§431:16-111 Effect of paid claims. (a) Any person recovering under this part shall be deemed to have assigned the person's rights under the policy to the association to the extent of the person's recovery from the association. Every insured or claimant seeking the protection of this part shall cooperate with the association to the same extent as that person would have been required to cooperate with the insolvent insurer. The association shall have no cause of action against the insured of the insolvent insurer for any sums it has paid out except any causes of action that the insolvent insurer would have had if those sums had been paid by the insolvent insurer and except as provided in subsection (b). In the case of an insolvent insurer operating as an assessable mutual company on a plan with assessment liability, payments of claims of the association shall not operate to reduce the liability of the insureds to the receiver, liquidator, or statutory successor for unpaid assessment.
(b) The association shall have the right to recover from the following persons the amount of any covered claim paid on behalf of such person pursuant to this part:
(1) Any insured whose net worth on December 31 of the year immediately preceding the date the insurer becomes an insolvent insurer exceeds fifty million dollars and whose liability obligations to other persons are satisfied in whole or in part by payments made under this part; and
(2) Any person who is an affiliate of the insolvent insurer and whose liability obligations to other persons are satisfied in whole or in part by payments made under this part.
(c) The association and a similar organization in another state shall be recognized as claimants in the liquidation of an insolvent insurer for any amounts paid by them on covered claims as determined under this part or similar laws in other states and shall receive dividends and any other distributions at the priority set forth in section 431:15-332. The receiver, liquidator, or statutory successor of an insolvent insurer shall be bound by determinations of covered claim eligibility under this part and by settlements of claims by the association or a similar organization in another state to the extent the determinations or settlements satisfy obligations of the association. The receiver shall not be bound in any way by the determinations or settlements to the extent there remains a claim against the insolvent insurer. The court having jurisdiction shall grant such claims priority equal to that to which the claimant would have been entitled in the absence of this part against the assets of the insolvent insurer.
(d) The association shall periodically file with the receiver or liquidator of the insolvent insurer statements of the covered claims paid by the association and estimates of anticipated claims on the association, which shall preserve the rights of the association against the assets of the insolvent insurer. [L 1987, c 347, pt of §2; am L 2000, c 93, §10]
Section: Previous 431-16-104 431-16-105 431-16-106 431-16-107 431-16-108 431-16-109 431-16-110 431-16-111 431-16-112 431-16-113 431-16-114 431-16-115 431-16-116 431-16-117 431-16-201 NextLast modified: October 27, 2016