2023 Laws of Puerto Rico › TITLE TWENTY-SIX - Insurance (§§ 101 — 10377) › Subtitle 1 - Insurance Generally (§§ 101 — 4513) › Chapter 40 - Rehabilitation and Liquidation (§§ 4001 — 4054) › § 4011 - Rehabilitation—Powers and duties

(1) The Commissioner, as rehabilitator, may appoint one or more special deputy commissioners, who shall have all the powers and responsibilities granted to the rehabilitator under this section, and the Commissioner may appoint such counsel, clerks and assistants as deemed necessary. The remuneration of the special deputy, counsel, clerks and assistants, and all expenses incurred in the take over of the insurer and in conducting the proceedings, shall be fixed by the Commissioner with the approval of the court and paid from the funds or assets of the insurer. The persons appointed under this section shall serve at the discretion of the Commissioner.
(2) The rehabilitator may take such action as he/she deems necessary or appropriate to reform and revitalize the insurer, including but not limited to the cancellation of policies, insurance and reinsurance contracts, surety bonds, surety undertaking or, with the authorization of the Receivership Court, the transfer of policies to an assuming solvent insurer. Furthermore, he/she shall have all the powers of the directors, officers and managers of the insurer, whose authority shall be suspended, unless they be again delegated by the rehabilitator. He/she shall likewise have full power to direct and administer, hire and discharge employees as well as to deal with the property and business of the insurer. The rehabilitator shall not be liable for policies issued or renewed in good faith while in rehabilitation or by any other action taken by him/her as rehabilitator.
(3) If it is evident to the rehabilitator that there has been criminal or tortious conduct or a breach of any contractual or fiduciary obligation detrimental to the insurer by any officer, manager, employee, general agent, authorized representative, producer, affiliate or other person, the rehabilitator may pursue all appropriate legal remedies on behalf of the insurer.
(4) If the rehabilitator determines that a reorganization, consolidation, conversion, reinsurance, merger or other transformation of the insurer is appropriate, he/she shall prepare a plan to execute such changes. Upon request of the rehabilitator for approval of the plan, and after such notices and hearings as the court may order, the court may either approve or disapprove the plan proposed, or may modify it and approve it as modified.
(5) The rehabilitator may assert all defenses available to the insurer against third parties, including statutes on limitations and fraud. A waiver of a defense by the insurer, while one of the grounds to request rehabilitation is present or after a rehabilitation or liquidation order has been issued, does not bind the rehabilitator.
(6) The rehabilitator shall have the power to prevent fraudulent transfers under §§ 4023 and 4024 of this title.
(7) The enumeration in this section of the powers and duties of the rehabilitator shall not be construed as a limitation upon the rehabilitator and does not exclude in any manner his/her right to do other acts not specifically enumerated or otherwise established herein, but which may be otherwise provided as may be necessary or appropriate to assist him/her in the rehabilitation process.
History —Ins. Code, added as § 40.110 on Aug. 17, 1991, No. 72, § 1; Jan. 19, 2006, No. 10, § 9; Dec. 14, 2007, No. 206, § 11.