617.23 Liability of affiliates. - Wisconsin Statutes

617.23

617.23 Liability of affiliates.

617.23(1)

(1) Right of receiver to recover dividends paid. If an order for the liquidation, rehabilitation or conservation of an insurer authorized to do business in this state is entered under ch. 645, the receiver appointed under the order shall have a right to recover on behalf of the insurer the amount of distributions other than stock dividends paid by the insurer on its capital stock at any time during the 5 years preceding the petition for liquidation, rehabilitation or conservation, subject to the limitations of subs. (2) to (4).

617.23(2)

(2) Dividend payments recoverable. No such dividend shall be recoverable if the insurer shows that when paid the distribution was lawful and reasonable, and that the insurer did not know and could not reasonably have known that the distribution might adversely affect the ability of the insurer to fulfill the obligations to claimants under its insurance contracts.

617.23(3)

(3) Persons liable.

617.23(3)(a)

(a) Affiliates at time of payment. Any person who was an affiliate of the insurer at the time the distributions were paid shall be liable up to the amount of distributions he or she received.

617.23(3)(b)

(b) Affiliates at time of declaration of distribution. Any person who was an affiliate of the insurer at the time the distributions were declared shall be liable up to the amount of distributions he or she would have received if they had been paid immediately.

617.23(3)(c)

(c) Joint and several liability. If under pars. (a) and (b) 2 persons are liable with respect to the same distributions, they shall be jointly and severally liable.

617.23(4)

(4) Aggregate limitation. The maximum amount recoverable under this section is:

617.23(4)(a)

(a) The amount needed in excess of all other available assets to pay all claims under the receivership.

617.23(4)(b)

(b) Reduced by any amount already paid to receivers under similar laws of other states.

617.23(5)

(5) Secondary liability. If any person liable under sub. (3) is insolvent, all its affiliates that controlled it at the time the dividend was paid are jointly and severally liable for any resulting deficiency in the amount recovered from the insolvent affiliate.

617.23 - ANNOT.

History: 1977 c. 203 ss. 95, 103; 1979 c. 102 ss. 146, 236 (5); 1989 a. 359; 1997 a. 254.