Thunor Trust Companies
Court Approves Madison National Agreements
On November 10, the Mississippi liquidation court approved the assumption reinsurance agreements, thus allowing Madison National Life to assume the obligations of First National Life Insurance Company of America, Franklin Protective Life Insurance Company and Family Guaranty Life Insurance Company. The task force is making final preparations and it appears that affected guaranty associations will be asked to make their closing payments on or about November 30. Guaranty associations were sent a financial schedule and opt-out package on November 1 and this package will be updated with specific payment instructions on or about November 22. Executed Participating Association Certificates for each insolvency should be sent to Bill Howard at NOLHGA.
In other Thunor news, the rehabilitator for International Financial Services Life in Missouri anticipates filing a liquidation petition and a petition to approve the IFS/Madison National assumption agreement either today or early next week. The task force expects the IFS closing to occur after the Mississippi agreements close, later in December.
If you require further information about these developments, please contact Task Force Chair Chuck LaShelle at 512.481.3000, Project Manager Fred Buck at 407.767.7223, Peter Gallanis or Bill Howard at NOLHGA.
Task Force Chair - Chuck LaShelle; Staff Contact - Mid-Continent Life (OK)On November 10, 1999, Oklahoma Insurance Commissioner Carroll Fisher, acting in his capacity as receiver for Mid-Continent Life Insurance Company, filed (i) an Application for Confirmation of Rehabilitation Plan and (ii) an Application for Order Approving Notice of Rehabilitation Plan and Procedures for Confirmation Hearing. Among other matters, the proposed rehabilitation plan provides for the assumption of Mid-Continent's insurance policies and contracts by Life Investors Insurance Company of America. Life Investors is an indirect, wholly owned subsidiary of AEGON, N.V. and is rated AAA by Standard and Poor's Corporation and A+ by A.M. Best.
In response to the Application for Order Approving Notice of Rehabilitation Plan and Procedures for Confirmation Hearing, Oklahoma District Court Judge Noma Gurich, on November 10, issued an order approving the form of notice to interested parties, certain procedural requirements to be followed by the receiver and interested parties in connection with the confirmation hearing, and certain "break-up payments" and a "Y2K consulting release" to be provided to Life Investors. Judge Gurich's order also provided for plan confirmation hearings to commence on December 13, 1999.
NOLHGA's Mid-Continent Task Force is in the process of reviewing the terms of the proposed rehabilitation plan and will be distributing a summary and analysis of the plan to guaranty associations in states where Mid-Continent is licensed.
Task Force Chair - Sonya Ekart; Staff Contact - Bill O'SullivanFourth Edition of Annotated Model Act Now Available
This week NOLHGA published the fourth edition of its annotations to the NAIC's Life and Health Insurance Guaranty Association Model Act. The publication represents the combined efforts of many guaranty association administrators, their counsel, and Annotated Model Act editors who kept NOLHGA staff apprised of local and regional cases decided within the last year.
Distribution of the Annotated Model Act is limited to guaranty association administrators and their counsel. Copies of the document have been mailed to administrators and will be sent to guaranty association counsel at the request of the appropriate guaranty association administrator. NOLHGA staff welcomes suggestions for improving the content, format or layout for next year's publication.
Staff Contact -Legal Committee Meeting
On Tuesday, November 9th, NOLHGA's Legal Committee held its fourth meeting of 1999 at NOLHGA's offices in Herndon, Virginia. The Committee approved an interim report from the Claims Valuation Subgroup for distribution to task forces. The is intended to provide guidance to task forces with respect to valuing policyholder level claims based upon guaranty association experience in previous insolvencies. The Committee also reviewed a preliminary draft of a standard offering package to be used by task forces in soliciting offers for the purchase of blocks of business. The Committee approved the package for exposure to other appropriate persons within the guaranty system. Finally, the Committee approved the distribution of a letter informing NOLHGA's members of the federal anti-fraud statute.
Other items on the Legal Committee's agenda included a discussion of escheat as it pertains to guaranty associations, insolvency issues relating to HMOs and health carriers, the federal superpriority statute, and an update on certain litigation matters. The Committee is scheduled to meet again in January/February, 2000.
Staff Contact -ETC.
Information Package
Last week, Guaranty association administrators and state board chairs were mailed a package of information containing an appendix for the 2000 NOLHGA operating budget, an updated roster of current NOLHGA Directors, and a number of other items. If you have not yet received this package please contact Holly Wilding at 703.787.4111.
CALENDAR/CONFERENCE CALLS
November 15: Thunor Trust Task Force Conference Call, 2:00 pm ET
November 17: Investment Life of America Working Group Teleconference, 10:00 am ET
November 18: Fidelity Bankers Task Force Meeting, Atlanta, GA
November 22: Claims Valuation Subgroup Teleconference, 12:00 Noon ET
December 16: Centennial Task Force Meeting, Chicago, IL
Staff Contact - Sean McKenna