Penn Treaty Network America Insurance Company has resumed selling long term care insurance products in Florida.
PTNA, a unit of Penn Treaty American Corp., Allentown, Pa., voluntarily suspended new LTC insurance sales in Florida in mid-August while getting its financial reporting in order.
Penn Treaty hired auditors to review its 2005 LTC insurance claim reserves. At the end of August, the company decided to increase the reserves and amend some financial statements.
To get permission to return to the Florida market, PTNA has agreed to continue to file monthly financial reports with Florida insurance regulators, as it has since 2002, and to limit total Florida premiums to the current level of about $48 million.
PTNA says it will seek approval from Florida insurance regulators before starting or ending any reinsurance agreements, and it has agreed to maintain a risk-based capital ratio greater than 250%.
PTNA’s RBC ratio stood at about 650% Dec. 31, 2005.
PTNA can ask Florida insurance regulators to remove the sales limits when the company’s financial strength improves or its ratings increase.
Standard & Poor’s Rating Services, New York, says the resumption of sales in Florida will not affect the B rating it has assigned PTNA.
“Standard & Poor’s believes that given PTNA’s current volume of new business in Florida, which constitutes about 6% of 2006 new applications, along with current lapse rates and premium volume in the state, the agreement allows the company to grow at a reasonable pace,” the rating agency says in a comment about the PTNA announcement.