1. Within one hundred twenty days of a final determination of insolvency under this chapter as assets become available, the liquidator shall make application to the court for approval of a proposal to disburse assets out of marshaled assets to a guaranty association or foreign guaranty association having obligations because of the insolvency. An application and disbursement of assets shall be made from time to time as 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 Iowa Code 507C.34

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Foreign guaranty association: means a similar entity presently existing in or to be created in the future by the legislature of any other state. See Iowa Code 507C.2
  • Guaranty association: means the Iowa insurance guaranty association created in chapter 515B, the Iowa life and health insurance guaranty association created in chapter 508C, and any other similar entity either presently existing or to be created by the general assembly for the payment of claims of insolvent insurers. See Iowa Code 507C.2
  • insolvent: means any of the following:
     (1) For an insurer issuing only assessable fire insurance policies, either of the following:
     (a) The inability to pay any obligation within thirty days after it becomes payable. See Iowa Code 507C.2
  • Insurer: means a person who has done, purports to do, is doing or is licensed to do insurance business, and is or has been subject to the authority of, or to liquidation, rehabilitation, reorganization, supervision, or conservation by an insurance commissioner. See Iowa Code 507C.2
  • security: includes a mortgage loan, mortgage-related securities, and an interest in any mortgage loan or mortgage-related security. See Iowa Code 507C.2
  • United States: includes all the states. See Iowa Code 4.1
 2. The proposal shall at least include provisions for all of the following:

 a. Reserving amounts for the payment of all the following:

 (1) Expenses of administration.
 (2) To the extent of the value of the security held, the payment of claims of secured creditors.
 (3) Claims falling within the priorities established in section 507C.42, subsection 1.
 b. Disbursement of the assets marshaled to date and subsequent disbursement of assets as they become available.
 c. Equitable allocation of disbursements to each of the guaranty associations and foreign guaranty associations entitled to disbursements.
 d. The securing by the liquidator from each of the associations entitled to disbursements of an agreement to return to the liquidator the 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 section 507C.42 in accordance with the priorities. A bond shall not be required of an association.
 e. A full report to be made by each association to the liquidator accounting for assets so disbursed to the association, all disbursements made from the assets, interest earned by the association on the assets and any other matter as the court may direct.
 3. The liquidator’s proposal shall provide for disbursements to the associations in amounts estimated at least equal to the claim payments made or to be made for which the associations could assert a claim against the liquidator. The proposal shall provide that if the assets available for disbursement do not equal or exceed the amount of the claim payments made or to be made by the association then disbursements shall be in the amount of available assets.
 4. With respect to an insolvent insurer writing life or health insurance or annuities, the liquidator’s proposal shall provide for disbursements of assets to a guaranty association or a 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 under the acts creating the associations.
 5. Notice of the application shall be given to the association in and to the commissioners of insurance of each of the states. Notice is given when deposited in the United States certified mails, 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 required notice has been given and that the liquidator’s proposal complies with subsection 2, paragraphs “a” and “b”.
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