-98 fiscal year. In connection with the development of the plan, the Department and Association shall determine the reasons insurance companies are not writing voluntary coverage on properties in the beach area of the State, considering, among other factors, that the companies may cede wind risks to the Association. The directors shall report to the Legislative Research Commission's Study Committee on Insurance and Insurance-Related Issues on their findings and the revised formula on or before October 15, 1996.
Sec. 4. Sections 1 and 2 of this act become effective October 1, 1996, and apply to policies issued or renewed on or after that date. The remainder of this act is effective upon ratification.
In the General Assembly read three times and ratified this the 20th day of June, 1996.
───────────────────
Dennis A. Wicker
President of the Senate
───────────────────
Harold J. Brubaker
Speaker of the House of Representatives