KRS 304.33-590: Interstate priorities.

(1) Priorities. In a liquidation proceeding in this state involving one or more reciprocal

states the order of distribution of the domiciliary state shall control as to all claims

of residents of this and reciprocal states. All claims of residents of reciproca l states

shall be given equal priority of payment from general assets regardless of where

such assets are located.

(2) Priority of special deposit claims. The owners of special deposit claims against an

insurer for which a liquidator is appointed in this or any other state shall be given

priority against the special deposits in accordance with the statutes governing the

creation and maintenance of the deposits. If there is a deficiency in any deposit so

that the claims secured by it are not fully discharged from it the claimants may share

in the general assets, but the sharing shall be deferred until general creditors, and

also claimants against other special deposits who have received smaller percentages

from their respective special deposits, have been pa id percentages of their claims

equal to the percentage paid from the special deposit.

(3) Priority of secured claims. The owners of a secured claim against an insurer for

which a liquidator has been appointed in this or any other state may surrender his

security and file his claim as a general creditor, or the claim may be discharged by

resort to the security in accordance with KRS 304.33 -420, in which case the

deficiency, if any, shall be treated as a claim against the general assets of the insurer

on the same basis as claims of unsecured creditors.