TITLE 27
Insurance

CHAPTER 27-64
The Protected Cell Companies Act

SECTION 27-64-6


§ 27-64-6 Reach of creditors and other claimants.

(a)(1) Protected cell assets shall only be available to the creditors of the protected cell company that are creditors in respect to that protected cell and shall be entitled, in conformity with the provisions of this chapter, to have recourse to the protected cell assets attributable to that protected cell, and shall be absolutely protected from the creditors of the protected cell company that are not creditors in respect of that protected cell and, who accordingly, shall not be entitled to have recourse to the protected cell assets attributable to that protected cell. Creditors with respect to a protected cell shall not be entitled to have recourse against the protected cell assets of other protected cells or the assets of the protected cell company's general account.

(2) Protected cell assets shall only be available to creditors of a protected cell company after all protected cell liabilities have been extinguished or provided for in accordance with the plan of operation relating to that protected cell.

(b) When an obligation of a protected cell company to a person arises from a transaction, or is imposed, in respect of a protected cell: (1) that obligation of the protected cell company shall extend only to the protected cell assets attributable to that protected cell, and the person shall, with respect to that obligation, be entitled to have recourse only to the protected cell assets attributable to that protected cell, and (2) that obligation of the company shall not extend to the protected cell assets of any other protected cell or the assets of the protected cell company's general account, and that person shall not, with respect to that obligation, be entitled to have recourse to the protected cell assets of any other protected cell or the assets of the protected cell company's general account.

(c) When an obligation of a protected cell company relates solely to the general account, the obligation of the protected cell company shall extend only to, and that creditor shall, with respect to that obligation, be entitled to have recourse only to the assets of the protected cell company's general account.

(d) The activities, assets, and obligations relating to a protected cell are not subject to the provisions of chapters 34, 34.1 and 34.3 of this title and neither a protected cell nor a protected cell company shall be assessed by or be required to contribute to any guaranty fund or guaranty association in this state with respect to the activities, assets or obligations of a protected cell. Nothing in this section shall affect the activities or obligations of an insurer's general account.

(e) In no event shall the establishment of one or more protected cells alone constitute or be deemed to be a fraudulent conveyance, an intent by the protected cell company to defraud creditors or the carrying out of business by the protected cell company for any other fraudulent purpose.

History of Section.
(P.L. 1999, ch. 22, § 1; P.L. 2001, ch. 156, § 1; P.L. 2008, ch. 475, § 97.)