CHAPTER 4. INTERSTATE RELATIONS

IC 27-9-4
    Chapter 4. Interstate Relations

IC 27-9-4-1
Conservators for alien or foreign insurers; grounds forappointment; procedure; order; termination
    Sec. 1. (a) If a domiciliary liquidator has not been appointed, thecommissioner may apply to the Marion County circuit court byverified petition for an order directing him to act as conservator toconserve the property of an alien insurer not domiciled in Indiana ora foreign insurer on any one (1) or more of the following grounds:
        (1) Any of the grounds stated in IC 27-9-3-1.
        (2) That any part of its property has been sequestered by officialaction in any other state.
        (3) That enough of its property has been sequestered in aforeign country to give reasonable cause to fear that the insureris or may become insolvent.
        (4) That its certificate of authority to do business in Indiana hasbeen revoked or that none was ever issued.
        (5) That there are residents of Indiana with outstanding claimsor outstanding policies.
    (b) When an order is sought under subsection (a), the MarionCounty circuit court shall cause the insurer to be given a notice anda time within which to respond to the request as is reasonable underthe circumstances.
    (c) The Marion County circuit court may issue the order inwhatever terms the court considers appropriate. The filing orrecording of the order with the clerk of the Marion County circuitcourt or the recorder of deeds of the county in which the principalbusiness of the company is located, shall impart the same notice asa deed, bill of sale, or other evidence of title duly filed or recordedwith that recorder of deeds would have imparted.
    (d) The conservator may at any time petition for and the MarionCounty circuit court may grant an order under section 2 of thischapter to liquidate assets of a foreign or alien insurer underconservation, or, if appropriate, for an order under section 4 of thischapter to be appointed ancillary receiver.
    (e) The conservator may at any time petition the Marion Countycircuit court for an order terminating conservation of an insurer. Ifthe court finds that the conservation is no longer necessary, the courtshall order the insurer be restored to possession of its property andthe control of its business. The court may also make such finding andissue such order at any time upon motion of any interested party, butif that motion is denied all costs shall be assessed against such party.
As added by Acts 1979, P.L.255, SEC.1.

IC 27-9-4-2
Liquidation of assets of foreign or alien insurer; grounds;procedure; order; domiciliary proceedings; federal courtproceedings; payment of claims    Sec. 2. (a) If no domiciliary receiver has been appointed, thecommissioner may apply to the Marion County circuit court byverified petition for an order directing him to liquidate the assetsfound in Indiana of a foreign insurer or an alien insurer not domiciledin Indiana, on any of the grounds:
        (1) specified in IC 27-9-3-1 or IC 27-9-3-6; or
        (2) specified in section 1(a)(2) through 1(a)(4).
    (b) When an order is sought under subsection (a), the MarionCounty circuit court shall cause the insurer to be given a notice anda time to respond to the request as is reasonable under thecircumstances.
    (c) If it appears to the court that the best interests of creditors,policyholders, and the public require, the Marion County circuitcourt may issue an order to liquidate in whatever terms the courtconsiders appropriate. The filing or recording of the order with theclerk of the Marion County circuit court or the recorder of deeds ofthe county in which the principal business of the company is locatedor the county in which its principal office or place of business islocated, shall impart the same notice as a deed, bill of sale, or otherevidence of title duly filed or recorded with that recorder of deedswould have imparted.
    (d) If a domiciliary liquidator is appointed in a reciprocal statewhile a liquidation is proceeding under this section, the liquidatorunder this section shall act as ancillary receiver under section 4 ofthis chapter. If a domiciliary liquidator is appointed in anonreciprocal state while a liquidation is proceeding under thissection, the liquidator under this section may petition the MarionCounty circuit court for permission to act as ancillary receiver undersection 4 of this chapter.
    (e) On the same grounds as are specified in subsection (a), thecommissioner may petition any appropriate federal district court tobe appointed receiver to liquidate that part of the insurer's assets andbusiness over which the court will exercise jurisdiction, or any lesserpart of the assets that the commissioner considers desirable for theprotection of the policyholders and creditors in Indiana.
    (f) The district court may order the commissioner, when he hasliquidated the assets of a foreign or alien insurer under this section,to pay claims of residents of Indiana against the insurer under suchrules as to the liquidation of insurers under IC 27-9 as are otherwisecompatible with this section.
As added by Acts 1979, P.L.255, SEC.1.

IC 27-9-4-3
Insurers domiciled in reciprocal states; title to property in Indiana;filing of claims by Indiana residents
    Sec. 3. (a) The domiciliary liquidator of an insurer domiciled ina reciprocal state shall, except as to special deposits and security onsecured claims under section 4(c) of this chapter, be vested byoperation of law with the title to all of the assets, property, contracts,and rights of action, insurance producers' balances, and all of the

books, accounts, and other records of the insurer located in Indiana.The date of vesting shall be the date of the filing of the petition, ifthat date is specified by the domiciliary law for the vesting ofproperty in the domiciliary state. Otherwise, the date of vesting shallbe the date of entry of the order directing possession to be taken. Thedomiciliary liquidator shall have the immediate right to recoverbalances due from insurance producers and to obtain possession ofthe books, accounts, and other records of the insurer located inIndiana. The domiciliary liquidator also shall have the right torecover all other assets of the insurer located in Indiana, subject tosection 4 of this chapter.
    (b) If a domiciliary liquidator is appointed for an insurer notdomiciled in a reciprocal state, the commissioner shall be vested byoperation of law with the title to all of the property, contracts andrights of action, and all of the books, accounts, and other records ofthe insurer located in Indiana, at the same time that the domiciliaryliquidator is vested with title in the domicile. The Indiana insurancecommissioner may petition for a conservation or liquidation orderunder section 1 or 2 of this chapter, or for an ancillary receivershipunder section 4 of this chapter, or after approval by the MarionCounty circuit court may transfer title to the domiciliary liquidator,as the interests of justice and the equitable distribution of the assetsrequire.
    (c) Claimants residing in Indiana may file claims with theliquidator or ancillary receiver, if any, in Indiana or with thedomiciliary liquidator, if the domiciliary law permits. The claimsmust be filed on or before the last date fixed for the filing of claimsin the domiciliary liquidation proceedings.
As added by Acts 1979, P.L.255, SEC.1. Amended by P.L.178-2003,SEC.79.

IC 27-9-4-4
Ancillary state receivers
    Sec. 4. (a) If a domiciliary liquidator has been appointed for aninsurer not domiciled in Indiana, the commissioner may file apetition with the Marion County circuit court requesting appointmentas ancillary receiver in Indiana if:
        (1) he finds that there are sufficient assets of the insurer locatedin Indiana to justify the appointment of an ancillary receiver;and
        (2) the protection of creditors or policyholders in Indianarequires it.
    (b) The Marion County circuit court may issue an orderappointing an ancillary receiver in whatever terms it considersappropriate. The filing or recording of the order with the recorder ofdeeds in Indiana imparts the same notice as a deed, bill of sale, orother evidence of title duly filed or recorded with that recorder ofdeeds.
    (c) When a domiciliary liquidator has been appointed in areciprocal state, then the ancillary receiver appointed in Indiana may,

whenever necessary, aid and assist the domiciliary liquidator inrecovering assets of the insurer located in Indiana. The ancillaryreceiver shall, as soon as practicable, liquidate from their respectivesecurities those special deposit claims and secured claims which areproved and allowed in the ancillary proceedings in Indiana, and shallpay the necessary expenses of the proceedings. He shall promptlytransfer all remaining assets, books, accounts and records to thedomiciliary liquidator. Subject to this section, the ancillary receiverand his deputies shall have the same powers and be subject to thesame duties with respect to the administration of assets as aliquidator of an insurer domiciled in Indiana.
    (d) When a domiciliary liquidator has been appointed in Indiana,ancillary receivers appointed in reciprocal states shall have, as toassets and books, accounts, and other records in their respectivestates, corresponding rights, duties and powers to those provided insubsection (c) for ancillary receivers appointed in Indiana.
As added by Acts 1979, P.L.255, SEC.1.

IC 27-9-4-5
Summary proceedings at request of officials of domiciliary states
    Sec. 5. The commissioner in his sole discretion may instituteproceedings under IC 27-9-2 at the request of the commissioner orother appropriate insurance official of the domiciliary state of anyforeign or alien insurer having property located in Indiana.
As added by Acts 1979, P.L.255, SEC.1.

IC 27-9-4-6
Claims by residents of other states
    Sec. 6. (a) In a liquidation proceeding begun in Indiana against aninsurer domiciled in Indiana, claimants residing in foreign countriesor in states not reciprocal states must file claims in Indiana, andclaimants residing in reciprocal states may file claims either with theancillary receivers, if any, in their respective states, or with thedomiciliary liquidator. Claims must be filed on or before the last datefixed for the filing of claims in the domiciliary liquidationproceeding.
    (b) Claims belonging to claimants residing in reciprocal statesmay be proved either in the liquidation proceeding in Indiana asprovided in IC 27-9, or in ancillary proceedings, if any, in thereciprocal states. If notice of the claims and opportunity to appearand be heard is afforded the domiciliary liquidator of Indiana asprovided in section 7(b) of this chapter with respect to ancillaryproceedings, the final allowance of claims by the courts in ancillaryproceedings in reciprocal states shall be conclusive as to amount andas to priority against special deposits or other security located inancillary states, but shall not be conclusive with respect to prioritiesagainst general assets under IC 27-9-3-40.
As added by Acts 1979, P.L.255, SEC.1.

IC 27-9-4-7 Claims by residents in proceeding in other states or in ancillaryproceedings in Indiana
    Sec. 7. (a) In a liquidation proceeding in a reciprocal state againstan insurer domiciled in that state, claimants against the insurer whoreside within Indiana may file claims either with the ancillaryreceiver, if any, in Indiana, or with the domiciliary liquidator. Claimsmust be filed on or before the last dates fixed for the filing of claimsin the domiciliary liquidation proceeding.
    (b) Claims belonging to claimants residing in Indiana may beproved either in the domiciliary state under the law of that state, orin ancillary proceedings, if any, in Indiana. If a claimant elects toprove his claim in Indiana, he shall file his claim with the liquidatorin the manner provided in IC 27-9-3-33 and IC 27-9-3-34. Theancillary receiver shall make his recommendation to the court asunder IC 27-9-3-41. He shall also arrange a date for hearing ifnecessary under IC 27-9-3-37 and shall give notice to the liquidatorin the domiciliary state, either by certified mail or by personalservice at least forty (40) days prior to the date set for hearing. If thedomiciliary liquidator, within thirty (30) days after the giving of suchnotice, gives notice in writing to the ancillary receiver and to theclaimant, either by certified mail or by personal service, of hisintention to contest the claim, he may appear or be represented in anyproceeding in Indiana involving the adjudication of the claim.
    (c) The final allowance of the claim by the courts of Indiana shallbe accepted as conclusive as to amount and as to priority againstspecial deposits or other security located in Indiana.
As added by Acts 1979, P.L.255, SEC.1.

IC 27-9-4-8
Attachment, garnishment, or levy of execution
    Sec. 8. During the pendency in this or any other state of aliquidation proceeding, whether called by that name or not, no actionor proceeding in the nature of an attachment, garnishment, or levy ofexecution shall be commenced or maintained in Indiana against thedelinquent insurer or its assets.
As added by Acts 1979, P.L.255, SEC.1.

IC 27-9-4-9
Proceedings involving reciprocal states, orders of distribution, andpriority of claims; special deposit claims; secured claims
    Sec. 9. (a) In a liquidation proceeding in Indiana involving one (1)or more reciprocal states, the order of distribution of the domiciliarystate shall control as to all claims of residents of this and reciprocalstates. All claims of residents of reciprocal states shall be given equalpriority of payment from general assets regardless of where thoseassets are located.
    (b) The owners of special deposit claims against an insurer forwhich a liquidator is appointed in this or any other state shall begiven priority against the special deposits in accordance with thestatutes governing the creation and maintenance of the deposits. If

there is a deficiency in any deposit, so that the claims secured by itare not fully discharged from it, the claimants may share in thegeneral assets, but the sharing shall be deferred until generalcreditors, and also claimants against other special deposits who havereceived smaller percentages from their respective special deposits,have been paid percentages of their claims equal to the percentagepaid from the special deposit.
    (c) The owner of a secured claim against an insurer for which aliquidator has been appointed in this or any other state may surrenderhis security and file his claim as a general creditor, or the claim maybe discharged by resort to the security in accordance withIC 27-9-3-39, in which case the deficiency, if any, shall be treated asa claim against the general assets of the insurer on the same basis asclaims of unsecured creditors.
As added by Acts 1979, P.L.255, SEC.1.

IC 27-9-4-10
Failure by ancillary receiver to transfer assets
    Sec. 10. If an ancillary receiver in another state or foreign country,whether called by that name or not, fails to transfer to the domiciliaryliquidator in Indiana any assets within his control other than specialdeposits, diminished only by the expenses of the ancillaryreceivership, if any, the claims filed in the ancillary receivership,other than special deposit claims or secured claims, shall be placedin the class of claims under IC 27-9-3-40(7).
As added by Acts 1979, P.L.255, SEC.1.