For purposes of this chapter:
(1) "Ancillary state" means any state other than a domiciliary state.
(2) "Creditor" is a person having any claim, whether matured or unmatured, liquidated or unliquidated, secured or unsecured, absolute, fixed, or contingent.
(3)(a) "Delinquency proceeding" means a proceeding instituted against an insurer to liquidate, rehabilitate, reorganize, or conserve the insurer and a summary proceeding under Section 38-27-220.
(b) "Formal delinquency proceeding" means a liquidation or rehabilitation proceeding.
(4) "Doing business" includes any of the following acts, whether effected by mail or otherwise:
(a) the issuance or delivery of contracts of insurance to persons resident in this State;
(b) the solicitation of applications for such contracts or other negotiations preliminary to the execution of such contracts;
(c) the collection of premiums, membership fees, assessments, or other consideration for such contracts;
(d) the transaction of matters subsequent to execution of such contracts and arising out of them; or
(e) operating under a license or certificate of authority, as an insurer, issued by the director or his designee.
(5) "Domiciliary state" means the state in which an insurer is incorporated or organized, or, in the case of an alien insurer, its state of entry.
(6) "Fair consideration" is given for property or obligation:
(a) when in exchange for the property or obligation, as a fair equivalent therefor and in good faith, property is conveyed or services are rendered or an obligation is incurred or an antecedent debt is satisfied; or
(b) when the property or obligation is received in good faith to secure a present advance or antecedent debt in amount not disproportionately small as compared to the value of the property or obligation obtained.
(7) "Federal home loan bank" or "FHLB" means a federal home loan bank established pursuant to the Federal Home Loan Bank Act, 12 U.S.C. Section 1421, et seq.
(8) "Foreign country" means any other jurisdiction not in any state.
(9) "General assets" means all property, real, personal, or otherwise, not specifically mortgaged, pledged, deposited, or otherwise encumbered for the security or benefit of specified persons or classes of persons. As to specifically encumbered property, "general assets" includes all such property or its proceeds in excess of the amount necessary to discharge the sum or sums secured thereby. Assets held in trust and on deposit for the security or benefit of all policyholders or all policyholders and creditors, in more than a single state, are treated as general assets.
(10) "Guaranty association" means the South Carolina Property and Casualty Insurance Guaranty Association, the South Carolina Life and Accident and Health Insurance Guaranty Association, and any other similar entity created by the legislature of this State for the payment of claims of insolvent insurers. "Foreign guaranty association" means any similar entity created by the legislature of any other state.
(11) "Insolvency" or "insolvent" means:
(a) For an insurer issuing only assessable fire insurance policies:
(i) the inability to pay any obligation within thirty days after it becomes payable; or
(ii) if an assessment is made within thirty days after that date, the inability to pay the obligation thirty days following the date specified in the first assessment notice issued after the date of loss.
(b) For any other insurer, that it is unable to pay its obligations when they are due, or when its admitted assets do not exceed its liabilities plus the greater of:
(i) any capital and surplus required by law for its organization; or
(ii) the total par or stated value of its authorized and issued capital stock.
(c) For purposes of this item, "liabilities" includes, but is not limited to, reserves required by statute, regulations, or specific requirements imposed by the director or his designee upon a subject company at the time of admission or subsequent thereto.
(12) "Insurer" means any person who has done, purports to do, is doing, or is licensed to do an insurance business and is or has been subject to the authority of, or to liquidation, rehabilitation, reorganization, supervision, or conservation by, the commissioner of insurance, or similar entity, of any state. For purposes of this chapter, any other persons included under Section 38-27-40 are considered insurers.
(13) "Insurer-member" means an insurer who is a member of a federal home loan bank.
(14) "Person" means natural persons, corporations, partnerships, trusts, associations, societies, orders, special purpose reinsurance vehicles, or any other organizations or entities.
(15) "Preferred claim" means any claim with respect to which the terms of this chapter accord priority of payment from the general assets of the insurer.
(16) "Receiver" means receiver, liquidator, rehabilitator, or conservator as the context requires.
(17) "Reciprocal state" means any state other than this State in which in substance and effect subsection (a) of Section 38-27-370, Section 38-27-930, Section 38-27-940, and Sections 38-27-960 through 38-27-980 are in force, and in which provisions are in force requiring that the director, his designee, or equivalent official be the receiver of a delinquent insurer, and in which some provision exists for the avoidance of fraudulent conveyances and preferential transfers.
(18) "Secured claim" means any claim secured by mortgage, trust deed, pledge, deposit as security, escrow, or otherwise, but not including special deposit claims or claims against general assets. The term also includes claims which have become liens upon specific assets by reason of judicial process.
(19) "Special deposit claim" means any claim secured by a deposit made pursuant to statute for the security or benefit of a limited class or classes of persons, but not including any claim secured by general assets.
(20) "State" means any state, district, or territory of the United States and the Panama Canal Zone.
(21) "Transfer" includes the sale and every other and different mode, direct or indirect, of disposing of or of parting with property or with an interest therein or with the possession thereof or of fixing a lien upon property or upon an interest therein, absolutely or conditionally, voluntarily, by or without judicial proceedings. The retention of a security title to property delivered to a debtor is considered a transfer suffered by the debtor.
HISTORY: Former 1976 Code Section 38-27-50 [1962 Code Section 37-1305; 1967 (55) 273] recodified as Section 38-39-40 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-5-1830 [En, 1982 Act No. 384, Section 3] recodified as Section 38-27-50 by 1987 Act No. 155, Section 1; 1991 Act No. 13, Section 18; 1993 Act No. 181, Section 609; 2002 Act No. 228, Section 5, eff May 1, 2002; 2016 Act No. 190 (S.693), Section 2, eff May 26, 2016.
Effect of Amendment
2016 Act No. 190, Section 2, in (3), added designators (a) and (b); added (7) and (13), definitions for "federal home loan bank" and "insurer-member"; and redesignated the paragraphs accordingly.