20-1571. Use of the unearned premium reserve on liquidation, dissolution or insolvency
281 words·~1 min read·
/az/title-20/20-1571A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
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.