Bankers Commercial Life (TX)
TPA Agreement Reached
On July 27, a third party administration agreement was reached with United Teacher Associates Insurance Company. An opt-out package will be mailed to all affected guaranty associations by Federal Express for delivery on Monday, July 31. As approved by the Members' Participation Council on July 20, a 10 day opt-out period will apply. The opt-out period expires August 10.
The package will include additional background information regarding the current status of activities on Bankers Commercial, along with state-specific reports reflecting policy status (as of June 30) and claims paid information (through May 25). The claim report will indicate the initial funding that will be required by guaranty associations for the first batch and includes information that would normally be shown on an explanation of benefits form. It is anticipated that funding will occur on or about August 21. Payment instructions will be sent under separate cover the week of July 31. Any questions on the reports should be directed to Marc Siegel (202.481.8475) or Garrett Rush (202.481.8413) of Arthur Andersen.
In related news, guaranty associations should also have received a package containing all relevant court orders along with a brief synopsis by Task Force Legal Counsel Frank O'Loughlin. Guaranty associations should confirm the date on which their guaranty association was triggered. This date will be used to reconcile premium receipt activity between the estate and guaranty associations.
Task Force Chair -William Falck; Staff Contact - Paul Peterson American Chambers Life (OH)Claims Activity Summary
During the week of July 24, the American Chambers claims/TPA subgroup reported significant milestones in claims processing by Antares Management Solutions, Inc. Among the activities:
1. Antares mailed post liquidation batch #3 earlier this week. Total number of claims processed is now more than 25,000.
2. Programming for determination of claims over GA limits is scheduled for August 1. A list of claims over limits and those over 50 percent of GA limits will be distributed.
3. Antares has extended the hours of the customer service personnel who answer requests on claim status. The additional personnel, handling upwards of 2,000 calls per day, should be able to handle calls on claims in pending status (i.e., claims where Antares requires additional information) or in controlled status (i.e., claims that are in the computer system and have been assigned a claim number). The personnel will not have information about claims still in incoming mail or those that have not been assigned a claim number. In total, about two-thirds of the 150,000 claims in process are identifiable by a claim number.
4. Some policyholders and guaranty associations have learned that Antares has an operation in Parkersburg WV. Antares currently uses this location only for non-GA related business; all GA related material should still be sent to Naperville. Antares will reroute to Naperville any mail inadvertently sent to Parkersburg.
5. The claims/TPA Subgroup has made GA Fax inquiry responses a top priority now that difficulties with the claim processing system have been resolved. Tangible results should be seen in the next few days (at least by August 4).
Application For Rehabilitation Plan Orders Filed
On July 17, 2000, Oklahoma Insurance Commissioner Carroll Fisher, acting as statutory receiver for Mid-Continent, filed with the Oklahoma District Court applications for orders approving (i) a notice of amended rehabilitation plan, (ii) procedures for a plan confirmation hearing, and (iii) the confirmation of an amended rehabilitation plan. The proposed amended rehabilitation plan provides for the transfer of Mid-Continent's insurance business to American Fidelity Assurance Company in an assumption reinsurance transaction. Under the terms of the assumption agreement, American Fidelity has agreed that premiums on Mid-Continent's Extra-Life Policies will not be increased for a period of 17 years following the closing of the assumption. The Plan also evidences a settlement in which Florida Progress, Mid-Continent's parent company, will pay $10 million and transfer Mid-Continent's stock to the receiver in exchange for a release of claims against Florida Progress and its affiliates, officers and directors. Confirmation hearings with respect to the amended rehabilitation plan are currently scheduled to begin on September 18.
Meanwhile, the Oklahoma District Court held a hearing on July 26 with respect to the Receiver's application for an order approving the plan notice and confirmation procedures. As a result of the hearing, District Court Judge Noma Gurich ordered the Receiver to revise his proposed notice to policyholders to include a description of the competing proposals to acquire Mid-Continent's business, and of the Farrimond policyholder class action lawsuit against Florida Progress. The Judge also ordered the Receiver to include information as to how policyholders could contact representatives for the competing proposers and the Farrimond litigation. A follow-up court hearing has been scheduled for August 1 to review the Receiver's revised notice.
Task Force Chair -Sonya Ekart; Staff Contact - Bill O'Sullivan ETC.Important Directory Changes
- Jean Hasch (ME) - New address - P.O. Box 881, Boothbay Harbour, ME, Phone - 207.633.1909, Fax - 207.633.1088. The above address cannot accept overnight delivery. Should you need to send an overnight package, please call Ms. Hasch for the overnight address.
- Jamie Kelldorf (CO, WY, MT) - New suite number - Suite 1250, 475 17th St., Denver, CO 80202.
- Candie Kinch (ID) - New fax number - 208.378.7683.