(a) Is obligated to the extent of the covered claims existing prior to the determination of insolvency, and for those claims arising within thirty days after the determination of insolvency, but the obligation only includes that amount of each covered claim which is in excess of one hundred dollars and is less than three hundred thousand dollars: Provided, That neither of these monetary limits applies to obligations arising out of covered workers' compensation claims. In no event is the association obligated to a policyholder or claimant in an amount in excess of the obligations of the insolvent insurer under the policy from which the claim arises. Notwithstanding any other provision of this article, a covered claim does not include any claim filed with the guaranty fund after the final date set by the court for the filing of claims against the liquidator or receiver of an insolvent insurer. A default judgment or stipulated judgment against the insolvent insurer, or against the insured of an insolvent insurer, is not binding against the association.
(b) Is the insurer to the extent of its obligation on the covered claims and to such extent has all rights, duties, defenses and obligations of the insolvent insurer as if the insurer had not become insolvent.
(c) Shall allocate claims paid and expenses incurred among the three accounts separately, and assess member insurers separately for each account amounts necessary to pay the obligations of the association under subdivision (a) of this subsection subsequent to an insolvency, the expenses of handling covered claims subsequent to an insolvency, the cost of examinations under section thirteen of this article and other expenses authorized by this article. The assessments of each member insurer shall be in the proportion that the net direct written premiums of the member insurer for the preceding calendar year on the kinds of insurance in the account bears to the net direct written premiums of all member insurers for the preceding calendar year on the kinds of insurance in the account: Provided, That farmers mutual insurance companies that do not issue workers' compensation insurance policies may not be assessed to pay for the obligations of the association payable from the workers' compensation insurance account. Each member insurer shall be notified of the assessment not later than thirty days before it is due. No member insurer may be assessed in any one year on any account an amount greater than two percent of that member insurer's net direct written premiums for the preceding calendar year on the kinds of insurance in the account. If the maximum assessment, together with the other assets of the association in any account, does not provide in any one year in any account an amount sufficient to make all necessary payments from that account, the funds available shall be prorated and the unpaid portion shall be paid as soon after that as funds become available. The association may exempt or 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 the 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. Each member insurer may set off against any assessment, authorized payments made on covered claims and expenses incurred in the payment of such claims by the member insurer if they are chargeable to the account for which the assessment is made.
(d) Shall investigate claims brought against the association and adjust, compromise, settle, and pay covered claims to the extent of the association's obligation and deny all other claims and may review settlements, releases and judgments to which the insolvent insurer or its insureds were parties to determine the extent to which the settlements, releases and judgments may be properly contested.
(e) Shall notify persons as the commissioner directs under subsection (2), section ten of this article.
(f) Shall handle claims through its employees or through one or more insurers or other persons designated as servicing facilities. Designation of a servicing facility is subject to the approval of the commissioner, but the designation may be declined by a member insurer.
(g) Shall 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 shall pay the other expenses of the association authorized by this article.
(2) The association may:
(a) Employ or retain persons that are necessary to handle claims and perform other duties of the association.
(b) Borrow funds necessary to effect the purposes of this article in accord with the plan of operation.
(c) Sue or be sued.
(d) Negotiate and become a party to contracts that are necessary to carry out the purpose of this article.
(e) Perform other acts that are necessary or proper to effectuate the purpose of this article.
(f) Refund to the member insurers in proportion to the contribution of each member insurer to an account that amount by which the assets of the account exceed the liabilities, if, at the end of any calendar year, the board of directors finds that the assets of the association in any account exceed the liabilities of that account as estimated by the board of directors for the coming year.