On April 9, 2009, Coral Insurance Company (“Coral”) was ordered into receivership for purposes of rehabilitation by the Second Judicial Circuit Court in Leon County, Florida ("Court"). The Florida Department of Financial Services is the court appointed Receiver of Coral. The company consented to the receivership.
Company Demographic Information
Coral, a Florida corporation licensed in 2004, is headquartered in Hollywood, Florida. The company was authorized to transact business in the state of Florida as a domestic property and casualty insurer. Coral wrote homeowner’s multi-peril insurance coverage in Florida.
Status of In-force Policies:
Current policies remain in force at this time. However, under Court Order dated April 20, 2009, all policies not otherwise cancelled or terminated prior to 12:01 a.m. on May 31, 2009, are cancelled as of that time and date.
To assist Coral’s policyholders in having funds available to obtain replacement insurance coverage, the Receiver made arrangements to return the unearned portion of policyholders’ premium already paid by the policyholders in advance of the May 31, 2009 cancellation date. Premium refund checks were mailed by May 15, 2009. Coral will continue to process cancellation requests received with cancellation dates prior to May 31, 2009. However, due to the mass cancellation process which cancelled policies effective as of 12:01 a.m. on May 31, 2009, any additional premium due to policyholders who cancel prior to that date will be processed on a supplemental basis.
Coral will continue to process loss claims and unearned premium claims in the normal course of business with the following exception. To help assure that Coral has adequate funds to administer the Receivership and avoid any preferential/disparate treatment of policyholders and claimants in the event that Coral is liquidated, Coral will retain the first $100 of the initial return premium/claim payment. If the Receiver ultimately determines that sufficient funds are available, it will process and pay the $100 retentions at a later date.
If the company is deemed to be insolvent and ordered liquidated, the Florida Insurance Guaranty Association would be activated to pay covered loss claims and unearned premium claims less a $100 deductible under Section 631.57(1)(a)2, Florida Statutes. If the company is liquidated, the $100 retention or deduction amounts may become claims in the estate.
REPLACEMENT INSURANCE COVERAGE WITH SECURITY FIRST INSURANCE COMPANY OR THROUGH MACNEILL GROUP, INC.
Coral reached an agreement with Security First Insurance Company (“Security First”) that will allow for Coral’s policyholders to obtain replacement homeowners insurance coverage through Security First. Security First is an “A - Exceptional” rated insurance company located in Ormond Beach, Florida. Under the plan, Security First will offer Coral’s independent agents the opportunity and capacity to replace all Coral policies that provide coverage for homes with Coverage A values up to and including $1,000,000, with similar policies from Security First at Security First’s currently filed rates. The only exception relates to Coral policyholders that currently have damage to their property. Per the agreement, Security First is not required to offer coverage to those policyholders.
Coral also reached an agreement with the MacNeill Group, Inc. (“MacNeill”), a Florida licensed Managing General Agent whereby MacNeill will work with Coral independent agents in an effort to replace all Coral policies that provide coverage for homes with Coverage A values over $1,000,000 with similar policies from one of MacNeill’s non-admitted markets at their standard rates for this class of business.
Background Information: Coral had approximately 11,750 policies in force as of the date of rehabilitation. The largest concentration of policies is located in Palm Beach, Miami-Dade and Broward counties. Coral also wrote in Lee, St. Lucie, Collier, Martin, Charlotte, Brevard, Indian River, Sarasota, Manatee and Duval counties. The company stopped writing new policies on February 26, 2009 and stopped renewing policies effective March 30, 2009.
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Division of Rehabilitation and
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