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Mealey's Insurance Insolvency

  • July 26, 2024

    Moratorium Granted In Rehabilitation Proceeding For Life Insurer, Subsidiaries

    HARTFORD, Conn. — A Connecticut judge has granted a moratorium motion filed by the rehabilitator of a life insurer and the subsidiaries that reinsure its liabilities.

  • July 25, 2024

    Panel Says Insolvency Pool Not Entitled To Reimbursement In Workers’ Comp Claim

    ATLANTA — The Georgia Court of Appeals affirmed a lower court ruling denying the Georgia Insurers Insolvency Pool’s request for reimbursement from the solvent insurer of a business using a temporary worker from a staffing agency when the agency’s insurer became insolvent, finding that reimbursement is not appropriate because the injured worker was not a borrowed servant of the business.

  • July 24, 2024

    CMS, HHS Seek Dismissal Of Guaranty Association’s MSP Suit Against Them

    RALEIGH, N.C. — The U.S. Department of Health and Human Services (DHHS), its secretary and the Centers for Medicare and Medicaid Services (CMS) on July 23 filed a brief in North Carolina federal court supporting summary judgment and dismissal of the North Carolina Insurance Guaranty Association’s (NCIGA) suit against them, arguing that the secretary correctly found that NCIGA, as a primary plan under the federal Medicare Secondary Payer (MSP) statute, must reimburse CMS for a workers’ compensation claim involving an insolvent insurer.

  • July 23, 2024

    Judge Issues Standing Order In Negligence Suit Against Purported Insurer’s Counsel

    ATLANTA — A Georgia federal judge issued a standing order outlining case management in a negligence suit against legal counsel for a purported health insurer now in liquidation regarding the law firm’s role in aiding and abetting in an alleged scheme to entice people to purchase health plans that ultimately left “members without coverage and with devastating medical bills.”

  • July 22, 2024

    Supreme Court Denies Rehearing In Civil Rights Suit Involving Guaranty Association

    WASHINGTON, D.C  — The U.S. Supreme Court on July 22 denied rehearing its previous denial of writ of certiorari filed by a man seeking review of the Fifth Circuit U.S. Court of Appeals’ ruling upholding a district court’s grant of summary judgment to an off-duty sheriff’s deputy and the Louisiana Insurance Guaranty Association (LIGA) in the man’s suit alleging that the off-duty officer used excessive force and violated the man’s civil rights when restraining him.

  • July 19, 2024

    Insureds File Contempt Motion In Hurricane Coverage Row With Guaranty Association

    LAKE CHARLES, La. — Insureds whose rental property purportedly incurred hurricane damage filed a contempt motion in Louisiana federal court against an independent adjustor for its failure to respond to a subpoena in their hurricane coverage dispute with the Louisiana Insurance Guaranty Association (LIGA), which was substituted for their now-insolvent insurer.

  • July 19, 2024

    Receiver’s Determination Proposal In Reinsurer’s Liquidation Draws Feedback

    WILMINGTON, Del. — Standard of review has emerged as an issue of contention in Delaware Chancery Court filings concerning final determination procedures in the liquidation of a life and health reinsurer, with the receiver’s proposal that an abuse of discretion standard be used for his proofs of claim recommendations drawing objections.

  • July 19, 2024

    Discovery Deadline Unchanged In SEC Suit Against Owner Of Insurers In Receivership

    WINSTON-SALEM, N.C. — A North Carolina federal magistrate judge granted in part a joint motion to extend the case schedule in the U.S. Securities and Exchange Commission’s suit alleging that an advisory services company, its former executive and its former owner, who also owned insurers now in receivership, defrauded clients of more than $75 million, allowing an extra 30 days for “additional fact discovery” but keeping the deadline for close of discovery.

  • July 18, 2024

    Preliminary Injunction Entered In Fraud Suit Over Secured Loans

    NEW YORK — A New York federal judge has entered a preliminary injunction against six defendants — including the parent company of Bermuda reinsurer 777 Re Ltd. — in a suit over fraud and racketeering allegations concerning a secured credit facility and related guaranty agreement.

  • July 17, 2024

    Stay Granted In Hurricane Coverage Row After Guaranty Association Substitution

    LAKE CHARLES, La. — A Louisiana federal judge granted a motion to stay filed by defendant Louisiana Insurance Guaranty Association (LIGA), which was substituted for a now-insolvent insurer in a hurricane coverage dispute, finding the stay appropriate due to the possibility of the restoration company that intervened in federal court intervening in a similar state court suit.

  • July 17, 2024

    Magistrate Extends Response Filing Time For D&O Insurers In Coverage Dispute

    INDIANAPOLIS — Without providing an explanation, an Indiana federal magistrate judge granted in part defendant insurers’ motion for extension to respond to a summary judgment motion filed by an insurer now in rehabilitation in its suit against them seeking a declaration that specified directors and officers (D&O) policies apply to cover claims in underlying litigation.

  • July 16, 2024

    Judge Allows Insurer To Seal Portions Of Complaint Disputing Coverage For Diocese

    SANTA ANA, Calif. — A federal judge in California on July 15 granted an insurer’s administrative motion to seal references to confidential information and documents in its declaratory judgment lawsuit disputing coverage for underlying sexual abuse lawsuits brought under the California Child Victims Act against The Roman Catholic Bishop of Orange.

  • July 16, 2024

    Case Management Order Issued In Hurricane Coverage Suit After Substitution Denied

    BATON ROUGE, La. — A Louisiana federal judge issued a case management order docketed July 15 in a Hurricane Ida coverage dispute after a magistrate judge denied a homeowner’s motion to substitute the Louisiana Insurance Guaranty Association (LIGA) for the defendant, a homeowners insurer that assumed policies for a now-insolvent insurer, finding substitution “improper” due to a lack of evidence regarding the defendant’s obligations under the policy.

  • July 16, 2024

    Mass. Panel Reverses Board Ruling Denying Reimbursement To Workers’ Comp Insurer

    BOSTON — A Massachusetts appellate court reversed a review board’s decision upholding the denial of a now-insolvent insurer’s claim for ongoing reimbursements from the Massachusetts Workers’ Compensation Trust Fund, finding that though the insurer was in a run-off period and not assessing premiums, the exception limiting reimbursements to insurers paying assessments into the fund is inapplicable to insurers in run-off.

  • July 05, 2024

    N.C. High Court Remands For Specific Performance Of MOU Involving Insolvent Insurers

    RALEIGH, N.C. — The North Carolina Supreme Court granted parties’ joint motion to remand a case to a lower court for implementation of a “specific performance remedy” outlined in the lower court’s judgment regarding enforcement of a memorandum of understanding (MOU) between insolvent insurers, specified companies and Greg E. Lindberg, who was recently convicted on retrial of bribing the North Carolina insurance commissioner.

  • July 03, 2024

    Constructive Trust Claims Deadline Set In Liquidation Of Vesttoo And Affiliates

    WILMINGTON, Del. — In the Chapter 11 liquidation of Vesttoo Ltd. and its dozens of affiliates, a Delaware federal bankruptcy judge set a July 22 deadline for asserting constructive trust claims and overruled the liquidating trustee’s objection regarding compensation for special counsel retained by the debtors.

  • July 02, 2024

    Appeal Over Confirmation Of Vesttoo’s Liquidation Is Voluntarily Dismissed

    WILMINGTON, Del. — An appeal of the order confirming the Chapter 11 plan of liquidation for Vesttoo Ltd. and its dozens of affiliates has been voluntarily dismissed pursuant to a joint stipulation.

  • June 27, 2024

    2nd Circuit Dismisses Bid To Overturn Revival Of Adversary Proceeding

    NEW YORK — In a summary order citing a lack of appellate jurisdiction, a Second Circuit U.S. Court of Appeals panel dismissed consolidated appeals over revival of an adversary proceeding in federal bankruptcy court relating to allegations of fraudulent conveyances from a reinsurer in liquidation.

  • June 26, 2024

    2 Stipulated Dismissals Granted In Insurer’s Suit Over Asbestos Liabilities Row

    OMAHA, Neb. — Two defendants referred to as reinsurers in a suit National Indemnity Co. (NICO) filed over a $157.2 million settlement it reached with Montana regarding alleged asbestos exposures have been dismissed with prejudice under a joint stipulation that a Nebraska federal judge granted June 24.

  • June 25, 2024

    Judge Says Removal Timely In Asbestos Coverage Suit Against Guaranty Association

    NEW ORLEANS — A Louisiana federal judge on June 24 denied a motion to remand filed by a man’s family members who sued numerous parties, including the Louisiana Guaranty Association (LIGA) as the purported statutory obligor for a now-insolvent insurer, alleging that the man’s death from mesothelioma resulted from his workplace asbestos exposure, finding that removal of the case to federal court was both permissible and timely.

  • June 25, 2024

    Liquidating Trustee Answers Insurer’s Counterclaim In Breach Of Contract Suit

    CINCINNATI — A viatical settlement provider’s liquidating trustee who sued a life insurer in Ohio federal court for breach of contract, seeking reimbursement from the insurer, has filed his answers to the insurer’s counterclaim.

  • June 25, 2024

    Breach Of Contract Case Stayed In Row Between Insurer In Rehab And Malta Company

    RALEIGH, N.C. — A North Carolina federal court granted an insurer in rehabilitation’s motion to stay the breach of contract case it filed against a Malta-based company for the company’s failure to make payments on a loan, staying the case until cross-motions for summary judgment are resolved in a related pending consolidated case.

  • June 25, 2024

    Mold Inspector Files Notice Of Dismissal In Suit Against Guaranty Association

    DELAND, Fla. — A mold inspection company, as an assignee of insureds, filed a notice of voluntary dismissal in a Florida state court in the company’s breach of contract suit against the Florida Insurance Guaranty Association (FIGA), a servicer of claims against a homeowners insurer ordered into receivership.

  • June 21, 2024

    TRO Extended In RICO, Fraud Suit Involving Reinsurer’s Parent Company

    NEW YORK — A New York federal judge has extended a temporary restraining order (TRO) entered against the parent company of Bermuda reinsurer 777 Re Ltd. and other defendants in a fraud and racketeering lawsuit over a secured credit facility and related guaranty agreement.

  • June 20, 2024

    Insurer In Rehab Gets Stay In Breach Of Contract Suit Against Investment Firm

    RALEIGH, N.C. — A North Carolina federal court granted an insurer in rehabilitation’s motion to stay the breach of contract case it filed against a Malta-based investment firm for the firm’s purported failure to make payments on a loan, staying the case until cross-motions for summary judgment are resolved in a related pending consolidated case.