Insurance regulators in the Southeast are notifying policyholders in their states of a Texas-domiciled/Atlanta, Georgia-headquartered property/casualty insurance company that is to be liquidated after being placed in receivership.
Access Insurance Co. is primarily a provider of non-standard auto insurance licensed in 22 states, including eight states in the Southeast region — Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina and Tennessee.
The situation kicked off with an order of impairment dated March 14 by the Texas Department of Insurance that said Access is an impaired insurer with liabilities greater than its assets. Under the March 13 liquidation order, all policies not previously expired will be terminated as of April 12.
Access was founded in 1994 and distributed its policies through independent agents.
In early March, California Insurance Commissioner Dave Jones ordered Access to immediately stop transacting and soliciting insurance business there.
The California Department of Insurance said the action followed Access’s Statutory Income Statement 2017 Preliminary (unaudited), which showed its policyholder surplus was negative $27.6 million as of Dec. 31, 2017, and its Statutory Income Statement 2018 Preliminary (unaudited) report noted its policyholder surplus was a negative $29 million as of Jan. 31, 2018, and after the company also failed to file its required yearly statutory statement.
In a separate order from July 2017, California alleged Access and some of its affiliates had engaged in improper claims handling and rating and underwriting practices in violation of the California Insurance Code and the Fair Claims Settlement Regulations. These actions are still pending.
South Carolina Department of Insurance Director Ray Farmer said that the South Carolina Property and Casualty Insurance Guaranty Association will work to cover valid claims filed by insureds in his state. Access had about 15,500 private passenger auto insurance policies in force there.
Kevin Walters, Communications director for the Tennessee Department of Commerce & Insurance said in e-mail to Insurance Journal that as Access is in liquidation, it cannot write or renew any business in Tennessee. The company wrote approximately $6,306 in premium as of Sept. 30, 2017 in two lines of business in the state – other private passenger auto liability and private passenger auto physical damage. TDCI is currently reviewing its next steps.
In Georgia, Access has approximately 2,431 policies in force. The Georgia Department of Insurance said customers are being advised to contact the Georgia Insolvency Pool.
The Alabama Department of Insurance advised those in Alabama with Access policies to find a new insurance provider and said claims will be paid by the Alabama Guaranty Association.
A spokesperson for the Florida Office of Insurance Regulation said the company’s certificate of authority would be suspended, but Access does not have any policies in force in the state.
The liquidation order stays all other lawsuits against Access. Cantilo & Bennett L.L.P. of Austin, Texas, appointed by Texas Insurance Commissioner Kent Sullivan as the special deputy receiver, will manage the liquidation process.
A statement agreeing to the liquidation order was signed by Access Holdco President Patrick McMenamin.
Stephanie K. Jones and Amy O’Connor contributed to this story.
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