Code of Maine Rules › 02 - DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION › 031 - BUREAU OF INSURANCE › Chapter 440 - MAINE WORKERS' COMPENSATION RESIDUAL MECHANISM › Subchapter II - MAINE WORKERS' COMPENSATION RESIDUAL MARKET POOL › Section 031-440-II-10 - Servicing Carriers

Current through 2024-29, July 17, 2024
A. Performance
				  standard. In order to ensure that residual market policies are serviced in a
				  quality manner and that adequate resources are available to provide the
				  necessary services to insured employers, the servicing performance standards
				  contained in this chapter shall apply regardless of whether servicing is
				  provided by insurers, their affiliate service corporations or independent
				  servicing contractors. For purposes of this chapter, the term "servicing
				  carrier'' shall include any insurer, insurer-affiliate service corporation or
				  independent servicing contractor which is providing service for assigned risk
				  policies.
B. Selection of service
				  carriers. Servicing of residual market policies shall be provided through one
				  of the following methods, which are described in order of priority. Any
				  contractual arrangement entered into by the manager or insurers for the
				  provision of service functions shall require the servicing carrier to provide
				  the same quality of service as is provided to insured employers in the
				  voluntary market and to comply with the minimum performance standards of
				  subchapter IV of this chapter. The Board shall have responsibility and
				  authority for enforcement of these standards.
(1) The Plan manager may contract with a
				  number of insurers to serve voluntarily as Maine servicing carriers.
(2) If adequate servicing cannot be provided
				  under paragraph (1), the Plan manager may contract with service companies which
				  are affiliates of insurers, or with a combination of such service companies and
				  licensed insurers. For purposes of this provision, "affiliate" means a
				  corporation which is under common ownership, management or control with an
				  insurer licensed to write workers' compensation insurance in Maine.
				  Alternatively, a licensed insurer may elect to contract with a servicing
				  contractor which is not an affiliate, subject to the same servicing fee it
				  would be paid if utilizing au affiliate for this purpose, provided the insurer
				  remains responsible for the servicing. In order to be eligible to enter into
				  servicing contracts under this paragraph, any non-insurer service company must
				  have a written agreement with a licensed insurer for issuance of policies which
				  has been approved by both the Plan manager and the Superintendent.
(3) If adequate servicing cannot be procured
				  through the methods described in paragraphs (1) and (2), the Plan manager may,
				  with the advice of the Board. award service contracts on the basis of
				  acceptable price and performance standards. Bid specifications shall be
				  established by the Board, but shall be no less stringent than servicing
				  standards applicable in this chapter. Under this method, policies shall be
				  issued by one or more licensed insurers procured on a voluntary basis by the
				  Plan manager for this purpose.
(4)
				  If adequate servicing cannot be procured through the methods prescribed in
				  paragraphs (1) through (3), the Superintendent may either
(a) award service contracts through a bidding
				  process or
(b) order the Plan
				  manager to make servicing assignments to all insurers licensed to write
				  workers' compensation and employer's liability insurance in this State. In
				  ordering the Plan manager to make servicing assignments, the Superintendent
				  shall specify an equitable basis for assignments, taking into consideration
				  each carrier's present residual and voluntary writings.
(5) If the Superintendent notifies the Plan
				  manager that efforts to award service contracts through a bidding process under
				  paragraph 4 have been unsuccessful, the Board may approve servicing contracts
				  with insurers, service companies which are affiliates of insurers, independent
				  service companies not affiliated with insurers, or a combination or such
				  service companies and insurers under terms which exclude any servicing premium
				  written under these contracts from the premium base of the servicing insurer or
				  the insurer affiliate of a service company for purposes of ally residual market
				  deficit assessment for that policy year if the Board fields that entering into
				  servicing contracts on these terms is in the best interests of the residual
				  market pool. If the Board declines to approve servicing contracts on a basis
				  which excludes the servicing premium from the assessment base and adequate
				  servicing cannot be procured, in whole or in part, through ally method other
				  than involuntary assignments under paragraph 4, the Superintendent may award
				  service contracts through a bidding process under terms which exclude the
				  servicing premium from the assessment base of the servicing insurer or insurer
				  affiliate of a service company.