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Michigan
Commissioner of Insurance v. National Life Ins. Co. of United States, 280 Mich.
344, 273 N.W. 592 (1937). Based upon the liquidation and dissolution
proceedings in Illinois, where a principal receiver of the insurance company
was appointed, and in Michigan, where an ancillary receiver was appointed,
the Illinois receiver, except by permission of the Michigan court, could not take
the company's property from Michigan. To protect the claim of the state of
Michigan for taxes, the Michigan court could impose conditions, including the
adjudication of the priority of the claims to be paid out of the funds turned
over to the Illinois receiver.
New Jersey Murphy v. Ambassador Ins. Co., 195 N.J. Super. 274, 478 A.2d 1243 (Ch. 1984).
The domiciliary receiver of an insurance company in delinquency proceedings
was entitled to possession of the insurer's assets wherever situated in order to
achieve the objectives of the Uniform Insurers Liquidation Act, including any
assets held out‐of‐state by the insurer's agents and brokers.
New York
In re National Surety Co., 286 N.Y. 216, 36 N.E.2d 119 (1941). When the insurance
commissioner took possession of domestic insurer and an ancillary
receivership was conducted in South Carolina, the New York commissioner, as
the domiciliary liquidator, was necessarily interested in the results of the South
Carolina proceedings and as such might request information of the ancillary
receivers and their attorneys concerning any surplus after payments of just
claims.
Liquidation of Special Deposits
Eighth Circuit American United Life Ins. Co. v. Fischer, 117 F. 2d 811, reviewed, 314 U.S. 549,
(8th Cir. 1941). Where the assets of an Iowa domiciled insurer had been
acquired by a now insolvent Michigan insurer through a reinsurance
agreement, the Circuit held the Iowa receiver had no legal title to securities on
special deposit in Iowa even though there was physical custody. The Iowa
insurance commissioner held merely a contractual interest for the benefit of
holders of policies originating in the Iowa company because the commissioner
was a custodian, bailee, or pledgee, depending on what function was required
under the reinsurance agreements. The Michigan commissioner was the
statutory successor of the insolvent Michigan company, and as such had title
to all its assets wherever situated.
Tenth Circuit
Alabama
Hobbs v. Occidental Life Ins. Co., 87 F.2d 380 (10th Cir. 1937). As against the
contention that the policies of an insolvent insurance company remained in
effect because of a reinsurance agreement entered into with a solvent insurer,
and thereby required the commissioner to maintain on deposit with the state
for the benefit of the policyholders certain securities, it was held that the order
requiring the commissioner to withdraw and forward the proceeds of such
securities was proper, as upon adjudication of insolvency the policies were
terminated and the holders became creditors for an amount equal to the then
value of their policies with no other rights than that of participating pro rata in
the assets.
Hopkins v. Lancaster, 254 F. 190 (N.D. Ala. 1918). When the receiver of an
insolvent Illinois brought an action in Alabama to recover securities of the
insurer held on deposit, a creditor intervened in an attempt to claim against
the funds held by the court. The court held that the creditors were not
judgment creditors nor bond holders, and therefore, not entitled to payment
of claims from these funds. The court also found that the creditors also were
not entitled to an equitable lien upon the funds.