Title XIII, COMMERCE (Ch. 505 - 554I)

1. Whenever the commissioner determines that further attempts to rehabilitate an insurer would substantially increase the risk of loss to creditors, policyholders, or the public, or would be futile, the commissioner may petition the district court for an order of liquidation. A p…

The commissioner may petition the district court for an order directing the commissioner to liquidate a domestic insurer or an alien insurer domiciled in this state on any of the following grounds: 1. Any ground for an order of rehabilitation specified in section 507C.12 whether …

1. The provisions of this section apply in accordance with Tit. II of the federal Dodd-Frank Wall Street Reform and Consumer Protection Act , Pub. L. No. 111-203 , 12 U.S.C. §5301 et seq. , with respect to a domestic insurer that is a covered financial company, as that term is de…

1. An order to liquidate the business of a domestic insurer shall appoint the commissioner as liquidator and shall direct the liquidator to immediately take possession of the assets of the insurer and to administer them under the general supervision of the court. The liquidator i…

1. Except for life or health insurance or annuities, policies in effect at the time of issuance of an order of liquidation shall continue in force only for the lesser of: a. A period of thirty days from the date of entry of the liquidation orders. b. The expiration of the policy …

As used in this chapter , unless the context otherwise requires: 1. “Affiliate” of or “affiliated” with a specific person, means a person that directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under common control with, the person spe…

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 the commissioner applies for a liquidation order. The court shall order dissolution of the corpo…

The commissioner may petition the court for an ancillary receivership or for an order redomesticating a foreign insurer which is the subject of a liquidation or other delinquency order in a reciprocal state. Only the corporate charter and rights to the licenses under such charter…

1. The liquidator may: a. Appoint a special deputy to act for the liquidator under this chapter , and determine the special deputy’s reasonable compensation. The special deputy shall have all powers of the liquidator granted by this section . The special deputy shall serve at the…

1. Unless the court otherwise directs, the liquidator shall give notice of the liquidation order as soon as possible by doing all of the following: a. By first class mail and either by telegram or telephone to the insurance commissioner of each jurisdiction in which the insurer i…

1. A person, who receives notice in the form prescribed in section 507C.22 that an insurer which the person represents as an agent is the subject of a liquidation order, shall within fifteen days of the notice give notice to each policyholder or other person named in a policy iss…

1. After the issuance of an order appointing a liquidator of a domestic insurer or of an alien insurer domiciled in this state, action at law or equity shall not be brought against the insurer or liquidator in this state or elsewhere, nor shall existing actions be maintained or f…

1. 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 as the liquidator may determine. One copy shall be file…

1. A transfer made and an obligation incurred by an insurer within one year prior to the filing of a successful petition for rehabilitation or liquidation under this chapter is fraudulent as to then existing and future creditors if made or incurred without fair consideration, or …

1. After a petition for rehabilitation or liquidation has been filed a transfer of real property of the insurer made to a person acting in good faith is valid against the receiver if made for a present fair equivalent value. If the transfer was not made for a present fair equival…

1. a. A preference is a transfer of the property of an insurer to or for the benefit of a creditor for an antecedent debt made or suffered by the insurer within one year before the filing of a successful petition for liquidation under this chapter , the effect of which transfer m…

1. Notwithstanding any other provision of this chapter to the contrary, including any other provision of this chapter permitting the modification of contracts, or other law of a state, a person shall not be stayed or prohibited from exercising any of the following: a. A contractu…

1. A claim of a creditor who has received or acquired a preference, lien, conveyance, transfer, assignment, or encumbrance, voidable under this chapter shall not be allowed unless the creditor surrenders the preference, lien, conveyance, transfer, assignment, or encumbrance. If t…

This chapter may be applied to any of the following: 1. Insurers who are doing or have done insurance business in this state, and against whom claims arising from that business may exist now or in the future. 2. Insurers who purport to do insurance business in this state. 3. Insu…

1. Except as provided in subsection 2 and section 507C.33 mutual debts or mutual credits between the insurer and another person in connection with an action or proceeding under this chapter shall be set off and the balance only shall be allowed or paid. 2. a. A setoff shall not b…

1. As soon as practicable but not more than two years from the date of an order of liquidation under section 507C.18 of an insurer issuing assessable policies, the liquidator shall make a report to the court setting forth all of the following: a. The reasonable value of the asset…

Notwithstanding a provision in the reinsurance contract or other agreement, the amount recoverable by the liquidator from reinsurers shall not be reduced as a result of delinquency proceedings. Payment made directly to an insured or other creditor shall not diminish the reinsurer…

1. a. An agent, broker, premium finance company or any other person responsible for the payment of a premium is obligated to pay an unpaid premium for the full policy term due the insurer at the time of the declaration of insolvency, whether earned or unearned, as shown on the re…

1. Within one hundred twenty days of a final determination of insolvency under this chapter as assets become available, the liquidator shall make application to the court for approval of a proposal to disburse assets out of marshaled assets to a guaranty association or foreign gu…

1. Proof of all claims shall be filed with the liquidator in the form required by section 507C.36 on or before the last day for filing specified in the notice required under section 507C.22 . However, proof of claims for cash surrender values or other investment values in life in…

1. Proof of claim shall consist of a statement signed by the claimant that includes all of the following that are applicable: a. The particulars of the claim including the consideration given for it. b. The identity and amount of the security on the claim. c. The payments, if any…

1. The claim of a third party which is contingent only on the third party first obtaining a judgment against the insured shall be considered and allowed as if there were no such contingency. 2. A claim may be allowed even if contingent, if it is filed in accordance with section 5…

1. If a third party asserts a cause of action against an insured of an insurer in liquidation, the third party may file a claim with the liquidator. 2. Whether or not the third party files a claim, the insured may file a claim on the insured’s own behalf in the liquidation. If th…

1. If 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 the proof of claim. Within sixty days from the mailing of the notice, the claim…

1. A delinquency proceeding shall not be commenced under this chapter by a person other than the commissioner. A court shall not have jurisdiction over a proceeding under this chapter commenced by a person other than the commissioner. 2. A court shall not have jurisdiction over a…

If a creditor, 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, then the other person may do so in the creditor’s name and shall be subrogated to the rights of the creditor, whether the claim h…

1. The value of security held by a secured creditor shall be determined in one of the following ways, as the court may direct: a. By converting the security into money according to the terms of the agreement pursuant to which the security was delivered to the creditors. b. By agr…

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. Claims in each class shall be paid in full or adequate funds retained for the payment before the members of the next class receive an…

1. The liquidator shall review claims duly filed in the liquidation and shall make further investigation as necessary. The liquidator may compound, compromise or in any other manner negotiate the amount for which claims will be recommended to the court except where the liquidator…

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 and the protection of unliquidated and undetermined claims, in…

1. 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 a creditor, shareholder, member, or other person who is unknown or cannot be found, shall be depo…

1. When all assets justifying the expense of collection and distribution have been collected and distributed under this chapter , the liquidator shall apply to the court for discharge. The court may grant the discharge and make any other orders, including an order to transfer rem…

At any time after the liquidation proceeding has been terminated and the liquidator discharged, the commissioner or other interested party may petition the court to reopen the proceedings for good cause including the discovery of additional assets. The court shall order the proce…

If it appears to the commissioner that the records of an insurer in process of liquidation or completely liquidated are no longer useful, the commissioner may recommend to the court and the court shall direct what records shall be retained for future reference and what shall be d…

The court may order audits to be made of the books of the commissioner relating to a receivership established under this chapter , and a report of each audit shall be filed with the commissioner and with the court. The books, records, and other documents of the receivership shall…

1. A receiver appointed in a proceeding under this chapter may at any time apply for, and any court of general jurisdiction may grant, restraining orders, preliminary and permanent injunctions, and other orders as necessary to prevent any of the following: a. The transaction of f…

1. If a domiciliary liquidator has not been appointed, the commissioner may apply to the court by verified petition for an order directing the commissioner to act as conservator to conserve the property of an alien insurer not domiciled in this state or a foreign insurer on any o…

1. If a domiciliary receiver has not been appointed, the commissioner may apply to the court by verified petition for an order directing the commissioner to liquidate the assets found in this state of a foreign insurer or an alien insurer not domiciled in this state on any of the…

1. Except as to special deposits and security on secured claims under section 507C.53, subsection 3 , the domiciliary liquidator of an insurer domiciled in a reciprocal state shall be vested with the title to the assets, property, contracts, rights of action, agents’ balances, bo…

1. If a domiciliary liquidator has been appointed for an insurer not domiciled in this state, the commissioner may file a petition with the court requesting appointment as ancillary receiver in this state if both of the following exist: a. If the domiciliary liquidator finds that…

In the sole discretion of the commissioner, the commissioner may institute proceedings under sections 507C.9 through 507C.11 at the request of the commissioner or other appropriate insurance official of the domiciliary state of a foreign or alien insurer having property located i…