Pennsylvania Insurance Commissioner Diane Koken announced that the State’s Commonwealth Court granted the Department’s petition to place PHICO Insurance Company of Mechanicsburg under rehabilitation.
The move was triggered when PHICO, which specializes in medical malpractice coverage, filed a late quarterly statement showing a surplus of $6.8 million, a sharp decline form the $127 million it had at the end of the year. Koken said that the dramatic decrease imperiled the company’s assets, and required immediate action.
The Department of Insurance will take over statutory control of PHICO and begin an analysis of its operations, which includes a review of its assets and liabilities as well as its loss reserves, potential risk exposures and overall capital adequacy.
PHICO is licensed to do business in all 50 states and had direct written premiums in excess of $242 million last year. Its business is mostly concentrated in Pennsylvania, Texas, Florida, Indiana and New Jersey.
Koken indicated that the Department’s primary concern would be to protect policyholders and to assure the payment of claims.
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