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65. (a) Where the Commissioner considers that a particular Insurer has done business in a manner likely to impair its ability to meet its liabilities, or the proper management of its business, he will send it a written notice specifying the defects, request their correction or the prevention of their harmful effects within a period stated in the notice and give the insurer an opportunity to submit, within the same or a shorter period, as stated in the notice its comments and objections as to the defects or the request for their correction.

(b) Where an Insurer submits comments and objections as referred to in subsection (a), the Commissioner will give a decision thereon as soon as possible after receiving them and will notify such decision to the Insurer, and if he requests the correction of the defects or the prevention of their harmful effects, he will prescribe the period within which the Insurer should  comply with the request.

66. (a) Where the Commissioner considers that the whole or part of a particular debt due to an Insurer is a bad debt or that any property of an Insurer is registered  in its books for an amount exceeding the market price which can be obtained by a willing seller to a willing purchaser, he may instruct the Insurer to allocate to a  fund the appropriate amount required for that purpose.

(b) An instruction under subsection (a) will be treated in like manner as a notice under section 65.

67. Where, after expiration of the period stated in a notice under section 65, the Commissioner considers that the Insurer has not corrected. or not prevented the harmful effects of, the defects notified to it under section 65 or where, after giving the Insurer an opportunity to submit its comments and objections or to have them heard, he considers that measures should be taken to prevent its becoming unable to meet its liabilities or its causing harm to those insured by it or to the holders of means of control in it, he may, after consultation with the Committee -

(1) Instruct the Insurer to refrain from taking certain actions stated in the instruction - other than for the discharge of its obligations;

(2) prohibit the distribution of dividend or profits or the grant of benefits to directors or to officers or other employees of the Insurer or to Insurance Brokers.

68. (a) Where, after consultation with the Committee, the Commissioner considers that a particular Insurer cannot meet his obligations or that its directors or officers have behaved in a manner likely to impair the proper management of its business, he may, after the Insurer has been given a reasonable opportunity to submit its arguments to the Committee or to have them heard by it, issue to the Insurer any of the directions set out in section 67 and may, with the approval of the Minister of Finance -

(1) suspend or limit any power of a director or of any business manager or of other employees of the Insurer;

(2) suspend any director or any manager of the Insurer from office for a period not exceeding three months;

(3) appoint an Administrator to manage the business of the Insurer under section 70, and appoint a Management Committee of three members, at least one of whom is a retired Judge, to advise the Administrator;

(4) appoint a Special Inspector to supervise the management of the Insurer under section 71.

(b) Where, in the circumstances of the case, the Commissioner considers that an act under subsection (a) is required in the public interest to be done without delay, he may, with the approval of the Minister of Finance, do such act forthwith, provided that he brings the matter before the Committee as soon as possible after doing the act and that the Committee gives the Insurer a reasonable opportunity to submit its arguments or to have them heard.

69. Where, in contravention of a direction under section 68, an act towards another party is done by an Insurer or by a person whose power to do it has been suspended or limited or who has been suspended from office, such act will not for that reason alone be void.

70. (a) An administrator appointed under section 68(a)(3) will manage the business of the Insurer in accordance with directions received from the Commissioner.

(b) Without prejudice to the provision of subsection (a), the Administrator will have all the powers and functions of a manager, the board of directors, the committees of the board of directors and the directors of the Insurer in accordance with its memorandum of association and the resolutions duly passed by it. So long as an Administrator carries out his functions, the board of directors and its committees and members will not carry out their functions or exercise their powers.

(c) The Administrator is authorized after consultation with the management committee and with the approval of the Minister of Finance to transfer the whole or part of the assets and liabilities of the Insurer to another Insurer which has consented thereto.

(d) The Commissioner may direct the Insurer to pay to the Administrator such remuneration and expenses as the Commissioner may determine; and if the Administrator is a State employee, the Commissioner may direct that the remuneration will be paid to the Treasury of the State.

70A. (a) An Administrator appointed under Section 68 (a)(3) may prepare a Scheme of Arrangement for  settling the Insurer’s liabilities to Insured’s, beneficiaries, and third parties, according to the Insurance Contracts, and to other creditors of the Insurer (Hereinafter: the Creditors); The Scheme of Arrangement may include a scale of payments and different dates of payments according to different priorities.

(b) The Scheme of Arrangement will define the types of creditors and set uniform rates of payments and dates of payments to each type of Creditor; in determining the types of Creditor and the priorities amongst them, it is allowed to favour creditors with claims for bodily injuries over Creditors whose claim is for property damages, and private Creditors may be favored over body corporate Creditors, and Creditors may be favored according to the extent of the damages caused to them and according to their ability to sustain such damages, and all according to criteria detailed in the Scheme of Arrangement.

(c) The Scheme of Arrangement may include terms of classification and priorities other than those stated in subsection (b), if, under the circumstances, it is just to do so.

(d) The Scheme of Arrangement requires the approval of the District Court; When deciding on the approval of the Scheme, the Court will consider, among other consideration, if the Scheme will benefit the majority of the Creditors to a greater extent than any other plan, and if it is just and worthy in the circumstances of the situation; The Court may approve the Scheme as is, or after changing it as the Court may deem fit.

(e) A Scheme of Arrangement submitted to Court for approval, and an approved Scheme, will be published in a way and manner determined by the Court; Any one who sees himself inflicted by the said Scheme or by the application of an approved Scheme, may submit his objection to the Court.

(f) As part of the Scheme the Court may, at the request of the Administrator, order stay of any standing proceedings whether against the Insurer or against it’s assets, including execution proceedings, confiscation, realization of collateral, and receivership, and prevent the commencement of the said proceedings; As well as giving any instructions as to any other matter regarding the application of the Scheme of Arrangement.

(g) In a case where the Administrator gives a notification to Court stating the Settlement Scheme is still not ready to be presented to Court for reason mentioned in the notification, and stating his intention to submit the Scheme to Court by a certain date, or in a case where the Administrator submitted a proposed Scheme of Arrangement to Court and the Court have not commenced the approval procedures, the Court may, a the request of the Administrator, order a temporary stay of proceedings, and prevent the commencement of proceedings, or give instructions in any other matter, all as stated in subsection (f), until rendering the decision or until any other date determined by Court.

71. (a) A Special Inspector appointed under section 68(a)(4) - will supervise the activities of the board of directors and the management of the business of the Insurer in accordance with directions received from the Commissioner.

(b) The Commissioner may permit the special inspector to employ other persons for the purpose of carrying out his. functions.

(c) The Commissioner may direct the Insurer to pay to the Special Inspector and the persons employed by him such remuneration and expenses as the Commissioner may direct; and if the Special Inspector or the persons employed by him are State employees. the Commissioner may direct that the remuneration will be paid to the Treasury of the State.

72. (a) A Management Committee appointed under section 68(a)(3) will advise the administrator on carrying out his functions under section 70.

(b) The Administrator will be the chairman of the Management Committee.

(c) The Commissioner may direct an Insurer to pay to the members of the Management Committee such remuneration and expenses as the Commissioner may determine: and if the members are State employees, the Commissioner may direct that the remuneration will be paid to the Treasury of the State.

(d) Where a Management Committee has been appointed it will approve the balance-sheet of the Insurer and will appoint an auditor for the Insurer as if it were a general assembly.

73. Where a direction under section 68 has been given every director or officer of the Insurer, whether or not a direction of suspension or limitation of powers or a direction of suspension from office has been issued against him, and every other person employed by the Insurer will, at a request of the Administrator, the Special Inspector or a person empowered by him, give him or his Brokers any information, books, certificates or other documents which, in the opinion of the person making the request,  is likely to ensure or facilitate the implementation of a direction under section 68.

74. (a) The administrator may direct, with the approval of Commissioner, that within a period not exceeding ten days from the day of his appointment under section 68(a)(3) the Insurer will not fulfill undertaking which the date of performance thereof within or prior to that period.

(b) The Commissioner may extend the period referred to in subsection (a) by a further ten days if he has given notice, according to  section 75, of his intention to revoke the licence of the Insurer and the period in which the board of directors may submit its arguments has not yet elapsed, or the Court has not yet ordered for the winding-up or the receivership of the Insured's assets.

(b1) The Commissioner may extend the period referred to in subsection (b) by a further sixty days, if it is necessary for the preparation of a Scheme of Arrangement, as long as the Court has not ordered the winding-up or the receivership of the Insured.

(c) The Administrator will publish a directive issued under subsections (a) or (b), as soon as possible after its issue, at least in two daily newspapers  published in Israel.

(d) The Insurer, the Administrator and the Commissioner will bear no responsibility for the issue of a directive under this section, nor will they bear liability for non-performance of an undertaking according to the directive under this Section.

75. Where the Commissioner wishes to revoke the licence of an Insurer for which an Administrator has been appointed, he will give the Insurer’s board of directors a reasonable opportunity to submit its arguments to the Committee.

76. (a) The Minister of Finance may, with the approval of the Government, announce in the Reshumot (the Official Gazette) that an Insurer which has consented and was empowered by the Minister of Finance or the Government (hereinafter referred to as “the Guarantor Insurer”) will guarantee –

(1) liabilities towards insureds by an Insurer for which a directive under section 68 has been issued, whether for the full amount of the liabilities or up to a specific amount for each of the liabilities of particular categories specified in the announcement;

(2) the whole or part of other categories of liabilities of an Insurer referred to in paragraph (a), provided that -

(a) it appears to him that the public interest so requires;

(b) no guarantee will thereby be given for the whole of the liabilities of an Insurer unless in the opinion of the Minister of Finance there is a reasonable chance that the issuance of such a guarantee will enable the Insurer to continue managing its business in an orderly manner.

(b) A Government guarantee under subsection (a) will require the approval of the Finance Committee of the Knesset.

(c) A guarantee under subsection (a) may be limited or unlimited in time and conditional or unconditional, as will be set out in the notice.

(d) Where an announcement as aforesaid has been published, the guarantee will be valid in accordance with the contents of the announcement even if the guaranteed Insured did not agree to the issuance of the guarantee: and the guarantor Insurer may at any time recover from the guaranteed Insurer for any amount paid by it by virtue of the guarantee.

(e) The guaranteed Insurer may, notwithstanding any stipulation to the contrary in an agreement to which it is a party, enter into an undertaking towards the Guarantor Insurer in respect of a guarantee issued under subsection (a) and the conditions thereof.

(f) Where the Minister of Finance, with the approval of the Government. decides to cancel a guarantee given under subsection (a), he will give notice in Reshumot (the Official Gazette) and in at least two daily newspapers of the cancellation and of the date thereof. The cancellation will not be less than ninety days from the day of publication of the notice; and from that date onward, no person will be entitled to claim from the guarantor Insurer the fulfillment of the liability. However, where a person has a right for the fulfillment of a guaranteed Insurer's undertaking at a date later than the date of cancellation and that undertaking existed when the guarantee was in force, that person will be entitled to recover from the Guarantor Insurer or to file a claim against it until the expiration of thirty days from the day set for the fulfillment of that undertaking, and if the Guarantor Insurer has paid, the provisions of subsection (d) will apply.

(g) A guarantee under this section will be treated as a guarantee under the Guarantee Law 1967.

77. (a) Where the Administrator issues a directive under section 74, then, as long as it is in force, the Court will not give an order for winding-up order or receiving for the Insurer in respect of which the directive is issued, and  the Insurer or any meeting of shareholders thereof or other holders of rights therein will not pass a resolution for voluntary winding-up, and a receiver will not be appointed for it either on behalf of debenture holders or of any other person, no lien will be imposed on it's assets or any of his rights held by another person, and no other execution proceedings against it will be instituted or continued, save upon application submitted by the Attorney-General or with his written consent.

(b) Where an Administrator has been appointed, then, as long as the appointment is in force, the Court will not give a winding-up order or receivership order  according to an application of one of its holders of the means of control thereof, and the Insurer or any meeting of holders of means of control thereof will not pass a resolution for voluntary winding-up.

78. Any such resolution of a meeting of holders of means of control of the Insurer which is inconsistent with the provisions of sections 67 to 77 or with any act or directive issued thereunder will be invalid.