Illinois Compiled Statutes 215 ILCS 5/131.25a – Recovery upon order of liquidation or rehabilitation of domestic insurer
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(a) If an order for liquidation or rehabilitation of a domestic insurer has been entered, the receiver shall have the right subject to the limitations set forth in subsections (b) and (c) of this Section to recover on behalf of the insurer any or all of the following made during the 3 years before the filing of the petition for liquidation, conservation, or rehabilitation:
(1) From any parent corporation, holding company,
(1) From any parent corporation, holding company,
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person, or affiliate who otherwise controlled the insurer, the amount of distributions, other than distributions of shares of the same class, paid by the insurer on its capital stock.
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(2) From any director, officer, or employee, the
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amount of any payment in the form of a bonus, termination settlement, or extraordinary lump sum salary adjustment made by the insurer or a subsidiary.
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(b) No distribution shall be recoverable if the parent or affiliate shows that the distribution or payment was lawful and reasonable when paid and that the insurer did not know and reasonably could not have known that the distribution might adversely affect the ability of the insurer to fulfill its contractual obligations.
(c) The maximum amount recoverable under this Section shall be the amount in excess of all other available assets of the impaired or insolvent insurer needed to pay the contractual obligations of that insurer and reimburse any guaranty funds.
(d) Any person who was a parent corporation, holding company, or who otherwise controlled the insurer or affiliate at the time the distributions were paid shall be liable up to the amount of distributions the person received. Any person who otherwise controlled the insurer at the time the distributions were declared shall be liable up to the amount of distributions the person would have received had the distributions been paid immediately. If 2 or more persons are liable with respect to the same distributions, they shall be jointly and severally liable.
(e) To the extent any person liable under subsection (d) is insolvent or otherwise fails to pay claims due, its parent corporations, holding company, or person who otherwise controlled it at the time the distribution was paid shall be jointly and severally liable for any resulting deficiency in the amount recovered.
Terms Used In Illinois Compiled Statutes 215 ILCS 5/131.25a
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
(c) The maximum amount recoverable under this Section shall be the amount in excess of all other available assets of the impaired or insolvent insurer needed to pay the contractual obligations of that insurer and reimburse any guaranty funds.
(d) Any person who was a parent corporation, holding company, or who otherwise controlled the insurer or affiliate at the time the distributions were paid shall be liable up to the amount of distributions the person received. Any person who otherwise controlled the insurer at the time the distributions were declared shall be liable up to the amount of distributions the person would have received had the distributions been paid immediately. If 2 or more persons are liable with respect to the same distributions, they shall be jointly and severally liable.
(e) To the extent any person liable under subsection (d) is insolvent or otherwise fails to pay claims due, its parent corporations, holding company, or person who otherwise controlled it at the time the distribution was paid shall be jointly and severally liable for any resulting deficiency in the amount recovered.