17B:32-45. Petition for order of liquidation
15. a. Whenever the commissioner believes further attempts to rehabilitate an insurer would substantially increase the risk of loss to creditors, policyholders or the public, or would be futile, the commissioner may petition the Superior Court for an order of liquidation. A petition under this subsection shall have the same effect as a petition under section 16 of this act. The Superior Court shall permit the directors of the insurer to take such actions as are reasonably necessary to defend against the petition and may order payment from the estate of the insurer of such costs and other expenses of defense as justice may require.
b. The protection of the interests of insureds, claimants and the public requires the timely performance of all insurance policy obligations. If the payment of policy obligations is suspended in substantial part for a period of 12 months at any time after the appointment of the rehabilitator and the rehabilitator has not filed an application for approval of a plan under subsection e. of section 13 of this act during the 12-month period, the rehabilitator shall petition the court for an order of liquidation on the grounds of insolvency; provided, however, that prior to the end of that 12-month period the commissioner may petition the court for an extension of the time period to file an application for approval of a plan.
c. The rehabilitator may at any time petition the Superior Court for an order terminating rehabilitation of an insurer. The court shall also permit the directors of the insurer to petition the court for an order terminating rehabilitation of the insurer and may order payment from the estate of the insurer of such costs and other expenses of that petition as justice may require. If the court finds that rehabilitation has been accomplished and that grounds for rehabilitation under section 11 of this act no longer exist, it shall order that the insurer be restored to possession of its property and the control of the business. The court may also make that finding and issue that order at any time upon its own motion.
L.1992,c.65,s.15.
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Last modified: October 11, 2016