MPC Meets in Nation’s Capital
The following are summaries of task force insolvency reports presented during the Members’ Participation Council meeting held October 30 in Washington, D.C. Coverage of NOLHGA’s 19th Annual Meeting, also held last week in Washington, D.C., will appear in the Winter 2002 edition of the NOLHGA Journal.
Staff Contact - Sean McKenna Guarantee Security Life Insurance Company (Fla.)Task Force Chair Frank Gartland (Ohio) updated attendees on the task force’s activities, which have centered on closing out Guaranty Reassurance Corporation (GRC) and working with the receiver on closing out the GSLIC estate. The task force voted to recommend closing GRC, and a vote of the shareholders taken during the following GRC shareholder meeting approved the dissolution of GRC and the establishment of a liquidating trust for the company’s remaining business.
Task Force Chair - Frank Gartland; Staff Contact - Legion & Villanova Insurance Companies (Pa.)The Legion & Villanova Task Force held a meeting in the round to update affected guaranty associations on recent developments in the rehabilitation. Task Force Legal Counsel Frank O’Loughlin (Rothgerber, Johnson & Lyons) briefed attendees on a number of hearings concerning the companies that have been held over the past few weeks. During these hearings, the companies’ parent company, MRM, has fought the rehabilitator’s attempts to liquidate the companies, and a hearing is scheduled for November 7 and 8 to discuss a disputed commutation agreement. Task force representatives will attend the hearing, and the task force will work to develop a plan for guaranty associations that may be triggered by a lack of claims payments by the companies; in addition, the task force plans to meet with the rehabilitator and the TPAs in the near future.
Task Force Chair - Peter Leonard; Staff Contact - London Pacific Life & Annuity Company (N.C.)Task Force Chair Frank Gartland (Ohio) provided meeting attendees with an overview of the company’s assets and liabilities and lines of business. He reported that London Pacific is primarily an annuity company and analyzed the various products (traditional annuities, MVA annuities, variable annuities, universal life, etc.) the company sells. The rehabilitator, who issued a moratorium order on August 23 (effective August 19), believes the company or blocks of the company’s business can be sold without guaranty association involvement. The task force plans to meet with the rehabilitator this month.
Task Force Chair - Frank Gartland; Staff Contact - Paul Peterson Reliance Insurance Companies (Pa.)Task Force Chair Tad Rhodes (Oklahoma) reported that the working group met with the liquidator on October 16 and added that the eleventh billing will be sent out in November. A proof of claim will be filed at the end of this year.
Task Force Chair - Tad Rhodes; Staff Contact -Annual Meeting & MPC Presentations Available On-line
Many of the PowerPoint presentations given at NOLHGA’s 19th Annual Meeting and the most recent MPC meeting, both of which were held last week in Washington, D.C., are now available on the NOLHGA Web site in PDF format. To access the presentations, click on the “Calendar” section of the site and scroll down to the “Past Events” section. Click on the “Details” arrow for either meeting and then on the “Presentations Available: Yes” link, where the presentations can be found. Please note that presentations from closed sessions of the MPC meeting are not posted.
If you have any questions, please contact Sean McKenna at [email protected] or 703.787.4106.
Staff Contact - Sean McKenna Bankers Commercial Life Insurance Company (Tex.)Assumption Transaction Successfully Closes November 8
The assumption reinsurance agreement with Philadelphia American Life Insurance Company (a wholly owned subsidiary of New Era Life Insurance Company) successfully closed on Friday, November 8. Philadelphia American has assumed all guaranty association liabilities on the BCL in-force blocks of business along with claim liabilities for non–in-force policies, effective September 1. Funding by guaranty associations was $3.5 million. A true-up is scheduled for March 2003, with the final accounting occurring November 2003. All affected guaranty associations participated in the assumption transaction.
Guaranty associations will receive the final weekly claims funding report (for the period 11/2/02 to 11/8/02) the week of November 10. We respectfully request all guaranty associations to send the claims funding amount (along with any prior periods not yet funded) to New Era Life as soon as possible. Thereafter, Philadelphia American will become responsible for all claims. All premium and claim activity that occurred after September 1 will be accounted for in the true-up scheduled for March 2003.
Task Force Chair - William Falck; Staff Contact - Paul Peterson Inter-American Life Insurance Company (Ill.)Early Access Distribution Checks Mailed
The OSD has advised NOLHGA that several guaranty association early access checks were delayed due to changes in association office addresses that were not reflected in OSD records. Checks were mailed to participating guaranty associations on September 25. Accordingly, all checks should have been received by now. If for any reason your association has not received its check, please contact NOLHGA so that we can follow up with the OSD.
Task Force Chair - William Falck; Staff Contact - Joni Forsythe