Pacific Standard Life (CA)
Estate Nears Close
On December 3, 1999, California Superior Court Judge Stephen L. Mock issued an order effectively closing the Pacific Standard Life Insurance Company estate. The order: (1) allows the commissioner to retain approximately $363,000 for administrative and closing costs; (2) approves disbursements covering unclaimed funds due opt-outs and non-persisting covered policyholders; (3) allows the commissioner to pay to NOLHGA, as partial reimbursement of NOLHGA's expenses, any future recoveries of written off assets or those previously deemed uncollectible, discovered assets, or any tax refund when collected; and (4) states that the Pacific Standard Life Insurance Company and the Pacific Standard Asset Liquidation Trust are closed and the commissioner shall be discharged as liquidator and trustee, respectively. A copy of the Order will be sent to affected guaranty associations next week.
NOLHGA anticipates receiving, for distribution to the affected guaranty associations, approximately $265,000 in January and a total of $325,000 from the estate by June 2000, assuming the estate's estimate of tax refunds due it are accurate.
As a result of the PSLIC estate closing, we also will be developing a final report discussing this case for distribution to guaranty associations by June 2000.
Task Force Chair - Bart Boles; Staff Contact - Paul Peterson Settlers Life (VA)Summary of Purchase Agreement Being Prepared
The Settlers Life Task Force will meet by teleconference on January 11 to review a communication regarding the sale of Settlers Life. This communication will be mailed to all states where Settlers was licensed.
Task Force Chair - Mike Marchman; Staff Contact - Centennial Life (VA)IRS Form 1099 Production
Guaranty associations are reminded that the Centennial Receiver, as the third party administrator, will again this year produce and mail to claimants IRS forms 1099 for the participating guaranty associations. Participating guaranty associations which have any questions should contact Beth Levy at the Receiver's office in Lawrence, KS, or Mark Femal. Currently, Texas is the only state preparing its own 1099 forms.
The Centennial task force has engaged Claims Systems Auditors to conduct a "wrap-up" audit of claims processing on the Centennial Health Block, focusing on suspended claims and cases where the claimant had appealed the TPA's original adjudication.
Task Force Chair - Mark Femal; Staff Contact - National Heritage Life (DE)Promissory Note Rate Reset
The rate for guaranty association promissory notes issued in connection with the MetLife assumption reinsurance agreement has been reset for the next six months to an annual effective rate of 7.5 percent. This is up from the previous six-month rate of 6.84 percent. The rate is based on the 5-year Constant Maturity Treasury (CMT) rate plus 100 basis points. This is quoted as a bond equivalent yield. Questions regarding the interest rate can be directed to Greg Jacobs of Milliman & Robertson at 317.639.1000.
Task Force Chair - Dan Orth; Staff Contact -Insolvency Financial Reports
The two-volume Insolvency Financial Reports were mailed the week of January 3. The reports include background and cost information by state and account, and have been modified this year to include additional expense, claim, and asset recovery information. Due to a limited supply of the reports, distribution is limited to NOLHGA Board members, state board chairs, and guaranty association administrators.
Staff Contact - Paul PetersonCALENDAR/CONFERENCE CALLS
January 10 CUIC Task Force Teleconference 1 pm
January 11 Settlers Life Task Force Teleconference 2 pm
January 12 Thunor Trust Teleconference with Receiver and GPM, 9:30 am
January 12 Centennial Status Teleconference with Receiver and New Era Life, 10 am
January 18 Universe Life Task Force Teleconference 1 pm
January 26 Claims Valuation Subgroup Meeting, Dallas, TX