Why does the Commissioner conserve an insurance company?
There are many different reasons, but the most common is that the company is in financial trouble such that its further transaction of business would be hazardous to its policyholders, or creditors, or to the public. See Insurance Code Section 1011 for the full list of reasons. What happens when a company is liquidated? Upon the Superior Court’s issuance of a liquidation order, the Commissioner publishes a notice to the company’s policyholders, creditors, shareholders and all parties interested in the company’s assets. The notice informs persons who might have a claim against the company to file a proof of claim with the Commissioner before the final claims filing date, which is published in the notice and in the court’s liquidation order. In addition, the Commissioner notifies all policyholders by mail that his/her insurance policy with this particular company will be cancelled effective 30 days from the date of the liquidation order. If the insurance company is insolvent, who pays po
