This text of Louisiana § 22:2061.1 (Net worth exclusion) is published on Counsel Stack Legal Research, covering Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
§2061.1. Net worth exclusion
A.For purposes of this Part, "high net worth insured" means any policyholder or
named insured, other than any state or local governmental agency or subdivision thereof,
whose net worth exceeds twenty-five million dollars on December thirty-first of the year
prior to the year in which the insurer becomes an insolvent insurer. An insured's net worth
on that date shall be deemed to include the aggregate net worth of the insured and all of its
subsidiaries and affiliates as calculated on a consolidated basis. The consolidated net worth
of the insured and all of its affiliates shall be calculated on the basis of their fair market
values. The members of a group self-insurance fund formed pursuant to R.S. 23:1191 et seq.
shall not be deemed to be affiliates of the fu
Free access — add to your briefcase to read the full text and ask questions with AI
§2061.1. Net worth exclusion
A. For purposes of this Part, "high net worth insured" means any policyholder or
named insured, other than any state or local governmental agency or subdivision thereof,
whose net worth exceeds twenty-five million dollars on December thirty-first of the year
prior to the year in which the insurer becomes an insolvent insurer. An insured's net worth
on that date shall be deemed to include the aggregate net worth of the insured and all of its
subsidiaries and affiliates as calculated on a consolidated basis. The consolidated net worth
of the insured and all of its affiliates shall be calculated on the basis of their fair market
values. The members of a group self-insurance fund formed pursuant to R.S. 23:1191 et seq.
shall not be deemed to be affiliates of the fund and shall not be included in the determination
of the net worth of the fund. For the purposes of this Section, a group self-insurance fund,
and each individual member of the fund upon whose behalf a claim is submitted, shall be
deemed to be policyholders or named insureds of any policy of insurance issued to the fund. B.(1) The association shall not be obligated to pay any claims or provide a defense
to any claims asserted for coverage under a policy when the insured is a high net worth
insured.
(2) The association shall have the right to recover from a high net worth insured all
costs incurred and all amounts paid by the association to or on behalf of such insured,
whether for indemnity, defense or otherwise, including attorney fees, administrative costs,
court costs, settlement, or other defense costs.
C. The association shall not be obligated to pay any claim that would otherwise be
a covered claim that is an obligation to or on behalf of a person who has a net worth greater
than that allowed by the insurance guaranty association law of the state of residence of the
claimant at the time specified by that state's applicable law, and which association has denied
coverage to that claimant on that basis.
D. The association shall maintain reasonable procedures subject to the approval of
the commissioner for requesting financial information from insureds on a confidential basis
for purposes of applying this Section. The financial information may be shared with any
other association similar to the association and the liquidator for the insolvent insurer on the
same confidential basis but shall otherwise be kept strictly confidential. The financial
information provided by the insured subject to these procedures is not subject to discovery,
subpoena, or other disclosure, unless the association and the high net worth insured are
compelled to disclose this information by a valid and final court order in a proceeding to
which the association was provided with notice and an opportunity to object to the disclosure
of the information. Any request to an insured seeking financial information shall advise the
insured of the consequences of failing to provide the financial information. If an insured
refuses to provide the requested financial information where it is requested and available, the
association may, until such time as the information is provided, provisionally deem the
insured to be a high net worth insured for the purpose of denying a claim pursuant to
Subsection B of this Section.
E. In any lawsuit contesting the applicability of this Section where the insured has
refused to provide financial information under the procedure established pursuant to
Subsection D of this Section, the insured shall bear the burden of proof concerning its net
worth at the relevant time. If the insured fails to prove that its net worth at the relevant time
was less than the applicable amount, the court shall award the association its full costs,
expenses and reasonable attorney fees in contesting the claim.