(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 liquidator shall make application to the court for approval of a proposal, subject to the priority schedule stated in § 431:15-332, to disburse assets out of marshaled assets, from time to time as the assets become available. 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 this determination.
Terms Used In Hawaii Revised Statutes 431:15-324
Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
insolvent: means :(1) For an insurer issuing only assessable fire insurance policies:(A) The inability to pay any obligation within thirty days after it becomes payable; or(B) If an assessment be made within thirty days after such date, the inability to pay such obligation thirty days following the date specified in the first assessment notice issued after the date of loss pursuant to this code;(2) For any other insurer, that it is unable to pay its obligations when they are due, or when its admitted assets do not exceed its liabilities plus the greater of: (A) Any capital and surplus required by law for its organization; or(B) The total par or stated value of its authorized and issued capital stock; and(3) As to any insurer licensed to do business in this State as of July 1, 1988, who does not meet the standard established under subparagraph (B), the term insolvency or insolvent shall mean, for a period not to exceed three years from July 1, 1988, that it is unable to pay its obligations when they are due or that its admitted assets do not exceed its liabilities plus any required capital contribution ordered by the commissioner under provisions of this code. See Hawaii Revised Statutes 431:15-103
Insurer: means any person who has done, purports to do, is doing or is licensed to do an insurance business, and is or has been subject to the authority of, or to liquidation, rehabilitation, reorganization, supervision, or conservation by any insurance commissioner. See Hawaii Revised Statutes 431:15-103
Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
(b) The 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 the priorities established in § 431:15-332, classes 1, 2 and 3;(2) Disbursement of the assets marshaled to date and subsequent disbursement of assets as they become available;(3)Equitable allocation of disbursements to each of the classes entitled thereto;(4) The securing by the liquidator from each of the classes 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 § 431:15-332 in accordance with the priorities. No bond shall be required of any of the classes; and(5) A full report to be made by each class to the liquidator accounting for all assets so disbursed to the class, all disbursements made therefrom, any interest earned by the class on the assets and any other matter as the court may direct.(c) The liquidator’s proposal shall provide for disbursements to the guaranty funds or associations in amounts estimated at least equal to the claim payments made or to be made thereby for which the funds or associations could assert a claim against the liquidator, and shall provide further that if the assets available for disbursement from time to time do not equal the amount of the claim payments made or to be made by the fund or association then disbursements shall be in the amount of available assets.(d) The liquidator’s proposal, with respect to an insolvent insurer writing life or accident and health or sickness insurance or annuities, shall provide for disbursements of assets to any guaranty fund or association, or any foreign guaranty fund or association covering life or accident and health or sickness insurance or annuities or to any other entity or organization reinsuring, assuming, or guaranteeing policies or contracts of insurance under the acts creating such funds or associations.(e) Notice of the application shall be given to the classes affected, the guaranty fund or association in, 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 certified mail, first class postage prepaid, at least thirty days prior to submission of the 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 liquidator’s proposal complies with subsections (b)(1) and (2).
