NU Online News Service, Aug. 24, 2:15 p.m. – Oklahoma Insurance Commissioner Carroll Fisher says he is trying to get approval from a state court to place Heritage National Insurance Company, Tulsa, Okla., in receivership.
Oklahoma County District Court Judge Nancy Coats refused earlier this month to place the company in receivership, but she did allow the Oklahoma department to keep the life, health and accident insurer in voluntary supervision.
Department officials now control company expenditures, but placing the company in receivership would help policyholders get assistance from the Oklahoma Life and Health Insurance Guaranty Association, Fisher says.
The Oklahoma department recently released enough funds to pay $1 million in claims, but the company owes $6 million in additional claims payments, Fisher says.
Reid Robison, an Oklahoma City lawyer who represents Heritage National, says the Heritage National management team is still running the company and still believes it can obtain the financing it needs to increase the company’s financial strength.
Reid declined to comment on the receivership proceedings.
“We’re prefer to have the case heard in the courtroom,” Reid says.
Heritage National writes group life and group accident and health policies. It provided health insurance for more than 5,000 Oklahoma residents and thousands of people in Texas.
The Texas Department of Insurance and the Texas Life, Accident, Health, and Hospital Service Guaranty Association negotiated an agreement a year ago that called for Heritage National to take over Medical Community Insurance Company, Houston, a small, 3-year-old, physician-owned insurance company that was placed in temporary receivership in August 2000, according to a February 2001 report from Standard & Poor’s, New York.
Heritage National agreed to voluntary supervision by the Oklahoma department in late June. At the time, it had negative capital and surplus of $106,825, Fisher says.
The department placed the company in temporary receivership July 27, pending an August hearing. However, at the August hearing, the court said it did not have enough evidence to place Heritage National in receivership, according to local press reports. The court did allow the voluntary supervision to continue.
S&P says it has assigned an ‘R’ financial strength rating to Heritage National, indicating that the company is now under regulatory supervision.