Insolvency Cost Information Files Now Available
As it has for the past few years, NOLHGA is providing insolvency cost information to assist industry companies in establishing accruals for their respective shares of insolvency costs. Insurance companies are required to establish a liability and expense report for guaranty fund and other assessments when a loss is probable and can be reasonably estimated. Issue Paper No. 35 - Accounting for Guaranty Fund and Other Assessments (finalized December 1999 by the NAIC) and SOP 97-3 - Accounting by Insurance and Other Enterprises for Guaranty Fund and Certain Other Insurance-Related Assessments (released December 1996 by the AICPA) discuss the particulars of establishing these liabilities.
The insolvency cost information files are now available for use on NOLHGA's Web site (www.nolhga.com). To access the files, simply click on the link on the left-hand side of the site, just below "Click link below to download insolvency cost information files."
The following files are provided to assist member companies:
1. Comments: A Word document containing general commentary.2. Costs: An Excel workbook containing individual insolvency cost information by state and account, along with various summary schedules and assessable premium information for use in calculating market shares.3. Report: A PDF file combining the two files above into one comprehensive report. This file is similar to hard copy reports available in past years.This report will not be printed and mailed to the industry as it was in past years. Should you receive a request for information on insolvency costs, simply refer the caller to the Web site link mentioned above. Please contact Paul Peterson at NOLHGA (703.787.4119) with any questions.
Staff Contact - Paul Peterson American Chambers Life Insurance Co. (Ohio)Antares Termination Date Nears
NOLHGA's service agreement with Antares is scheduled to terminate soon. As a reminder to affected guaranty associations, as of Nov. 30, the telephone service line will be disconnected. Effective Dec. 31, the post office box will be closed. Those with unresolved claims issues are encouraged to contact Antares as soon as possible. All faxes should be to the attention of Frances Pignataro at fax number 440.414.2120.
In the coming weeks, the task force will provide further information to guaranty associations regarding how issues arising after these dates should be handled.
Task Force Chair - Chuck Gullickson; Staff Contact - Executive Life Insurance Co. (Calif.)Aurora Issues Subpoenas for NOLHGA Documents
Counsel for Aurora National Life Assurance Co. recently served subpoenas on a number of non-parties, including NOLHGA and its counsel, Foley & Lardner, seeking production of documents in connection with the California commissioner's lawsuit against Altus Finance and other defendants. The subpoenas seek a variety of documents, including documents reflecting communications since Jan. 1, 1997, between NOLHGA and its counsel and between NOLHGA and the commissioner, and call for production of the requested documents by Dec. 3, 2001. NOLHGA and Foley & Lardner have served objections on Aurora's counsel.
Aurora has also advised the commissioner that it intends to depose more than 75 individuals in connection with the commissioner's lawsuit. Aurora's list of proposed deponents includes 18 NOLHGA representatives.
Task Force Chair - Art Dummer; Staff Contact - Inter-American Life Insurance Co. (Ill.)Guaranty Associations to Receive Estate Distribution
The receiver for Inter-American Life Insurance Co. will make a distribution to the affected state guaranty associations and to uncovered policyholders. According to OSD representatives, checks will be mailed to the policyholders and individual state guaranty associations over the course of the next two weeks.
The total amount of the distribution is $15,503,454, of which $12,525,774 is allocated to uncovered policyholders. This will be the first distribution of assets from the estate to the uncovered policyholders. The remaining $2,977,680 is allocated to the affected state guaranty associations, bringing total distributions to guaranty associations to date to $30,767,969 (including $26,685,957 in actual distribution payments to the guaranty associations, $1,742,259 in statutory deposits, and $2,339,753 in reinsurance premiums paid by the receiver).
The receiver's petition for approval of the proposed distribution was filed on Nov. 6 and approved by the court on Nov. 14. The task force and task force consultants have reviewed the petition and supporting documentation provided by the receiver and have confirmed the accuracy of the proposed allocation. Copies of the petition and supporting documentation are available to guaranty associations upon request.
Task Force Chair - William Falck; Staff Contact - Joni ForsytheSupplement to Fifth Edition of Annotated Model Act Now Available
On Nov. 14, NOLHGA's Legal Department published a cumulative supplement to the fifth edition of its annotations to the NAIC's Life and Health Insurance Guaranty Association Model Act. The publication represents the combined efforts of editor in chief Carlisle Herbert and many guaranty association administrators, their counsel, and regional reporters, all of whom kept NOLHGA staff apprised of local and regional cases decided within the last year.
The Annotated Model Act includes reported and unreported case decisions, as well as attorney general and insurance commissioner opinions relevant to the Life and Health Insurance Guaranty Association Model Act.
The format of this year's publication was designed to supplement last year's edition and can be inserted behind the tab labeled "Supplements." Both the Fifth Edition of the Annotated Model Act and the Supplement have been posted on the NOLHGA Web site in the "Confidential Access" section reserved for guaranty association administrators and board members. Hard copies of each are also available to administrators or their counsel upon request.
As always, NOLHGA staff welcomes suggestions for improving the content, format, or layout of the document. Suggestions should be sent to Meg Melusen at [email protected] or 703.787.4130.
Staff Contact -Membership Directory Revisions Mailed Out
Revised sections of the State Life and Health Insurance Membership Directory were mailed this week to all guaranty association administrators, the NOLHGA Board of Directors, state chairs, and NOLHGA committee members.
The revisions include the addition of new principal contacts to the Arizona and Montana state pages. Michael Surguine joined the Arizona Life & Disability Insurance Guaranty Fund upon Jack King's retirement in October, and effective Nov. 30, Wilson D. (Dave) Perry will assume the role of executive director of the Montana Life & Health Insurance Guaranty Association.
Other changes include the addition of e-mail addresses for Mauna Frye of the West Virginia Life & Health Insurance Guaranty Association and Ray Terfera of the Massachusetts Life & Health Insurance Guaranty Association. Frye's new e-mail address is [email protected], and Terfera can be reached at [email protected].
To maintain up-to-date information in our directory and on our Web site, we ask that all changes and corrections to the directory be sent to Karen Early via fax (703.481.5209) or e-mail ([email protected]).
Staff Contact -Gus Estrada Joins NOLHGA
NOLHGA is very pleased to announce that Augusto (Gus) Estrada has been hired as the organization's new controller. Estrada brings more than 10 years of accounting experience to the NOLHGA staff, most if it in the healthcare arena.
Estrada received a BBA degree in Accounting from Marymount University, and his most recent position was regional senior accountant with Cox Interactive Media in Virginia. Before joining Cox, he spent seven years at Potomac Home Health Care in Rockville, Md. He served in a variety of positions at Potomac, including controller, finance/budget analyst, accounting manager, and senior accountant. Before that, he spent a year with a small CPA firm in Lanham, Md.
Staff Contact - Sean McKennaNo Wire Next Week
The NOLHGA offices will be closed Nov. 22 and 23 for the Thanksgiving holiday. As a result, there will be no Weekly Wire next week.
Staff Contact - Sean McKenna