Cut-Through Sample Clauses

Cut-Through. (a) In the event the Ceding Company does not pay amounts otherwise payable under a Covered Insurance Policy as a result of a court of competent jurisdiction or the state insurance regulatory authority in the Ceding Company’s domiciliary state issuing an order finding the Ceding Company to be insolvent or entering an order to the Ceding Company which legally prohibits the Ceding Company from paying amounts otherwise payable under a Covered Insurance Policy because of the Ceding Company’s financial condition, then the Reinsurer may elect to pay on behalf of the Ceding Company 100% of any Reinsured Liabilities payable by the Ceding Company under the Covered Insurance Policy that has not been previously paid by the Ceding Company, subject always to the other terms, conditions, exclusions and limitations of the Covered Insurance Policy. If the Reinsurer elects to make such payment in accordance with the preceding sentence, the Reinsurer shall make such payment directly to the insured under the Covered Insurance Policy (such party entitled to payment, the “Payee”). The Reinsurer shall be deemed to have all the rights of the Ceding Company and be subrogated to all the rights of the Ceding Company to the extent of such payment. Any such payment by the Reinsurer shall be used to discharge the Ceding Company from its related payment obligation under the subject Covered Insurance Policy and shall be treated as a payment by the Ceding Company for all purposes. (b) The Reinsurer shall have no obligation to indemnify the Ceding Company for amounts paid or payable by the Ceding Company in respect of a Covered Insurance Policy to the extent of any payments made by the Reinsurer to the applicable Payee of such Covered Insurance Policy in accordance with Section 7.2(a), and the Reinsurer shall be discharged of its payment obligations to the Ceding Company, or to its conservator, rehabilitator, receiver, liquidator or statutory successor, under this Agreement to the extent of such payments.