375.1202. Reinsurers, amounts recoverable not reduced due to delinquency proceedings--exceptions. - Missouri Statutes

Reinsurers, amounts recoverable not reduced due to delinquencyproceedings--exceptions.

375.1202. 1. The amount recoverable by the liquidator fromreinsurers shall not be reduced as a result of the delinquency proceedings,regardless of any provision in the reinsurance contract or other agreement.Payment made directly to an insured or other creditor shall not diminishthe reinsurer's obligation to the insurer's estate except where:

(1) The reinsurance contract specifically provides for payment to thenamed insured, assignee or named beneficiary of the policy issued by theceding insurer in the event of the ceding insurer's insolvency; or

(2) The assuming insurer, with the consent of the direct insured orinsureds, has directly assumed the ceding insurer's policy obligations tothe payees under such policies in substitution for the ceding insurer'sobligations to such payees.

2. Notwithstanding subsection 1 of this section, in the event that alife and health insurance guaranty association has made the election tosucceed to the rights and obligations of the insolvent insurer under thecontract of reinsurance, then the reinsurer's liability to pay coveredreinsured claims shall continue under the contract of reinsurance, subjectto the payment to the reinsurer of the reinsurance premiums for suchcoverage. Payment for such reinsured claims shall only be made by thereinsurer pursuant to the direction of the guaranty association or itsdesignated successor. Any payment made at the direction of the guarantyassociation or its designated successor by the reinsurer will discharge thereinsurer of all further liability to any other party for said claimpayment.

(L. 1991 H.B. 385, et al. § 81, A.L. 2002 H.B. 1568)