382.285. Liquidation or rehabilitation, effects--maximum amount recoverable--liability, parent company, when. - Missouri Statutes

Liquidation or rehabilitation, effects--maximum amountrecoverable--liability, parent company, when.

382.285. 1. If an order for liquidation or rehabilitationof a domestic insurer has been entered, the receiver appointedunder such order shall have a right to recover on behalf of theinsurer, from any parent corporation or holding company or personor affiliate who otherwise controlled the insurer, the amount ofdistributions, other than distributions of shares of the sameclass of stock, paid by the insurer on its capital stock, or anypayment in the form of a bonus, termination settlement orextraordinary lump sum salary adjustment made by the insurer orits subsidiary to a director, officer or employee, where thedistribution or payment is made at any time during the one yearpreceding the petition for liquidation, conservation orrehabilitation, as the case may be, subject to the limitations ofsubsections 2, 3, and 4 of this section.

2. No such distribution shall be recoverable if the parentor affiliate shows that when paid such distribution was lawfuland reasonable, and that the insurer did not know and could nothave reasonably known that such distribution might adverselyaffect the ability of the insurer to fulfill its contractualobligations.

3. Any person who was a parent corporation or holdingcompany or a person who otherwise controlled the insurer oraffiliate at the time such distributions were paid shall beliable up to the amount of distributions or payments undersubsection 1 of this section such person received. Any personwho otherwise controlled the insurer at the time suchdistributions were declared shall be liable up to the amount ofdistributions he would have received if they had been paidimmediately. If two or more persons are liable with respect tothe same distributions, they shall be jointly and severallyliable.

4. The maximum amount recoverable under this subsectionshall be the amount needed in excess of all other availableassets of the impaired or insolvent insurer to pay thecontractual obligations of the impaired or insolvent insurer andto reimburse any guaranty funds.

5. To the extent that any person liable under subsection 3of this section is insolvent or otherwise fails to pay claims duefrom it pursuant to such subsection, its parent corporation orholding company or person who otherwise controlled it at the timethe distribution was paid shall be jointly and severally liablefor any resulting deficiency in the amount recovered from suchparent corporation or holding company or person who otherwisecontrolled it.

(L. 1992 H.B. 1574)