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Searching 2019-2020 Session

The Vermont Statutes Online

 

Title 8 : Banking and Insurance

Chapter 141 : CAPTIVE INSURANCE COMPANIES

Subchapter 004 : SPECIAL PURPOSE FINANCIAL INSURANCE COMPANIES

(Cite as: 8 V.S.A. § 6048m)
  • § 6048m. Delinquency

    (a) Except as otherwise provided in this section, the provisions of chapter 145 of this title shall apply in full to a special purpose financial insurance company.

    (b) Upon any order of supervision, rehabilitation, or liquidation of a special purpose financial insurance company, the receiver shall manage the assets and liabilities of the special purpose financial insurance company pursuant to the provisions of this subchapter.

    (c) Amounts recoverable by the receiver of a special purpose financial insurance company under a reinsurance contract shall not be reduced or diminished as a result of the entry of an order of conservation, rehabilitation, or liquidation with respect to a ceding insurer, notwithstanding any provision in the contracts or other documentation governing the special purpose financial insurance company securitization.

    (d) Notwithstanding the provisions of chapter 145 of this title or any other law of this State:

    (1) An application or petition or a temporary restraining order or injunction issued pursuant to the provisions of chapter 145 of this title with respect to a ceding insurer does not prohibit the transaction of business by a special purpose financial insurance company, including any payment by a special purpose financial insurance company made with respect to a special purpose financial insurance company security, or any action or proceeding against a special purpose financial insurance company or its assets.

    (2) The commencement of a summary proceeding with respect to a special purpose financial insurance company and any order issued by the court in such summary proceeding shall not prohibit payments by a special purpose financial insurance company and shall not prohibit the special purpose financial insurance company from taking any action required to make such payments, provided such payments are made:

    (A) pursuant to a special purpose financial insurance company security or reinsurance contract; and

    (B) consistent with the special purpose financial insurance company's plan of operation and any order issued to the special purpose financial insurance company pursuant to subsection 6048d(b) of this subchapter, as either is amended from time to time.

    (3) A receiver of a ceding insurer may not void a nonfraudulent transfer by a ceding insurer to a special purpose financial insurance company of money or other property made pursuant to a reinsurance contract.

    (4) A receiver of a special purpose financial insurance company may not void a nonfraudulent transfer by the special purpose financial insurance company of money or other property:

    (A) made to a ceding insurer pursuant to a reinsurance contract or made to or for the benefit of any holder of a special purpose financial insurance company security with respect to the special purpose financial insurance company security; and

    (B) made consistent with the special purpose financial insurance company's plan of operation and any order issued to the special purpose financial insurance company pursuant to subsection 6048d(b) of this subchapter, as either is amended from time to time.

    (e) With the exception of the fulfillment of the obligations under a reinsurance contract and notwithstanding another provision of this subchapter or other laws of this State, the assets of a special purpose financial insurance company, including assets held in trust, on a funds-withheld basis, or in any other arrangement to secure the special purpose financial insurance company's obligations under a reinsurance contract, shall not be consolidated with or included in the estate of a ceding insurer in any delinquency proceeding against the ceding insurer pursuant to the provisions of this subchapter for any purpose including distribution to creditors of the ceding insurer. (Added 2007, No. 49, § 17; amended 2013, No. 29, § 64, eff. May 13, 2013.)