Frequently Asked Questions
Evaluation, Adjudication, and Allowance of Claims

Q: What is the process for evaluating claims?

A: An examiner will review a proof of claim for purposes of determining whether sufficient documentation has been presented to support a recommendation for allowance. This applies whether the claim is, for instance, for insurance coverage, attorneys' fees, or reinsurance protection. If additional documentation or other support is required, the examiner will contact the claimant or the claimant's representative. Depending on the particulars of a given claim and the nature of the information provided, there may be instances where further requests for information are needed. A claim will be either recommended for allowance if the facts demonstrate a valid claim or alternatively be denied if a claim does not exist or there is insufficient evidence to prove the claim. Once a decision is reached, the Liquidator will send a Notice of Determination to the claimant.

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Q: What is a Notice of Determination?

A: A Notice of Determination advises the claimant of the Liquidator's intent to recommend that the claim be allowed or disallowed. If the recommendation is for an allowance, then the Notice of Determination advises the claimant of the amount and the priority level at which the claim is being recommended for allowance. 

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Q: What is an "objection"?

A: Either a claimant or one of the company's reinsurers may assert an objection to a Notice of Determination.

An objection is when a claimant disagrees with the Liquidator's recommendation or denial by the Notice of Determination and files a timely letter objecting to the denial or the amount of the allowance. A claimant has 60 days from the date on which the initial Notice of Determination is mailed to submit a written objection to the Liquidator. If the claimant does not submit an objection within the 60-day period, the claimant is barred from objecting. If the claimant does submit a timely objection, the Liquidator's staff will attempt to resolve the objection with the claimant. 

Although the Liquidator and claimant are in agreement on an allowed claim, one or more of the receivership estate's reinsurers may object to the Liquidator's proposed recommendation for allowance.

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Q: What is a "hearing"?

A: When the Liquidator and either a claimant or reinsurer are unable to resolve an objection, the Liquidator will present the disputed claim to the supervisory court for resolution. The objecting claimant or reinsurer will be given notice of the hearing process and will have an opportunity to present its objections to the court (either by way of written submissions and/or oral argument before the court).

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Q: What is claim adjudication?

A: Claim adjudication is the process of having a recommendation for the allowance or disallowance of claim presented to the supervisory court and obtaining an order from the court either approving or disapproving the Liquidator's recommendation.  If the claimant did not file a timely written objection to the Liquidator's Notice of Determination (See "What is a Notice of Determination?" and "What is an objection?") then the Liquidator will present the claim to the supervisory court for adjudication without notice to the claimant.

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Q: What is an allowed claim?

A: A proof of claim becomes an allowed claim in the liquidation proceedings when an order is entered by the supervisory court stating that the claim is allowed for purposes of participating in any distributions of company assets that may be made at a particular priority level. 

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