A New York captive insurer, formed to cover the liability of New York City contractors and subcontractors involved in the World Trade Center debris cleanup, said officials faulting the way it conducts business do not understand its purpose.

The WTC Captive Insurance Company Inc., backed by $1 billion in federal money, was hit with a letter last week from New York Insurance Superintendent Howard Mills, demanding that the New York-domiciled operation send his department a “detailed analysis of claims paid and expenses incurred” since the captive’s inception in July 2004.

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