Liquidator's recommendations to the court. 645.71(1)(1)
The liquidator shall review all claims duly filed in the liquidation and shall make all further investigation deemed necessary by the liquidator. The liquidator may compound, compromise or in any other manner negotiate the amount for which claims will be recommended to the court. Unresolved disputes shall be determined under s. 645.65
. As often as practicable, the liquidator shall present to the court reports of claims against the insurer with his or her recommendations. The liquidator shall notify claimants of the liquidator's recommendations. The reports shall include the name and address of each claimant, the particulars of the claim and the amount of the claim finally recommended, if any. As soon as reasonably possible after the last day for filing claims, the liquidator shall present a list of all claims not already reported. If the insurer has issued annuities or life insurance policies, the liquidator shall report the persons to whom, according to the records of the insurer, amounts are owed as cash surrender values or other investment values and the amounts owed. If the insurer has issued policies on the advance premium plan, the liquidator shall report the persons to whom, according to the records of the insurer, unearned premiums are owed and the amounts owed.
Allowance of claims.
The court may approve, disapprove or modify any report on claims by the liquidator, except that the liquidator's agreements with other parties shall be final and binding on the court on claims of any size settled for $500 or less. No claim under a policy of insurance may be allowed for an amount in excess of the applicable policy limits.
History: 1979 c. 93
Distribution of assets. 645.72(1)(1)
Payments to creditors.
Subject to ch. 646
and under the direction of the court, the liquidator shall pay dividends as promptly as possible to security funds under sub. (2)
and to other creditors in a manner that will assure the proper recognition of priorities and a reasonable balance between the expeditious completion of the liquidation and the protection of unliquidated and undetermined claims, including 3rd-party claims. Distribution of assets in kind may be made at valuations set by agreement between the liquidator and the creditor and approved by the court.
Payment of dividends to security funds.
The liquidator shall pay dividends to security funds under sub. (1)
to satisfy their subrogation claims under s. 646.33
or similar laws of other states, if the claims have been filed pursuant to rules established under s. 645.61 (4)
. The total dividends to security funds paid under this subsection may not exceed the total of the claims properly made by the funds under s. 645.61 (4)
. The liquidator shall pay dividends as frequently as practicable and in sums as large as possible without sacrificing of asset values by untimely disposition or inequitable allocation of available assets among the subrogated funds. The liquidator may protect against inequitable allocations by making payments to funds subject to binding agreements by the funds to repay any portions of the dividends found later to be in excess of an equitable allocation. If assets are available, the liquidator may also lend to security funds, subject to court approval.
Reports to the court.
The liquidator shall report to the court within 120 days after the issuance of the liquidation order under s. 645.42
, and every 3 months thereafter, on the status of the assets and the payment of dividends and loans under sub. (2)
. The court may order the liquidator to pay dividends to security funds under sub. (2)
more expeditiously to minimize the need for assessments under s. 646.51
Upon liquidation of a domestic mutual insurance company, any assets held in excess of its liabilities and the amounts which may be paid to its members as provided under sub. (4) (b)
shall be paid into the state treasury to the credit of the common school fund.
The maximum amount payable upon liquidation to any member for and on account of his or her membership in a domestic mutual insurance company, in addition to the insurance benefits promised in the policy, shall be the total of all premium payments made by the member with interest at the legal rate compounded annually.
Unclaimed and withheld funds. 645.73(1)(1)
The liquidator, as provided in ch. 177
, shall report and deliver to the secretary of revenue all unclaimed funds subject to distribution remaining in the liquidator's hands when he or she is ready to apply to the court for discharge, including the amount distributable to any creditor, shareholder, member or other person who is unknown or cannot be found or who is under disability with no person legally competent to receive a distributive share.
All funds withheld under s. 645.64
and not distributed shall upon discharge of the liquidator be deposited with the secretary of revenue and paid by the secretary in accordance with s. 645.64
. Any sums remaining which under s. 645.64
would revert to the undistributed assets of the insurer shall be transferred to the secretary of revenue and become the property of the state under sub. (1)
, unless the commissioner petitions the court to reopen the liquidation under s. 645.75
Termination of proceedings. 645.74(1)(1)
When all assets justifying the expense of collection and distribution have been collected and distributed under this chapter, the liquidator shall apply to the court for discharge. The court may grant the discharge and make any other orders deemed appropriate, including an order to transfer to the state treasury for the common school fund any remaining funds that are uneconomic to distribute.
Application by others.
Any other person may apply to the court at any time for an order under sub. (1)
. If the application is denied, the applicant shall pay the costs and expenses of the liquidator in resisting the application, including a reasonable attorney's fee.
After the liquidation proceeding has been terminated and the liquidator discharged, the commissioner or other interested party may at any time petition the court to reopen the proceedings for good cause, including the discovery of additional assets. If the court is satisfied that there is justification for reopening, it shall so order.
Disposition of records during and after termination of liquidation.
Records of any insurer in the process of liquidation or completely liquidated under this chapter shall be disposed of by the public records board in the same manner as state records under s. 16.61
Legislative Council Note, 1979: This section makes disposition of the records of insurers subject to liquidation under this chapter subject to the procedures established in s. 16.61, a system which did not exist at the time the former s. 645.76 was created. [Bill 20-S]
External audit of receiver's books.
The court in which the proceeding is pending may, as it deems desirable, cause audits to be made of the books of the commissioner relating to any receivership established under this chapter, and a report of each audit shall be filed with the commissioner and with the court. The books, records and other documents of the receivership shall be made available to the auditor at any time without notice. The expense of each audit shall be considered a cost of administration of the receivership.
Conservation of property of foreign or alien insurers found in this state. 645.81(1)(1)
Grounds for petition.
If a domiciliary liquidator has not been appointed, the commissioner may apply to the circuit court for Dane County by verified petition for an order directing him or her to conserve the property of an alien insurer not domiciled in this state or a foreign insurer on any one or more of the following grounds:
That any of its property has been sequestered by official action in its domiciliary state, or in any other state;
That enough of its property has been sequestered in a foreign country to give reasonable cause to fear that the insurer is or may become insolvent;
That its certificate of authority to do business in this state has been revoked or that none was ever issued, and that there are residents of this state with outstanding claims or outstanding policies.
Terms of order.
The court may issue the order in whatever terms it considers appropriate. The recording of the order with any register of deeds in this state imparts the same notice as a deed, bill of sale or other evidence of title recorded with that register of deeds.
Transformation to liquidation or ancillary receivership.
The conservator may at any time petition for and the court may grant an order under s. 645.82
to liquidate the assets of a foreign or alien insurer under conservation or, if appropriate, for an order under s. 645.84
to be appointed ancillary receiver.
Order to return to company.
The conservator may at any time petition the court for an order terminating conservation of an insurer. If the court finds that the conservation is no longer necessary, it shall order that the insurer be restored to possession of its property and the control of its business. The court may also make such finding and issue such order at any time upon its own motion.
Liquidation of property of foreign or alien insurers found in this state. 645.82(1)(1)
Grounds for petition.
If no domiciliary receiver has been appointed, the commissioner may apply to the circuit court for Dane County by verified petition for an order directing the commissioner to liquidate the assets found in this state of a foreign insurer or an alien insurer not domiciled in this state, on any of the following grounds:
Terms of order.
If it appears to the court that the best interests of creditors, policyholders and the public so require, the court may issue an order to liquidate in whatever terms it considers appropriate. The recording of the order with any register of deeds in this state imparts the same notice as a deed, bill of sale or other evidence of title filed or recorded with that register of deeds.
Conversion to ancillary proceeding.
If a domiciliary liquidator is appointed in a reciprocal state while a liquidation is proceeding under this section, the liquidator under this section shall thereafter act as ancillary receiver under s. 645.84
. If a domiciliary liquidator is appointed in a nonreciprocal state while a liquidation is proceeding under this section, the liquidator under this section may petition the court for permission to act as ancillary receiver under s. 645.84
On the same grounds as are specified in sub. (1)
, the commissioner may petition any appropriate federal district court to be appointed receiver to liquidate that portion of the insurer's assets and business over which the court will exercise jurisdiction, or any lesser part thereof that the commissioner deems desirable for the protection of the policyholders and creditors in this state. The commissioner may accept appointment as federal receiver if another person files a petition.
History: 1979 c. 102
s. 236 (21)
; 1993 a. 301
Foreign domiciliary receivers in other states. 645.83(1)(1)
Property rights and title: reciprocal state.
The domiciliary liquidator 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, accounts and other records of the insurer located in this state. The date of vesting shall be the date of the filing of the petition, if that date is specified by the domiciliary law for the vesting of property in the domiciliary state; otherwise, the date of vesting shall be the date of entry of the order directing possession to be taken. The domiciliary liquidator shall have the immediate right to recover balances due from agents and to obtain possession of the books, accounts and other records of the insurer located in this state. The domiciliary liquidator may also recover the other assets of the insurer located in this state, subject to s. 645.84 (2)
Property rights and title: state not a reciprocal state.
If a domiciliary liquidator is appointed for an insurer not domiciled in a reciprocal state, the commissioner of this 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, accounts and other records of the insurer located in this state, at the same time that the domiciliary liquidator is vested with title in the domicile. The commissioner of this state may petition for a conservation or liquidation order under s. 645.81
, or for an ancillary receivership under s. 645.84
, or after approval by the circuit court for Dane County may transfer title to the domiciliary liquidator, as the interests of justice and the equitable distribution of the assets require.
Claimants residing in this state may file claims with the liquidator or ancillary receiver, if any, in this state or with the domiciliary liquidator, if the domiciliary law permits. The claims must be filed on or before the last date fixed for the filing of claims in the domiciliary liquidation proceedings.
History: 1979 c. 102
Ancillary formal proceedings. 645.84(1)(1)
Appointment of ancillary receiver in this state.
If a domiciliary liquidator has been appointed for an insurer not domiciled in this state, the commissioner shall file a petition with the circuit court for Dane County requesting appointment as ancillary receiver in this state:
If the commissioner finds that there are sufficient assets of the insurer located in this state to justify the appointment of an ancillary receiver;
If 10 or more persons resident in this state having claims against the insurer file a petition with the commissioner requesting appointment of an ancillary receiver; or
If the protection of creditors or policyholders in this state so requires.
Terms of order.
The court may issue an order appointing an ancillary receiver in whatever terms it considers appropriate. The recording of the order with any register of deeds in this state imparts the same notice as a deed, bill of sale or other evidence of title filed or recorded with that register of deeds.
Property rights and title: ancillary receivers in this state.
When a domiciliary liquidator has been appointed in a reciprocal state, the ancillary receiver appointed in this state under sub. (1)
shall have the sole right to recover all the assets of the insurer in this state not already recovered by the domiciliary liquidator, except that the domiciliary liquidator shall be entitled to and have the sole right to recover balances due from agents and the books, accounts and other records of the insurer. The ancillary receiver shall have the right to recover balances due from agents and books, accounts and other records of the insurer, if such action is necessary to protect the assets because of inaction by the domiciliary liquidator. 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 state, and shall pay the necessary expenses of the proceedings. The ancillary receiver shall promptly transfer all remaining assets to the domiciliary liquidator. Subject to this section, the ancillary receiver and the ancillary receiver's deputies shall have the same powers and be subject to the same duties with respect to the administration of assets as a liquidator of an insurer domiciled in this state.
Property rights and title: foreign ancillary receivers.
When a domiciliary liquidator has been appointed in this state, ancillary receivers appointed in reciprocal states shall have, as to assets and books, accounts and other records located in their respective states, corresponding rights and powers to those prescribed in sub. (3)
for ancillary receivers appointed in this state.
History: 1979 c. 102
, 236 (6)
; 1993 a. 301
Ancillary summary proceedings.
The commissioner in his or her sole discretion may institute proceedings under ss. 645.21
at the request of the commissioner or other appropriate official of the domiciliary state of any nondomestic insurer having property located in this state.
History: 1979 c. 102
Claims of nonresidents against insurers domiciled in this state. 645.86(1)(1)
In a liquidation proceeding begun in this state against an insurer domiciled in this state, claimants residing in foreign countries or in states not reciprocal states must file claims in this state, and claimants residing in reciprocal states may file claims either with the ancillary receivers, if any, in their respective states, or with the domiciliary liquidator. Claims must be filed on or before the last dates fixed for the filing of claims in the domiciliary liquidation proceeding.
Claims belonging to claimants residing in reciprocal states may be proved either in the liquidation proceeding in this state as provided in this chapter, or in ancillary proceedings, if any, in the reciprocal states. If notice of the claim and opportunity to appear and be heard is afforded the domiciliary liquidator of this state as provided in s. 645.87
with respect to ancillary proceedings in this state, the final allowance of claims by the courts in ancillary proceedings in reciprocal states shall be conclusive as to amount and as to priority against special deposits or other security located in the ancillary states, but shall not be conclusive with respect to priorities against general assets under s. 645.68
Claims of residents against insurers domiciled in reciprocal states. 645.87(1)(1)
In a liquidation proceeding in a reciprocal state against an insurer domiciled in that state, claimants against the insurer who reside within this state may file claims either with the ancillary receiver, if any, in this state, or with the domiciliary liquidator. Claims must be filed on or before the last dates fixed for the filing of claims in the domiciliary liquidation proceeding.
Claims belonging to claimants residing in this state may be proved either in the domiciliary state under the law of that state or in ancillary proceedings, if any, in this state. If a claimant elects to prove his or her claim in this state, the claimant shall file the claim with the court in the manner provided in ss. 645.61
. The ancillary receiver shall make his or her recommendation to the court as under s. 645.71
. The ancillary receiver also shall arrange a date for hearing if necessary under s. 645.65
and shall give notice to the liquidator in the domiciliary state, either by registered mail or by personal service at least 40 days prior to the date set for hearing. If the domiciliary liquidator, within 30 days after the giving of such notice, gives notice in writing to the ancillary receiver and to the claimant, either by registered mail or by personal service, of his or her intention to contest the claim, the domiciliary liquidator shall be entitled to appear or to be represented in any proceeding in this state involving the adjudication of the claim. The final allowance of the claim by the courts of this state shall be accepted as conclusive as to amount and as to priority against special deposits or other security located in this state.
History: 1979 c. 102
Attachment, garnishment and levy of execution.
During the pendency in this or any other state of a liquidation proceeding, whether called by that name or not, no action or proceeding that is in the nature of an attachment, garnishment or levy of execution or that would interfere with proceedings under this chapter or ch. 646
shall be commenced or maintained in this state or elsewhere against the delinquent insurer or its assets.
History: 1985 a. 216
Interstate priorities. 645.89(1)(1)
In a liquidation proceeding in this state involving one or more reciprocal states, the order of distribution of the domiciliary state shall control as to all claims of residents of this and reciprocal states. All claims of residents of reciprocal states shall be given equal priority of payment from general assets regardless of where such assets are located.
Priority of special deposit claims.
The owners of special deposit claims against an insurer for which a liquidator is appointed in this or any other state shall be given priority against the special deposits in accordance with the statutes governing the creation and maintenance of the deposits. If there is a deficiency in any deposit so that the claims secured by it are not fully discharged from it, the claimants may claim against a security fund or share in the general assets, but the sharing shall be deferred until general creditors having the same priority, and also claimants against other special deposits having the same priority who have received smaller percentages from their respective special deposits, have been paid percentages of their claims equal to the percentage paid from the special deposit.
Priority of secured claims.
The owner of a secured claim against an insurer for which a liquidator has been appointed in this or any other state may surrender the security for the claim and file the claim as a general creditor, or the claim may be discharged by resort to the security in accordance with s. 645.67
, in which case the deficiency, if any, shall be treated as a claim against the general assets of the insurer or the appropriate security fund on the same basis as claims of unsecured creditors having the same priority.
History: 1979 c. 102
Subordination of claims for noncooperation.
If an ancillary receiver in another state or foreign country, whether called by that name or not, fails to transfer to the domiciliary liquidator in this state any assets within his or her control other than special deposits, diminished only by the expenses of the ancillary receivership, if any, the claims filed in the ancillary receivership or with a security fund in that jurisdiction, other than special deposit claims or secured claims, shall be placed in the class of claims under s. 645.68 (8)
History: 1979 c. 102
s. 236 (13)
; 1979 c. 109