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agents of the insurer or reinsurer insofar as those
records relate to its business activities.
(7) To hold hearings, to subpoena witnesses to
compel their attendance, to administer oaths, to ex-
amine any person under oath, and, in connection
therewith, to require the production of any books,
papers, records, or other documents which the re-
ceiver deems relevant to the liquidation.
(8) To remove any record and property of the
insurer or reinsurer to such place as may be conven-
ient for the purposes of efficient and orderly execu-
tion of the liquidation.
(9) To prosecute any action or right of action
which may exist on behalf of the creditors, policy-
holders, or shareholders of the insurer or reinsurer
against any of its officers or any other person.
(10) To borrow money on the security of the in-
surer’s or reinsurer’s assets or without security and
to execute and deliver all documents necessary to
that transaction for the purpose of facilitating the
liquidation. Any such funds borrowed may be repaid
as an administrative expense.
(11) To enter into such contracts as are nec-
essary to carry out the order to liquidate and to af-
209
firm or disavow any contract to which the insurer or
reinsurer is a party.
(12) To continue to prosecute and to institute
in the name of the insurer or reinsurer or in its own
name any suit and other legal proceeding and to
abandon the prosecution of claims it deems not to be
in the best interests of the insurer or reinsurer, its
policyholders, or creditors. If the insurer or rein-
surer is dissolved, the receiver shall have the power
to apply to any court for leave to substitute itself for
the insurer or reinsurer as party to any action or
proceeding.
(13) To deposit in one or more banks such
sums as are required for meeting current adminis-
trative expenses and dividend distributions.
(14) To invest all sums not currently needed.
(15) To file any necessary documents for re-
cording in the office of any recorder of deeds or
record office wherever property of the insurer or re-
insurer is located.
(16) To assert all defenses available as against
third persons, including statutes of limitation, stat-
utes of frauds, and the defense of usury. A waiver
of any defense by the insurer or reinsurer after a pe-
210
tition in liquidation has been filed shall not bind the
receiver.
(17) To exercise and enforce all the rights, rem-
edies, and powers of any creditor, shareholder, pol-
icyholder, or member, including any power to avoid
any transfer or lien that may be given by the law
and that is not included in sections 714, 715, and
716.
(18) To intervene in any proceeding wherever
instituted that may affect the insurer or reinsurer or
its assets.
(19) To exercise all powers now held or here-
after conferred upon a receiver by the laws of the
United States.
(20) To defray from the funds or assets of the
insurer or reinsurer all expenses of taking possession
of, conserving, conducting, liquidating, disposing of,
or otherwise dealing with, the business and property
of the insurer or reinsurer. In the event that the
property of the insurer or reinsurer does not contain
sufficient cash or liquid assets to defray the costs in-
curred, the receiver may pay the costs so incurred
from its general funds. Any amounts so advanced
for expenses of administration shall be repaid to the
211
receiver as administrative expenses when sufficient
assets are liquidated.
(21) To appoint, with the approval of the court,
an advisory committee of policyholders, claimants, or
other creditors, including, as appropriate, NIPC and
any guaranty associations which have standing
under section 713, if the receiver determines such a
committee to be necessary. If an advisory committee
is appointed for a federally certified insurer, it shall
include NIPC. Such committee shall serve without
compensation other than reimbursement for reason-
able travel and per diem living expenses incurred in
attending committee meetings.
(b) CONTINUED DEFENSE ON PENDING CASES.—
The obligation of the insurer or reinsurer to defend or con-
tinue the defense of any claim or suit required under a
liability policy shall terminate on the entry of an order
of receivership, except during the appeal of an order of
liquidation, except that NIPC and the appropriate guar-
anty association shall defend or continue the defense of
insurers against claims or suits under covered liability
policies, in accordance with the terms of said policies.
212
SEC. 729. NOTICE TO CREDITORS AND OTHERS.
(a) IN GENERAL.—Unless the court otherwise di-
rects, the receiver shall give or cause to be given notice
of a liquidation order as soon as possible—
(1) to the insurance regulator of each State in
which the insurer or reinsurer is domiciled, licensed,
or transacting the business of insurance;
(2) to NIPC or any guaranty association which
is or may become obligated as a result of the liq-
uidation;
(3) to all agents or brokers of the insurer or re-
insurer;
(4) to all persons known or reasonably expected
to have claims against the insurer or reinsurer, in-
cluding all current policyholders, at their last known
address as indicated by the records of the insurer or
reinsurer; and
(5) by publication in a newspaper of general
circulation in the county in which the insurer or re-
insurer has its principal place of business and in
such other locations as the receiver determines to be
appropriate.
(b) NOTICE TO CLAIMANTS.—Except as otherwise es-
tablished by the receiver with approval of the court, notice
to potential claimants under subsection (a) shall require
claimants to file with the receiver their claims together
213
with proper proofs thereof on or before a date the receiver
shall specify in the notice. All claimants shall have a duty
to keep the receiver informed of any changes of address.
(c) GUARANTY ASSOCIATION.—
(1) Notice under subsection (a) to agents of an
insurer and to potential claimants who are policy-
holders shall include, where applicable, notice that
coverage by NIPC or guaranty associations may be
available for all or part of policy benefits in accord-
ance with this Act or applicable guaranty laws.
(2) The receiver shall promptly provide to
NIPC and guaranty associations such information
concerning the identities and addresses of such pol-
icyholders and their policy coverages as may be with-
in the receiver’s possession or control, and otherwise
cooperate with NIPC and guaranty associations to
assist them in providing to such policyholders timely
notice of NIPC’s or the guaranty association’s cov-
erage of policy benefits, including, as applicable, cov-
erage of claims and continuation or termination of
coverages.
(d) DISTRIBUTION OF ASSETS.—If notice is given in
accordance with this section, the distribution of assets of
the insurer or reinsurer under section 745 shall be conclu-