(a) Mutual debts ormutual credits, whether arising out of one or more contracts between theinsurer and another person in connection with any action or proceeding underthis Article shall be set off and the balance only shall be allowed or paid,except as provided in subsections (b), (d), and (e) of this section and in G.S.58‑30‑175.
(b) No setoff shall beallowed in favor of any person where:
(1) The obligation ofthe insurer to the person would not at the date of the filing of a petition forliquidation entitle the person to share as a claimant in the assets of theinsurer;
(2) The obligation ofthe insurer to the person was purchased by or transferred to the person with aview to its being used as a setoff;
(3) The obligation of theperson is to pay an assessment levied against the members or subscribers of theinsurer, or is to pay a balance upon a subscription to the capital stock of theinsurer, or is in any other way in the nature of a capital contribution;
(4) Repealed by SessionLaws 1995 (Regular Session, 1996), c. 658, s. 1.
(5) The obligation ofthe insurer is owed to an affiliate of the person, or to any other entity orassociation other than the person;
(6) The obligation ofthe person is owed to an affiliate of the insurer, or to any other entity orassociation other than the insurer;
(7) The obligationsbetween the person and the insurer arise out of transactions where either theperson or the insurer has assumed risks and obligations from the other partyand then has ceded back to that party substantially the same risks andobligations;
(8) The obligation ofthe person is to pay to the insurer sums held in a fiduciary capacity for theinsurer; or
(9) The person alone ortogether with any other member of its insurance company holding system ownsfifty percent (50%) or more of the voting stock of the insurer.
(c) A setoff shall bepermitted to local agents against agents' balances otherwise payable to thedomiciliary or ancillary receiver for the amount expended by the agents toreplace insurance coverage of their insureds and the reasonable expensesincident thereto as a result of any domestic, foreign or alien insurer beingplaced in delinquency proceedings. Agents claiming a setoff shall within 60days of replacing coverage provide a verified accounting of the replacement ofthe insurance to the domiciliary receiver, the ancillary receiver, if any, andthe North Carolina Insurance Guaranty Association or similar organization inthe state of residence of the policyholder. The verified accounting shallinclude the name of the agent, the name of the insured, the policy number, thereplacement policy number, the cost of the replacement policy, the amount ofunearned premium under each policy as to which setoff is claimed, any claimedexpenses and a verification that the accounting has been provided to each ofthe persons and entities described herein. Unearned premiums set off asprovided above in any amount shall be deemed paid in full by the insurer and noperson shall have a claim for the unearned premiums against the North CarolinaInsurance Guaranty Association or similar organization in the state ofresidence of the policyholder.
(d) The receiver shallprovide persons with accounting statements identifying debts which are currentlydue and payable. Where a person owes to the insurer currently due and payablebalances, against which the person asserts setoff of mutual credits which maybecome due and payable from the insurer in the future, the person shallpromptly pay to the receiver the currently due and payable amount; providedthat, notwithstanding any other provision of this Article, the receiver shallpromptly and fully refund, to the extent of the person's prior payments, anymutual credits that become due and payable to the person by the insurer.
(e) Notwithstanding anyother provision of this section, a setoff of sums due on obligations in thenature of those set forth in subdivision (b)(7) of this section shall beallowed for those sums accruing from business written where the contracts wereentered into, renewed, or extended with the express written approval of theinsurance regulator of the state of domicile of the now insolvent insurer, whenin the judgment of the regulator it was necessary to provide reinsurance inorder to prevent or mitigate a threatened impairment or insolvency of theinsurer in connection with the exercise of the regulator's officialresponsibilities. (1989, c. 452, s. 1; 1991, c. 681, s. 47; 1995 (Reg.Sess., 1996), c. 658, s. 1.)
(a) Mutual debts ormutual credits, whether arising out of one or more contracts between theinsurer and another person in connection with any action or proceeding underthis Article shall be set off and the balance only shall be allowed or paid,except as provided in subsections (b), (d), and (e) of this section and in G.S.58‑30‑175.
(b) No setoff shall beallowed in favor of any person where:
(1) The obligation ofthe insurer to the person would not at the date of the filing of a petition forliquidation entitle the person to share as a claimant in the assets of theinsurer;
(2) The obligation ofthe insurer to the person was purchased by or transferred to the person with aview to its being used as a setoff;
(3) The obligation of theperson is to pay an assessment levied against the members or subscribers of theinsurer, or is to pay a balance upon a subscription to the capital stock of theinsurer, or is in any other way in the nature of a capital contribution;
(4) Repealed by SessionLaws 1995 (Regular Session, 1996), c. 658, s. 1.
(5) The obligation ofthe insurer is owed to an affiliate of the person, or to any other entity orassociation other than the person;
(6) The obligation ofthe person is owed to an affiliate of the insurer, or to any other entity orassociation other than the insurer;
(7) The obligationsbetween the person and the insurer arise out of transactions where either theperson or the insurer has assumed risks and obligations from the other partyand then has ceded back to that party substantially the same risks andobligations;
(8) The obligation ofthe person is to pay to the insurer sums held in a fiduciary capacity for theinsurer; or
(9) The person alone ortogether with any other member of its insurance company holding system ownsfifty percent (50%) or more of the voting stock of the insurer.
(c) A setoff shall bepermitted to local agents against agents' balances otherwise payable to thedomiciliary or ancillary receiver for the amount expended by the agents toreplace insurance coverage of their insureds and the reasonable expensesincident thereto as a result of any domestic, foreign or alien insurer beingplaced in delinquency proceedings. Agents claiming a setoff shall within 60days of replacing coverage provide a verified accounting of the replacement ofthe insurance to the domiciliary receiver, the ancillary receiver, if any, andthe North Carolina Insurance Guaranty Association or similar organization inthe state of residence of the policyholder. The verified accounting shallinclude the name of the agent, the name of the insured, the policy number, thereplacement policy number, the cost of the replacement policy, the amount ofunearned premium under each policy as to which setoff is claimed, any claimedexpenses and a verification that the accounting has been provided to each ofthe persons and entities described herein. Unearned premiums set off asprovided above in any amount shall be deemed paid in full by the insurer and noperson shall have a claim for the unearned premiums against the North CarolinaInsurance Guaranty Association or similar organization in the state ofresidence of the policyholder.
(d) The receiver shallprovide persons with accounting statements identifying debts which are currentlydue and payable. Where a person owes to the insurer currently due and payablebalances, against which the person asserts setoff of mutual credits which maybecome due and payable from the insurer in the future, the person shallpromptly pay to the receiver the currently due and payable amount; providedthat, notwithstanding any other provision of this Article, the receiver shallpromptly and fully refund, to the extent of the person's prior payments, anymutual credits that become due and payable to the person by the insurer.
(e) Notwithstanding anyother provision of this section, a setoff of sums due on obligations in thenature of those set forth in subdivision (b)(7) of this section shall beallowed for those sums accruing from business written where the contracts wereentered into, renewed, or extended with the express written approval of theinsurance regulator of the state of domicile of the now insolvent insurer, whenin the judgment of the regulator it was necessary to provide reinsurance inorder to prevent or mitigate a threatened impairment or insolvency of theinsurer in connection with the exercise of the regulator's officialresponsibilities. (1989, c. 452, s. 1; 1991, c. 681, s. 47; 1995 (Reg.Sess., 1996), c. 658, s. 1.)
(a) Mutual debts ormutual credits, whether arising out of one or more contracts between theinsurer and another person in connection with any action or proceeding underthis Article shall be set off and the balance only shall be allowed or paid,except as provided in subsections (b), (d), and (e) of this section and in G.S.58‑30‑175.
(b) No setoff shall beallowed in favor of any person where:
(1) The obligation ofthe insurer to the person would not at the date of the filing of a petition forliquidation entitle the person to share as a claimant in the assets of theinsurer;
(2) The obligation ofthe insurer to the person was purchased by or transferred to the person with aview to its being used as a setoff;
(3) The obligation of theperson is to pay an assessment levied against the members or subscribers of theinsurer, or is to pay a balance upon a subscription to the capital stock of theinsurer, or is in any other way in the nature of a capital contribution;
(4) Repealed by SessionLaws 1995 (Regular Session, 1996), c. 658, s. 1.
(5) The obligation ofthe insurer is owed to an affiliate of the person, or to any other entity orassociation other than the person;
(6) The obligation ofthe person is owed to an affiliate of the insurer, or to any other entity orassociation other than the insurer;
(7) The obligationsbetween the person and the insurer arise out of transactions where either theperson or the insurer has assumed risks and obligations from the other partyand then has ceded back to that party substantially the same risks andobligations;
(8) The obligation ofthe person is to pay to the insurer sums held in a fiduciary capacity for theinsurer; or
(9) The person alone ortogether with any other member of its insurance company holding system ownsfifty percent (50%) or more of the voting stock of the insurer.
(c) A setoff shall bepermitted to local agents against agents' balances otherwise payable to thedomiciliary or ancillary receiver for the amount expended by the agents toreplace insurance coverage of their insureds and the reasonable expensesincident thereto as a result of any domestic, foreign or alien insurer beingplaced in delinquency proceedings. Agents claiming a setoff shall within 60days of replacing coverage provide a verified accounting of the replacement ofthe insurance to the domiciliary receiver, the ancillary receiver, if any, andthe North Carolina Insurance Guaranty Association or similar organization inthe state of residence of the policyholder. The verified accounting shallinclude the name of the agent, the name of the insured, the policy number, thereplacement policy number, the cost of the replacement policy, the amount ofunearned premium under each policy as to which setoff is claimed, any claimedexpenses and a verification that the accounting has been provided to each ofthe persons and entities described herein. Unearned premiums set off asprovided above in any amount shall be deemed paid in full by the insurer and noperson shall have a claim for the unearned premiums against the North CarolinaInsurance Guaranty Association or similar organization in the state ofresidence of the policyholder.
(d) The receiver shallprovide persons with accounting statements identifying debts which are currentlydue and payable. Where a person owes to the insurer currently due and payablebalances, against which the person asserts setoff of mutual credits which maybecome due and payable from the insurer in the future, the person shallpromptly pay to the receiver the currently due and payable amount; providedthat, notwithstanding any other provision of this Article, the receiver shallpromptly and fully refund, to the extent of the person's prior payments, anymutual credits that become due and payable to the person by the insurer.
(e) Notwithstanding anyother provision of this section, a setoff of sums due on obligations in thenature of those set forth in subdivision (b)(7) of this section shall beallowed for those sums accruing from business written where the contracts wereentered into, renewed, or extended with the express written approval of theinsurance regulator of the state of domicile of the now insolvent insurer, whenin the judgment of the regulator it was necessary to provide reinsurance inorder to prevent or mitigate a threatened impairment or insolvency of theinsurer in connection with the exercise of the regulator's officialresponsibilities. (1989, c. 452, s. 1; 1991, c. 681, s. 47; 1995 (Reg.Sess., 1996), c. 658, s. 1.)
