|
| |
56-12-104. Definitions.
- As used in this part, unless the context otherwise
requires:
- "Account" means any one ( 1 ) of the accounts created
by § 56-12-105;
- "Affiliate" means a person who directly, or indirectly,
through one ( 1 ) or more intermediaries, controls, is controlled by, or
is under common control with an insolvent insurer on December 31 of the
year next preceding the date the insurer become s an insolvent insurer.
- "Association" means the Tennessee Insurance Guaranty
Association created under § 56-12-105;
- "Claimant" means any insured making a first-party claim
or any person instituting a liability claim; provided, however, no person
who is an affiliate of an insolvent insurer may be a claimant.
- "Commissioner" means the Commissioner of Commerce and
Insurance;
- "Control" means the possession, direct or indirect, of
the power to direct or cause the direction of the management and policies
of a person, whether through the ownership of voting securities, by
contract other than a commercial contract for goods or non-management
services, or otherwise, unless the power is the result of an official
position with or corporate office held by the person. Control is presumed
to exist if any person, directly percent ( 10% ) or more of the voting
securities of any other person. This presumption may be rebutted by a
showing that control does not exist in fact.
- (A) "Covered claim" means an unpaid claim, including
one for unearned premiums, submitted by a claimant, which arises out of
and is within the coverage and is subject to the applicable limits of an
insurance policy to which this chapter applies and was issued by an
insurer which is insolvent, if such insurer becomes an insolvent insurer
after the effective date of this act, and;
(i) The claimant or insured is a resident of this state
when the insured event occurs; provided, however, for an entity other than
an individual, the residence of a claimant, insured or policyholder is the
state in which its principal place of business is located when the insured
event occurs; or
(ii) The claim is a first-party claim for damage to
property with a permanent location in this state.
(B) "Covered claim" does not include:
(i) Any amount awarded as punitive or exemplary damages;
(ii) Any amount sought as a return of premium under any
retrospective rating plan;
(iii) Any amount due any reinsurer, insurer, insurance
pool, or underwriting association, as subrogation recoveries, reinsurance
recoveries, contribution, indemnification or otherwise. No such claim for
any amount due any reinsurer, insurer, insurance pool, or underwriting
association may be asserted against a person insured under a policy issued
by an insolvent insurer other than to the extent such claim exceeds the
association's obligations and limitations set forth in this part or policy
limits of the insured whichever amount is greater.
(iv) Any first party claim by an insured whose net worth
exceeds ten million dollars ($ 10,000,000) on December 31 of the year next
preceding the date the insurer becomes an insolvent insurer. An insured's
net worth on such date is deemed to include the aggregate net worth of the
insured and all of its subsidiaries as calculated on a consolidated basis;
and
(v) any first-party claims by an insured which is an
affiliate of the insolvent insurer.
- "Insolvent Insurer" means an insurer authorized to
transact insurance in this state, either when the policy was issued or
when the insured event occurred, and against whom a final order of
liquidation has been entered after the effective date of this act with a
finding of insolvency by a court of competent jurisdiction in the
insurer's state of domicile.
- (A) "Member insurer" means any person who:
(i) Writes any kind of insurance to which this part applies
under § 56-12-103, including the exchange of reciprocal or inter-insurance
contracts; and
(ii) Is licensed to transact insurance in this state,
except county mutual fire insurance companies and nonprofit service
corporations.
(B) An insurer shall cease to be a member insurer
effective on the day after the termination or expiration of its license to
transact the kinds of insurance to which this act applies; provided,
however, the insurer shall remain liable as a member insurer for any and
all obligations, including obligations for assessments levied before the
termination or expiration of the insurer's license and assessments levied
after the termination or expiration, which relate to any insurer which
became an insolvent insurer before the termination or expiration of such
insurer's license.
- "Net direct written premiums" means:
(A) Direct gross premiums written in this state on
insurance policies to which this part applies, less return premiums
thereon and dividends paid or credited to policyholders on such direct
business.
(B) "Net direct written premiums": does not include
premiums on contracts between insurers or reinsurers.
- "Person" means any individual, corporation,
partnership, governmental entity, association, voluntary organization or
any other legal entity.
|
[Acts 1971, ch. 180, § 4; modified; Acts 1975, ch. 62 § 4;
Acts 1977, ch. 203 § 2; T.C.A., § 56-4004; Acts 1989, ch. 316 § 1; Acts 1999 ch.
48, § 2.]
Return to Statute Page
|
