The U.S. Securities and Exchange Commission has sent Wells notices to three top, parent company-level officers of a multiline insurer in connection with concerns about some of the company’s products.
Assurant Inc., New York, a company that has substantial health insurance and employee benefits businesses as well as substantial specialty property-casualty businesses, says its board has placed the three top officers on leave.
The officers now on leave include Chief Executive Officer Robert Pollock, Executive Vice President Philip Bruce Camacho and Chief Financial Officer Adam Lamnin, according to the Assurant board.
Assurant announced earlier this month that two employees of the Assurant Solutions/Assurant Specialty Property unit had received Wells notices. Those employees are also on leave, Assurant says.
The SEC issued the notices in connection with an ongoing investigation of some loss mitigation insurance products, Assurant says.
Recipients of a Wells notice can communicate with the SEC staff before the staff makes a formal recommendation about whether the SEC should file a civil suit.
“The Assurant board of directors has formed a special committee of non-management directors,” Dr. John Palms, Assurant’s chairman, says in a statement. “The special committee continues the board’s work of evaluating the situation and will be in a position to continue to promptly recommend appropriate actions to the board with respect to the investigation. Over the past two years, Assurant has cooperated fully with the SEC’s industry-wide investigation and will continue to do so while focusing on executing on its proven business strategy and honoring its commitments to employees, customers and shareholders.”
Moody’s Investors Service, New York, has responded to the announcement by putting its ratings of Assurant Inc. and six Assurant Inc. subsidiaries, including Time Insurance Company, John Alden Life Insurance Company and American Bankers Life Assurance Company of Florida, on review for a possible downgrade.
Moody’s has assigned a Baa1 issuer rating to Assurant Inc. and an A2 insurance financial strength rating to the insurance company subsidiaries.
Standard & Poor’s Ratings Services, New York, says it has put its BBB plus counterparty credit rating on Assurant Inc. and its financial strength ratings on Assurant Inc.’s insurance company subsidiaries on CreditWatch Negative.
S&P has assigned ratings of A to some of the insurance subsidiaries and A minus to others.
“The uncertainty surrounding the aftermath of the recent announcement and the distraction of management highlight serious corporate governance concerns,” Shellie Stoddard, an S&P credit analyst, says in a statement about the Wells notice announcement.
Allison Bell added information to this report.