House of Representatives State of Utah


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        SALT LAKE CITY, UTAH 84114-5030 . (801) 538-1029         
        January 30, 2007

Mr. Speaker:

    The Business and Labor Committee reports a favorable recommendation on H.B. 340, INSURER RECEIVERSHIP ACT, by Representative J. Dunnigan, with the following amendments:

1.    Page 128, Lines 3954 through 3958 :    

             3954          (ii)

  in addition to paying other Class 1 claims described in Subsection 31A- 27a-701(2)(a), if the payment assists or results in the collection or recovery of property of the insurer that provides a net benefit to creditors of the estate,       pay Class 1 administrative costs of the estate:

             3955          
{   (A) at the liquidator's sole discretion;   }

             3956          
{   (B)   }        (A)       upon approval of the receivership court; and

             3957          
{   (C) where the payment assists or results in the collection or recovery of property of the

             3958      insurer that provides a net benefit to creditors of the estate;   }
    
  (B) only to the extent of the collection or recovery of the property;      


2.    Page 196, Lines 6068 through 6072 :    

             6068          
{   (d)   }        (e)       "Other secured obligation" means an obligation, such as a reinsurance or

             6069      retrospective premium obligation, that is:
             6070          (i) payable by the insured to the insurer; and
             6071          (ii) secured by collateral that also secures a deductible obligation.
             6072          
{   (e)   }        (f)       "Uncovered claim" means a deductible claim that is secured by collateral but that:


3.    Page 199, Lines 6148 through 6149 :    

             6148          (iii) Collateral may not be considered as a general asset of the estate, except as
             6149      provided in Subsections
{   (6)(b)   }        (5)(c)       and (8).


4.    Page 200, Lines 6168 through 6169 :    

             6168          (e) (i) The receiver shall first apply or reserve collateral to the insured's obligations
             6169      referenced in
{   Subsection (6)(b)   }        Subsections (5)(c)(i)(A) and (C)       .


5.    Page 203, Line 6277 :    

             6277      timely manner.
  (10) This section modifies Subsection 31A-22-1010(2)(b) to the extent necessary to permit an insured to participate in the payment of the insurance claims and losses by reimbursement of a receiver or affected guaranty association as provided in this section.      

    Respectfully,

    Stephen D. Clark
    Committee Chair

Voting: 12-0-1
3 HB0340.HC1.wpd 1/30/07 4:55 pm anicholson/AMN PO/AMN

Bill Number
Action Class
Action Code

*HB0340*
*H*
*HCRAMD*

 HB0340
H
HCRAMD