Sec. 14.07.02.02. Preliminary Determination of Eligibility

A. Before coverage can be bound, a producer shall:

(1) Make an independent preliminary determination of the eligibility of the applicant for MAIF insurance, in accordance with these regulations.

(2) Obtain all appropriate and material information from the applicant which is necessary to provide the requested coverage. Information provided to the fund producer may not be considered knowledge on the part of MAIF unless it has been expressly provided to MAIF.

B. A fund producer determines eligibility by verifying that the applicant:

(1) Is a Maryland resident;

(2) Owns an automobile validly registered with the Motor Vehicle Administrator, as may be required by the Transportation Article, Annotated Code of Maryland, or has a valid Maryland operator's license;

(3) Has been rejected or refused a policy of automobile liability insurance by two insurers or has had the coverage canceled or nonrenewed by an insurer for a reason other than nonpayment of premium; and

(4) Does not owe any unpaid premium to MAIF.

C. If MAIF subsequently determines that an applicant has made material misrepresentations as to the applicant's eligibility before coverage was bound:

(1) There is no coverage bound;

(2) Any policy or endorsement issued in reliance on the incorrect eligibility information is void; and

(3) An administrative fee up to $350 shall be collected for each policy voided by MAIF.

D. Eligibility shall be determined and verified under §B of this regulation by the fund producer on each new policy application.