Global Bankers Insurance Group
The Global Companies consist of three insurance companies domiciled in North Carolina – Southland National LIfe Insurance Company (SNIC), Colorado Bankers Life Insurance Company (CBLIC), and Bankers Life Insurance Company (BLIC). All three companies were placed in rehabilitation in June 2019 due to significant troubled investments in affiliates.
On December 30, 2022, a liquidation order with a finding of insolvency was issued with respect to CBLIC and BLIC (CBLIC/BLIC Order). However, the CBLIC/BLIC Order, by its terms, is not effective and won’t become effective until approximately 90 days following the resolution of any appeal filed with respect to the CBLIC/BLIC Order. GBIG Holdings, the shareholder of CBLIC and BLIC, appealed the CBLIC/BLIC Order. The appeal remains pending as of the date of this report, and the timing of the resolution of the appeal is uncertain. As a result, the CBLIC/BLIC Order is not effective and guaranty associations have not been activated to provide coverage benefits with respect to CBLIC and BLIC.
On May 2, 2023, a liquidation order with a finding of insolvency was entered with respect to SNIC (SNIC Order). While the SNIC Order was also appealed by GBIG Holdings, it was effective immediately upon being entered. GBIG Holding also filed a motion to stay the SNIC Order, but the motion was denied by the Receivership Court. As a result, the SNIC Order remains in effect and affected guaranty associations have been activated and are providing coverage benefits to SNIC policyholders.
Solely for the purpose of providing an estimated cost for member insurer consideration of possible guaranty association assessment accruals (if any), the information included in this report and related data file assumes (1) that the receiver’s program to distribute to CBIC and BLIC annuity contract holders 25% of their account values has been completed, and (2) a portion of the companies’ admitted assets would be made available to guaranty associations as early access. However, it should be noted that all three companies are involved in extensive litigation and disputes over assets. Moreover, NOLHGA and its consultants have NOT reviewed in detail or reached conclusions regarding the estimates, liabilities, assets, or related valuations. Therefore, the assumptions and estimates reflected herein will likely change based on developing circumstances.
Penn Treaty/American Network
Penn Treaty/American Network costs by state are included in the Insolvency Costs Workbook. We have included a special memorandum containing liability estimates as of March 1, 2017 (the date that the Orders of Liquidation for both companies were entered) and projected cash flows, both of which are included in the 2017 section below. (See “Memo re Liabilities” and “Cash Flow Estimate”)
American Independent Network Insurance Company (AINIC)
On September 5, 2023, New York (NY) Superintendent Harris filed a petition for the liquidation of AINIC, the wholly owned subsidiary of American Network Insurance Company. The Supreme Court of NY (the receivership court) subsequently granted the petition and issued the Liquidation Order for AINIC on October 1. As the company was licensed only in NY, the NY Guaranty Corporation is the only affected guaranty association. However, policyholders reside in 22 states in addition to NY, and they will be covered under the “orphan” provisions of the New York statute up to New York’s coverage limit of $500,000.
AINIC’s gross premium reserves as of June 30, 2023, were $58.8 million, as the covered policyholder obligations are currently being determined. The NY Guaranty Corporation, led by Administrator Alan Shortell, has already received Board approval to authorize and call member assessments in 2024.
Friday Health Plans of Texas, Georgia, North Carolina, Colorado, Oklahoma, and Nevada
Liquidation orders with a finding of insolvency were entered against the following Friday Health Plan affiliated entities during 2023: Friday Health Plans of Texas (March 23rd), Friday Health Plans of Georgia (August 1st), Friday Health Plans of North Carolina (September 1st), Friday Health Plans of Colorado (September 1st), Friday Health Plans of Oklahoma (September 1st), and Friday Health Plans of Nevada (September 1st). Each of these companies triggered only the guaranty association in its state of domicile. While these cases are “single state insolvencies,” the affiliated nature of the entities prompted the formation of an ad hoc “task force” of affected guaranty associations to collaborate on common issues and share resources where appropriate.
Colorado and Nevada were the only states to authorize assessments ($70 million and $30 million, respectively). No assessments have been called for Colorado, but $15 million was called on September 1 for Nevada.
We plan to share the accumulated cost and liability information in next year’s update.
Other
- National Heritage Life was moved from Closed Insolvencies to Estates Closed in November 2023.
- Senior Health Insurance Company of PA continues to maintain an order of rehabilitation and is not included in this year’s report.