Sheila Bair to Speak at NOLHGA's Annual Meeting

Professor Sheila Bair, author of Consumer Ramifications of an Optional Federal Charter for Life Insurers, has agreed to speak at NOLHGA's 21st Annual Meeting, which will be held October 26-27, 2004, at the Four Seasons Hotel Las Vegas in Las Vegas, Nev. Professor Bair, the Dean's Professor of Financial Regulatory Policy at the University of Massachusetts Isenberg School of Management, has more than 20 years of experience working in the nation's capital in senior positions in government and financial services. The National Journal has described her as "an experienced Washington hand who has forged a career at the intersection of politics and policy."

Professor Bair was President George W. Bush's first pick to serve as the Assistant Secretary for Financial Institutions in his new administration. During her tenure at the Treasury Department, Secretary Paul O'Neill cited her for her tireless work on the enactment of terrorism insurance legislation and her integral involvement in the development of the USA PATRIOT Act regulations.

An MPC meeting will be held at the Four Seasons Hotel Las Vegas before the Annual Meeting. More information about the Annual Meeting and the MPC meeting will appear in future issues of the NOLHGA Wire and other NOLHGA publications. If you have any questions about the Annual Meeting, please contact Holly Wilding at 703.787.4111 or [email protected].

  Staff Contact -

MPC Meets in Seattle

The Members' Participation Council (MPC) met in Seattle, Wash., on July 21, 2004. The following are summaries of task force insolvency reports presented during the meeting:

  Staff Contact - Sean McKenna American Chambers Life Insurance Company (Ohio)

Task Force Chair Chuck Gullickson (South Dakota) provided a brief update on the insolvency, noting that the estate still holds $18 million in cash and liquid assets as well as a parcel of undeveloped real estate in Chicago that the liquidator has been unable to sell. The liquidator's suits against the company's former officers, directors, actuary, and auditor are still pending, and the estate is also involved in litigation with two insurance companies.

Task Force Chair - Chuck Gullickson;   Staff Contact - American Life Assurance Corporation (Ala.)

Staff Contact Joni Forsythe brought attendees up-to-date on the ALAC insolvency, detailing the protracted legal maneuvers being employed by New South Investment Corporation (NSIC), ALAC's former owner, to reacquire the company. Despite NSIC's objections, on June 18, 2004, the court granted the receiver's petition to close the estate and pay claims. Final distributions will be made after the exhaustion or expiration of any final appeals with respect to that June 18 order.

Task Force Chair - Mike Marchman;   Staff Contact - Joni Forsythe Life & Health Insurance Company of America (Pa.)

Task Force Chair Linda Becker (Kansas) gave attendees a comprehensive overview of this new insolvency (the liquidation order was issued on July 2, 2004). She noted that the status of the company's liabilities and assets is uncertain at this point; however, the task force does know that long-term care and home service life and health make up approximately 70 percent of the company's remaining business. The task force, which is working to obtain information on the company's assets and liabilities, has assigned a TPA to conduct a review of pending claims.

Task Force Chair - Linda Becker;   Staff Contact - London Pacific Life & Annuity Company (N.C.)

Task Force Chair Frank Gartland (Ohio) updated attendees on the status of three agreements: universal life and payout/supplementary contract assumption agreements (both pre-liquidation straight assumptions with Hartford Life, with no guaranty association involvement) and the deferred annuity plan (an exchange agreement with Hartford Life). The deferred annuity agreement does involve guaranty association participation, and all affected associations have elected to participate. Election packages for the deferred annuity agreement are expected to be sent to policyholders in mid-August 2004, and the agreement is expected to close on October 12, 2004.

Task Force Chair - Frank Gartland;   Staff Contact - Paul Peterson

Financial Services Update & Other MPC News

The July 2004 MPC meeting also featured an update from NOLHGA President Peter Gallanis on recent financial services modernization activity. He explained that the "roadmap" outlined by Rep. Michael Oxley (R-Ohio) to the NAIC in March 2004 is designed to use federal mandates to bring about reform in state insurance regulation rather than to replace state regulation with a federal mechanism; in addition, it does not address the guaranty system. Most segments of the industry have voiced support for the roadmap, while the NAIC recently issued its own roadmap that entails less federal involvement in state regulation. The NAIC's roadmap also envisions improvements in the receivership system. Legislation relating to the Oxley roadmap is rumored to be imminent.

In other MPC meeting news, MPC Chair Jack Falkenbach (Delaware) briefed attendees on the activities of the MPC Executive Committee. The committee accepted a final report from the Health Issues/TPA Subgroup and also received updates from the Operational Audit, Plan of Operation, and Asset Recovery Project Subgroups. Lowell Miller (North Carolina), head of the MPC Chair Preference Poll Subgroup, reminded attendees to return their second round ballots, which were mailed shortly before the MPC meeting. John Colpean (Michigan) announced that the MPC Meeting Planning Committee has chosen locations for the first two meetings of 2005; the first meeting will be held in Tampa, Fla., from February 23-25, and the second will take place in Austin, Tex., from May 16-18.

  Staff Contact - Sean McKenna