A.M. Best's McElroy to Speak at Annual Meeting

Stephanie Guethlein McElroy, Manager of Rating Criteria and Rating Relations with A.M. Best Company, is scheduled to speak at NOLHGA's 2009 Annual Meeting in Washington, D.C., in October. McElroy previously spoke at NOLHGA's 2005 Legal Seminar in Park City, Utah.

As Manager of Rating Criteria and Rating Relations at A.M. Best, McElroy is responsible for developing corporate-wide rating criteria, which are A.M. Best's policies and procedures defining the methodologies used in assigning ratings. In her rating relations role, she maintains an ongoing dialogue with key third parties--such as investment bankers, consultants, brokers, and actuarial and accounting firms--to ensure corporate rating criteria are disseminated effectively and are a resource for knowledge-sharing on emerging industry issues.

NOLHGA's 26th Annual Meeting will be held at the Fairmont Washington, D.C., on October 13 and 14 (an MPC meeting will be held on October 12). More information about the meeting--including a partial list of guest speakers, hotel information, and online registration--can be found at the meeting Web page. More information about the meeting will appear in the NOLHGA Wire and other NOLHGA communications in the near future.

  Staff Contact -

MPC Meets in Chicago

The Members' Participation Council (MPC) met in Chicago on July 8, 2009. The following are summaries of task force insolvency reports presented during the meeting:

  Staff Contact - Sean McKenna Executive Life Insurance Company (California)

The Executive Life task force made a closed-session presentation.

Task Force Chair - Art Dummer;   Staff Contact - Bill O'Sullivan Executive Life Insurance Company of New York (New York)

The ELNY task force made a closed-session presentation.

Task Force Chair - Jack Falkenbach;   Staff Contact - Lincoln Memorial & Memorial Service Life Insurance Companies (Texas)

The Lincoln Memorial/Memorial Service task force made a closed-session presentation.

Task Force Chair - Tad Rhodes;   Staff Contact - Paul Peterson Medical Savings Insurance Company (Indiana)

Task Force Chair Dan Orth (Illinois) reported that the receiver has added staff to process claims; the backlog of non-disputed claims is expected to be eliminated by the end of the third quarter of this year. Task Force Legal Counsel Joel Glover (Rothgerber, Johnson & Lyons) reviewed the status of the large number of lawsuits brought against Medical Savings by Medical Savings insureds and various hospitals or provider groups.

Task Force Chair - Dan Orth;   Staff Contact - Joni Forsythe Penn Treaty Network America Insurance Co./American Network Insurance Co. (Pennsylvania)

Task Force Chair Chuck Gullickson (South Dakota) reported that the rehabilitator is seeking to suspend commission payments to agents. Numerous objections to this proposal have been filed, but no hearing on the issue has yet been scheduled. The rehabilitator is still developing the final plan of rehabilitation, which is likely to include requests for rate increases on the large block of pre-2002 long-term-care insurance. The plan should be filed by October 2, 2009.

Task Force Chair - Chuck Gullickson;   Staff Contact - Shenandoah Life Insurance Company (Virginia)

NOLHGA President Peter Gallanis reported that the Special Deputy Receiver continues to evaluate offers to purchase the company. The task force is working with the rehabilitation team on the second RFP process.

Task Force Chair - William Falck;   Staff Contact - Standard Life Insurance Company of Indiana (Indiana)

Task Force Chair John Colpean (Michigan) reviewed the status of the company, which concentrated in annuity writing and has approximately $2 billion in liabilities. The Special Deputy Rehabilitator filed a first accounting in June, which seeks to extend the current moratorium on loans and surrenders for an additional year. The task force submitted its response to the first accounting on July 10. The task force is currently developing a preliminary estimate of guaranty association coverage liabilities and is also reviewing the company's assets and liabilities with the rehabilitation team. More information on the company can be found in the FAQ section of the company's Web site.

Task Force Chair - John Colpean;   Staff Contact - Universal Life/Booker T. Washington Insurance Companies (Alabama)

Task Force Chair Rusty Haydel (Mississippi) provided the first report to the MPC on these companies, which were placed in rehabilitation in February 2006 (Booker T. Washington) and April 2009 (Universal Life). The receiver filed a motion seeking the liquidation of both companies in May 2009, but no hearing has been set. The MPC unanimously passed a resolution authorizing the task force to enter into confidentiality and joint and common interest agreements with the receiver.

Task Force Chair - Rusty Haydel;   Staff Contact -

Joint Annuities & Model Act Adoption Addressed at MPC Meeting

The MPC General Session also featured a lively Coverage/Claims Committee presentation on guaranty association coverage of jointly owned annuities by Committee Chair John Colpean (Michigan) and committee members Art Dummer (Utah) and Kevin Griffith (Baker & Daniels). Dave Perry (Montana) and Bill O'Sullivan (NOLHGA staff) reported on a new NOLHGA Board initiative to provide assistance to guaranty associations planning to adopt the new Guaranty Association Model Act. NOLHGA President Peter Gallanis gave a wide-ranging report on recent developments concerning financial services regulatory reform on Capitol Hill, and MPC Chair Bart Boles reported on the activities of the MPC Executive Committee and the NOLHGA Board.

  Staff Contact - Sean McKenna