Executive Life (CA)
NOLHGA Seeks Limited Intervention
In the California Commissioner's lawsuit against Altus Finance and others, NOLHGA has requested intervention for the purpose of supporting the Commissioner's claims in certain specific respects. Specifically, NOLHGA has sought intervention (1) to show that, if the Commissioner's allegations of misconduct are correct, losses resulting from the ELIC insolvency were substantially exacerbated as a result of such misconduct, and (2) to present certain arguments in support of the Commissioner's claims seeking restitution from the defendants. A hearing on NOLHGA's motion is scheduled for August 6, 2001.
Task Force Chair - Art Dummer; Staff Contact - Bankers Commercial Life (LA)Omnibus Proof of Claims Packages Mailed
Omnibus proof of claims packages were mailed to affected guaranty associations on June 27. The package summarizes the court order establishing a claims bar date of August 31, along with various notices to be mailed by claimants to the receiver and, if applicable, guaranty associations (copies of the order were included in the package). The order indicated that guaranty associations were to mail proof of claim notices to covered policyholders; however, this provision is currently being revised so that no notice needs to be mailed. The receiver has filed a motion, reviewed and approved by the working group, with the court requesting that these notices need not be sent. A copy of the revised order amending the requirement of the mailing to covered policyholders will be furnished upon receipt.
Additionally, the proof of claim package includes a completed omnibus proof of claim with supporting charts reflecting guaranty association expenses and claims incurred. As part of this package, guaranty associations must complete an affirmation indicating that NOLHGA is authorized to file the association's claim on its behalf. This notice must be received at NOLHGA no later than August 1. Please fax your completed affirmation to Paul Peterson at 703.481.5209.
In addition to the proof of claim notice, rate increase notices have been mailed to all Medicare Supplement Plan A, B, C, and F policyholders covered by Louisiana, Oklahoma, and Texas. Rate increases will be implemented by July 15 in Louisiana and Oklahoma, and on August 1 in Texas. Phone scripts have been provided to New Era to assist in handling the anticipated call volume.
Follow-up letters have also been mailed to policyholders with a claim listed in the pre-March 1, 2000 potential claims inventory (the initial letters sent to providers produced few responses). The letters included details of the outstanding claims and requested confirmation of the benefits that have/have not been provided under the Bankers policies as of August 31. Any claim will be permanently closed if no response is received by August 31.
Task Force Chair- William Falck; Staff Contact - Paul Peterson Guaranty Security Life (FL)Cotton Ginny Sale Closes
On June 28, Guaranty Reassurance Corporation closed on the sale of its last remaining asset, Canadian clothing retailer, Cotton Ginny. The sale price was US$19 million, with US$5 million of the sale proceeds reserved for escrow. The purchaser was current Cotton Ginny management. The $19 million sale price is in contrast to a purchase offer several years ago of US$10 million.
Task Force Chair - Frank Gartland; Staff Contact - National Heritage Life (DE)Early Access Distribution
On June 29, 2001, the receiver for National Heritage Life Insurance Company distributed $5 million from the estate as an early access distribution to the affected guaranty associations. The receiver forwarded a single payment of $5 million to NOLHGA, which is in the process of disbursing the funds to the affected guaranty associations on a pro rata basis. Those associations should expect to receive payments within the next few days.
Task Force Chair - Dan Orth; Staff Contact -Jonathan Aked
It is with regret that NOLHGA announces the passing of Jonathan Aked, a partner in the firm of LaFollette, Godfrey & Kahn, after a seven-month struggle with cancer. Jonathan was a skilled lawyer and a true gentleman. He will be greatly missed by all in the NOLHGA family who knew him.
Staff Contact - Sean McKenna