§435C-3  Joint underwriting plan,establishment.  (a)  A joint underwriting plan is established, consistingof all insurers authorized to write and engaged in writing casualty insurancein this State on a direct basis.  Each insurer shall be a member of the planand shall maintain membership as a condition of its licensure to transact suchinsurance in this State.  The purpose of the plan shall be to provide medicalmalpractice insurance on a self-supporting basis.  The plan shall be theexclusive agency through which medical malpractice insurance may be written inthis State on a primary basis for physicians and hospitals.

(b)  The plan shall, pursuant to the provisionsof this chapter and the plan of operation with respect to medical malpracticeinsurance, have the power on behalf of its members:

(1)  To issue, or to cause to be issued policies ofinsurance to applicants, including incidental coverages and subject to limitsas specified in the plan of operation but not to exceed $100,000 for eachclaimant under one policy in any one year;

(2)  To appoint service companies to underwrite suchinsurance and to adjust and pay losses with respect thereto;

(3)  To assume reinsurance from its members; and

(4)  To cede reinsurance.

  (c)(1)  The commissioner shall, after consultation withthe joint underwriting plan, representatives of the public, the Hawaii MedicalAssociation and other affected individuals and organizations, promulgate a planof operation consistent with the provisions of this chapter within sixty daysafter the creation of the plan.  The plan of operation shall become effectiveand operational upon order of the insurance commissioner.

(2)  The plan of operation shall provide for economic,fair and nondiscriminatory administration and for the prompt and efficientprovision of medical malpractice insurance, and shall contain other provisionsincluding, but not limited to, preliminary assessment of all members forinitial expenses necessary to commence operation, establishment of necessaryfacilities, management of the plan, assessment of members to defray losses andexpenses, commission arrangements, reasonable and objective underwritingstandards, acceptance and cession of reinsurance, appointment of servicingcarriers and standards, and procedures for determining amounts of insurance tobe provided by the plan.

(3)  The plan of operation shall provide that anyprofit achieved by the plan be added to the reserves of the plan or returned tothe policyholders as a dividend.

(4)  Amendments to the plan of operation may be madeby the directors of the plan, subject to the approval of the insurancecommissioner, or shall be made at the direction of the insurance commissioner.[L 1975, c 161, pt of §1; am L 1976, c 219, §5; am L 1984, c 232, §2]