Insurer liquidation AN ACT TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING SECTION 38-27-610, RELATING TO PRIORITY OF DISTRIBUTION FOR CLAIMS, SO AS TO ADD FUNDING AGREEMENTS. - RATIFIED TITLEView full text View Vote History View Fiscal Impact04/29/25Senate Introduced and read first time (Senate Journal-page 9)04/29/25Senate Referred to Committee on Banking and Insurance (Senate Journal-page 9)02/12/26Senate Committee report: Favorable Banking and Insurance (Senate Journal-page 27)02/18/26Senate Read second time (Senate Journal-page 27)02/18/26Senate Roll call Ayes-44 Nays-0 (Senate Journal-page 27)02/19/26Senate Read third time and sent to House (Senate Journal-page 10)02/24/26House Introduced and read first time (House Journal-page 61)02/24/26House Referred to Committee on Labor, Commerce and Industry (House Journal-page 61)04/30/26House Committee report: Favorable Labor, Commerce and Industry (House Journal-page 7)05/05/26House Debate adjourned until Wed., 5-6-26 (House Journal-page 37)05/06/26House Debate adjourned05/07/26House Read second time (House Journal-page 70)05/07/26House Roll call Yeas-102 Nays-0 (House Journal-page 70)05/07/26House Unanimous consent for third reading on next legislative day (House Journal-page 71)05/08/26House Read third time and enrolled (House Journal-page 3)05/14/26 Ratified R 14505/18/26 Signed By Governor05/27/26 Effective date 05/18/2605/27/26 Act No. 168
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Senate
- Passed House
- To Governor
- Became Law
Overview
This bill amends South Carolina law to clarify the priority of distribution for claims made during insurer liquidations. Specifically, it adds funding agreements – such as those related to life insurance, annuities, or investment values – to the list of claims that receive priority. This ensures that these types of agreements are treated as loss claims when determining how funds are distributed to policyholders.
Key provisions
- Adds funding agreements (life insurance, annuities, investment values) to the list of priority claims during insurer liquidations.
- Designates these funding agreements as ‘loss claims’ for distribution purposes.
- Clarifies that only portions of a loss not covered by other benefits (like familial support or life insurance proceeds) are included in the priority claim class.
- Excludes payments by employers to employees as gratuities.
Who is affected
- Policyholders of insurance companies
- Insurance companies
- Financial institutions
- State government
- Individuals with life insurance and annuity policies
Notable changes
- Expands the definition of ‘loss claims’ to include funding agreements.
- Provides greater clarity on the order of priority for claims during insurer insolvency.
Bill text
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