In various posts, the latest of which was September 2, 2015, Reinsurance Focus has covered developments in the liquidation of The Home Insurance Company.

The scenario: You have been injured and PretendCorp is liable to you in the amount of $100,000. PretendCorp has a commercial general liability insurance policy (“CGL”), which covers your claim. The CGL has a $20,000 self-insured retention (“SIR”) clause that states that PretendCorp is to directly pay you before the insurance company is liable for the remaining amount of the claim. PretendCorp files for federal bankruptcy protection and, as a result, is not required to pay the SIR. Is the insurance company still liable for your claim?

Executive Summary

The Commonwealth Court of Pennsylvania has established March 31, 2016, as the Claims Bar Date in the Reliance Insurance Company Liquidation. Policyholders and claimants may think that if they file a claim on March 31, 2016, the claim will be deemed timely filed. They would be wrong.

March 30 Is the Key Date

On February 17, the Federal Deposit Insurance Corporation (FDIC) approved a proposal for recordkeeping requirements for FDIC-insured institutions with a large number of deposit accounts to facilitate rapid payment of insured deposits to customers if those institutions were to fail. The proposed rule would apply to insured depository institutions with more than 2 million deposit accounts. Under the proposal, these institutions would generally be required to maintain complete and accurate data on each depositor.

On February 17, the Federal Deposit Insurance Corporation (FDIC) and the Securities and Exchange Commission (SEC) proposed a joint rule that would govern the resolution of large broker-dealers that are designated as “covered financial companies” under the Orderly Liquidation Authority (OLA) provisions (Title II) of the Dodd-Frank Act.

(Bankr. W.D. Ky. Feb. 16, 2016)

The court overseeing the liquidation of Reliance Insurance Company, one of the largest insurance liquidations in history, has approved the liquidator’s request for a final claims bar date of March 31, 2016.  Reliance’s current payment percentage is 65%, so any insured with a significant coverage claim against Reliance should ensure that it files a proof of claim and provides the requisite supporting information by the bar date.  If your company needs assistance in determining whether you have a valid claim against Reliance or in filing and documenting a claim, our firm can help.

We recently wrote about the many failures of health insurance co-ops created under the Affordable Care Act (“ACA”), and the impact of those failures on providers and other creditors, consumers, and taxpayers.

On January 21, the Federal Deposit Insurance Corporation (FDIC) announced that it was seeking comment on a revised proposed rule that would amend the way small banks are assessed for deposit insurance. The proposed rule would affect banks with less than $10 billion in assets that have been insured by the FDIC for at least five years.

In a recent adversary proceeding in the chapter 11 case involving Ames Department Stores, Inc. (“Ames”), Lumbermens Mutual Casualty Company (“Lumbermen’s”) argued that under the McCarran-Ferguson Act, the issues in dispute between it and Ames should be decided in Illinois state court as part of Lumbermens’ insolvency proceedings.