§431:20-115 Use of reinsurance reserve on liquidation, dissolution or insolvency. (a) If a domestic title insurer becomes insolvent, is in the process of liquidation or dissolution, or is in the possession of the commissioner:

(1) The amount of the reinsurance reserve then remaining may be used by or with the written approval of the commissioner to pay for reinsurance of the liability of the title insurer upon all outstanding title insurance policies or reinsurance agreements to the extent for which claims for losses by the holders thereof are not then pending. The balance of the assets, if any, equal to the reinsurance reserve may be transferred to the general assets of the title insurer; and

(2) The assets net of the reinsurance reserve shall be available to pay claims for losses sustained by holders of title insurance policies then pending or arising up to the time reinsurance is effected. If claims for losses exceed any other assets of the title insurer, the claims, when established, shall be paid pro rata out of the surplus assets attributable to the reinsurance reserve, to the extent of the surplus, if any.

(b) If reinsurance is not obtained, assets equal to the reinsurance reserve and assets constituting minimum capital, or so much as remains thereof after outstanding claims have been paid, shall constitute a trust fund to be held and invested by the commissioner for twenty years, out of which claims of policyholders shall be paid as they arise. The balance, if any, of the trust fund, at the expiration of twenty years, shall revert to the general assets of the title insurer. [L 1987, c 347, pt of §2 as superseded by c 349, §13]