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Texas Insurance Code - Not Codified - Section 21A.101. Rehabilitation Orders

Legal Research Home > Texas Lawyer > Insurance Code - Not Codified > Texas Insurance Code - Not Codified - Section 21A.101. Rehabilitation Orders

Sec. 21A.101. REHABILITATION ORDERS.  (a) An order to
rehabilitate the business of an insurer must appoint the
commissioner and the commissioner's successors in office as the
rehabilitator and must direct the rehabilitator to take possession
of the property of the insurer wherever located and to administer it
subject to this chapter.  The rehabilitator is entitled to request
the receivership court to appoint a single judge to supervise the
rehabilitation and hear any cases or controversies arising out of
or related to the rehabilitation.  Rehabilitation proceedings are
exempt from any dormancy or similar program maintained by the
receivership court for the early closure of civil actions.  The
filing or recording of the order with the clerk of the court or
recorder of deeds of the county in which the principal business of
the company is conducted, or, in the case of real estate, the county
in which its principal office or place of business is located,
imparts the same notice as a deed, bill of sale, or other evidence
of title filed or recorded with the recorder of deeds would impart.
The order to rehabilitate the insurer must, by operation of law,
vest title to all property of the insurer in the rehabilitator.
	(b)  Any order issued under this section must require
accountings to the receivership court by the rehabilitator.
Accountings must be at the intervals specified by the receivership
court in its order, but not less frequently than semi-annually.
Each accounting must include a report concerning the
rehabilitator's opinion as to the likelihood that a plan under
Section 21A.103 will be prepared by the rehabilitator and the
timetable for doing so.
	(c)  In recognition of the need for a prompt and final
resolution for all persons affected by a plan of rehabilitation,
any appeal from an order of rehabilitation or an order approving a
plan of rehabilitation must be heard on an expedited basis.  A stay
of an order of rehabilitation or an order approving a plan of
rehabilitation may not be granted unless the appellant demonstrates
that extraordinary circumstances warrant delaying the recovery
under the plan of rehabilitation of all other persons, including
policyholders.  If the plan provides an appropriate mechanism for
adjustment in the event of any adverse ruling from an appeal, a stay
may not be granted.

Added by Acts 2005, 79th Leg., ch. 995, Sec. 1, eff. Sept. 1, 2005.

Last modified: August 11, 2007