N.J. Stat. § 17B:32-33

Current through L. 2024, c. 87.

Section 17B:32-33 - Definitions

For the purposes of this act:

"Advance" shall have the same meaning as that term is defined at 12 C.F.R. s. 1266.1.

"Ancillary state" means any state other than a domiciliary state.

"Commissioner" means the Commissioner of Insurance of this State.

"Creditor" is a person having any claim against the insurer, whether matured or unmatured, liquidated or unliquidated, secured or unsecured, absolute, fixed or contingent.

"Delinquency proceeding" means any proceeding instituted against an insurer for the purpose of liquidating, rehabilitating, reorganizing or conserving that insurer, and any summary proceeding under section 9 of this act. "Formal delinquency proceeding" means any liquidation or rehabilitation proceeding.

"Department" means the Department of Insurance.

"Doing business" includes any of the following acts, whether effected by mail or otherwise:

(1) The issuance or delivery of contracts of life or health insurance or annuity to persons residing in this State;

(2) The solicitation of applications for those contracts, or other negotiations preliminary to the execution of those contracts;

(3) The collection of premiums, membership fees, assessments or other consideration for those contracts;

(4) The transaction of matters subsequent to execution of those contracts and arising out of them; or

(5) Operating under a license or certificate of authority, as an insurer, issued by the department.

"Domiciliary state" means the state in which an insurer is incorporated or organized; or, in the case of an alien insurer, its state of entry.

"Fair consideration" is given for property or obligation:

(1) When in exchange for that property or obligation, as a fair equivalent therefor, and in good faith, property is conveyed or services are rendered or an obligation is incurred or an antecedent debt is satisfied; or

(2) When that property or obligation is received in good faith to secure a present advance or antecedent debt in an amount not disproportionately small as compared to the value of the property or obligation obtained.

"Federal home loan bank" means a bank as defined in 12 U.S.C. s. 1422(1)(A).

"Foreign country" means any other jurisdiction not in any state.

"General assets" means all property, real, personal or otherwise, not specifically mortgaged, pledged, deposited or otherwise encumbered for the security or benefit of specified persons or classes of persons. As to specifically encumbered property, "general assets" includes all such property or its proceeds in excess of the amount necessary to discharge the sum or sums secured thereby. Assets held in trust and on deposit for the security or benefit of all policyholders or all policyholders and creditors, in more than a single state, shall be treated as general assets.

"Guaranty association" means the New Jersey Life and Health Insurance Guaranty Association created in subsection a. of section 5 of P.L. 1991, c. 208(C.17B:32A-5) and any other similar entity now or hereafter created by any other law of this State for the payment of claims of insolvent insurers. "Foreign guaranty association" means any similar entities now in existence in, or hereafter created by, any law of any other state.

"Insolvency" or "insolvent" means:

(1) That an insurer:

(a) is unable to pay its obligations when they are due, or

(b) its admitted assets do not exceed its liabilities plus the greater of:

(i) Any capital and surplus required by law for its organization; or

(ii) The total par or stated value of its authorized and issued capital stock.

(2) As to any insurer licensed to do business in this State, as of the effective date of this act, which does not meet the standard established under paragraph (1) of this definition, the term "insolvency" or "insolvent" shall mean, for a period not to exceed three years from the effective date of this act, that it is unable to pay its obligations when they are due or that its admitted assets do not exceed its liabilities plus any required capital contribution ordered by the commissioner under provisions of the insurance law.

(3) For purposes of the definition of "insolvency" or "insolvent," "liabilities" shall include, but not be limited to, reserves required by law or by regulations of the department or specific requirements imposed by the commissioner upon an insurer at the time of admission or subsequent thereto.

"Insurer" includes every person engaged as indemnitor or contractor in the business of life insurance, health insurance or of annuities and every such person subject to the supervisory authority of, or to liquidation, rehabilitation, reorganization or conservation by, the commissioner or the equivalent insurance regulator of another state; every person purporting to be engaged as indemnitor or contractor in the business of life insurance, health insurance or of annuities in this State; every person in the process of organization to become engaged as indemnitor or contractor in the business of life insurance, health insurance or of annuities; and every fraternal benefit society established pursuant to P.L. 1959, c. 167(C.17:44A-1 et seq.); every mutual benefit association established pursuant to R.S. 17:45-1 et seq.; every hospital service corporation established pursuant to P.L. 1938, c. 366(C.17:48-1 et seq.); every health service corporation established pursuant to P.L. 1985, c. 236(C.17:48E-1 et seq.); every medical service corporation established pursuant to P.L. 1940, c. 74(C.17:48A-1 et seq.); every dental service corporation established pursuant to P.L. 1968, c. 305(C.17:48C-1 et seq.); every dental plan organization established pursuant to P.L. 1979, c. 478(C.17:48D-1 et seq.); and every health maintenance organization established pursuant to P.L. 1973, c. 337(C.26:2J-1 et seq.).

"Insurer-member" means an insurer that is a member of a federal home loan bank.

"Preferred claim" means any claim which is accorded priority of payment from the general assets of the insurer pursuant to the provisions of this act.

"Receiver" means receiver, liquidator, rehabilitator or conservator as the context requires.

"Reciprocal state" means any state, other than this State, in which in substance and effect, subsection a. of section 17 and sections 51, 52 and 54 through 56 of this act are in force, and in which provisions are in force requiring the commissioner or equivalent official to be the receiver of a delinquent insurer, and in which some provision exists for the avoidance of fraudulent conveyances and preferential transfers.

"Secured claim" means any claim secured by mortgage, trust deed, pledge, deposit as security, escrow, or otherwise; but not including special deposit claims or claims against general assets. The term also includes claims which have become liens upon specific assets by reason of judicial process.

"Special deposit claim" means any claim secured by a deposit made pursuant to law for the security or benefit of a limited class or classes of persons, but not including any claim secured by general assets.

"State" means any state, district, or territory of the United States and the Panama Canal Zone.

"Transfer" shall include the sale and every other and different mode, direct or indirect, of disposing of or of parting with, property or with an interest therein, or with the possession thereof, or of fixing a lien upon property or upon an interest therein, absolutely or conditionally, voluntarily, by or without judicial proceedings. The retention of a security title to property delivered to a debtor shall be deemed a transfer suffered by the debtor.

N.J.S. § 17B:32-33

Amended by L. 2023, c. 172, s. 5, eff. 2/18/2024.

L.1992, c.65, s.3.