Okla. Stat. tit. 36, § 36-2007

A. The Oklahoma Property and Casualty Insurance Guaranty

Association shall:

1. Be obligated to pay the covered claims existing prior to the

determination of insolvency if the claims arise within thirty (30)

days after the determination of insolvency, or before the policy

expiration date if less than thirty (30) days after the

determination, or before the insured replaces the policy or causes

its cancellation, if the insured does so within thirty (30) days of

the determination. The obligation shall be satisfied by paying to

the claimant an amount as follows:

a. the full amount of a covered claim for benefits under

a workers' compensation insurance coverage,

b. an amount not exceeding Ten Thousand Dollars

($10,000.00) per policy for a covered claim for the

return of unearned premium,

c. an amount not exceeding One Hundred Fifty Thousand

Dollars ($150,000.00) per claimant for all other

covered claims except for claims relating to a

cybersecurity insurance policy, and

d. in no event shall the Association be obligated to pay

an amount in excess of Three Hundred Thousand Dollars

($300,000.00) for all first- and third-party claims

under a policy or endorsement providing, or that is

found to provide, cybersecurity insurance coverage and

arising out of or related to a single insured event,

regardless of the number of claims made or the number

of claimants.

In no event shall the Association be obligated to pay a claimant

an amount in excess of the obligation of the insolvent insurer under

the policy or coverage from which the claim arises or in excess of

the limits of the obligation of the Association existing on the date

on which the order of liquidation is filed with the court clerk;

2. Any obligation of the Association to defend an insured shall

cease upon the payment or tender by the Association of an amount

equal to the lesser of the covered claim obligation limit of the

Association or the applicable policy limit;

3. As payor of last resort, have all rights, duties and

obligations of the insolvent insurer as if the insurer had not

become insolvent including, but not limited to, the right to pursue

and retain salvage and subrogation recoverable on covered claim

obligations to the extent paid by the Association. The Association

Oklahoma Statutes - Title 36. Insurance Page 577

shall not be deemed the insolvent insurer for the purpose of

conferring jurisdiction;

4. Allocate claims paid and expenses incurred among the three

accounts set out in Section 2005 of this title separately, and

assess member insurers separately for each account amounts necessary

to pay the obligations of the Association under this section

subsequent to a member insurer becoming an insolvent insurer, the

expenses of handling covered claims subsequent to an insolvency, and

other expenses authorized by the Oklahoma Property and Casualty

Insurance Guaranty Association Act, Sections 2001 through 2020 of

this title and Sections 2020.1 and 2020.2 of this title. The

assessments of each member insurer shall be in the proportion that

the net direct written premiums of the member insurer for the

calendar year preceding the assessment on the kinds of insurance in

the account bear to the net direct written premiums of all

participating insurers for the calendar year preceding the

assessment on the kinds of insurance in the account. Each member

insurer shall be notified in writing of the assessment not later

than thirty (30) days before it is due. No member insurer may be

assessed in any year an amount greater than two percent (2%) of the

net direct written premiums of that member or one percent (1%) of

that surplus of the member insurer as regards policyholders for the

calendar year preceding the assessment on the kinds of insurance in

the account, whichever is less. If the maximum assessment, together

with the other assets of the Association, does not provide in any
in any year an amount greater than two percent (2%) of the

net direct written premiums of that member or one percent (1%) of

that surplus of the member insurer as regards policyholders for the

calendar year preceding the assessment on the kinds of insurance in

the account, whichever is less. If the maximum assessment, together

with the other assets of the Association, does not provide in any

one (1) year in any account an amount sufficient to make all

necessary payments from that account, the funds available may be

prorated and the unpaid portion shall be paid as soon thereafter as

funds become available. The Association shall pay claims in any

order which it deems reasonable, including the payment of claims as

the claims are received from the claimants or in groups or

categories of claims. The Association may exempt or defer, in whole

or in part, the assessment of any member insurer, if the assessment

would cause the financial statement of the member insurer to reflect

amounts 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. During the

period of deferment, no dividends shall be paid to shareholders or

policyholders. Deferred assessments shall be paid when the payments

will not reduce capital or surplus below required minimums. The

payments may be refunded to those companies receiving larger

assessments by virtue of the deferment, or, at the election of any

company credited against future assessments. Each member insurer

serving as a servicing facility may set off against any assessment

authorized payments made on covered claims and expenses incurred in

the payment of covered claims by a member insurer if they are

chargeable to the account for which the assessment is made;

Oklahoma Statutes - Title 36. Insurance Page 578

5. Investigate claims brought against the Association and

adjust, compromise, settle and pay covered claims to the extent of

the obligation of the Association and deny all other claims. The

Association shall pay claims in any order that it may deem

reasonable, including, but not limited to, the payment of claims as

they are received from claimants or in groups of categories of

claims. The Association shall have the right to select and to

direct legal counsel under liability insurance policies for the

defense of covered claims;

6. Notify claimants in this state as deemed necessary by the

Commissioner and upon the request of the Commissioner, to the extent

records are available to the Association. Notification may include,

but shall not be limited to, a legal posting on the website of the

Association;

7. a. Handle claims through employees or through one or more

insurers or other persons designated as servicing

facilities. Designation of a servicing facility is

subject to approval of the Commissioner, but such

designation may be declined by a member insurer.

b. The Association shall have the right to review and

contest as set forth in this paragraph, settlements,

releases, compromises, waivers and judgments to which

the insolvent insurer or its insureds were parties

prior to the entry of the order of liquidation. In an

action to enforce settlements, releases and judgments

to which the insolvent insurer or its insureds were

parties prior to the entry of the order of

liquidation, the Association shall have the right to

assert the following defenses:

(1) the Association shall not be bound by a

settlement, release, compromise or waiver

executed by an insured or the insurer, or any

judgment entered against the insured or the

insurer by consent or through a failure to

exhaust all appeals, if the settlement, release,

compromise waiver or judgment was:
r of

liquidation, the Association shall have the right to

assert the following defenses:

(1) the Association shall not be bound by a

settlement, release, compromise or waiver

executed by an insured or the insurer, or any

judgment entered against the insured or the

insurer by consent or through a failure to

exhaust all appeals, if the settlement, release,

compromise waiver or judgment was:

(a) executed or entered within one hundred

twenty (120) days prior to the entry of an

order of liquidation, and the insured or the

insurer did not use reasonable care in

entering into the settlement, release,

compromise, waiver or judgment, or did not

pursue all reasonable appeals of an adverse

judgment, or

(b) executed by or taken against an insured or

the insurer based on default, fraud,

Oklahoma Statutes - Title 36. Insurance Page 579

collusion or the failure of the insurer to

defend,

(2) if a court of competent jurisdiction finds that

the Association is not bound by a settlement,

release, compromise, waiver or judgment for the

releases provided for in division (1) of

subparagraph b of this paragraph, the settlement,

release, compromise, waiver or judgment shall be

set aside and the Association shall be permitted

to defend any covered claim on the merits. The

settlement, release, compromise, waiver or

judgment shall not be considered as evidence of

liability in connection with any claim brought

against the Association or any other party

pursuant to the Oklahoma Property and Casualty

Insurance Guaranty Association Act, and

(3) the Association shall have the right to assert

any statutory defenses or rights of offset

against any settlement, release, compromise or

waiver executed by an insured or the insurer, or

any judgment taken against the insured or the

insurer.

c. As to any covered claims arising from a judgment under

any decision, verdict or finding based on the default

of the insolvent insurer or its failure to defend, the

Association, either on its own behalf or on behalf of

an insured, may apply to have the judgment, order,

decision, verdict or finding set aside by the same

court or administrator that entered the judgment,

claim, decision, verdict or finding and shall be

permitted to defend on the merits;

8. Reimburse each servicing facility for obligations of the

Association paid by the facility and for reasonable expenses

incurred by the facility while handling claims on behalf of the

Association and pay the other expenses of the Association authorized

by the Oklahoma Property and Casualty Insurance Guaranty Association

Act;

9. Have standing to appear before any court of this state which

has jurisdiction over an impaired or insolvent insurer for whom the

Association is or may become obligated pursuant to the provisions of

the Oklahoma Property and Casualty Insurance Guaranty Association

Act. Standing shall extend to all matters germane to the powers and

duties of the Association including, but not limited to, proposals

for rehabilitation, acquisition, merger, reinsuring, or guaranteeing

the covered policies of the impaired or insolvent insurer, and the

determination of covered policies and contractual obligations of the

impaired or insolvent insurer; and

Oklahoma Statutes - Title 36. Insurance Page 580

10. Notwithstanding any other provision of the Oklahoma

Property and Casualty Insurance Guaranty Association Act, an

insurance policy issued by a member insurer and later allocated,

transferred, assumed by or otherwise made the sole responsibility of

another insurer pursuant to any provision of law providing for the

division of an insurance company, or the statutory assumption or

transfer of designated policies under which there is no remaining

obligation to the transferring entity, shall be considered to have

been issued by a member insurer which is an insolvent insurer for

the purposes of this act in the event that the insurer to which the
ther insurer pursuant to any provision of law providing for the

division of an insurance company, or the statutory assumption or

transfer of designated policies under which there is no remaining

obligation to the transferring entity, shall be considered to have

been issued by a member insurer which is an insolvent insurer for

the purposes of this act in the event that the insurer to which the

policy has been allocated, transferred, assumed or otherwise made

the sole responsibility of is placed in liquidation. An insurance

policy that was issued by an insurer who is not a member insurer and

subsequently allocated, transferred, assumed by or otherwise made

the sole responsibility of a member insurer under any provision of

law providing for the division of an insurance company shall not be

considered to have been issued by a member insurer pursuant to this

act.

B. The Association may:

1. Employ or retain persons as are necessary to handle claims

and perform other duties of the Association;

2. Borrow funds necessary to effect the purposes of the

Oklahoma Property and Casualty Insurance Guaranty Association Act in

accordance with the plan of operation;

3. Sue or be sued;

4. Negotiate and become a party to contracts as are necessary

to carry out the purpose of the Oklahoma Property and Casualty

Insurance Guaranty Association Act;

5. Refund to member insurers in proportion to the contribution

of each member insurer that amount by which the assets of the

Association exceed its liabilities, if at the end of any calendar

year the board of directors finds that the assets of the Association

exceed the liabilities as estimated by the board of directors for

the coming year;

6. Lend monies to an insurer declared to be impaired by the

Commissioner. The Association, with approval of the Commissioner,

shall approve the amount, length and terms of the loan. "Impaired

Insurer" for purposes of this section shall mean an insurer

potentially unable to fulfill its contractual obligations, but shall

not mean an insolvent insurer;

7. Perform other acts as are necessary or proper to effectuate

the purpose of the Oklahoma Property and Casualty Insurance Guaranty

Association Act;

8. Intervene as a party in interest in any supervision,

conservation, liquidation, rehabilitation, impairment or

receivership in which policyholders' interests and interests of the

Association may be or are affected; and

Oklahoma Statutes - Title 36. Insurance Page 581

9. Be designated or may contract as a servicing facility for

any entity which may be recommended by the board of directors of the

Association and shall be approved by the Commissioner.