One of the tasks of the special deputy liquidator is to

• A. Freeze and quantify the insurer's liabilities
• B. Issue new policies to replace the liquidated ones
• C. Cancel regulatory filings
• D. Increase capital reserves

Answer: (A)

When an insurer is in liquidation and a special deputy liquidator is appointed, the immediate priority is to secure the company's remaining assets and establish the scope of its obligations. The key task is to freeze and quantify the insurer's liabilities. Freezing means stopping actions that could dissipate assets or create new, unverified debts, while quantifying means assembling a complete, verifiable list of all outstanding claims and other liabilities. This provides the foundation for an orderly and fair distribution to policyholders and creditors, and it sets the baseline for evaluating the estate’s solvency.

Issuing new policies would create additional liabilities and complicate the liquidation, so it isn’t appropriate. Cancelling regulatory filings isn’t a primary objective of the deputy liquidator, and adjusting filings wouldn’t advance the wind-down. Increasing capital reserves isn’t feasible in liquidation, since the focus is on realizing assets and settling verified claims, not injecting new funds.