{"data":{"id":"us-ky/krs-304.33-290","jurisdiction":"us-ky","citation":"KRS 304.33-290","heading":"Fraudulent transfer prior to petition -- Exceptions.","body":"(1) Definition and effect. Except as provided in subsection (5) of this section and KRS\n304.33-055:\n(a) Every transfer made or suffered and every obligation incurred by an insurer\nwithin one (1) year prior to the filing of a successful petition for rehabilitation\nor liquidation under this subtitle shall be fraudulent as to then existing and\nfuture creditors if made or incurred without fair consideration, or with actual\nintent to hinder, delay or defraud either existing or future creditors;\n(b) A transfer made or an obligation incurred by an insurer ordered to be\nrehabilitated or liquidated under this subtitle, which is fraudulent under this\nsection, may be avoided by the receiver, exce pt as to a person who in good\nfaith is a purchaser, lienor, or obligee for a present fair equivalent value; and\nexcept that any purchaser, lienor, or obligee, who in good faith has given a\nconsideration less than fair for such transfer, lien, or obligation, may retain the\nproperty, lien, or obligation as security for repayment; and\n(c) The court may, on due notice, order any such transfer or obligation to be\npreserved for the benefit of the estate, and in that event the receiver shall\nsucceed to and may enforce the rights of the purchaser, lienor, or obligee.\n(2) Perfection of transfers.\n(a) Personal property. A transfer of property other than real property shall be\ndeemed to be made or suffered when it becomes so far perfected that no\nsubsequent lien obtain able by legal or equitable proceedings on a simple\ncontract could become superior to the rights of the transferee under subsection\n(3) of KRS 304.33-310.\n(b) Real property. A transfer of real property shall be deemed to be made or\nsuffered when it becomes so far perfected that no subsequent bona fide\npurchaser from the insurer could obtain rights superior to the rights of the\ntransferee.\n(c) Equitable liens. A transfer which creates an equitable lien shall not be deemed\nto be perfected if there are availabl e means by which a legal lien could be\ncreated.\n(d) Transfer not perfected prior to petition. Any transfer not perfected prior to the\nfiling of a petition for liquidation shall be deemed to be made immediately\nbefore the filing of the successful petition.\n(e) Actual creditors unnecessary. This subsection shall apply whether or not there\nare or were creditors who might have obtained any liens or persons who might\nhave become bona fide purchasers.\n(3) Fraudulent reinsurance transactions. Any transaction of the insurer with a reinsurer\nshall be deemed fraudulent and may be avoided by the receiver under subsection (1)\nof this section if:\n(a) The transaction consists of the termination, adjustment or settl ement of a\nreinsurance contract in which the reinsurer is released from any part of its\nduty to pay the originally specified share of losses that had occurred prior to\nthe time of the transaction, unless the reinsurer gives a present fair equivalent\nvalue for the release; and\n(b) Any part of the transaction took place within one (1) year prior to the date of\nfiling of the petition through which the receivership was commenced.\n(4) Every person receiving any property from the insurer or any benefit thereof wh ich\nis a fraudulent transfer under this section shall be personally liable therefor and\nshall be bound to account to the liquidator.\n(5) (a) Except as provided in paragraph (b) of this subsection, any transfer of, and\nany obligation to transfer, money or other property from an insurer-member to\nthe federal home loan bank under a federal home loan bank security, pledge,\ncollateral, or guarantee agreement, or other similar arrangement or credit\nenhancement, shall not be deemed fraudulent and shall not be avoi ded by the\nreceiver under subsection (1) of this section if the agreement, arrangement, or\nenhancement is:\n1. Made in the ordinary course of business; and\n2. Made in compliance with the applicable federal home loan bank\nagreement.\n(b) A transfer may be dee med fraudulent and may be avoided by the receiver\nunder subsection (1) of this section if the transfer is made with the intent to\nhinder, delay, or defraud:\n1. An insurer-member;\n2. The receiver of the insurer-member; or\n3. Existing or future creditors of the insurer-member.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=56206","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:57:54Z","sha256":"93ee7554ee20934fe15e7a70d15ec46c399c5f107315ef57354af0b6a6274229","source_id":"us-ky","stale":false,"prev":"us-ky/krs-304.33-280","next":"us-ky/krs-304.33-300"},"notice":"GroundRules: Original legal text. Not legal advice."}