Sec. 38a-917. (Formerly Sec. 38-435). Actions by and against rehabilitator.
Sec. 38a-917. (Formerly Sec. 38-435). Actions by and against rehabilitator. (a)
Any court in this state before which any action or proceeding in which the insurer is a
party or is obligated to defend a party is pending when a rehabilitation order against the
insurer is entered shall stay the action or proceeding for ninety days and such additional
time as is necessary for the rehabilitator to obtain proper representation and prepare
for further proceedings. The rehabilitator shall take such action respecting the pending
litigation as he deems necessary in the interests of justice and for the protection of
creditors, policyholders and the public. The rehabilitator shall immediately consider all
litigation pending outside this state and shall petition the courts having jurisdiction over
that litigation for stays whenever necessary to protect the estate of the insurer.
(b) No statute of limitations or defense of laches shall run with respect to any action
by or against an insurer between the filing of a petition for appointment of a rehabilitator
for that insurer and the order granting or denying that petition. Any action by or against
the insurer that might have been commenced when the petition was filed may be commenced for at least sixty days after the order of rehabilitation is entered or the petition
is denied. The rehabilitator may, upon an order for rehabilitation, within one year or
such other longer time as applicable law may permit, institute an action or proceeding
on behalf of the insurer upon any cause of action against which the period of limitation
fixed by applicable law has not expired at the time of the filing of the petition upon
which such order is entered.
(c) Any guaranty association or foreign guaranty association covering life or health
insurance or annuities shall have standing to appear in any court proceeding concerning
the rehabilitation of a life or health insurer if such association is or may become liable
to act as a result of the rehabilitation.
(P.A. 79-382, S. 15; P.A. 92-93, S. 13.)
History: Sec. 38-435 transferred to Sec. 38a-917 in 1991; P.A. 92-93 amended Subsec. (b) re rehabilitator's institution
of an action on insurer's behalf.