A. Except as to nonassessable policies as provided for in Section 577 [59A-34-31 N.M. Stat. Ann.] of this article, each member of a domestic mutual insurer shall have contingent liability, pro rata and not one for another, for discharge of the insurer’s obligation incurred while the member was a policyholder, which liability shall be in such maximum amount, not less than one nor more than six (6) times the premium for the member’s policy at the annual premium rate, as specified in the insurer’s articles of incorporation.

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Terms Used In New Mexico Statutes 59A-34-28

  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.

B. Every policy issued by the insurer shall contain a statement of the contingent liability.

C. Termination of the policy shall not relieve the member of contingent liability as to liabilities of the insurer incurred while the policy was in force.

D. Unrealized contingent liability of members does not constitute an asset of the insurer in any determination of financial condition.

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