New York forces step for insurers
New York State regulatory authorities forced today, a leading executive of the Corporation of an insurance operating subsidiaries to raise an additional $ 125 million to pay claims, forcing insurers to lower financial difficulties and possibility, maybe bankruptcy fell.
The New York Insurance Department, said Premier Executive, Executive Life Insurance, said he would be in conformity with the rules of procedure. A spokesman for First Executive, which is headquartered in Los Angeles, will not return a telephone consultation to comment.
The division reported $ 125 million from the capital of the company or the amount of his fortune to exceed the values of their obligations. Capital, which is also known in the insurance industry surplus, is a financial measure of a security company. Capital average of more than two-thirds
The addition to what is claimed to reduce the reserve to pay Executive Life of New York’s capital more than two-thirds, to $ 60 million.
Kevin Foley, Deputy Superintendent of the Division, said the New York regulatory authorities have not yet decided if the capital of the enterprise level would be appropriate for him to continue. He planned to divide an intensive analysis of books by Executive Life of New York in a few days and it was possible that regulatory authorities require that other supplements the insurer reserves above $ 125 million.
“At some point, we will soon face an opinion on whether the surplus capital is sufficient,” said Foley.
It is true to say it is too early to conclude on a possible bankruptcy Executive Life of New York, Mr. Foley, said the regulatory measures of the company “one step closer to the much deeper problems.” Bar on the release of new policies
The insurance division of New York also said he had ordered Executive Life of New York for the release of new policies, until the company has been able to show that new contracts would not affect its ability to payment of claims arising from existing customers.
In a statement, Salvatore R. Curiale, New York’s Superintendent of Insurance, said: “The department takes these steps towards the protection of policyholders and another on the prevention of erosion of the financial status of the company. We will continue to monitor about life and executive measures that we must engage quickly see that policyholders are threatened. ”
Executive Life of New York is one of two main operating subsidiaries of First Executive. The other girl, the Executive Life Insurance Company, is headquartered in Los Angeles and is placed under the control of intensive surveillance by state authorities in California. An examination of the books of the company
A spokesman for the California Insurance Department said it had no action against Executive Life announced today, but it is expected that a verification of books of the company in a few days.
The transition from New York, pressure regulator further establishes Executive First, new financial arrangements for the coverage back or sell a large part of their business, raise cash. The first Board of Directors, which was hit by huge losses on its portfolio of “junk bonds”, has entered into negotiations with a European financial institution, whose identity was not disclosed to an infusion of capital and a review of their finances.
The first Board of Directors has also been negotiating table to sell part of their life insurance to Hartford Life Insurance Company, which is in possession of ITT Corporation, but so far it had not reached a Deal.
First Executive’s problems have been growing for over a year as Junk Bond prices fell and many issuers of High Yield, High-Risk Securities late. First Executive to be published Monday that its auditors had expressed doubts about the ability to stay in business and they lost $ 465.9 million in the fourth quarter. Potentially the No. 1 Failure
AFTER Board of Directors and its operating units are insolvent, it would still be the biggest mistake an insurance company. It could be a risk to the investment of tens of thousands of policyholders, many of whose pension funds have invested in retirement sold by First Executive and its subsidiaries.
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