20-1571. Use of the unearned premium reserve
on liquidation, dissolution or insolvency
A. If an order of rehabilitation or of liquidation shall have been entered with
respect to a title insurer in accordance with the provisions of article 4 of chapter 3 of
this title, then, and notwithstanding the provisions of such article:
1. Such amount of the assets of such title insurer equal to the unearned premium
reserve then remaining as is necessary may be used to pay for reinsurance of the
liability of such title insurer upon all outstanding policies of title insurance, as to
which claims for losses by the holders are not then pending, the balance, if any, of
assets equal to the unearned premium reserve fund then remaining, then to be transferred
to the general assets of the title insurer.
2. The assets other than the unearned premium reserve shall be available to pay
claims for losses sustained by holders of policies then pending or arising up to the time
reinsurance is effected. In the event that claims for losses are in excess of such other
assets of the title insurer, such claims, when established, shall be paid pro rata out of
the surplus assets attributable to the unearned premium reserve, to the extent of such
surplus, if any.
B. In the event that reinsurance is not obtained, the unearned premium reserve and
assets constituting minimum capital, or so much as remains thereof after outstanding
claims have been paid, shall constitute a trust fund to be held by the director for
twenty years, out of which claims of policyholders shall be paid as they arise. The
balance, if any, of such fund shall, at the expiration of twenty years, revert to the
general assets of the title insurer.
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