Title 38a — Title 38a: Insurance

Sec. 38a-903. (Formerly Sec. 38-421). Short title: Insurers Rehabilitation and Liquidation Act. Interpretation. Applicability. Sections 38a-903 to 38a-961, inclusive, may be cited as the “Insurers Rehabilitation and Liquidation Act”. Said sections shall not be interpreted to limi…

Sec. 38a-904. (Formerly Sec. 38-422). Application of provisions. Sections 38a-903 to 38a-961, inclusive, shall apply to: (1) All insurers who are doing, or have done, an insurance business in this state and against whom claims arising from that business may exist now or in the fu…

Sec. 38a-905. (Formerly Sec. 38-423). Definitions. For the purposes of sections 38a-903 to 38a-961, inclusive: (1) “Alien insurer domiciled in this state” means a United States branch. (2) “Ancillary state” means any state other than a domiciliary state. (3) “Commissioner” means …

Sec. 38a-906. (Formerly Sec. 38-424). Jurisdiction and venue. (a) No delinquency proceeding shall be commenced under sections 38a-903 to 38a-961, inclusive, by anyone other than the commissioner and no court shall have jurisdiction to entertain, hear or determine any proceeding c…

Sec. 38a-907. (Formerly Sec. 38-425). Injunctions, orders and stays. (a) The conservation, rehabilitation and liquidation of insurance companies and other persons subject to the provisions of sections 38a-903 to 38a-961, inclusive, are a matter of vital public interest and affect…

Sec. 38a-908. (Formerly Sec. 38-426). Cooperation of officers, owners and employees. Penalties. (a) Any present or former officer, manager, director, trustee, owner, employee or agent of any insurer, or any other persons with authority over or in charge of any segment of the insu…

Sec. 38a-909. (Formerly Sec. 38-427). Persons afforded protection. Official immunity. Segregation of funds. Bonds. (a) For the purposes of this section the persons entitled to protection under this section shall be: (1) All receivers responsible for the conduct of a delinquency p…

Sec. 38a-910. (Formerly Sec. 38-428). Continuation of delinquency proceedings. Section 38a-910 is repealed, effective October 1, 2018. (P.A. 79-382, S. 8; P.A. 18-158, S. 19.)

Sec. 38a-911. (Formerly Sec. 38-429). Delinquency proceeding: Limitations and conditions. No insurer that is subject to any delinquency proceedings, whether formal, informal, administrative or judicial, shall: (1) Be permitted to solicit or accept new business or request or accep…

Sec. 38a-912. (Formerly Sec. 38-430). Seizure order by court. (a) The commissioner may file in the Superior Court of this state a petition alleging, with respect to a domestic insurer: (1) That there exist any grounds that would justify a court order for a formal delinquency proc…

Sec. 38a-913. (Formerly Sec. 38-431). Confidentiality of proceedings. In all proceedings and judicial reviews thereof pursuant to section 38a-912, all records of the insurer, other documents and all Insurance Department files and court records and papers, so far as they pertain t…

Sec. 38a-913a. Records of delinquent insurer. Use as evidence. Applicability of Freedom of Information Act. Costs of producing records. (a) All records or certified copies thereof of any delinquent insurer which come into the possession of the receiver and are held by the receive…

Sec. 38a-914. (Formerly Sec. 38-432). Grounds for rehabilitation. The commissioner may apply by petition to the Superior Court for an order authorizing the commissioner to rehabilitate a domestic insurer or an alien insurer domiciled in this state on any one or more of the follow…

Sec. 38a-915. (Formerly Sec. 38-433). Rehabilitation orders. Appointment of judge to supervise rehabilitation. Accounting. Appeals. (a) An order to rehabilitate the business of a domestic insurer, or an alien insurer domiciled in this state, shall appoint the commissioner and his…

Sec. 38a-916. (Formerly Sec. 38-434). Powers and duties of the rehabilitator. Advisory committees. (a) The commissioner as rehabilitator may appoint one or more special deputies, who shall have all the powers and responsibilities of the rehabilitator granted under this section, a…

Sec. 38a-917. (Formerly Sec. 38-435). Actions by and against rehabilitator. (a) Any court in this state before which any action or proceeding in which the insurer is a party or is obligated to defend a party is pending when a rehabilitation order against the insurer is entered sh…

Sec. 38a-918. (Formerly Sec. 38-436). Order of liquidation. Termination of rehabilitation. (a) Whenever the commissioner believes further attempts to rehabilitate an insurer would substantially increase the risk of loss to creditors, policyholders or the public, or would be futil…

Sec. 38a-919. (Formerly Sec. 38-437). Grounds for liquidation. The commissioner may petition the Superior Court for an order directing him to liquidate a domestic insurer or an alien insurer domiciled in this state on the basis: (a) Of any ground for an order of rehabilitation as…

Sec. 38a-920. (Formerly Sec. 38-438). Liquidation orders. Financial reports: Contents and filings. Handling of claim obligations. Appointment of judge to supervise liquidation. Preference of claims. Appeals. (a) An order to liquidate the business of a domestic insurer shall appoi…

Sec. 38a-921. (Formerly Sec. 38-439). Continuance of coverage. Cancellation of bond or surety undertaking. (a) Notwithstanding any policy or contract language or any other provision of law, all policies, insurance contracts, other than reinsurance, surety bonds or surety undertak…

Sec. 38a-922. (Formerly Sec. 38-440). Dissolution of insurer. The commissioner may petition for an order dissolving the corporate existence of a domestic insurer or the United States branch of an alien insurer domiciled in this state at the time he applies for a liquidation order…

Sec. 38a-923. (Formerly Sec. 38-441). Powers of liquidator. (a) The liquidator shall have the power: (1) To appoint a special deputy to act for such liquidator under sections 38a-903 to 38a-961, inclusive, and to determine such special deputy's reasonable compensation. The specia…

Sec. 38a-924. (Formerly Sec. 38-442). Notice to creditors and others. Requirements. Exceptions. (a) Unless the court otherwise directs, the liquidator shall give or cause to be given notice of the liquidation order as soon as possible: (1) By first class mail and electronic commu…

Sec. 38a-925. (Formerly Sec. 38-443). Duties of agents. Penalty. (a) Each person who receives notice in the form prescribed in section 38a-924 that an insurer such person represents as an agent is the subject of a liquidation order shall, within thirty days of such notice, provid…

Sec. 38a-926. (Formerly Sec. 38-444). Actions by and against liquidator. (a) Upon issuance of an order appointing a liquidator of a domestic insurer or of an alien insurer domiciled in this state, no action at law or equity shall be brought against the insurer or liquidator, whet…

Sec. 38a-927. (Formerly Sec. 38-445). List of assets. (a) As soon as practicable after the liquidation order but not later than one hundred twenty days thereafter, the liquidator shall prepare in duplicate a list of the insurer's assets. The list shall be amended or supplemented …

Sec. 38a-928. (Formerly Sec. 38-446). Fraudulent transfers prior to petition. (a) Every transfer made or suffered and every obligation incurred by an insurer within one year prior to the filing of a successful petition for rehabilitation or liquidation under sections 38a-903 to 3…

Sec. 38a-929. (Formerly Sec. 38-447). Fraudulent transfer after petition. (a) After a petition for rehabilitation or liquidation has been filed a transfer of any of the real property of the insurer made to a person acting in good faith shall be valid against the receiver if made …

Sec. 38a-930. (Formerly Sec. 38-448). Voidable preferences and liens. Exceptions. (a)(1) A preference is a transfer of any of the property of an insurer to or for the benefit of a creditor, for or on account of an antecedent debt, made or suffered by the insurer within one year b…

Sec. 38a-931. (Formerly Sec. 38-449). Claims of holders of void or voidable rights. (a) No claims of a creditor who has received or acquired a preference, lien, conveyance, transfer, assignment, or encumbrance, voidable under sections 38a-903 to 38a-961, inclusive, shall be allow…

Sec. 38a-932. (Formerly Sec. 38-450). Set-offs and counterclaims. Accounting statements. (a) Mutual debts or mutual credits, whether arising out of one or more contracts between the insurer and another person in connection with any action or proceeding under sections 38a-903 to 3…

Sec. 38a-933. (Formerly Sec. 38-451). Assessments. (a) As soon as practicable but not more than two years from the date of an order of liquidation pursuant to section 38a-920 of an insurer issuing assessable policies, the liquidator shall make a report to the court setting forth:…

Sec. 38a-933a. Amounts recoverable. Affiliate liability. Timing of proceedings. (a) If an order instituting a delinquency proceeding against an insurer authorized to do business in this state is entered under this chapter, the receiver appointed under the order has a right to rec…

Sec. 38a-934. (Formerly Sec. 38-452.) Reinsurer's liability. The amount recoverable by the liquidator from reinsurers shall not be reduced as a result of the delinquency proceedings, regardless of any provision in the reinsurance contract or other agreement. Payment made directly…

Sec. 38a-935. (Formerly Sec. 38-453). Recovery of premiums owed. Penalty. Appeals. (a)(1) A producer, premium finance company or any other person, other than the insured, responsible for the payment of a premium shall pay any unpaid collected premium including any amount represen…

Sec. 38a-936. (Formerly Sec. 38-454). Liquidator's proposal to distribute assets. (a) Within one hundred twenty days of a final determination of insolvency of an insurer by a court of competent jurisdiction of this state, the liquidator shall make application to the court for app…

Sec. 38a-937. (Formerly Sec. 38-455). Filing of claims. (a) Proof of all claims shall be filed with the liquidator in the form required by section 38a-938 on or before the last day for filing specified in the notice required pursuant to section 38a-924, except that proof of claim…

Sec. 38a-938. (Formerly Sec. 38-456). Proof of claim. (a) Proof of claim shall consist of a statement signed by the claimant that includes all of the following that are applicable: (1) The particulars of the claim including the consideration given for it; (2) the identity and amo…

Sec. 38a-939. (Formerly Sec. 38-457). Special claims. (a) Claims made under employment contracts by directors, principal officers, or persons in fact performing similar functions or having similar powers are limited to payment for services rendered prior to the issuance of any or…

Sec. 38a-940. (Formerly Sec. 38-458). Special provisions for third party claims. Liquidator recommendations. Provisions not applicable to claims covered by guaranty association. (a) Whenever any third party asserts a cause of action against an insured of an insurer in liquidation…

Sec. 38a-941. (Formerly Sec. 38-459). Disputed claims. Hearings. Procedure. (a) When a claim is denied in whole or in part by the liquidator, written notice of the determination shall be given to the claimant or the claimant's attorney by first class mail at the address shown in …

Sec. 38a-942. (Formerly Sec. 38-460). Claims of surety. Whenever an obligee whose claim against an insurer is secured, in whole or in part, by the undertaking of another person, fails to prove and file that claim, the other person may do so in the obligee's name, and shall be sub…

Sec. 38a-943. (Formerly Sec. 38-461). Secured creditor's claims. (a) The value of any security held by a secured creditor shall be determined in one of the following ways, as the court may direct: (1) By converting the same into money according to the terms of the agreement pursu…

Sec. 38a-944. (Formerly Sec. 38-462). Priority of distribution of claims. (a) The priority of distribution of claims from the insurer's estate shall be in accordance with the order in which each class of claims is set forth in this section. Every claim in each class shall be paid…

Sec. 38a-944a. Additional rights. Netting agreements. Qualified financial contracts. Security arrangements. (a) Notwithstanding any provision of sections 38a-903 to 38a-961, inclusive, including any provision permitting the modification of contracts, or other law of a state, no p…

Sec. 38a-945. (Formerly Sec. 38-463). Liquidator's recommendations to the court. (a) The liquidator shall review all claims duly filed in the liquidation and shall make such further investigation as deemed necessary. The liquidator may compound, compromise or in any other manner …

Sec. 38a-946. (Formerly Sec. 38-464). Distribution of assets. Under the direction of the court, the liquidator shall pay distributions in a manner that will assure the proper recognition of priorities and a reasonable balance between the expeditious completion of the liquidation …

Sec. 38a-947. (Formerly Sec. 38-465). Unclaimed and withheld funds. (a) All unclaimed funds subject to distribution remaining in the liquidator's hands when the liquidator is ready to apply to the court for discharge, including the amount distributable to any creditor, shareholde…

Sec. 38a-948. (Formerly Sec. 38-466). Termination of proceedings. (a) When all assets justifying the expense of collection and distribution have been collected and distributed under sections 38a-903 to 38a-961, inclusive, the liquidator shall apply to the court for discharge. The…

Sec. 38a-949. (Formerly Sec. 38-467). Reopening liquidation. After the liquidation proceeding has been terminated and the liquidator discharged, the commissioner or other interested party may at any time petition the Superior Court to reopen the proceedings for good cause, includ…