Missouri Revised Statutes













Chapter 375

Provisions Applicable to All Insurance Companies

←375.1204

Section 375.1205.1

375.1206→

August 28, 2015

Distribution of assets, liquidator shall apply for, when--contents--notice provisions.

375.1205. 1. Within one year of a final order of liquidation 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 make early

access disbursements out of marshaled assets to a guaranty association or

foreign guaranty association having obligations because of such insolvency.



2. Such proposal shall at least include provisions for:



(1) 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 priority class I as established in

section 375.1218;



(2) Initial disbursement of the assets marshaled to date, which shall be

as soon as practicable and in any case not later than one hundred twenty days

after the approval of the early access plan, and subsequent disbursement of

assets which shall be at least annually;



(3) The securing by the liquidator from each of the guaranty associations

or foreign guaranty 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 sections 375.700 and 375.1218 in accordance with such

priorities. No bond or indemnity agreement shall be required of any such

association;



(4) A full report to be made by each guaranty association or foreign

guaranty 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;

and



(5) Disbursements to guaranty associations in sums as large as possible,

subject to the limitations set forth in subdivision (1) of this subsection

and subsection 4 of this section. If the liquidator determines that there

are insufficient assets to disburse at the time of any required disbursement,

the liquidator shall make application to the court, with notice to the state

insurance commissioners and guaranty associations pursuant to subsection 6 of

this section, for approval of an intent not to disburse, stating the reasons

for such determination.



3. Subject only to the provisions of subdivision (4) of subsection 2 of

this section, guaranty associations shall not be charged interest on assets

disbursed pursuant to this section.



4. The liquidator's proposal shall provide for disbursements to each

guaranty association of foreign guaranty associations in amounts at least

equal to the sum of claims payments and allocated lost adjustment expenses of

each guaranty association, and a reasonable estimate of reserves for unpaid

but known loss claims and allocated loss adjustment expenses expected to be

paid within one year by each guaranty association. Amounts used for such

calculation shall be those reported to the liquidator by each guaranty

association in its most recent financial report to the liquidator. The

liquidator's proposal shall further provide that if the assets available for

required disbursements do not equal or exceed the amount of such claim

payments to be made by the association, the required disbursements may be in

the amount of available assets. Unless otherwise provided by the court, the

reserves of the insolvent insurer, as reflected in its records or in the

financial examination leading to the finding of insolvency, on the date of

the final order of liquidation, shall be used to determine the initial

disbursement to the guaranty associations. The liquidator shall liquidate the

assets of the insurer in an expeditious manner, but is not required to make

forced or quick sales that would result in obtaining less than market value

for assets.



5. 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 pursuant to the laws creating such associations.



6. Notice of each application shall be given to each guaranty

association or foreign guaranty associations in and to the commissioners of

the insurance departments of each of the involved states. Any such notice

shall be deemed to have been given when deposited in the United States mail,

certified delivery, 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 provided the above-required notice has been given.



7. The liquidator shall not offset the amount to be disbursed to a

guaranty association or a foreign guaranty association by the amount of any

special deposit or any other statutory deposit or asset of the insolvent

insurer held in this state or another state unless such deposit has been

forwarded to the guaranty association.



(L. 1991 H.B. 385, et al. § 83, A.L. 1992 H.B. 1574, A.L. 1999 S.B.

386)







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