2023 Laws of Puerto Rico › TITLE TWENTY-SIX - Insurance (§§ 101 — 10377) › Subtitle 1 - Insurance Generally (§§ 101 — 4513) › Chapter 40 - Rehabilitation and Liquidation (§§ 4001 — 4054) › § 4039 - Liquidation—Distribution, priority

The priority in the distribution of claims from the insurer’s estate shall be in accordance with the order in which each class of claims is set forth in this section. All claims in each class shall be paid in full or sufficient funds shall be retained for such payment before the members of the next class receive any payment. No subclauses shall be established within any class. The distribution order of the claims shall be:
(1) Class 1.— The administrative costs and reasonable expenses of the settler of a guaranty association or a foreign guarantee association in the handling of claims.
(2) Class 2.— Due debts with employees for services rendered up to a maximum of one thousand dollars ($1,000) and which represent payment for services rendered within one year prior to the filing of the petition for settlement. Officers and directors shall not be entitled to the benefit of this priority. This priority shall be in lieu of any other similar priority that any other law may grant with respect to salaries or compensation of employees.
(3) Class 3.— All claims for losses incurred and covered by policies, including third party claims, all claims against the insurer for liability for body injuries or damage, or destruction of tangible property, which are not covered by policies and all claims of a guaranty association or a foreign guaranty association.
(4) Class 4.— Claims for unearned premiums or other premiums refunds under non-assessable policies and the claims of general creditors.
(5) Class 5.— Claims of the federal government, or of any Commonwealth or local government body. Claims, including those of a government body for penalties or forfeiture, shall be allowed in this class only to the extent of the pecuniary loss sustained as a result of the act, transaction or proceeding costs resulting thereby. The remainder of such claims shall be passed on to the class describe[d] in Class 8.
(6) Class 6.— Claims filed late and claims of any other class that are not described in Classes 7 and 8.
(7) Class 7.— Surplus notes or loans without the guarantee of assets or apportionments, or any other similar obligations and premiums refunds on policies subjects to assessment. Payments to members of domestic mutual insurance companies shall be limited in accordance with this title.
(8) Class 8.— Claims of shareholders or other owners.
All claims included under separate account, which provides, in effect, that the assets of said separate account shall not be subject to the obligations that arise from any other business that the insurer may carry out, shall only be paid from the assets of the separate account. If the claims cannot be fully satisfied as provided above, the surplus of said claim shall be deemed as a Class 3 claim to the extent in which the corresponding reserve have been established in the general account of the insurer pursuant to this chapter. If the assets deposited in the separate account or accounts exceed obligations that arise from the separate account agreements, said excess shall be transferred to the insurer’s estate.
For purposes of this section, “separate accounts agreement or agreements” means any separate accounts agreement or agreements referred to in § 1328a of this title.
History —Ins. Code, added as § 40.390 on Aug. 17, 1991, No. 72, § 1; Dec. 19, 2003, No. 310, § [4]