Thunor Trust Companies
IFS Life Declared Insolvent: December 9 Closing for Four Transactions
The Circuit Court of Cole County Missouri on Nov. 30 found that International Financial Services Life Insurance Company (MO) was insolvent, that further efforts to rehabilitate IFSL would be futile, and ordered IFSL liquidated. The court also on Nov. 30 issued an order approving the assumption reinsurance agreement under which Madison National Life would assume the Guaranty Associations' obligations under IFSL. Thus, there appear to be no impediments to the scheduled Dec. 9 closing of the Madison National transaction. Copies of the two orders were faxed to affected Guaranty Associations Dec. 2.
The Madison National assumptions of Guaranty Associations' obligations under Family Guaranty Life Insurance Company (MS), First National Life Insurance Company of America (MS) and Franklin Protective Life Insurance Company (MS) are also scheduled to close Dec. 9. The liquidation orders for these companies were issued June 29.
All affected Guaranty Associations with covered obligations in these four companies have become Participating Guaranty Associations, and will fund approximately $95 million in cash and $22 million in notes at the Dec. 9 closing of these four assumption agreements.
Task Force Chair - Mark Femal; Staff Contact - Executive Life (CA)Trust Terminated; Defeasance Requests Sought
As of August 30th, the ELIC Trust formally terminated, and shortly thereafter, the Trustees distributed all of the Trust's remaining assets, except for a small contingency reserve, to the ELIC Estate's Opt-in and Opt-out accounts. It is presently planned that existing policyholders will be credited with their shares of the distribution before the end of December, and former policyholders will receive a cash distribution before the end of January, 2000.
Recently, the ELIC Trustees sent a final report with final financial statements to the trust beneficiaries. The report has generated a number of calls to Aurora and to at least one PGA. If you have not yet received a copy of the report, please contact Meg Melusen at NOLHGA.
In other ELIC News, as in prior years, any participating guaranty association (PGA) that is contemplating defeasance in 2000 must make a written request for a defeasance computation to Aurora before year-end 1999. According to the Enhancement Agreement, Aurora then has 60 days after year-end to calculate the PGA's defeasance amount, and the PGA has until the 150th day after the preceding December 31 (i.e. May 29, 2000) to decide whether or not to defease. NOLHGA will distribute a notice on this subject to the PGAs next week.
Task Force Chair - Art Dummer; Staff Contact - National Heritage Life (DE)$13 Million Trust Distribution Made
On December 1, the NHL Trust distributed $13 million to its beneficiaries, of which $6.5 million was distributed to affected guaranty associations, either through NOLHGA's NHL Escrow Account or directly to MetLife as payment on a promissory note on behalf of guaranty associations. This is the sixth distribution from the Trust. To date, distributions from the Trust have totaled nearly $176 million.
Task Force Chair - Dan Orth; Staff Contact - Universe Life (ID)Assumption Reinsurance Agreement Sent
The assumption reinsurance agreement with Madison National Life was sent to affected guaranty associations last week. The opt-out deadline is December 24. Closing will be scheduled for the following week and guaranty associations should be prepared to fund the agreement at that time. A revised Exhibit C showing required funding for each guaranty association was faxed earlier this week. Those who have not yet received the revised Exhibit C should contact Dana Woodward.
Task Force Chair - Tad Rhodes; Staff Contact - Paul PetersonCALENDAR/CONFERENCE CALLS
December 6: Thunor Trust Working Group Teleconference, 4:30 pm ET
December 7: American Western Working Group Teleconference, 1:30 pm ET
December 8: Kentucky Central Working Group Meeting, Greensboro, NC
December 9: Thunor Trust Closing Teleconference, 9:00 am ET
December 9: Thunor Trust Closing Teleconference, 11:00 am ET
December 10: Unison Task Force Teleconference, 11 am ET
December 16: Centennial Task Force Meeting, Chicago, IL