2006 Utah Code - 31A-27-304 — Powers and duties of the rehabilitator.

     31A-27-304.   Powers and duties of the rehabilitator.
     (1) The rehabilitator shall employ a special deputy to rehabilitate the insurer, when this is reasonable and possible. The special deputy has all of the powers of the rehabilitator granted under this section. The rehabilitator may take any reasonable steps to obtain a suitable special deputy, including consulting with and obtaining the assistance of executives of insurers doing business in this state. The rehabilitator shall make those arrangements for compensation which are necessary to obtain a special deputy of proven ability, subject to the approval of the court. The special deputy shall serve at the pleasure of the rehabilitator.
     (2) The rehabilitator may take any action he considers necessary or expedient to rehabilitate the insurer, subject to any instructions the court may give. Subject to these instructions, the rehabilitator may redelegate this authority to officers and managers of the insurer, and in the ordinary course of business the rehabilitator has full power to direct and manage the business, deal with property, and hire and discharge employees subject to any contractual or statutory rights they may have.
     (3) The rehabilitator may obtain, on reasonable terms of employment, formal or informal advice and aid from professional persons, including legal counsel pursuant to Section 31A-2-108, who neither hold nor represent an interest adverse to the insurer. The compensation of these professionals is an administration cost under Section 31A-27-335.
     (4) If it appears to the rehabilitator that any person has engaged in criminal or tortious conduct or breach of any contractual or fiduciary obligation detrimental to the insurer, the rehabilitator may pursue all appropriate legal remedies on behalf of the insurer.
     (5) The rehabilitator may prepare a plan for the reorganization, consolidation, conversion, reinsurance, merger, or other transformation of the insurer. The plan may include the equitable reformation of contracts with the court's approval. Upon application by the rehabilitator for approval of the plan, and after any notice and hearings prescribed by the court, the court may either approve or disapprove the plan proposed, or may modify it and approve it as modified. If it is approved, the rehabilitator shall carry out the plan. For a life insurer, the plan proposed may include the imposition of liens upon the equities of policyholders of the company, if all rights of shareholders are first relinquished. A plan for a life insurer may also propose the imposition of a moratorium upon loan and cash surrender rights under policies, for a period and to the extent it is considered necessary.
     (6) The rehabilitator has, on behalf of the insurer, the power to avoid transfers under Sections 31A-27-319 through 31A-27-322.

Amended by Chapter 344, 1995 General Session