Two Florida Insurers Face Insolvency Actions: Seminole, AequiCap

Two Florida insurers are facing regulatory action as the state’s Office of Insurance Regulation (OIR) ordered commercial insurer AequiCap Insurance Co. into liquidation and suspended the license of insurer Seminole Casualty Insurance Co.

The Fort Lauderdale-based AequiCap was taken over by the state in late February when the company’s financial statement showed that as of September 30, 2010, the insurer had $30 million in assets and $29 million in liabilities. At the time, regulators hoped they could rehab the insurer, which provided workers’ compensation and commercial auto coverage to a small number of policyholders.

According to OIR documents, AequiCap had licenses to operate in Florida, Georgia, Oklahoma, and South Carolina. The insurer had roughly 2,330 policies in force. On March 11, the state started a bidding process for other companies that might want to buy or assume the company’s current book of business.

Florida regulators also suspended the license of the Sunrise-based Seminole Casualty Insurance Co. after it reported a negative policyholder surplus. The company’s 2010 annual financial statement showed that the company has $25.8 million in assets and $31.6 million in liabilities. Faced with a policyholder surplus of negative $5.8 million, the company agreed to be taken into receivership.

In order to regain its license, Seminole must prove it has secured an infusion of capital or faced being liquidated by the state. The insurer provided commercial auto coverage to businesses around the state.