Oklahoma Property and Casualty Insurance Guaranty Association

The Oklahoma Property and Casualty Insurance Guaranty Association is a nonprofit organization established to provide financial protection to policyholders in the event of an insurance company's insolvency. It operates under the provisions of the Oklahoma Property and Casualty Insurance Guaranty Association Act.

Purpose

The primary purpose of the Association is to ensure that policyholders receive payment for covered claims when an insurer becomes insolvent, avoiding excessive delays and financial losses. This is achieved by assessing costs among member insurers to cover the obligations of insolvent insurers.

Coverage and Limits

• Types of Insurance Covered: The Association covers various types of property and casualty insurance, including automobile, homeowners, professional liability, medical malpractice, and workers' compensation.
• Coverage Limits: The Association pays up to $150,000 per claimant for most covered claims, except for workers' compensation claims which are paid in full. For unearned premium refunds, the limit is $10,000 per policy.

Operations

• Management: The Association is managed by a board of twelve directors, comprising insurers operating in Oklahoma.
• Member Insurers: All insurers transacting business in Oklahoma are required to be members of the Association.
• Claim Processing: After an insurer is declared insolvent and ordered into liquidation, the Association processes claims based on data transferred by the court-appointed receiver or liquidator.

Legal Framework

The Association's activities are governed by Oklahoma state law, specifically Title 36 of the Oklahoma Statutes, which defines its powers, duties, and the process for handling claims from insolvent insurers. It can borrow funds and engage in contracts necessary to fulfill its purposes.

Role in Insolvency

When an insurer is declared insolvent, the Association steps in to handle claims, ensuring that policyholders continue to receive some level of coverage. Policies remain in effect until canceled by the policyholder or automatically at a date specified in the court's liquidation order.