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Alaska Statutes.

Title 21. Insurance

Chapter 78. Rehabilitation and Liquidation

Section 281. Special Provisions For Third-Party Claims.

AS 21.78.281. Special Provisions For Third-Party Claims.

(a) If a third party asserts a cause of action against an insured of an insurer in liquidation, the third party may file a claim with the receiver.

(b) Whether or not the third party files a claim, the insured may file a claim on the insured's own behalf in the liquidation. If the insured fails to file a claim by the date for filing claims specified in the order of liquidation or within 60 days after mailing of the notice required by AS 21.78.290 , whichever is later, the insured is an unexcused late filer.

(c) The receiver shall make a recommendation to the court under AS 21.78.260 for the allowance of an insured's claim under (b) of this section after consideration of the probable outcome of a pending action against the insured on which the claim is based, the probable damages recoverable in the action, and the probable costs and expenses of defense. After allowance by the court, the receiver shall withhold from the undistributed assets of the insurer as a reserve the amounts payable on the claim, pending the outcome of litigation and negotiation with the insured. If appropriate, the receiver may reconsider the claim on the basis of additional information and may amend recommendations made to the court. The insured shall be afforded the same notice and opportunity to be heard on all changes in the recommendations as in its initial determination. The court may amend its allowance. As claims against the insured are settled or barred, the insured shall be paid from the amount withheld the same percentage as was paid on other claims of like property, based on the lesser of (1) the amount actually recovered from the insured by action or paid by agreement plus the reasonable costs and expenses of defense, or (2) the amount allowed on the claims by the court. After all claims are settled or barred, any sum remaining from the amount withheld reverts to the undistributed assets of the insurer. Delay in final payment under this subsection is not a reason for unreasonable delay of the final distribution and discharge of the receiver.

(d) If several claims founded upon one policy are filed, whether by third parties or as claims by the insured under this section, and the aggregate allowed amount of the claims to which the same limit of liability in the policy is applicable exceeds that limit, each claim as allowed shall be reduced in the same proportion so that the total amount of the claims equals the policy limit. Claims by the insured shall be evaluated as in (c) of this section. If an insured's claim is subsequently reduced under (c) of this section, the amount available shall be apportioned ratably among the claims that have been reduced under this subsection.

(e) A claim may not be presented under this section if it is or might be covered by a guaranty association or foreign guaranty association.

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This version of the Alaska Statutes is current through December, 2004. The Alaska Statutes were automatically converted to HTML from a plain text format. Every effort has been made to ensure their accuracy, but this can not be guaranteed. If it is critical that the precise terms of the Alaska Statutes be known, it is recommended that more formal sources be consulted. For statutes adopted after the effective date of these statutes, see, Alaska State Legislature If any errors are found, please e-mail Touch N' Go systems at E-mail. We hope you find this information useful.

Last modified 9/3/2005