National Affiliated Investors Life (LA)
Participation Certificates Due
As a reminder, participation certificates for both the assumption reinsurance transaction with Citizens Security and United Liberty Life Insurance Companies and the early access agreement are due June 2. In addition, guaranty association expense estimates are due May 26. It is anticipated that the assumption reinsurance transaction will close in early July. Initial closing funding schedules and payment instructions will be mailed to guaranty associations on or about June 9. Finally, requests for approval of assumption certificates have been filed with the appropriate state insurance departments by Citizens Security and United Liberty Life. Guaranty associations are encouraged to contact their insurance department representatives to help expedite the approval of those certificates.
Task Force Chair -Chuck Gullickson; Staff Contact - Paul Peterson American Standard Life (OK)Nicholas Appeal Dismissed
On May 22, the Oklahoma Supreme Court dismissed an appeal filed by David Nicholas, the former owner of ASL, seeking the vacation of ASL's liquidation order. The appeal was dismissed because Nicholas, following repeated warnings from the Court, failed to file a notice of completion of record. With the disposition of the above appeal, two additional ASL-related appeals filed by Nicholas remain pending before the Oklahoma Supreme Court: 1) Petition in Error with respect to District Court Order Approving the Sale of the Colorado Ranch; and 2) Petition in Error with respect to District Court Order Denying Nicholas Equity Holders' Motion to Intervene.
Task Force Chair -Andrea Bowers; Staff Contact - Bill O'Sullivan National Heritage Life (DE)Petition for Approval of Distribution Filed
On May 10, NHL trustees filed a Petition for Approval of Seventh Distribution in the liquidation court. The Trustees are proposing to distribute no less than $10 million on July 1 to Trust beneficiaries. The distribution will be split equally between guaranty associations and uncovered policyholders. The distribution will result in full payment of all remaining uncovered claims. All future Trust distributions will be made to guaranty associations.
Task Force Chair - Dan Orth; Staff Contact - Mid-Continent Life (OK)Proposals Submitted
In accordance with the plan confirmation schedule approved by District Court Judge Noma Gurich, on May 22 the following intervening parties submitted revised proposals to acquire Mid-Continent's insurance business: MEGA Life and Health Insurance Company; H.E. Rainbolt and Jay Novik; American Fidelity Assurance Company; and Realty Advisers, Inc. The court-approved schedule provides that Life Investors, Inc., the remaining interested party, has until June 1 to submit its revised proposal to acquire Mid-Continent's business, and that the Oklahoma Insurance Commissioner, acting as receiver, has until June 11 to file with the court his decision regarding the proposals. The District Court will then conduct confirmation hearings in August.
Task Force Chair - Sonya Ekart; Staff Contact - Bill O'Sullivan Universe Life (ID)Early Access Agreement Distributed
On May 22 NOLHGA distributed an early access agreement with the Universe Liquidator to affected guaranty associations. The agreement is based on NOLHGA's model form. Statutory deposits are assigned to guaranty associations in those states holding statutory deposits. The opt-out deadline is June 23.
Task Force Chair - Tad Rhodes; Staff Contact - Paul Peterson Executive Life (CA)Artemis Moves to Dismiss Commissioner's Action
Artemis, S.A., and certain other recently named defendants in the California Commissioner's action against Altus Finance and others have moved to dismiss the Commissioner's action. Artemis' primary contention is that the Commissioner cannot show he suffered any injury as a result of the misrepresentations allegedly made by the defendants and that the Commissioner's claims accordingly are deficient. A hearing on Artemis' motion is scheduled for July 10, 2000.
Task Force Chair - Art Dummer; Staff Contact -Request for Sample Plans of Operation
Several guaranty association administrators have recently contacted NOLHGA seeking assistance with the possible amendment of their association's plan of operation. In particular, these administrators have inquired as to whether NOLHGA has access to updated plans of operation that could be shared with them in connection with the possible amendment of their plans. In order to assist these administrators, we would appreciate receiving copies of plans of operation from guaranty associations that have updated their plans within the past five years. Responding guaranty associations should send a copy of their plan of operation to Karen Early in NOLHGA's Legal Department. Any administrator wishing to receive sample plans of operation provided to NOLHGA should so advise Karen Early (phone: 703.787.4101; e-mail address: [email protected]).
Staff Contact - Bill O'SullivanLegal Committee Meeting
NOLHGA's Legal Committee met in Orlando, Florida on May 9. The principal discussion items related to the planning of NOLHGA's 9th Annual Legal Seminar, and the preparation of a report analyzing the implications of the Gramm-Leach-Bliley Act to guaranty associations. Other agenda items included variable insurance products with guaranteed living benefits, proposed amendments to the NAIC HMO Model Act, the upcoming joint meeting of the NOLHGA and NCIGF Legal Committees, protected cells and a report on recent litigation developments and amicus activities.
During the meeting, the Legal Committee approved a program for the Legal Seminar. The program includes an impressive array of speakers from the guaranty system, the insurance industry and the federal and state regulatory community. The centerpiece for this year's seminar will be panel discussions on financial services modernization and the Gramm-Leach-Blilely Act. One of these panels will examine a hypothetical case of a troubled financial holding company with insurer and bank subsidiaries. Persons on this panel will assume the roles of various federal and state regulators and other interested parties, and will engage in a lively exchange over the troubled conglomerate's assets and other issues arising from the recently enacted Gramm-Leach-Bliley Act. The luncheon speaker for the seminar is Ms. Ellen J. Pollock, Senior Special Writer for the Wall Street Journal. Ms. Pollock covered the Thunor Trust case for the Journal and is currently writing a book about the case's chief antagonist, Martin Frankel. She will share her perspectives on Mr. Frankel and the Thunor scam gained through her work as an investigative reporter on the case. The Seminar, which will be held on July 20 - 21 at the Fairmont Copley Plaza Hotel (Boston), promises to be a very rewarding educational experience for anyone working in the insurer insolvency area. It is anticipated that registration materials for the seminar will be distributed within the next week. Please contact Karen Early in NOLHGA's Legal Department (phone: 703.787-4101; e-mail: [email protected]) if you did not receive registration materials by mail last year and are interested in attending.
Staff Contact - Bill O'SullivanCALENDAR/CONFERENCE CALLS
May 29 NOLHGA Offices Closed (Memorial Day)
May 31 American Chambers Working Group Teleconference with Liquidator, 3:00 pm ET
June 2 GA assumption agreement participation certificates due for Nat'l Affiliated
June 2 GA assumption early access participation certificates due for Nat'l Affiliated
July 20-21 NOLHGA Legal Seminar, Boston, MA