(a) Insurer means any person, firm, corporation, association, or aggregation of persons doing any insurance business subject to the insurance supervisory authority of the Commissioner of Banking and Insurance of this territory, or the equivalent insurance supervisory official of another state.

(b) Delinquency proceeding means any proceeding commenced against an insurer for the purpose of liquidating, rehabilitating, reorganizing, or conserving such insurer.

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(c) State means any state of the United States, its territories arid possessions, and the District of Columbia.

(d) Foreign country means territory not in any state.

(e) Domiciliary state means the state in which an insurer is incorporated or organized, or, in the case of an insurer incorporated or organized in a foreign country, the state in which such insurer, having become authorized to do business in such state, has, at the commencement of delinquency proceedings, the largest amount of its assets held in trust, and assets held on deposit for the benefit of its policy holders or policy holders and creditors in the United States; and any such insurer is deemed to be domiciled in such state.

(f) Ancillary state means any state other than a domiciliary state.

(g) Reciprocal state means any state other than this territory in which, in substance and effect, the provisions of this article are in force, including the provisions requiring that the Commissioner of Banking and Insurance or equivalent insurance supervisory official be the receiver of a delinquent insurer.

(h) 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 a limited class or classes of persons, and as to such specifically encumbered property the term includes all such property or its proceeds in excess of the amount necessary to discharge the sum or sums secured thereby. Assets held in trust and assets held on deposit for the security or benefit of all policy holders, or all policy holders and creditors in the United States, shall be deemed general assets.

(i) Preferred claim means any claim with respect to which the law of a state or of the United States accords priority of payment from the general assets of the insurer.

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(j) 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 general assets.

(k) Secured claim means any claim secured by mortgage, trust, deed, pledge, deposit as a security, escrow, or otherwise, but not including special deposit claims or claims against general assets. The term also includes claims which more than four (4) months prior to the commencement of delinquency proceedings in the state of the insurer’s domicile have become liens upon specific assets by reason of judicial process.

(1) Receiver means receiver, liquidator, rehabilitator, or conservator, as the context may require.

SOURCE: GC § 43225.

2011 NOTE: Reference to the “”Insurance Commissioner”” in subsections (a) and (g) changed to the “”Commissioner of Banking and Insurance”” pursuant to P.L. 27-088:10 (May 6, 2004).

§ 15602. Conduct of Delinquency Proceedings Against
Insurers Domiciled in this Territory.

(a) Whenever under the laws of this territory a receiver is to be appointed in delinquency proceedings for an insurer domiciled in this territory, the court shall appoint a competent receiver who shall furnish proper bond in an amount determined by said court. The court shall direct the receiver forthwith to take possession of the assets of the insurer and to administer the same under orders of this court.

(b) The domiciliary receiver and his successors in office shall be vested by operation of law with the title to all of the property, contracts, and rights of action, and all of the books and records of the insurer wherever located, as of the date of entry of the order directing possession to be taken, and he shall have the right to recover the same and reduce the same to possession; except that ancillary receivers in reciprocal states shall have, as to assets located in their respective states, the rights and powers

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which are hereinafter prescribed for ancillary receivers appointed in this territory as to assets located in this territory. The filing or recording of the order directing possession to be taken, or a certified copy thereof, in the office where instruments affecting title to property are required to be filed or recorded shall impart the same notice as would be imparted by a deed, bill of sale, or other evidence of title duly filed or recorded. The domiciliary receiver shall be responsible on his official bond for the proper administration of all assets coming into his possession or control. The court may at any time require an additional bond from him or his deputies if deemed desirable for the protection of the assets.

(c) Upon taking possession of the assets of a delinquent insurer, the domiciliary receiver shall, subject to the direction of the court, immediately proceed to conduct the business of the insurer or to take such steps as are authorized by the laws of this territory for the purpose of liquidating, rehabilitating, reorganizing, or conserving the affairs of the insurer. In connection with delinquency proceedings, he may, with the approval of the court, appoint one or more special deputy receivers to act for him and may employ such counsel, clerks, and assistants as he deems necessary. The compensation of the special deputies, counsel, clerks, or assistants and all expenses of taking possession of the delinquent insurer and of conducting the delinquency proceedings shall be fixed by the receiver, subject to the approval of the court, and shall be paid out of funds or assets of the insurer. Within the limit of the duties imposed upon them, special deputies shall possess all the powers given to, and, in the exercise of those powers, shall be subject to all of the duties imposed upon the receiver with respect to delinquency proceedings.

SOURCE: GC § 43226.

§ 15603. Conduct of Delinquency Proceedings Against
Insurers not Domiciled in this Territory.

(a) Whenever under the laws of this territory an ancillary receiver is to be appointed in delinquency proceedings for an

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insurer not domiciled in this territory, the Commissioner shall file a petition requesting the appointment

(1) if he finds that there are sufficient assets of such insurer located in this territory to justify the appointment of an ancillary receiver, or

(2) if ten (10) or more persons resident in this territory, having claims against such insurer, file a petition with the Commissioner requesting the appointment of such ancillary receiver.

(b) The domiciliary receiver of an insurer domiciled in a reciprocal state shall be vested by operation of law with the title to all of the property, contracts, and rights of action, and all of the books and records of the insurer located in this territory, and he shall have the immediate right to recover balances due from local agents and to obtain possession of any books and records of the insurer found in this territory. He shall also be entitled to recover the other assets of the insurer located in this territory except that upon the appointment of an ancillary receiver in this territory, the ancillary receiver shall, during the ancillary receivership proceedings, have the sole right to recover such other assets. The ancillary receiver shall, as soon as practicable, liquidate from their respective securities those special deposit claims and secured claims which are proved and allowed in the ancillary proceedings in this territory and shall pay the necessary expenses of the proceedings. All remaining assets he shall promptly transfer to the domiciliary receiver. Subject to the foregoing provisions, the ancillary receiver and his deputies shall have the same powers and be subject to the same duties with respect to the administration of such assets as a receiver of an insurer domiciled in this territory.

SOURCE: GC § 43227.

§ 15604. Filing and Proving of Claims of Nonresidents
Against Delinquent Insurers Domiciled in this Territory.

(a) In a delinquency proceeding begun in this territory against an insurer domiciled in this territory, claimants residing

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in reciprocal states may file claims either, with the ancillary receivers, if any, in their respective states, or with the domiciliary receiver. All such claims must be filed on or before the last date fixed for the filing of claims in the domiciliary delinquency proceedings.

(b) Controverted claims belonging to claimants residing in reciprocal states may either

(1) be proved in this territory as provided by law, or

(2) if ancillary proceedings have been commenced in such reciprocal states, may be proved in those proceedings.

(c) In the event a claimant elects to prove his claim in ancillary proceedings, if notice of the claim and opportunity to appear and be heard is afforded the domiciliary receiver of this territory, as provided in § 15605 with respect to ancillary proceedings in this territory, the final allowance of such claim by the courts in the ancillary state shall be accepted in this territory as conclusive as to its amount and shall also be accepted as conclusive as to its priority, if any, against special deposits or other security located within the ancillary state.

SOURCE: GC § 43228.

2015 NOTE: Subsection designation (c) added to adhere to the
Compiler’s general codification scheme pursuant to 1 Guam Code Ann. § 1606.