40A:10-41. Approval of bylaws and plan of risk management

No joint insurance fund shall begin providing insurance coverage to its member local units until its bylaws and plan of risk management have been approved as hereinafter provided:

a. The commissioners of each joint insurance fund shall concurrently file with the Commissioner of the Department of Insurance for his approval a copy of the fund's bylaws adopted pursuant to section 4. of this act and a copy of the fund's plan of risk management prepared pursuant to section 5. of this act.

b. Upon receipt of any such bylaws and plan of risk management, the Commissioner of Insurance shall immediately notify the Commissioner of the Department of Community Affairs and shall immediately provide that commissioner with a copy of the bylaws and plan of risk management. The Commissioner of the Department of Community Affairs, or if the commissioner shall so designate, the Director of Local Government Services in the Department of Community Affairs, is empowered to approve or disapprove any such bylaws and plans on the basis of whether or not they conform with rules and regulations governing the custody, investment or expenditure of public moneys. Within 25 working days of the receipt of any such bylaws and plan of risk management, the Commissioner of the Department of Community Affairs shall notify the Commissioner of Insurance of his approval or disapproval. As a condition of approval, the Commissioner of the Department of Community Affairs may require such modification of any bylaws or plan of risk management as he may deem necessary to bring them into conformity with the rules and regulations governing the custody, investment or expenditure of public moneys. No bylaws or plan of risk management disapproved by the Commissioner of the Department of Community Affairs, or his designee, shall take effect. If the Commissioner of the Department of Community Affairs, or his designee, fails to approve or disapprove any bylaws or plan of risk management within 25 working days, the bylaws or plan of risk management shall be deemed approved.

c. Within 30 working days of receipt, the Commissioner of Insurance shall either approve or disapprove the bylaws or plan of risk management of any joint insurance fund. If the Commissioner of Insurance shall fail to either approve or disapprove the bylaws or plan of risk management within that 30 working day period, the bylaws or plan shall be deemed approved.

If any bylaws or plan shall be disapproved, the Commissioner of Insurance shall set forth in writing the reasons for disapproval. Upon the receipt of the notice of disapproval, the commissioners of the affected joint insurance fund may request a public hearing. The public hearing shall be convened by the Commissioner of Insurance in a timely manner.

L.1983, c. 372, s. 6, eff. Oct. 28, 1983.