Section 118: Conditions Relating to Liquidation of Insurer

1) Notwithstanding anything contained elsewhere in the prevailing laws, if the approval pursuant to section 117 is received from the Authority, it shall be deemed as the commencement of liquidation process from the date of approval received.

2) The following activities shall be performed while liquidating the insurer:

(a) The notice concerning the insurer being in the process of liquidation is to be published at least twice in two national-level daily newspapers and through the Authority’s website within thirty-five days from the date of approval received from the Authority,

(b) The notice concerned with the insurer being in the process of liquidation to be provided to all insured, creditors or concerned persons and the Office of Company Registrar within thirty-five days,

(c) The amount under insurance policy to be paid to the insured, the amount of loan to be paid to the creditors, and all other liabilities to be fulfilled by the insurer within the period prescribed by the Authority,

(d) The amount to be paid to the insured as per clause (c), which has not been matured for payment as per the insurance policy, shall be deemed as having been matured ipso facto for the payment on the last day of the period prescribed by the Authority,

(e) While making payment or fulfilling the liabilities, if any insured, creditor or concerned person is absent to receive the payment or the insurer being failure to make payment by any reason, the amount equivalent to the fulfilment of all the liabilities in accordance with clause (c), the conditions determined by the Authority to be deposited in a separate account in the bank as fixed by the Authority,

(f) The insurer shall not perform any act or use any authority that will create any liability after the approval received from the Authority, except that it will be necessary for the liquidation.

3) The license of the insurer shall automatically be cancelled from the date of completion of the liquidation process by the Authority.

4) The Authority may formulate and implement the necessary directives relating to the liquidation of the insurer.