Request By:
Mr. Harold B. McGuffey
Commissioner
Department of Insurance
Capital Plaza Tower
Frankfort, Kentucky
Opinion
Opinion By: Robert F. Stephens, Attorney General; By: Victor Fox, Assistant Attorney General
You have requested from this office a determination of the following question:
"Is the Kentucky Assigned Claims Bureau either a reinsurer, insurer, insurance pool, or underwriting association, within the usage of those words in KRS 304.36-050(3) so as to be precluded from enforcing its subrogation rights, attained under KRS 304.39-060(2), against the Guaranty Association?"
The Kentucky Insurance Guaranty Association (hereinafter referred to as Association) exists by virtue of KRS 304 Subtitle 36. In KRS 304.36-050(3) and (4) the terms "covered claim" and "insolvent insurer" are defined. Subsection (3) also specifically excludes from the term "covered claim" the amount due any reinsurer, insurer, insurance pool or underwriting association.
The Kentucky Assigned Claims Bureau (hereinafter referred to as Bureau) exists by virtue of KRS 304.39-170. In subsection (2) of the statute, an assignee of the Bureau has the same rights and obligations as if he, the assignee, had issued a policy of basic reparation insurance in the first instance. In other words the assignee becomes an insurer.
It is the opinion of this office in reliance on the above statutes that the Bureau is precluded from enforcing against the Association any subrogation right it may acquire because it is an insurer.