Application of Commissioner to Act as Conservator of Alien or Foreign Insurer — Grounds — Notice to Insurer — Issuance of Order by Court — Termination of Conservation
Application of Commissioner to Act as Conservator of Alien or Foreign Insurer — Grounds — Notice to Insurer — Issuance of Order by Court — Termination of Conservation
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If a domiciliary liquidator has not been appointed, the commissioner may apply to the chancery court by verified petition for an order directing the commissioner to act as conservator to conserve the property found in this state or any other state of an alien insurer not domiciled in this state or property found in this state or any other state of a foreign insurer on any one (1) or more of the following grounds:
The insurer is insolvent;
Any of its property has been sequestered by official action in its domiciliary state, or in any other state;
Enough of its property has been sequestered in a foreign country to give reasonable cause to fear that the insurer is or may become insolvent;
Its certificate of authority to do business in this state has been revoked or that none was ever issued; and
There are residents of this state with outstanding claims or outstanding policies.
When an order is sought under subsection (a), the court shall cause the insurer to be given notice and time to respond thereto as is reasonable under the circumstances.
The court may issue the order in whatever terms it shall deem appropriate. The filing or recording of the order with the clerk of the chancery court, or the register of deeds of the county in which the principal business of the company is located, shall impart the same notice as a deed, bill of sale or other evidence of title duly filed or recorded which that register of deeds would have imparted.
The conservator shall hold and conserve the assets until the time the commissioner in the domiciliary state begins formal delinquency proceedings against the insurer or until an order terminating conservation is entered under subsection (e). Once a delinquency proceeding is instituted in the domiciliary state, the conservator may either turn the property over to the domiciliary commissioner or petition to be appointed ancillary receiver. If the insurer is an alien insurer that has not established a domicile in the United States under an appropriate port of entry statute, the conservator may petition the court for an order of liquidation under any permissible ground. The application may seek, and the order of liquidation shall provide, that all property and assets, affairs and claims against the alien insurer shall be vested in the liquidator in this state as if the insurer was domiciled in this state; provided, that if an order of liquidation of the alien insurer has been entered by a court of competent jurisdiction in a reciprocal state, which provides for the reciprocal state's receiver to be treated as if it is the domiciliary liquidator, then the order of liquidation in this state shall be issued as an order appointing an ancillary receiver.
The conservator may at any time petition the court for an order terminating conservation of the property of an insurer. If the court finds that the conservation is no longer necessary, it shall order that the insurer be restored to possession of its property and the control of its business. The court may also make a finding and issue an order at any time upon motion of any interested party, but if the motion is denied all costs shall be assessed against the party.