Posted On: March 31, 2008, 10:33 am CDT

Posted By: Big Dog

Nope - what I'm saying is that if the California DOI had done their job in the first place, then carriers such as Superior Nat'l and Fremont would not have gone under.

Specifically, they would not have approved the acquisition by Superior National of Cal Comp - Cal Comp was technically insolvent at the time SN purchased them. Additionally, Cal Comp's actuaries lied about their reserves. [I know this because I worked for SN when they were ceased by the DOI, and helped "bury the body"]

As respects to Fremont, if the DOI had monitored their financial condition, the reinsurance (Unicover) they put in place, and their (lack of) underwriting, they could have reigned them in and held them in check.

Agreed - in both cases, their collapse was due to fraud...and stupidity. Seaman and Gentz were double dumb for buying Cal Comp. BTW, they had the opportunity to just buy the assets, and leave the liabilities to the parent - but they thought their wonderful SWAMI claims management system could fix anything.

For Fremont, Rampino bought the Unicover reinsurance, and started writing all of the crap business. If you know Fremont's history, after he screwed up the insurance side, Fremont General kept him on, and he lead them into the sub-prime debacle.