Louisiana Revised Statutes 22:2061 – Effect of paid claims
Terms Used In Louisiana Revised Statutes 22:2061
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Association: means the Louisiana Insurance Guaranty Association created under Louisiana Revised Statutes 22:2055
- Association similar to the association: means any guaranty association, security fund or other insolvency mechanism that affords protection similar to that of the association. See Louisiana Revised Statutes 22:2055
- Covered claim: means the following:
(a) An unpaid claim, including one for unearned premiums that arises out of and is within the coverage and not in excess of the applicable limits of an insurance policy to which this Part applies issued by an insurer, if such insurer becomes an insolvent insurer after September 1, 1970, and the policy was issued by such insurer and any of the following:
(i) The claimant or insured is a resident of this state at the time of the insured event, provided that, for entities, the residence of a claimant or insured is the state in which its principal place of business is located at the time of the insured event. See Louisiana Revised Statutes 22:2055
- Insolvent insurer: means an insurer who meets both of the following criteria:
(a) Is licensed and authorized to transact insurance in this state, either at the time the policy was issued or when the insured event occurred. See Louisiana Revised Statutes 22:2055
- Insured: means any named insured, any additional insured, any vendor, lessor, or any other party identified as an insured under the policy. See Louisiana Revised Statutes 22:2055
- 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.
- Person: means any natural or juridical person, company, insurer, association, organization, reciprocal or inter-insurance exchange, partnership, business, trust, corporation, or other entity, including governmental entities. See Louisiana Revised Statutes 22:2055
- Receiver: means liquidator, rehabilitator, conservator or ancillary receiver, as the context requires. See Louisiana Revised Statutes 22:2055
A. Any person recovering under this Part shall be deemed to have assigned his rights under the policy to the association to the extent of his recovery from the association. Every insured or claimant seeking the protection of this Part shall cooperate with the association to the same extent as such person would have been required to cooperate with the insolvent insurer. The association shall have no cause of action against the insured of the insolvent insurer for any sums it has paid out except such causes of action as the insolvent insurer would have had if such sums had been paid by the insolvent insurer, except with respect to the recovery of sums paid on a claim excluded due to the high net worth of an insured as defined in this Part. In the case of an insolvent insurer operating on a plan with assessment liability, payments of claims of the association shall not operate to reduce the liability of insureds to the receiver, liquidator or statutory successor for unpaid assessments.
B. The receiver, liquidator or statutory successor of an insolvent insurer shall be bound by settlements of covered claims by the association or a similar organization in another state. The court having jurisdiction shall grant such claims priority equal to that which the claimant would have been entitled in the absence of this Part against the assets of the insolvent insurer. The expenses of the association or similar organization in handling claims shall be accorded the same priority as the liquidator’s expenses.
C. The association shall periodically file with the receiver or liquidator of the insolvent insurer statements of the covered claims paid by the association and estimates of anticipated claims on the association which shall preserve the rights of the association against the assets of the insolvent insurer.
D. The association and any association similar to the association in another state shall be entitled to file a claim in the liquidation of an insolvent insurer for any amounts paid by them on covered claim obligations as determined under this Part or similar laws in other states and shall receive dividends and other distributions at the priority set forth in La. Rev. Stat. 22:2025.
Added by Acts 1970, No. 81, §1; Redesignated from La. Rev. Stat. 22:1385 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009; Acts 2010, No. 959, §1, eff. July 6, 2010.