NY Ins L § 7713 (2021)
2021 New York Laws ISC - Insurance Article 77 - The Life Insurance Company Guaranty Corporation of New York Act 7713 - Miscellaneous Provisions.

§ 7713. Miscellaneous provisions. (a) Nothing in this article shall be construed to reduce the liability for unpaid assessments of the insureds of  an  impaired  or  insolvent  insurer  operating  under  a  plan with assessment liability.  (b) The corporation shall maintain records  of  all  negotiations  and meetings in which the corporation or its representatives are involved to discuss the activities of the corporation in carrying out its powers and duties under section seven thousand seven hundred eight of this article, except  to  the  extent otherwise provided by or pursuant to the plan of operation. Records of such negotiations or meetings shall be made public only  upon  the  termination  of  a   liquidation,   rehabilitation   or conservation  proceeding  involving  the  impaired or insolvent insurer, upon the termination of the impairment or insolvency of the insurer,  or upon  the  order  of a court of competent jurisdiction.  Nothing in this subsection shall limit the duty of the corporation to render a report of its activities under section seven thousand seven  hundred  fourteen  of this article.  (c)  (1)  During  an  article  seventy-four rehabilitation proceeding, assets of the impaired or insolvent insurer which are determined by  the superintendent  to  be  currently  available may be used to continue all covered policies, and pay all contractual obligations, of  the  impaired or  insolvent insurer that would otherwise be covered by the corporation under section seven thousand seven hundred eight of  this  article.  The corporation   shall,  subsequent  to  the  termination  of  the  article seventy-four rehabilitation proceeding  and  within  a  reasonable  time after  the  commencement  of  a  liquidation  proceeding  under  article seventy-four of this chapter reimburse the estate  of  the  impaired  or insolvent  insurer  for  such portion of the amount of assets so used to the extent necessary to pay class one, two and three claims pursuant  to paragraph  one, two or three of subsection (a) of section seven thousand four hundred thirty-five of this chapter. The corporation shall  have  a claim  against  the estate of the impaired or insolvent insurer equal to the full amount of such reimbursement, consistent with the provisions of paragraph four of subsection (a) of section seven thousand four  hundred thirty-five of this chapter.  (2)  During  an article seventy-four rehabilitation proceeding, assets of the impaired  or  insolvent  insurer  which  are  determined  by  the superintendent to be currently available may be used to continue covered policies,  and pay contractual obligations, of the impaired or insolvent insurer, other than the covered  policies  and  contractual  obligations that  are  covered by the corporation under section seven thousand seven hundred eight of this article, if a corporation,  association  or  other organization  which  performs or will perform functions similar to those of  the  corporation  enters  into  an  agreement  satisfactory  to  the superintendent  prior  to such use of such assets to repay the amount of such assets subsequent to the termination of  the  article  seventy-four rehabilitation  proceeding  and  within  a  reasonable  time  after  the commencement of a liquidation proceeding under article  seventy-four  of this chapter.  (d)  In addition to the duties and powers enumerated elsewhere in this chapter, and subject to the limitations and exclusions contained in this and  other  sections  of  this  chapter,  upon  the  commencement  of  a proceeding  under  article  seventy-four of this chapter with respect to any impaired or  insolvent  domestic  insurer,  the  superintendent  may request and receive from the corporation, and the corporation shall lend to  the  superintendent  upon such request, an amount not to exceed five hundred thousand dollars as  determined  by  the  superintendent  to  be necessary  on  an  emergency  basis  for  use  by the superintendent, as  liquidator or rehabilitator, in the administration  of  the  affairs  of such impaired or insolvent insurer.  To the extent it deems necessary or appropriate  to carry out its duties under this section, the corporation may  borrow  such  amount  in  accordance with subsection (h) of section seven thousand seven hundred eight of this article and may assess member insurers for the purpose of repaying such  borrowing.  Such  assessments against each member insurer shall be in the proportion that the premiums received  by  such insurer on business in this state in all accounts for the calendar  year  preceding  the  assessment  bear  to  such  premiums received  on  business  in  this state in all accounts for such calendar year by all assessable member insurers. The  corporation  shall  have  a claim  against the estate of such impaired or insolvent insurer equal to the  amount  loaned  to  the  superintendent  in  accordance  with  this subsection,  together  with interest thereon at the maximum rate allowed by subdivision one of section 5-501 of the general obligations law,  and such  claim  shall  be  treated as a class one claim under section seven thousand four hundred thirty-five of this chapter.  (e) The corporation  shall  have  a  claim  against  the  impaired  or insolvent  insurer  for  all amounts expended by the corporation for the purposes of carrying out its obligations under this article.  (f) (1) Prior to the  termination  of  any  proceeding  under  article seventy-four  of this chapter, the court may take into consideration the contributions of the respective parties, including the corporation,  the shareholders and policyholders of the impaired or insolvent insurer, and any  other  party  with  a  bona  fide  interest, in making an equitable distribution of the ownership  rights  of  such  impaired  or  insolvent insurer.  In  such  a determination, consideration shall be given to the welfare of the policyholders of the continuing or successor insurer.  (2) No distribution  to  shareholders,  if  any,  of  an  impaired  or insolvent  insurer shall be made, and no rehabilitation proceeding shall be terminated (except by a final order of liquidation), until and unless the total amount of valid  claims  of  the  corporation  for  all  funds expended  in  carrying  out  its  powers  and duties under section seven thousand seven hundred eight  of  this  article  with  respect  to  such insurer,  together  with  interest thereon, have been fully recovered by the corporation or an arrangement satisfactory to  the  corporation  has been made for their recovery. Such interest shall be at a rate which, in the opinion of the court, fairly compensates the corporation for the use of  such  funds,  but  in  no  event shall such rate be in excess of the maximum rate allowed by subdivision one of section 5-501 of the  general obligations law at the time such funds were expended.  (g)  (1)  If  an order for liquidation or rehabilitation of an insurer domiciled in this state has been entered, the receiver  appointed  under such  order shall have a right to recover on behalf of the insurer, from any parent corporation  or  holding  company  or  person  who  otherwise controlled   the  insurer,  the  amount  of  distributions  (other  than distributions of shares of the same class of stock) paid by the  insurer on  its  capital stock, made at any time during the five years preceding the petition for liquidation, conservation  or  rehabilitation,  as  the case  may  be,  subject  to the limitations of paragraphs two, three and four of this subsection.  (2) No such distribution shall be recoverable  if  the  insurer  shows that  when  paid,  such distribution was reasonable and that the insurer did not know and could not reasonably have known that such  distribution might  adversely  affect  the  ability  of  the  insurer  to fulfill its contractual obligations.   Notice  to  the  superintendent  pursuant  to subsection  (a)  of  section  four  thousand  two  hundred seven of this chapter and the lack of a prior objection by the superintendent to  such  distributions  shall  not  constitute evidence to support the showing of reasonableness which would prevent the recovery of such distribution.  (3)  Any  person  who was a parent corporation or holding company or a person  who  otherwise  controlled  the  insurer  at   the   time   such distributions   were   paid   shall  be  liable  up  to  the  amount  of distributions such  persons  received.  Any  person  who  was  a  parent corporation  or holding company or a person who otherwise controlled the insurer at the time such distributions were declared shall be liable  up to  the  amount of distributions he would have received if they had been paid immediately. If two or more persons are liable with respect to  the same distribution, they shall be jointly and severally liable.  (4)  The maximum amount recoverable under this subsection shall be the amount needed in excess of all other available assets of the impaired or insolvent insurer to pay the contractual obligations of the impaired  or insolvent insurer and to reimburse the corporation for such payments and for all other claims the corporation may have pursuant to subsection (c) of this section.  (5) To the extent that any person liable under paragraph three of this subsection  is  insolvent  or  otherwise fails to pay claims due from it pursuant to such paragraph, its parent corporation or holding company or person who otherwise controlled it at  the  time  the  distribution  was paid, shall be jointly and severally liable for any resulting deficiency in  the amount recovered from such parent corporation or holding company or person who otherwise controlled it.