Insurance (Agents and Brokers) Act 1984 No. 75 of 1984 - SECT 28 Distribution of insurance broking account moneys on insolvency, &c.

Insurance (Agents and Brokers) Act 1984 No. 75 of 1984 - SECT 28

28. (1) This section applies to and in relation to a registered insurance
broker-

   (a)  who has become an insolvent under administration; or

   (b)  that is an insolvent company under administration, or to and in
        relation to the estate of a deceased insurance broker that is being
        administered under Part XI of the Bankruptcy Act 1966 or under the law
        of an external Territory providing for the administration of insolvent
        estates of deceased persons.

(2) This section applies notwithstanding anything to the contrary contained in
the Bankruptcy Act 1966 or in a law (including a law of a State or Territory)
that relates to companies.

(3) Moneys in an account maintained with a bank by the broker under
sub-section 26 (1), and securities in which moneys have been invested under
sub-section 26 (4), shall be treated as though they were subject to a trust in
favour of the persons to whom payment from that account may be made under
paragraph 26 (3) (a) or (b).

(4) Moneys from such an account shall be paid as follows:

   (a)  first, moneys that have been paid into the account in error shall be
        withdrawn from the account;

   (b)  secondly, insureds shall be paid the amounts they are entitled to
        receive from the moneys in the account in respect of claims made
        pursuant to contracts of insurance;

   (c)  thirdly, insureds shall be paid the amounts (other than amounts to
        which paragraph (b) applies) they are entitled to receive from the
        moneys in the account;

   (d)  fourthly, after all payments have been made under paragraphs (b) and
        (c), insurers shall be paid the amounts they are entitled to receive
        from the moneys in the account.

(5) If the moneys in the account that are available to make payments required
under a particular paragraph (other than paragraph (a)) of sub-section (4) are
not sufficient to meet those payments in full, the payments required under the
paragraph concerned shall be made proportionally.

(6) Any moneys remaining after all payments have been made under sub-section
(4) shall be taken to be moneys payable to the broker.

(7) Nothing in the preceding provisions of this section prevents moneys in the
account being invested as mentioned in paragraph 26 (3) (c) by a person, other
than the broker, who has lawful custody or control of the moneys.