(a) The Association shall:
(1) Be obligated to the extent of the covered claims existing prior to the determination of insolvency, or arising within 30 days after the determination of insolvency, before the policy expiration date if less than 30 days after the determination, or before the insured replaces the policy or on request effects cancellation, if he does so within 30 days of the determination, but such obligation shall include only that amount of each covered claim which is in excess of $50 and less than $50,000. In no event shall the association be obligated to a policyholder or claimant in an amount in excess of the face amount of the policy from which the claim arises;
(2) Be deemed the insurer to the extent of its obligation on the covered claims and to such extent shall have all rights, duties, and obligations of the insolvent insurer as if the insurer had not become insolvent;
(3)
(A) [Effective until September 30, 2019] Assess insurers amounts necessary to pay the obligations of the Association under paragraph (1) of this subsection subsequent to an insolvency, the expenses of handling covered claims subsequent to an insolvency, and the cost of examinations under section 243 of this title and other expenses authorized by this section. The Association shall not be required to make assessments pursuant to subsection (a)(3)(A) of this section at any time that the amount contained in the Insurance Guaranty Fund is less than $10,000,000, and the shortfall is due to appropriations, disbursements, expenditures or other transfers from the Insurance Guaranty Fund for purposes other than pursuant to this chapter 10 of this title. In the event of the shortfall, assessments shall not be made of any member insurer unless and until the Government repays and transfers to the Insurance Guaranty Fund the lesser of (i) the amounts arising from appropriations, disbursements, expenditures or other transfers from the Insurance Guaranty Fund, or (ii) the amount that is necessary to restore the Fund balance to $10,000,000, and under any circumstance excluding appropriations, disbursements or expenditures or other transfers made pursuant to this chapter. Each member insurer shall be notified of the assessment not later than 30 days before it is due. No member insurer may be assessed in any year an amount greater than 3% of that member insurer's net direct written premiums for the preceding calendar year. If the maximum assessment, together with the other assets of the Association, does not provide in any one year an amount sufficient to make all necessary payments, the funds available shall be prorated and the unpaid portion shall be paid as soon thereafter as funds become available. The Association may defer, in whole or in part, the assessment of any member insurer, if the assessment would cause the member insurer's financial statement to reflect an amount of capital or surplus less than the minimum amounts required for a certificate of authority by any jurisdiction in which the member insurer is authorized to transact insurance; Provided, however, That during the period of deferment, no dividends shall be paid to shareholders or policyholders. Deferred assessments shall be paid when such payment will not reduce capital or surplus below required minimums. Such payments shall be refunded to those companies receiving larger assessments by virtue of such deferment, or, in the discretion of any such company, credited against future assessments.
(A) [Effective September 30, 2019] Assess insurers amounts necessary to pay the obligations of the Association under paragraph (1) of this subsection subsequent to an insolvency, the expenses of handling covered claims subsequent to an insolvency, and the cost of examinations under section 243 of this title and other expenses authorized by this section. The Association shall not be required to make assessments pursuant to subsection (a)(3)(A) of this section at any time that the amount contained in the Insurance Guaranty Fund is less than $50,000,000, and the shortfall is due to appropriations, disbursements, expenditures or other transfers from the Insurance Guaranty Fund for purposes other than pursuant to this chapter 10 of this title. In the event of the shortfall, assessments shall not be made of any member insurer unless and until the Government repays and transfers to the Insurance Guaranty Fund the lesser of (i) the amounts arising from appropriations, disbursements, expenditures or other transfers from the Insurance Guaranty Fund, or (ii) the amount that is necessary to restore the Fund balance to $50,000,000, and under any circumstance excluding appropriations, disbursements or expenditures or other transfers made pursuant to this chapter. Each member insurer shall be notified of the assessment not later than 30 days before it is due. No member insurer may be assessed in any year an amount greater than 3% of that member insurer's net direct written premiums for the preceding calendar year. If the maximum assessment, together with the other assets of the Association, does not provide in any one year an amount sufficient to make all necessary payments, the funds available shall be prorated and the unpaid portion shall be paid as soon thereafter as funds become available. The Association may defer, in whole or in part, the assessment of any member insurer, if the assessment would cause the member insurer's financial statement to reflect an amount of capital or surplus less than the minimum amounts required for a certificate of authority by any jurisdiction in which the member insurer is authorized to transact insurance; Provided, however, That during the period of deferment, no dividends shall be paid to shareholders or policyholders. Deferred assessments shall be paid when such payment will not reduce capital or surplus below required minimums. Such payments shall be refunded to those companies receiving larger assessments by virtue of such deferment, or, in the discretion of any such company, credited against future assessments.
(B) Solely for the purpose of determining assessments, and not for the purpose of determining refunds under paragraph (7) of subsection (b) of this section or for any other purpose, the Association shall consider the amounts contained in the Virgin Islands Insurance Guaranty Fund established pursuant to Title 33, section 3061 of this Code, as an asset of the Association and the Association shall first utilize amounts contained therein in paying the obligations of insolvent insurers. The Association shall request in writing of the Commissioner of Insurance and the Commissioner of Finance transfer to the Association of any amounts contained in said Fund needed to pay such obligations, and the Commissioner of Finance shall promptly make such amounts available to the Association upon the written certification of the Commissioner of Insurance that such funds are in fact needed to pay such obligations. In the event that amounts in excess of the Association's requirements are transferred, the Association shall promptly refund the excess to the Commissioner of Finance for redeposit in the said Fund.
(C) The rates and premiums charged for insurance policies to which this chapter applies shall include amounts sufficient to recoup a sum equal to the amounts paid to the Association by the member insurer less (1) any amounts returned to the member insurer by the Association and (2) any amounts collected under the following proviso, and such rates shall not be deemed excessive because they contain an amount reasonably calculated to recoup assessments paid by the member insurer; Provided, however, if the total amount assessed member insurers in any year exceeds ¼ of 1% of the member insurers' net direct written premiums for the preceding calendar year, the total amount so assessed shall be recovered during a reasonable period of time by member insurers by a surcharge on the net direct written premium on insurance policy for which such assessment was made. Any such surcharge shall be authorized by regulations promulgated by the Commissioner. Any such surcharge shall not be considered premium for purposes of (1) accounting, (2) premium or other tax and (3) agent and broker compensation, nor shall it be considered a deposit, penalty, fee, charge or tax for purposes of any retaliatory law. The Commissioner may authorize such a surcharge even if the total amount assessed member insurers in any account in any year does not exceed ¼ of 1%;
(4) Investigate, adjust, compromise, settle, and pay covered claims to the extent of the Association's obligation and deny all other claims;
(5) Notify such persons as the Commissioner directs pursuant to paragraphs (1) and (2) of subsection (b), section 239 of this title;
(6) Handle claims through its employees or through one or more insurers or other persons designated as servicing facilities. Designation of a servicing facility shall be subject to the approval of the Commissioner, but such designation may be declined by a member insurer;
(7) Reimburse each servicing facility for obligations of the Association paid by the facility and for expenses incurred by the facility while handling claims on behalf of the Association and pay the other expenses of the Association authorized by this chapter.
(b) The Association may:
(1) Appear in, defend, and appeal any action on a covered claim or on a claim brought against the Association;
(2) Employ or retain such persons as are necessary to handle claims and perform other duties;
(3) Borrow funds necessary to effect the purposes of this chapter in accordance with the plan of operation;
(4) Sue or be sued;
(5) Negotiate and become party to such contracts as are necessary to carry out the purposes of this chapter;
(6) Perform such other acts as are necessary or proper to effectuate the purposes of this chapter;
(7) Refund to the member insurers in proportion to the contribution of each member insurer to the Association that amount by which the assets of the Association exceed the liabilities, if at the end of any calendar year, the Board of Directors finds that the assets of the Association exceed the liabilities of the Association as estimated by the Board of Directors for the coming year.