Real Legacy Assurance ordered to liquidate assets
SAN JUAN – At the request of Puerto Rico’s Insurance Commissioner’s Office, the Court of First Instance of San Juan issued Friday an order to begin liquidating Real Legacy Assurance Co.’s assets, under court supervision.
Real Legacy was placed under regulatory supervision by the Office of the Commissioner on Sept. 28 largely for losses stemming from hurricanes Irma and Maria, which developed in the first half of 2018 by approximately $110 million, which exceeded the company’s reinsurance limits by approximately $70 million. Accordingly, as of June 30, the company’s policyholder surplus was negative $42 million, according to insurer rating company A.M. Best.
The liquidation process is governed by the Insurance Code’s Chapter 40 provisions, which establish the manner and priority order to be followed for the equitable distribution of the insolvent insurer’s available assets among its policyholders and creditors.
In “November and December, the Court authorized the sale of the business portfolio of Real Legacy in Puerto Rico and the British and U.S. Virgin Islands, respectively, in order to monetize the assets of the insurer in money available to honor the maximum possible the obligations of Real Legacy with its policyholders, claimants and creditors, to best protect the best public interest,” Insurance Commissioner Javier Rivera Ríos said in a statement.
He explained that the liquidation process ordered by the court also activates the coverage of the Miscellaneous Insurance Guarantee Association, a mechanism whereby valid claims against Real Legacy can be met within a maximum limit of $300,000) per claim, or $1 million in aggregate. The association will be considered as the insurer with respect to the pending claims against Real Legacy.
Every claimant, policyholder or creditor, even if they have previously submitted their claim to Real Legacy or have a pending lawsuit in court, must complete and file the claim form, found at the the commissioner’s office website, with the Assistant Liquidator appointed by the commissioner no later than 90 days from the date the order was issued.
“It is important that all Real Legacy policyholders who have a pending claim that has not been paid act promptly, completing and submitting this form as indicated so that the order of priority in dealing with the claim is not jeopardized,” Rivera Ríos concluded.
The form may also be filed personally at Metro Office Park, Lot 1, Floor 2, in Guaynabo or sent via mail to P.O. Box 71467, San Juan, Puerto Rico 00936-8567.
Real Legacy’s business in the USVI has been transferred to Guardian General Insurance Co.
–Cybernews contributed to this report.