508C.13 Miscellaneous provisions. 1. This chapter does not reduce the liability for unpaid assessments of the insureds on an impaired or insolvent insurer operating under a plan with assessment liability other than theplan of this chapter. 2. Records shall be kept of all negotiations and meetings in which the association or its representatives are involved to discuss the activities of the association in carrying out itspowers and duties under section 508C.8. Records of the negotiations or meetings shall bemade public pursuant to chapter 22 only upon the termination of a liquidation, rehabilitation,or conservation proceeding involving the impaired or insolvent insurer, upon the terminationof the impairment or insolvency of the insurer, or upon the order of a court of competentjurisdiction. This subsection does not limit the duty of the association to render a report ofits activities under section 508C.14. 3. For the purpose of carrying out its obligations under this chapter, the association shall be deemed to be a creditor of the impaired or insolvent insurer to the extent of assetsattributable to covered policies or contracts reduced by any amounts to which the associationis ssociation shall be deemed to be a creditor of the impaired or insolvent insurer to the extent of assetsattributable to covered policies or contracts reduced by any amounts to which the associationis entitled pursuant to its subrogation rights under section 508C.8, subsection 7. Assetsof the impaired or insolvent insurer attributable to covered policies or contracts shall beused to continue all covered policies or contracts and pay all contractual obligations of theimpaired or insolvent insurer as required by this chapter. As used in this subsection,'assetsattributable to covered policies or contracts' means that proportion of the assets which thereserves that should have been established for the policies or contracts bear to the reservesthat should have been established for all policies of insurance or health benefit plans writtenby the impaired or insolvent insurer. 4. a. Prior to the termination of a liquidation, rehabilitation, or conservation proceeding, the court may take into consideration the contributions of the respective parties, includingthe association, the shareholders, contract owners, certificate holders, enrollees, and policyowners of the insolvent insurer, and consideration the contributions of the respective parties, includingthe association, the shareholders, contract owners, certificate holders, enrollees, and policyowners of the insolvent insurer, and any other party with a bona fide interest, in making anequitable distribution of the ownership rights of the insolvent insurer. When considering thecontributions, consideration shall be given to the welfare of the contract owners, certificateholders, enrollees, and policy owners of the continuing or successor member insurer. b. A distribution to stockholders, if any, of an impaired or insolvent insurer shall not be made until the total amount of valid claims of the association and of similar associations ofother states for funds expended in carrying out its powers and duties under section 508C.8with respect to the member insurer have been fully recovered by the association and thesimilar associations. 5. a. Subject to the limitations of paragraphs 'b', 'c', and 'd', if an order for liquidation or rehabilitation of a member insurer domiciled in this state has been entered, the receiverappointed under the order may recover, on behalf of the member insurer, from any affiliatethat liquidation or rehabilitation of a member insurer domiciled in this state has been entered, the receiverappointed under the order may recover, on behalf of the member insurer, from any affiliatethat controlled it, the amount of distributions other than stock dividends paid by the memberinsurer on its capital stock, made at any time during the five years preceding the petition forliquidation or rehabilitation. b. Distributions are not recoverable if the member insurer shows that when paid the distributions were lawful and reasonable and that the member insurer did not know andcould not reasonably have known that the distributions might adversely affect the ability ofthe member insurer to fulfill its contractual obligations. c. A person who was an affiliate that controlled the member insurer at the time the distributions were paid shall be liable up to the amount of distributions received. A personwho was an affiliate that controlled the member insurer at the time the distributions weredeclared shall be liable up to the amount of distributions that would have been received ifthe distributions had been paid immediately. controlled the member insurer at the time the distributions weredeclared shall be liable up to the amount of distributions that would have been received ifthe distributions had been paid immediately. If two or more persons are liable with respectto the same distributions, the persons are jointly and severally liable. d. The maximum amount recoverable under this subsection is the amount needed in excess of all other available assets of the insolvent insurer to pay the contractual obligationsof the insolvent insurer. e. If a person liable under paragraph 'c' is insolvent, all its affiliates that controlled it at Sat Dec 23 00:41:11 2023 Iowa Code 2024, Section 508C.13 (21, 0) §508C.13, IOWA LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION 2 the time the dividend was paid are jointly and severally liable for a resulting deficiency in theamount recovered from the insolvent affiliate. 87 Acts, ch 223, §13; 90 Acts, ch 1234, §26; 2019 Acts, ch 12, §28, 29, 35, 36; 2020 Acts, ch 1063, §276 Referred to in §22.7(23), 508C.82019 amendments apply beginning March 29, 2019; 2019 Acts, ch 12, §35, 36 Sat Dec 23 00:41:11 2023 Iowa Code 2024, Section 508C.13 (21, 0)
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