§ 27-35-10.5. Recovery.
(a) If an order for liquidation or rehabilitation of a domestic insurer has been entered,
the receiver appointed under the order shall have a right to recover on behalf of
the insurer, (i) From any parent corporation or holding company or person or affiliate
who otherwise controlled the insurer, the amount of distributions (other than distributions
of shares of the same class of stock) paid by the insurer on its capital stock; or
(ii)Any payment in the form of a bonus, termination settlement, or extraordinary
lump sum salary adjustment made by the insurer or its subsidiary to a director, officer,
or employ
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§ 27-35-10.5. Recovery.
(a) If an order for liquidation or rehabilitation of a domestic insurer has been entered,
the receiver appointed under the order shall have a right to recover on behalf of
the insurer, (i) From any parent corporation or holding company or person or affiliate
who otherwise controlled the insurer, the amount of distributions (other than distributions
of shares of the same class of stock) paid by the insurer on its capital stock; or
(ii) Any payment in the form of a bonus, termination settlement, or extraordinary
lump sum salary adjustment made by the insurer or its subsidiary to a director, officer,
or employee, where the distribution or payment pursuant to (i) or (ii) is made at
any time during the one year preceding the petition for liquidation, conservation,
or rehabilitation, as the case may be, subject to the limitations of subsections (b),
(c), and (d).
(b) No distribution shall be recoverable if the parent or affiliate shows that when paid
the distribution was lawful and reasonable, and that the insurer did not know and
could not reasonably have known that the distribution might adversely affect the ability
of the insurer to fulfill its contractual obligations.
(c) Any person who was a parent corporation or holding company or a person who otherwise
controlled the insurer or affiliate at the time the distributions were paid shall
be liable up to the amount of distributions or payments under subsection (a) which
the person received. Any person who otherwise controlled the insurer at the time the
distributions were declared shall be liable up to the amount of distributions that
would have been received if they had been paid immediately. If two (2) or more persons
are liable with respect to the same distributions, they shall be jointly and severally
liable.
(d) The maximum amount recoverable under this section shall be the amount needed in excess
of all other available assets of the impaired or insolvent insurer to pay the contractual
obligations of the impaired or insolvent insurer and to reimburse any guaranty funds.
(e) To the extent that any person liable under subsection (c) is insolvent or otherwise
fails to pay claims due from it, its parent corporation or holding company or person
who otherwise controlled it at the time the distribution was paid, shall be jointly
and severally liable for any resulting deficiency in the amount recovered from the
parent corporation or holding company or person who otherwise controlled it.