North Dakota Code 26.1-06.1-03 – Definitions
For the purposes of this chapter:
Terms Used In North Dakota Code 26.1-06.1-03
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Deed: The legal instrument used to transfer title in real property from one person to another.
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- following: when used by way of reference to a chapter or other part of a statute means the next preceding or next following chapter or other part. See North Dakota Code 1-01-49
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Lien: A claim against real or personal property in satisfaction of a debt.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Organization: includes a foreign or domestic association, business trust, corporation, enterprise, estate, joint venture, limited liability company, limited liability partnership, limited partnership, partnership, trust, or any legal or commercial entity. See North Dakota Code 1-01-49
- Person: means an individual, organization, government, political subdivision, or government agency or instrumentality. See North Dakota Code 1-01-49
- Process: means a writ or summons issued in the course of judicial proceedings. See North Dakota Code 1-01-49
- Property: includes property, real and personal. See North Dakota Code 1-01-49
- Rule: includes regulation. See North Dakota Code 1-01-49
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See North Dakota Code 1-01-49
- Statute: A law passed by a legislature.
- United States: includes the District of Columbia and the territories. See North Dakota Code 1-01-49
1. “Ancillary state” means any state other than a domiciliary state.
2. “Creditor” is a person having any claim, whether matured or unmatured, liquidated or unliquidated, secured or unsecured, absolute, fixed, or contingent.
3. “Delinquency proceeding” means any proceeding instituted against an insurer for the purpose of liquidating, rehabilitating, reorganizing, or conserving such insurer, and any summary proceeding under section 26.1-06.1-09. “Formal delinquency proceeding” means any liquidation or rehabilitation proceeding.
4. “Doing business” includes any of the following acts, whether effected by mail or otherwise:
a. The issuance or delivery of contracts of insurance to residents of this state; b. The solicitation of applications for such contracts, or other negotiations preliminary to the execution of such contracts; c. The collection of premiums, membership fees, assessments, or other consideration for such contracts; d. The transaction of matters subsequent to execution of such contracts and arising out of them; e. Operating under a license or certificate of authority, as an insurer, issued by the commissioner; or
f. Any other act specified in section 26.1-02-06 as the transaction of an insurance business.
5. “Domiciliary state” means the state in which an insurer is incorporated or organized or, in the case of an alien insurer, its state of entry.
6. “Fair consideration” is given for property or obligation:
a. When in exchange for property or obligation, as a fair equivalent therefor, and in good faith, property is conveyed or services are rendered or an obligation is incurred or an antecedent debt is satisfied; or
b. When property or obligation is received in good faith to secure a present advance or antecedent debt in an amount not disproportionately small as compared to the value of the property or obligation obtained.
7. “Foreign country” means any other jurisdiction not in any state.
8. “General assets” means all property, real, personal, or otherwise, not specifically mortgaged, pledged, deposited, or otherwise encumbered for the security or benefit of specified persons or classes of persons. As to specifically encumbered property, “general assets” includes all property or its proceeds in excess of the amount necessary to discharge the sum or sums secured thereby. Assets held in trust and on deposit for the security or benefit of all policyholders or all policyholders and creditors, in more than a single state, shall be treated as general assets.
9. “Guaranty association” means the North Dakota insurance guaranty association created by chapter 26.1-42.1 or the North Dakota life and health insurance guaranty association created by chapter 26.1-38.1, and any other similar entity now or hereafter created by the legislative assembly for the payment of claims of insolvent insurers. “Foreign guaranty association” means any similar entity now in existence in or hereafter created by the legislature of any other state.
10. “Insolvency” or “insolvent” means:
a. For an insurer issuing only assessable fire insurance policies:
(1) The inability to pay any obligation within thirty days after it becomes payable; or
(2) If an assessment be made within thirty days after such date, the inability to pay the obligation thirty days following the date specified in the first assessment notice issued after the date of loss.
b. For any other insurer, that it is unable to pay its obligations when they are due, or when its admitted assets do not exceed its liabilities plus the greater of:
(1) Any capital and surplus required by law for its organization; or
(2) The total par or stated value of its authorized and issued capital stock.
c. As to any insurer licensed to do business in this state as of July 7, 1991, which does not meet the standard established under subdivision b, the term “insolvency” or “insolvent” means, for a period not to exceed three years from July 7, 1991, that it is unable to pay its obligations when they are due or that its admitted assets do not exceed its liabilities plus any required capital contribution ordered by the commissioner under provisions of the insurance law.
d. For purposes of this subsection, “liabilities” includes reserves required by statute, by rule, or by specific requirements imposed by the commissioner upon a subject company at the time of admission or a later time.
11. “Insurer” means any person who has done, purports to do, is doing, or is licensed to do an insurance business, and is or has been subject to the authority of, or to liquidation, rehabilitation, reorganization, supervision, or conservation by any other state. For purposes of this chapter, any other persons included under section 26.1-06.1-02 shall be deemed to be insurers.
12. “Policyholder” includes a certificate holder.
13. “Preferred claim” means any claim with respect to which the terms of this chapter accord priority of payment from the general assets of the insurer.
14. “Receiver” means receiver, liquidator, rehabilitator, or conservator as the context requires.
15. “Reciprocal state” means any state other than this state in which in substance and effect subsection 1 of section 26.1-06.1-17 and sections 26.1-06.1-51, 26.1-06.1-52, 26.1-06.1-54, 26.1-06.1-55, and 26.1-06.1-56 are in force, and in which provisions are in force requiring that the commissioner or equivalent official be the receiver of a delinquent insurer, and in which some provision exists for the avoidance of fraudulent conveyances and preferential transfers.
16. “Secured claim” means any claim secured by mortgage, trust deed, pledge, deposit as security, escrow, or otherwise, but not including special deposit claims or claims against general assets. The term also includes claims which have become liens upon specific assets by reason of judicial process.
17. “Special deposit claim” means any claim secured by a deposit made pursuant to statute for the security or benefit of a limited class or classes of persons, but not including any claim secured by general assets.
18. “State” means any state, district, or territory of the United States and the Panama Canal Zone.
19. “Transfer” includes the sale and every other and different mode, direct or indirect, of disposing of or of parting with property or with an interest therein, or with the possession thereof or of fixing a lien upon property or upon an interest therein, absolutely or conditionally, voluntarily, by or without judicial proceedings. The retention of a security title to property delivered to a debtor shall be deemed a transfer suffered by the debtor.