You got boat insurance from an insurance company that specializes in boat insurance but the company has suddenly gone under liquidation proceedings. Oh no! What is going to happen to the boat insurance company? Liquidators will now be in charge of winding up of the insurance company's affairs. What does this mean? The liquidator has the responsibility of settling the claims against the company, collecting all the company assets before the company will finally be dissolved.

Liquidation is a term used to distinguish the process in which a company is slowly and peacefully brought to end. The assets and properties of the company will be redistributed. There are many processes within liquidation and the last stage of such is dissolution of the company. There are types of liquidation. Liquidation can be compulsory, meaning creditors of the company demand the company's liquidation. Or the company itself will decide to liquidate itself; this is known as voluntary liquidation or a shareholder's liquidation.

In compulsory liquidation, upon proper petition of the creditors, the court will appoint the boat insurance company's a liquidator or receiver. While in voluntary liquidation, the company will pass a resolution and the boat insurance company appoints a liquidator to liquidate all its assets and properties of the company to convert it into cash. Liquidators can be a single person or they can be a committee.

The boat insurance company's liquidator will have different powers and duties according to different laws. As already stated, the boat insurance company's liquidator actions will sometimes need prior court approval but a description and instruction of their duties and powers are already found within the court appointment order or the company board resolution.

The boat insurance company's liquidator will first liquidate assets of the company, meaning, he will sell the assets of the company. This will allow the company to raise money to meet the claims of their creditors. The liquidator will make compromises and arrangements with the boat company's creditors. Creditors may be secured creditors or unsecured creditors. This is just a general overview because there are different creditors such as a preferred one or an unsecured one. Laws on the matter differ in different countries. Hence, its impractical to discuss more about this topic about creditors.

Skipping the part about creditors, their differences and how their claims should be settled, dissolution comes next. Having successfully settled the affairs of the company, the boat insurance company's liquidator can now call the members if it was a voluntary liquidation or the creditors if it was a compulsory liquidation. The liquidator will give his final report and notify the court. The company is now considered as dissolved.

The boat insurance company's liquidator should perform his duties and powers faithfully or else the board members or the creditors can ask the court to remove the liquidator from his duty and have him replaced with a new and more efficient liquidator. A cause for removal can be the liquidator's failure to find good terms for the company when it comes to disposal of its assets. The reason for his removal must be in relation to his job as a liquidator and not in his personal life. His function in liquidation proceedings is very important. He generally facilitates liquidation of the company's properties and how the process should end up.

Joel Sampson is a successful webmaster of http://www.boatinsuranceinfo.com He provides more information on charter boat insurance, liability/property insurance and antique boat insurance on his website.