SB 1019 - This act revises the powers and duties of the rehabilitator and liquidator in insurance company insolvency proceedings.

REHABILITATOR'S AND LIQUIDATOR'S EMPLOYEES - The Director may hire employees to assist him in his duties as rehabilitator but no employee hired shall not be related within the second degree by blood or marriage to the rehabilitator, the special duty rehabilitator, or to any law firm or consulting firm receiving fees from the insurer's assets. The liquidator's employees, legal counsel and other personnel shall not be related within the first degree by blood or marriage to the liquidator, special duty liquidator, or any law firm or other persons receiving fees from the insurer's assets.

CONFLICT OF DUTY - The attorney who serves as a special duty rehabilitator may not serve as counsel to the rehabilitator or to the company undergoing rehabilitation.

CRIMINAL INVESTIGATION - The rehabilitator may pursue all appropriate legal remedies, upon court approval, if it appears that there has been criminal or tortious conduct committed. The court shall not approve the pursuit of legal remedies by the rehabilitator unless it finds that the costs and benefits of such investigation will exceed its costs. The court may impose conditions on the rehabilitator's pursuit of legal remedies to conserve the insurer's estate.

ATTORNEY GENERAL AND APPEALS - Only the Attorney General may appear in behalf of the rehabilitator and liquidator in the court of appeals or the supreme court.

AUDITS - The State Auditor may audit the rehabilitator's and liquidator's accounts annually.

SPECIAL DEPUTY REHABILITATOR - A special deputy may not serve in the rehabilitation of an insurance company if he or she represented that insurer before.

The provisions of this act are similar to ones contained in CCS/SCS/HB 1292 (2000).
STEPHEN WITTE