Annual Meeting Web Site On-line
The Web site for “The Direction of Change,” NOLHGA’s 19th Annual Meeting, is now on-line. The site includes a printable registration form, a preliminary schedule of events (in PDF format), speaker biographies, hotel reservation information, links for planning site-seeing activities in the nation’s capital, and general meeting information.
An Annual Meeting registration brochure was also mailed to prospective meeting attendees this week. If you have not received a brochure within the next week and are interested in attending the meeting, please contact De Gadd (703.787.4121; [email protected]) for a brochure or visit the meeting Web site.
NOLHGA’s 19th Annual Meeting will be held October 31 and November 1, 2002, at the Monarch Hotel in Washington, D.C.; an MPC meeting will take place October 30. Information about the MPC meeting and updates to the Annual Meeting program will be added to the Annual Meeting Web site as they become available.
Staff Contact - Sean McKenna Andrew Jackson Life Insurance Company (Miss.)Affected GAs Receive Early Access Distribution
On July 8, an early access distribution of approximately $3.5 million was paid to the state guaranty associations affected by the Andrew Jackson Life Insurance Company insolvency. The funds were paid directly to the associations from the estate. According to the liquidator, the distribution was allocated among the guaranty associations on a pro-rata basis, based upon the proofs of claims received from the individual guaranty associations as of December 31, 2001. To date, there have been four early access distributions from the Andrew Jackson Life estate totaling approximately $12.5 million.
Task Force Chair - Dan Elrod; Staff Contact - Joni Forsythe Diamond Benefits Life Insurance Company (Ariz.)/Life Assurance Company of Pennsylvania (Pa.)Distributions Anticipated
Guaranty associations will receive a package in the very near future outlining distributions from the DBL and LACOP estates that are expected to occur prior to year-end 2002. The distributions are the result of litigation recoveries (in the case of DBL) and subrogation claims (in the case of LACOP). The package describes the difference in the allocation methods for the two distributions and also includes estimates of anticipated amounts by state. NOLHGA anticipates the distributions to affected guaranty associations and Security Benefit Life Insurance Company (“SBL”) will be approximately $2.8 million from DBL and $3.6 million from LACOP.
The guaranty associations will receive approximately $2.0 million of the DBL distribution, while SBL will receive approximately $0.8 million. From LACOP, the guaranty associations will receive approximately $3.1 million and SBL will receive approximately $0.5 million.
In addition, all parties (guaranty associations, SBL, and the Arizona and Pennsylvania receivers) will be asked to consent to the termination of the Reimbursement Trust Agreement and appointment of United States Trust Company of New York as trustee. NOLHGA will be appointed as escrow agent in its stead. All parties must agree to the termination and the appointment of NOLHGA for it to be effective. Therefore, all parties must complete the consent form included in the package. Completed forms should be returned to the attention of Paul Peterson no later than September 9, 2002.
Parties are asked to adhere to the above date, since both receivers must petition their respective courts for their recommended distributions. Distributions may be delayed if a third party files an objection to the petitions; however, at this time we are not aware of any third party that may have an objection.
Staff Contact - Paul Peterson Universe Life Insurance Company (Idaho)Judge Denies Trusts’ Motion for Summary Judgment
On July 31, District Judge Thomas F. Neville denied all aspects of the trusts’ motion for partial summary judgment and granted the liquidator’s motion for partial summary judgment regarding the liquidator’s ruling on the trusts’ claims.
The trusts (Grain Growers Membership & Insurance Trust, American Soybean Association Membership & Insurance Trust, American Independent Association Participating Trust, National Growers and Stockman Group Trust, and the National Contract Poultry Growers Association Membership & Insurance Trust) had filed two sets of claims (Claims 1-5 and 7-10) concerning two types of group universal health policies, which the trusts had canceled pursuant to the terms of the Rehabilitation Plan. The trusts asserted that they had the right to act and make a claim on behalf of the group policy certificate holders for recovery of surrender charges imposed pursuant to a court-approved Rehabilitation Plan and unclaimed policy benefits that had accrued prior to the cancellation of the group policy.
Claims 1-5 were an attempt to claim the surrender charges deducted from the policy at the time of cancellation, and Claims 7-10 sought benefits to offset premium and deductible increases that took place before cancellation of the policies but had not been claimed by certificate holders prior to the policy cancellation. The claims totaled approximately $13.9 million, and the trusts sought to have them treated as Class 2 policyholder-level claims.
The liquidator, who initially denied the trusts’ claims, subsequently amended the decision to allow partial claims only for certificate holders who had applied for, filed, and submitted a valid claim for benefits before December 1, 1997. All other claims brought by the trusts were again denied.
In his ruling, Judge Neville indicated that the certificate holders were adequately informed of their options and treated equitably under the notices given as part of the Rehabilitation Plan and that the trusts were bound by the terms of the Mutual Release and Indemnification Agreement they executed in December 1997. The ruling, which has the effect of affirming the liquidator’s decisions on the claims, also stated that the trusts do not have Class 2 priority policyholder claims since the trusts’ cancellation of the policies terminated the certificate holders’ rights to any supplemental or unvested benefits.
Task Force Chair - Tad Rhodes; Staff Contact - Paul PetersonGA Contact Info
The office of the New Hampshire Life & Health Insurance Guaranty Association has moved. The new address is:
New Hampshire Life & Health Insurance Guaranty Association
47 Hall Street, Suite 2
Concord, NH 03301
The office’s phone and fax numbers remain the same; the new e-mail address will appear in the Wire when it becomes active.
Staff Contact -No Wire Next Week
Due to the MPC meeting and Legal Seminar in Chicago next week, there will be no NOLHGA Wire next Friday.
Staff Contact - Sean McKenna