NU Online News Service, June 3, 2:36 p.m. EST
Florida homeowners insurer Argus Fire and Casualty Insurance Co. has been ordered to stop doing business in the state.
The company, owned by United Automobile Insurance Group, cannot buy adequate catastrophe reinsurance for the 2011 hurricane season, concludes an order from the Office of Insurance Regulation (OIR).
"Therefore the office has decided that it is in the policyholder's best interest to cancel all of [Argus'] existing policies," reads a letter that will be sent to the company's policyholders. Policies will be cancelled 45 days from the time policyholders receive notice.
To carry out the cancellation process, Argus has been placed under administrative supervision.
The OIR order outlines a series of financial statements received from North Miami Beach, Fla.-based Argus over the last month. Each reveals a company in trouble, resulting in a May 23 meeting with the OIR when Argus told regulators of its intention to run off its book of business and stop writing policies in Florida.
The OIR began reviewing Argus' reinsurance plans after the insurer submitted information to comply with a data call from the OIR to get an indication of companies' reinsurance programs. The company's surplus was $4.55 million at the end of April, leading the OIR to conclude that Argus' "proposed reinsurance program, specifically the company's retention, in conjunction with [its financial statement], specifically its surplus position," prevents the company from securing adequate catastrophe reinsurance.
All of Argus' $29.4 million in direct premiums are written in Florida, according to Highline Data. The company's last profitable year was 2007, when it reported net income of $62,287. In 2010 Argus posted a loss of nearly $4 million, with an underwriting loss of about $6 million and a combined ratio of 148.
Higline Data is a part of Summit Business Media, which also owns National Underwriter.
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
