A. In a delinquency proceeding against an insurer domiciled in this state, the priority of distribution of claims from the general assets of the insurer shall be determined pursuant to this section. Every claim in each class shall be paid in full or adequate funds shall be reserved for the payment before the members of the next class may receive any payment. Subclasses may not be established within any class. The order of distribution is as follows:

1. 1. The costs and expenses of administration incurred in connection with the delinquency proceedings.
2. 2. Claims of the Arizona property and casualty insurance guaranty fund established pursuant to section 20-662 and the life and disability insurance guaranty fund established pursuant to section 20-683 or a similar organization in another state to the extent the organization provides substantially similar protection with respect to the same kinds of insurance, including claims for unallocated loss adjustment expenses and general administrative costs and expenses.
3. 3. Claims under insurance policies and contracts and guaranteed investment contracts except reinsurance, including claims under nonassessable policies for unearned premiums, claims under annuity contracts, third-party claims against insureds who are covered under liability insurance policies and, in a delinquency proceeding of a health care services organization that is domiciled in this state, claims of enrollees and enrollees' beneficiaries and any claim of a provider for services that are provided pursuant to and covered by a health care plan.
4. 4. Claims of the federal government, except those claims under paragraph 3 of this subsection and claims that are treated as secured claims.
5. 5. Claims for compensation actually owing to employees of the insurer, other than its officers, for services rendered to the insurer. This priority is in lieu of any other similar priority authorized by law as to wages or compensation of employees.
6. 6. Claims of any state or local government, except those claims under paragraph 3 of this subsection and claims that are treated as secured claims.
7. 7. Claims of other general creditors that do not fall within any other priority under this section.
8. 8. Claims that are filed after the date specified for filing proofs of claim pursuant to section 20-640.
9. 9. Claims of surplus note or certificate of contribution holders or other similar obligations and for premium refunds on assessable policies.
10. 10. Claims of shareholders, members or other owners in that capacity.