§ 59A-42-9. Plan of operation

A. The association shall submit to the superintendent a plan of operation or amendments to the plan necessary or suitable to assure the fair, reasonable and equitable administration of the association. The plan of operation or amendments to the plan shall become effective upon approval in writing by the superintendent or on the thirty-first day after submission to the superintendent if it has not been disapproved within that time.

B. If the association fails to submit suitable amendments to the plan, the superintendent shall, after notice and hearing, promulgate reasonable rules necessary or advisable to effectuate the provisions of the Life and Health Insurance Guaranty Association Act. The rules shall continue in force until modified by the superintendent or superseded by amendments submitted by the association and approved by the superintendent.

C. All member insurers shall comply with the plan of operation.

D. The plan of operation shall include:

(1) procedures for handling the assets of the association;

(2) the amount and method of reimbursement for members of the board;

(3) the regular places and times for meetings, including telephone conference calls of the board;

(4) procedures for records to be kept of all financial transactions of the association, its agents and the board;

(5) procedures for selecting members of the board and submitting those selections for approval to the superintendent;

(6) additional procedures for assessments;

(7) additional provisions necessary or proper for the execution of the powers and duties of the association;

(8) procedures to remove a director for cause, including the case where a member insurer director becomes an impaired or insolvent insurer; and

(9) policies and procedures for addressing conflicts of interest.

E. The plan of operation may provide that the powers and duties of the association, except those provided in Paragraph (3) of Subsection L of Section 59A-42-7 NMSA 1978 and in Section 59A-42-8 NMSA 1978 , may be delegated to a corporation, association or other organization that performs or will perform functions similar to those of the association, or its equivalent, in two or more states. That corporation, association or organization shall be reimbursed as a servicing facility would be reimbursed and shall be paid for its performance of other functions of the association. A delegation pursuant to this subsection shall take effect only with the approval of both the board and the superintendent, and may be made only to a corporation, association or organization that extends protection not substantially less favorable and effective than that provided by the Life and Health Insurance Guaranty Association Act.