MPC Meets in Orlando

The Members' Participation Council (MPC) met in Orlando, Fla., on January 17, 2007. The following are summaries of task force insolvency reports presented during the meeting:

  Staff Contact - Sean McKenna American Chambers Life Insurance Company (Ohio)

Task Force Chair Chuck Gullickson (South Dakota) announced that the task force will be asking affected associations for expense figures so that it can file an updated proof of claim.

Task Force Chair - Chuck Gullickson;   Staff Contact - AMS Life Insurance Company (Ariz.)

Joni Forsythe (NOLHGA staff) reported that in late 2006, the few remaining assets in the AMS estate (which consisted of approximately eight uncollected judgments and rights with respect to two streams of renewal commissions resulting from various settlements) were assigned to the Illinois guaranty association for the benefit of each of the affected associations. In mid-December, the court approved the asset assignments as well as the final accounting. The final distribution to guaranty associations was released immediately thereafter, and the estate was then closed, effective December 29. In 2007, task force efforts will be focused on asset recovery from the assigned assets and development of a Lessons Learned Report for this insolvency.

Task Force Chair - Luther Hill;   Staff Contact - Joni Forsythe Executive Life Insurance Company (Calif.)

The Executive Life task force made a closed-session presentation.

Task Force Chair - Art Dummer;   Staff Contact - Bill O'Sullivan Life & Health Insurance Company of America (Pa.)

Task Force Chair Linda Becker (Kansas) and Task Force Legal Counsel Charlie Richardson (Baker & Daniels) reviewed the status of the estate and the progress made in discussions with the liquidator on the liquidation/distribution plan. The MPC unanimously passed three resolutions concerning an agreement with Philadelphia American Life Insurance Company to assume a block of long-term care policies, a partial commutation of eight reinsurance claims, and an agreement to continue the reinsurance on some policies in the AIL block.

Task Force Chair - Linda Becker;   Staff Contact - Reliance Insurance Company (Pa.)

Task Force Chair Tad Rhodes (Oklahoma) reported that the task force has continued to respond to the liquidator's audit questions and also negotiated a settlement with the liquidator concerning guaranty association payment of the not-billed and held claims. The task force plans to continue to request reimbursement for 2005 administrative expenses, work to resolve large disability claims, respond to the liquidator's audit questions, and monitor asset recovery at a very high level.

Task Force Chair - Tad Rhodes;   Staff Contact - Financial Statements and NAIC Model Act Review Highlight MPC Meeting

In addition to the task force reports, the general session also featured a closed-session presentation on new task force discussions. NOLHGA Senior Vice President and General Counsel Bill O'Sullivan updated attendees on the NAIC's review of the Life & Health Insurance Guaranty Association Model Act, and NOLHGA President Peter Gallanis reported on recent developments concerning financial services modernization on Capitol Hill. New MPC Chair Bart Boles (Texas) introduced a number of new guaranty association administrators.

The MPC meeting also featured a seminar entitled "Understanding Financial Statements." The seminar, which was sponsored by the Administrators' Education Steering Committee, was moderated by Candie Kinch (Idaho) and featured Randy Blumer (Wisconsin), Fred Buck (Buck & Associates), Lowell Miller (North Carolina), and Paul Peterson (NOLHGA staff).

  Staff Contact - Sean McKenna