(1)  This chapter is known as the “Insurer Receivership Act.”

Terms Used In Utah Code 31A-27a-101

  • Application: means a document:
(a) 
(i) completed by an applicant to provide information about the risk to be insured; and
(ii) that contains information that is used by the insurer to evaluate risk and decide whether to:
(A) insure the risk under:
(I) the coverage as originally offered; or
(II) a modification of the coverage as originally offered; or
(B) decline to insure the risk; or
(b) used by the insurer to gather information from the applicant before issuance of an annuity contract. See Utah Code 31A-1-301
  • business of insurance: includes any of the following acts, whether effected by mail, electronic means, or otherwise:
    (a) issuing or delivering a contract, certificate, or binder relating to insurance or annuities:
    (i) to a person who is resident in this state; or
    (ii) covering a risk located in this state;
    (b) soliciting an application for the contract, certificate, or binder described in Subsection (11)(a);
    (c) negotiating preliminary to the execution of the contract, certificate, or binder described in Subsection (11)(a);
    (d) collecting premiums, membership fees, assessments, or other consideration for the contract, certificate, or binder described in Subsection (11)(a);
    (e) transacting matters:
    (i) subsequent to execution of the contract, certificate, or binder described in Subsection (11)(a); and
    (ii) arising out of the contract, certificate, or binder described in Subsection (11)(a);
    (f) operating as an insurer under a license or certificate of authority issued by the department; or
    (g) engaging in an act identified in Chapter 15, Unauthorized Insurers, Surplus Lines, and Risk Retention Groups. See Utah Code 31A-27a-102
  • Commissioner: is a s defined in Section 31A-1-301. See Utah Code 31A-27a-102
  • Insurance: includes :
    (i) a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;
    (ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and
    (iii) a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301
  • insurer: means a person who:
    (a) is doing, has done, purports to do, or is licensed to do the business of insurance;
    (b) is or has been subject to the authority of, or to rehabilitation, liquidation, reorganization, supervision, or conservation by an insurance commissioner; or
    (c) is included under Section 31A-27a-104. See Utah Code 31A-27a-102
  • 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.
  • Litigation: A case, controversy, or lawsuit. Participants (plaintiffs and defendants) in lawsuits are called litigants.
  • Proceeding: includes an action or special statutory proceeding. See Utah Code 31A-1-301
  • Process: means a writ or summons issued in the course of a judicial proceeding. See Utah Code 68-3-12.5
  • receiver: means the commissioner or the commissioner's designee, including a rehabilitator, liquidator, or ancillary receiver. See Utah Code 31A-27a-102
  • receivership: means a rehabilitation, liquidation, or ancillary receivership. See Utah Code 31A-27a-102
  • State: means a state, district, or territory of the United States. See Utah Code 31A-27a-102
  • (2)  The proceedings authorized by this chapter may be applied to:

    (a)  all insurers and reinsurers:

    (i)  who are doing, or have done, an insurance business in this state; and

    (ii)  against whom claims arising from that business may exist;

    (b)  all insurers who have the appearance of or claim they do an insurance business in this state;

    (c)  all insurers who have insureds resident in this state; and

    (d)  all other persons organized or in the process of organizing to do an insurance business as an insurer in this state.

    (3)  This chapter shall be liberally construed to protect the interests of insureds, claimants, creditors, and the public generally through:

    (a)  early detection of any potentially hazardous condition in an insurer;

    (b)  prompt application of appropriate corrective measures;

    (c)  the commissioner making rules pertaining to Subsections (3)(a) and (b):

    (i)  in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act; and

    (ii)  that are similar to those set forth in the Model Regulation to Define Standards and Commissioner‘s Authority for Companies Deemed to be in Hazardous Financial Condition of the National Association of Insurance Commissioners;

    (d)  improved methods for conserving and rehabilitating insurers;

    (e)  enhanced efficiency and economy of liquidation, through clarification of the law, to minimize legal uncertainty and litigation;

    (f)  apportionment of any unavoidable loss in accordance with the statutory priorities set out in this chapter;

    (g)  lessening the problems of interstate receivership by:

    (i)  facilitating cooperation among states in delinquency proceedings; and

    (ii)  extending the scope of personal jurisdiction over debtors of the insurer outside this state;

    (h)  regulation of the business of insurance by the impact of the law relating to delinquency procedures and by substantive rules; and

    (i)  providing for a comprehensive scheme for the receivership of insurance companies and those subject to this chapter as part of the regulation of the business of insurance in this state.

    (4)  A proceeding in the case of insurer insolvency and delinquency are integral aspects of the business of insurance and are of vital public interest and concern.

    (5)  This chapter does not limit the powers granted the commissioner by other provisions of law.

    (6)  The powers and authority of a receiver under this chapter are:

    (a)  cumulative; and

    (b)  in addition to any power or authority available to a receiver under a law other than this chapter.

    Amended by Chapter 253, 2012 General Session