South Carolina regulators have ordered Atlantic Coast Life Insurance coverage and its captive reinsurer, Southern Atlantic Re, to cease writing new insurance policies by Tuesday, Dec. 31.
The carriers additionally had been ordered to inform all producers in regards to the cease-and-desist directive from the South Carolina Division of Insurance coverage.
“We’re publishing these orders in the present day as a part of our ongoing efforts to guard the shoppers of South Carolina,” Michael Sensible, SCDOI director, stated in a Dec. 20 bulletin. “We’ll proceed to work with our fellow state regulators to make sure corporations conducting insurance coverage enterprise are adequately funded in compliance with the regulation.”
The division in April put the businesses beneath confidential supervision because of rising issues in regards to the true state of Atlantic’s monetary state of affairs. The April order, launched by DOI this month, famous that the insurers relied closely on reinsurance, together with 777 Re, which has seen its monetary scores downgraded considerably this 12 months.
Atlantic Coast, based in South Carolina in 1925, is now owned by Benefit Capital Holdings, referred to as A-Cap, which is a serious lender to 777 Partners, a personal fairness agency identified for its holdings in soccer groups and airways.
The South Carolina motion follows an identical order this month by Utah insurance coverage regulators, which stated that A-Cap’s Utah-based life and reinsurers had been in a hazardous monetary situation and should stop writing. These subsidiary insurers are Sentinel Safety Life Insurance coverage, Haymarket Insurance coverage, and Jazz Reinsurance.
The South Carolina April order additionally charged that Atlantic Coast had submitted inaccurate experiences about its property. Earlier this 12 months, the insurer reported that its risk-based capital ratio was a optimistic 1,353%. However the DOI questioned that and Atlantic submitted an adjusted report exhibiting the ratio was extra like -19,700% (adverse).
“Underneath the Danger-Primarily based Capital (RBC) regulatory scheme set forth in Article 3, Chapter 9 of Title 38 of the Code of Legal guidelines of South Carolina 1976, as amended, the Division is required to take sure preventive and corrective measures which differ relying on the severity of any lack of capital sufficiency indicated by the RBC end result,” the April DOI order reads.
The April order could be seen here. The Utah regulators’ emergency order is here.
Atlantic Coast representatives couldn’t be reached for remark Friday morning.
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