Okla. Stat. tit. 36, § 36-2025

Act - Coverage - Liability.

A. For the policies and contracts specified in subsection B of

this section, the Oklahoma Life and Health Insurance Guaranty

Association Act shall provide coverage:

1. a. To persons, who regardless of where they reside,

except for nonresident certificate holders under group

policies or contracts, are the beneficiaries,

assignees or payees, including health care providers

rendering services covered under health insurance

policies or certificates, of the persons covered under

subparagraph b of this paragraph,

b. To persons who are owners of or certificate holders or

enrollees under the policies or contracts, other than

structured settlement annuities, and in each case who:

(1) are residents, or

(2) are not residents, but only under all of the

following conditions:

(a) the member insurer that issued the policies

or contracts are domiciled in this state,

(b) the states in which the persons reside have

associations similar to the Oklahoma Life

and Health Insurance Guaranty Association

created by this act, and the persons are not

eligible for coverage by an association in

any other state due to the fact that the

insurer or health maintenance organization

was not licensed in the state at the time

specified in the guaranty association law of

the state;

Oklahoma Statutes - Title 36. Insurance Page 595

2. Subparagraphs a and b of paragraph 1 of this subsection

shall not apply to structured settlement annuities specified in

subsection B of this section and in the Oklahoma Life and Health

Insurance Guaranty Association Act shall, except as provided in

paragraphs 3 and 4 of this subsection, provide coverage to a person

who is a payee under a structured settlement annuity or a

beneficiary of a payee if the payee is deceased, if the payee:

a. is a resident, regardless of where the contract owner

resides, or

b. is not a resident, but only under both of the

following conditions:

(1) (a) the contract owner of the structured

settlement annuity is a resident, or

(b) the contract owner of the structured

settlement annuity is not a resident but:

i. the insurer that issued the structured

settlement annuity is domiciled in this

state, and

ii. the state in which the contract owner

resides has an association similar to

the association created by the Oklahoma

Life and Health Insurance Guaranty

Association Act, and

(2) neither the payee nor beneficiary nor the

contract owner is eligible for coverage by the

association of the state in which the payee or

contract owner resides;

3. The Oklahoma Life and Health Insurance Guaranty Association

Act shall not provide coverage to a person who is a payee or

beneficiary of a contract owner resident of this state, if the payee

or beneficiary is afforded coverage by the association of another

state; and

4. The Oklahoma Life and Health Insurance Guaranty Association

Act is intended to provide coverage to a person who is a resident of

this state and in special circumstances, to a nonresident. In order

to avoid duplicate coverage, if a person who would otherwise receive

coverage under the Oklahoma Life and Health Insurance Guaranty

Association Act is provided coverage under the laws of any other

state, the person shall not be provided coverage under the Oklahoma

Life and Health Insurance Guaranty Association Act. In determining

the application of the provisions of this paragraph to situations

where a person could be covered by the association of more than one

state, whether as an owner, payee, enrollee, beneficiary or

assignee, the Oklahoma Life and Health Insurance Association Act

shall be construed in conjunction with the laws of other states to

result in coverage by only one association.

Oklahoma Statutes - Title 36. Insurance Page 596

B. 1. The Oklahoma Life and Health Insurance Guaranty

Association Act shall provide coverage to the persons specified in
her as an owner, payee, enrollee, beneficiary or

assignee, the Oklahoma Life and Health Insurance Association Act

shall be construed in conjunction with the laws of other states to

result in coverage by only one association.

Oklahoma Statutes - Title 36. Insurance Page 596

B. 1. The Oklahoma Life and Health Insurance Guaranty

Association Act shall provide coverage to the persons specified in

subsection A of this section for policies or contracts of direct,

non-group life insurance, health insurance, which for the purposes

of this act includes health maintenance organization subscriber

contracts and certificates, or annuities and supplemental policies

or contracts to any of these, and for certificates under direct

group policies and contracts, except as limited by the Oklahoma Life

and Health Insurance Guaranty Association Act. Annuity contracts

and certificates under group annuity contracts include allocated

funding agreements, structured settlement annuities and any

immediate or deferred annuity contracts.

2. Except as provided in paragraph 3 of this subsection, the

Oklahoma Life and Health Insurance Guaranty Association Act shall

not provide coverage for:

a. a portion of a policy or contract not guaranteed by

the insurer, or under which the risk is borne by the

policy or contract owner,

b. a policy or contract of reinsurance, unless assumption

certificates have been issued pursuant to the

reinsurance policy or contract,

c. a portion of a policy or contract to the extent that

the rate of interest on which it is based, or the

interest rate, crediting rate or similar factor

determined by use of an index or other external

reference stated in the policy or contract employed in

calculating returns or changes in value:

(1) averaged over the period of four (4) years prior

to the date on which the Association becomes

obligated with respect to the policy or contract,

exceeds a rate of interest determined by

subtracting two (2) percentage points from

Moody's Corporate Bond Yield Average averaged for

that same four-year period or for such lesser

period if the policy or contract was issued less

than four (4) years before the Association became

obligated, and

(2) on and after the date on which the Association

becomes obligated with respect to the policy or

contract, exceeds the rate of interest determined

by subtracting three (3) percentage points from

Moody's Corporate Bond Yield Average as most

recently available,

d. a portion of a policy or contract issued to a plan or

program of an employer, association or other person to

provide life, health or annuity benefits to its

employees, members or others, to the extent that the

Oklahoma Statutes - Title 36. Insurance Page 597

plan or program is self-funded or uninsured, including

but not limited to benefits payable by an employer,

association or other person under:

(1) a Multiple Employer Welfare Arrangement as

defined in 29 U.S.C. Section 1144,

(2) a minimum premium group insurance plan,

(3) a stop-loss group insurance plan, or

(4) an administrative services only contract,

e. a portion of a policy or contract to the extent that

it provides for:

(1) dividends or experience rating credits,

(2) voting rights, or
er,

association or other person under:

(1) a Multiple Employer Welfare Arrangement as

defined in 29 U.S.C. Section 1144,

(2) a minimum premium group insurance plan,

(3) a stop-loss group insurance plan, or

(4) an administrative services only contract,

e. a portion of a policy or contract to the extent that

it provides for:

(1) dividends or experience rating credits,

(2) voting rights, or

(3) payment of any fees or allowances to any person,

including the policy or contract owner, in

connection with the service to or administration

of the policy or contract,

f. a policy or contract issued in this state by a member

insurer at a time when it was not licensed or did not

have a certificate of authority to issue the policy or

contract in this state,

g. a portion of a policy or contract to the extent that

the assessments required by Section 2030 of this title

with respect to the policy or contract are preempted

by federal or state law,

h. an obligation that does not arise under the express

written terms of the policy or contract issued by the

member insurer to the enrollee, certificate holder or

contract or policy owner, including without

limitation:

(1) claims based on marketing materials,

(2) claims based on side letters, riders or other

documents that were issued by the member insurer

without meeting applicable policy or contract

form filing or approval requirements,

(3) misrepresentations of or regarding policy or

contract benefits,

(4) extra-contractual claims, or

(5) a claim for penalties or consequential or

incidental damages,

i. a contractual agreement that establishes the

obligations of the member insurer to provide a book

value accounting guaranty for defined contribution

benefit plan participants by reference to a portfolio

of assets that is owned by the benefit plan or its

trustee, which in each case is not an affiliate of the

member insurer,

j. an unallocated annuity contract,

Oklahoma Statutes - Title 36. Insurance Page 598

k. a portion of a policy or contract to the extent it

provides for interest or other changes in value to be

determined by the use of an index or other external

reference stated in the policy or contract, but which

have not been credited to the policy or contract, or

as to which the policy or contract owner's rights are

subject to forfeiture, as of the date the member

insurer becomes an impaired or insolvent insurer under

the Oklahoma Life and Health Insurance Guaranty

Association Act, whichever is earlier. If a policy's

or contract's interest or changes in value are

credited less frequently than annually, then for

purposes of determining the values that have been

credited and are not subject to forfeiture under this

subparagraph, the interest or change in value

determined by using the procedures defined in the

policy or contract will be credited as if the

contractual date of crediting interest or changing

values was the date of impairment or insolvency,

whichever is earlier, and will not be subject to

forfeiture, or

l. a policy or contract providing any hospital, medical,

prescription drug or other health care benefits

pursuant to Part C or Part D of Subchapter XVIII,

Chapter 7 of Title 42 of the United States Code,

commonly known as Medicare Part C or Part D, or

Subchapter XIX, Chapter 7 of Title 42 of the United

States Code or any regulations issued pursuant

thereto.

3. The exclusion from coverage in this section shall not apply

to any portion of a policy or contract, including a rider that

provides long-term care or any other health insurance benefits.

C. The benefits that the Association may become obligated to

cover shall in no event exceed the lesser of:

1. The contractual obligations for which the member insurer is

liable or would have been liable if it were not an impaired or

insolvent insurer; or

2. a. with respect to any one life, regardless of the number

of policies or contracts:
g-term care or any other health insurance benefits.

C. The benefits that the Association may become obligated to

cover shall in no event exceed the lesser of:

1. The contractual obligations for which the member insurer is

liable or would have been liable if it were not an impaired or

insolvent insurer; or

2. a. with respect to any one life, regardless of the number

of policies or contracts:

(1) Three Hundred Thousand Dollars ($300,000.00) in

life insurance death benefits, but not more than

One Hundred Thousand Dollars ($100,000.00) in net

cash surrender and net cash withdrawal values for

life insurance,

(2) for health insurance benefits:

(a) One Hundred Thousand Dollars ($100,000.00)

for coverages not defined as disability

Oklahoma Statutes - Title 36. Insurance Page 599

income insurance or health benefit plans or

long-term care insurance as defined in

Section 4424 of this title, including any

net cash surrender and net cash withdrawal

values,

(b) Three Hundred Thousand Dollars ($300,000.00)

for insurance providing income payments to

an insured wage earner when income is

interrupted or terminated because of

illness, sickness or accident, commonly

known as disability income insurance and

Three Hundred Thousand Dollars ($300,000.00)

for long-term care insurance as defined in

Section 4424 of this title, and

(c) Five Hundred Thousand Dollars ($500,000.00)

for health benefit plans, or

(3) Three Hundred Thousand Dollars ($300,000.00) in

the present value of annuity benefits, including

net cash surrender and net cash withdrawal

values, or

b. with respect to each payee of a structured settlement

annuity or beneficiary or beneficiaries of the payee

if the payee is deceased, Three Hundred Thousand

Dollars ($300,000.00) in present value annuity

benefits, in the aggregate, including net cash

surrender and net cash withdrawal values,

c. however, in no event shall the Association be

obligated to cover more than:

(1) an aggregate of Three Hundred Thousand Dollars

($300,000.00) in benefits with respect to any one

life under this subparagraph and subparagraphs a

and b of this paragraph except with respect to

health benefit plans under division (2) of

subparagraph a of this paragraph, in which case

the aggregate liability of the Association shall

not exceed Five Hundred Thousand Dollars

($500,000.00) with respect to any one individual,

or

(2) with respect to one owner of multiple non-group

policies of life insurance, whether the policy or

contract owner is an individual, firm,

corporation or other person, and whether the

persons insured are officers, managers, employees

or other persons, more than Five Million Dollars

($5,000,000.00) in benefits, regardless of the

number of policies and contracts held by the

owner,

Oklahoma Statutes - Title 36. Insurance Page 600

d. the limitations set forth in this subsection are

limitations on benefits for which the Association is

obligated before taking into account either its

subrogation and assignment rights or the extent to

which those benefits could be provided out of the

assets of the impaired or insolvent insurer

attributable to covered policies. The costs of the

obligations of the Association under the Oklahoma Life

and Health Insurance Guaranty Association Act may be

met by the use of assets attributable to covered

policies or reimbursed to the Association pursuant to

its subrogation and assignment rights,

e. for purposes of the Oklahoma Life and Health Insurance

Guaranty Association Act, benefits provided by a long-

term care rider to a life insurance policy or annuity

contract shall be considered the same type of benefits

as the base life insurance policy or annuity contract

to which it relates.

D. In performing its obligations to provide coverage under

Section 2028 of this title, the Association shall not be required to

guarantee, assume, reinsure, reissue or perform, or cause to be
ovided by a long-

term care rider to a life insurance policy or annuity

contract shall be considered the same type of benefits

as the base life insurance policy or annuity contract

to which it relates.

D. In performing its obligations to provide coverage under

Section 2028 of this title, the Association shall not be required to

guarantee, assume, reinsure, reissue or perform, or cause to be

guaranteed, assumed, reinsured, reissued or performed, the

contractual obligations of the insolvent or impaired insurer under a

covered policy or contract that do not materially affect the

economic values or economic benefits of the covered policy or

contract.