§2034. Distribution of assets; priorities; unpaid dividends
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 commissioner of insurance shall
make application to the court for approval of a proposal to disburse assets out of such
insurer's marshalled assets from time to time as such assets become available, to the
Insurance Guaranty Association and to any similar organization in another state.
B. Such a proposal shall at least include provisions for:
(1)Reserving amounts for the payment of the expenses of administration and claims
falling within the priorities established in R.S. 22:2025.
(2)Disbursement of the assets marshalled to date and subsequent disbursements of
assets as they become availa
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§2034. Distribution of assets; priorities; unpaid dividends
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 commissioner of insurance shall
make application to the court for approval of a proposal to disburse assets out of such
insurer's marshalled assets from time to time as such assets become available, to the
Insurance Guaranty Association and to any similar organization in another state.
B. Such a proposal shall at least include provisions for:
(1) Reserving amounts for the payment of the expenses of administration and claims
falling within the priorities established in R.S. 22:2025.
(2) Disbursement of the assets marshalled to date and subsequent disbursements of
assets as they become available.
(3) Equitable allocation of disbursements to the Insurance Guaranty Association and
each similar organization in another state entitled thereto.
(4) The securing by the commissioner of insurance from the Insurance Guaranty
Association and each similar organization in another state entitled to disbursements pursuant
to this Section of an agreement to return to the commissioner of insurance such assets
previously disbursed as may be required to pay claims of secured creditors and claims falling
within the priorities established in R.S. 22:2025 in accordance with such priorities. No bond
shall be required of the Insurance Guaranty Association or any similar organization in
another state.
(5) A full report to be made by the Insurance Guaranty Association and any similar
organization in another state receiving disbursements pursuant to this Section to the
commissioner of insurance 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.
C. The proposal of the commissioner of insurance shall provide for disbursements
to the Insurance Guaranty Association and any similar organization in another state in
amounts at least equal to the payments made or to be made thereby for which the Insurance
Guaranty Association or any similar organization in another state could assert claims against
the commissioner of insurance, and shall further provide that if the assets available for
disbursement from time to time do not equal or exceed the amount of such payments made
or to be made by the Insurance Guaranty Association or any similar organization in another
state, then disbursements shall be in the amount of available assets.
D. Notice of such application shall be given to the Insurance Guaranty Association,
the similar organization of each other state, and to the commissioners of insurance of each
of the states. Any such notice shall be deemed to have been given when deposited in the
United States mail, certified and 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, provided
the above required notice has been given, and provided further that the proposal complies
with Subsections A, B, and C of this Section.
E. Any time after the last day fixed for the filing of proofs of claim in the liquidation
of a domestic insurer, the court may, upon the application of the commissioner of insurance,
authorize him to declare out of the funds remaining in his hands after the payment of
expenses, one or more dividends upon all claims allowed. Such order shall specify what
claims, if any, are entitled to priority of payment and shall direct the manner in which
dividends shall be paid.
F. If there has been no adjudication of insolvency, the commissioner of insurance
shall pay all allowed claims in full and shall distribute the balance of the assets remaining
in his hands after reserving sufficient assets for all administration costs and fees, in
accordance with the direction of the court. The commissioner of insurance shall not be
chargeable for any assets so distributed to any claimant who has failed to file a proper proof
of claim before such distribution has been made.
G. If subsequent to an adjudication of insolvency, pursuant to R.S. 22:2027, a surplus
is found to exist after the payment in full of all allowed claims which have been duly filed
prior to the last date fixed for the filing thereof and the setting aside of a reserve for all costs
and expenses of the proceeding, the court shall set a new date for the filing of claims. After
the expiration of such new date, the solvency of such insurer shall be reexamined and if such
insurer is then found to be solvent on the basis of all claims then filed and allowed, any
surplus existing shall be distributed by the commissioner of insurance subject to approval
by the court, which shall not unreasonably withhold such approval.
H. Dividends remaining unclaimed or unpaid in the hands of the commissioner of
insurance for six months after the final order of distribution may be by him deposited in one
or more state or national banks, trust companies, or savings banks to the credit of the
commissioner of insurance, in trust for the person entitled thereto, but no such person shall
be entitled to any interest upon such deposit. All such deposits shall be entitled to priority
of payment in case of the insolvency or voluntary or involuntary liquidation of the depository
on an equality with any other priority given by the banking law. Any such funds together
with interest, if any, paid or credited thereon, remaining and unclaimed in the hands of the
commissioner of insurance in trust after five years shall be by him paid to the state treasurer
to be credited to the funds received from insurance revenues.
NOTE: Former R.S. 22:2034 redesignated as R.S. 22:1167 by Acts 2008,
No. 415, §1, eff. Jan. 1, 2009.
NOTE: §2 of Acts 2015, No. 340, provides for retroactive application to all pending
receivership proceedings.