Section 19-5-4.08.5 - InsolvencyA. A Member's participation in the Pool shall be deemed terminated in the event a Member becomes insolvent. As used herein, "insolvent" means being the subject of receivership, conservatorship, rehabilitation, liquidation, or similar proceedings, whether voluntary or involuntary, in any jurisdiction.B. If, at the time of a Member's insolvency, the insolvent Member's account in the Pool reflects a net balance due to the Pool and the liquidator or receiver of the insolvent Member does not have sufficient funds available to make a final adjustment of the account, the insolvent Member's share of undistributed surpluses and/or uncollected deficits for each policy year for which the insolvent Member was a participant in the Pool shall be reallocated to the remaining Members as if the insolvent Member had not been a participant in the Pool for such policy years.C. In the event a Servicing Carrier becomes insolvent, the Pool Administrator shall have the option to: 1. pay to the receiver, conservator, rehabilitator, liquidator or other appropriate representative of the insolvent Servicing Carrier the losses and expenses for which the Pool is liable under the Reinsurance Agreement(s); or:2. subject to the approval of the receiver, conservator, rehabilitator, liquidator or other representative, and subject to the approval of any court having jurisdiction over the proceedings, assume the policy obligations of the insolvent Servicing Carrier for policies written pursuant to the Plan and reinsured by the Pool. If the latter option is exercised, the Pool Administrator shall make arrangements to have all policies that have been assigned to and are being serviced by the insolvent Servicing Carrier reassigned to another Servicing Carrier for servicing. The successor Servicing Carrier shall assume all the duties and obligations of the insolvent Servicing Carrier and shall be entitled to the reinsurance provided by the Pool. Payment made on account of such policies, including expenses for the servicing thereof, shall be reimbursed by the Pool and apportioned to the policy years for which such policies were originally issued.
3. All amounts due to an insolvent Servicing Carrier from the Pool as a result of the reinsurance provided to such Servicing Carrier and all amounts due from an insolvent Servicing Carrier as a member shall be merged into one account and deemed mutual debits and credits which the Pool may offset.4. The Pool shall have all the rights allowed by law against the estate or funds of an insolvent Member for recovery of amounts which have been absorbed by the other. Members of the Pool as herein provided. The Pool Administrator may assert and enforce such rights on behalf of the Pool.5. Anything in this Article to the contrary notwithstanding, the Commissioner may, in the event such action is in his judgment feasible and desirable, and in a manner equitable to all Members, elect not to terminate the participation of an insolvent Member and permit such Member to continue its participation in the Pool upon such conditions as he may prescribe and subject in all respects to these Articles and the rules and procedures applicable to the Pool and the Plan.19 Miss. Code. R. 5-4.08.5