Ohio § 3903.42

§ 3903.42.

The priority of distribution of claims from the insurer's estate shall be in accordance

with the order in which each class of claims is set forth in this section.  Every claim in each class shall be paid in full or adequate funds retained for such

payment before the members of the next class receive any payment.  No subclasses shall be established within any class.  The order of distribution of claims shall be: (A) Class 1.  The costs and expenses of administration, including but not limited to the following: (1) The actual and necessary costs of preserving or recovering the assets of the insurer; (2) Compensation for all services rendered in the liquidation; (3) Any necessary filing fees; (4) The fees and mileage payable to witnesses; (5) Reasonable attorney's fees; (6) The reasonable expenses of a guaranty association or foreign guaranty association

in handling claims. (B) Class 2.  All claims under policies for losses incurred, including third party claims, all

claims of contracted providers against a medicaid health insuring corporation for

covered health care services provided to medicaid recipients, all claims against the

insurer for liability for bodily injury or for injury to or destruction of tangible

property that are not under policies, and all claims of a guaranty association or

foreign guaranty association.  All claims under life insurance, annuity policies, and funding agreements, whether

for death proceeds, annuity proceeds, investment values, principal, or interest, shall

be treated as loss claims.  That portion of any loss, indemnification for which is provided by other benefits

or advantages recovered by the claimant, shall not be included in this class, other

than benefits or advantages recovered or recoverable in discharge of familial obligations

of support or by way of succession at death or as proceeds of life insurance, or as

gratuities.  No payment by an employer to an employee shall be treated as a gratuity.  Claims under nonassessable policies for unearned premium or other premium refunds. (C) Class 3.  Claims of the federal government. (D) Class 4.  Debts due to employees for services performed to the extent that they do not exceed

one thousand dollars and represent payment for services performed within one year

before the filing of the complaint for liquidation.  Officers and directors shall not be entitled to the benefit of this priority.  Such priority shall be in lieu of any other similar priority that may be authorized

by law as to wages or compensation of employees. (E) Class 5.  Claims of general creditors. (F) Class 6.  Claims of any state or local government.  Claims, including those of any state or local governmental body for a penalty or

forfeiture, shall be allowed in this class only to the extent of the pecuniary loss

sustained from the act, transaction, or proceeding out of which the penalty or forfeiture

arose, with reasonable and actual costs occasioned thereby.  The remainder of such claims shall be postponed to the class of claims under division

(J) of this section. (G) Class 7.  Claims filed late or any other claims other than claims under divisions (H), (I),

and (J) of this section. (H) Class 8.  Surplus or contribution notes, or similar obligations, and premium refunds on assessable

policies.  Payments to members of domestic mutual insurance companies shall be limited in accordance

with law. (I) Class 9.  Interest at the legal rate compounded annually on all claims in the classes prescribed

in divisions (A) to (H) of this section, except for claims of the federal government,

from the date of the order for liquidation or the date on which the claim becomes

due, whichever is later, until the date on which the interest or dividend is declared,

according to the terms of a plan proposed by the liquidator and approved by the court

supervising the liquidation.  The liquidator, with the approval of the court, may make reasonable approximate

computations of interest to be paid under this division. (J) Class 10.  The claims of shareholders or other owners. If any provision of this section or the application of any provision of this section

to any person or circumstance is held invalid, the invalidity does not affect other

provisions or applications of this section, and to this end the provisions are severable. (K) As used in sections 3903.42 and 3903.421 of the Revised Code , “contracted provider” and “medicaid recipient” have the same meanings as in section 3903.14 of the Revised Code .