§ 10-3-533 — Domiciliary liquidator's proposal to distribute assets

Colorado § 10-3-533

• Jurisdiction: Colorado
• Title 10: Insurance
• Art.: Regulation of Insurance Companies

Text

(1) Within
one hundred twenty days after 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 approval of a proposal to disburse assets out of marshaled assets,
from time to time and as such assets become available, to a guaranty association or
foreign guaranty association having obligations because of such insolvency. If the
liquidator determines that there are insufficient assets to disburse, the application
required by this section shall be considered satisfied by a filing by the liquidator
stating the reasons for such determination.

(2) The proposal referenced in subsection (1) of this section shall at least
include provisions for:

(a) Reserving amounts for the payment of expenses of administration and
the payment of claims of secured creditors, to the extent of the value of the
security held, and claims falling within the priorities established in section 10-3-541
(1) and (2);

(b) Disbursement of the assets marshaled to date and subsequent
disbursement of assets as they become available;

(c) Equitable allocation of disbursements to each of the guaranty
associations and foreign guaranty associations entitled thereto;

(d) The securing, by the liquidator, from each of the associations entitled to
disbursements pursuant to this section, of an agreement to return to the liquidator
such assets together with income earned on assets previously disbursed as may be
required to pay claims of secured creditors and claims falling within the priorities
established in section 10-3-541 in accordance with such priorities; and in such case,
no bond shall be required of any such association; and

(e) A full report to be made by each association to the liquidator accounting
for all assets so disbursed to the association, all disbursements made therefrom,
any interest earned by the association on such assets, and any other matter as the
court may direct.

(3) The liquidator's proposal shall provide for disbursements to the
associations in amounts estimated at least equal to the claim payments made or to
be made thereby for which such associations could assert a claim against the
liquidator, and shall further provide that, if the assets available for disbursement
from time to time do not equal or exceed the amount of such claim payments made
or to be made by the association, then disbursements shall be in the amount of
available assets.

(4) The liquidator's proposal shall, with respect to an insolvent insurer
writing life or health insurance or annuities, provide for disbursements of assets to
any guaranty association or any foreign guaranty association covering life or health
insurance or annuities or to any other entity or organization reinsuring, assuming, or
guaranteeing policies or contracts of insurance under the statutes creating such
associations.

(5) Notice of the application referenced in subsection (1) of this section shall
be given to the association in, and to the insurance departments of, each of the
states having jurisdiction over any insurer affected by the liquidator's proposal. Any
such notice shall be deemed to have been given when deposited in the United
States certified mail, first-class postage prepaid, at least thirty days prior to
submission of such application to the court. Action on the application may be taken
by the court if such notice has been given and if the liquidator's proposal complies
with the requirements of paragraphs (a) and (b) of subsection (2) of this section.

Legislative History

Source: L. 92: Entire part R&RE, p. 1467, � 14, effective July 1.