(215 ILCS 5/131.25a) (from Ch. 73, par. 743.25a)
Sec. 131.25a.
Recovery upon order of liquidation or rehabilitation of
domestic insurer.
(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, |
| 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.
(Source: P.A. 87-1090.)
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