Spirit Commercial Auto Risk Retention Group is in RECEIVERSHIP
On February 27, 2019, Department XXVII of the Eighth Judicial District Court of Nevada entered its Permanent Injunction and Order Appointing Commissioner as Permanent Receiver of Spirit Commercial Auto Risk Retention Group, Inc., In Receivership (the “Permanent Order”). Pursuant to the terms of the Permanent Order, the Commissioner was appointed Permanent Receiver (“Receiver”), and the firm of CANTILO & BENNETT, L.L.P. has been appointed by the Receiver as Special Deputy Receiver of Spirit.
The permanent receivership against Spirit was ordered by the court because Spirit was insolvent and in a hazardous financial condition. Current Spirit RRG customers should obtain obtain alternative insurance coverage as of April 16, 2019, for any active insurance policy with Spirit. Currently, the Receiver does not have an estimated timeframe as to when claim or insurance defense disbursements will resume, as it will depend on many factors that are not yet known to the Receiver. * Source https://spiritinsure.com/2019/03/05/839/
Get your truck insurance quotes started right now in AL,AR,FL,GA,IA,IN,KS,MD,MS,NC,NE,NJ,OH,PA,SC,TN or VA (888) 287-3449 .
Get the best Taxi Insurance, Black Car and Airport Shuttle insurance rates in GA,IA,IN,KS,MD,NC,NE,NJ,OH,PA,SC,TN and VA. Contact us for a fast money saving quote today with our same quote and bind service possible for your company now.
The Court found Spirit RRG to be in an insolvent and hazardous financial condition that required the appointment of a Receiver and Special Deputy Receiver to administer the affairs of the Company for the protection of its insured’s, policyholders, creditors, and the general public.
Receivership is a protective measure established under Nevada insurance law whereby regulatory officials seize control of an insurance company that is in an insolvent and hazardous financial condition. Receivership action is taken (as is the case for Spirit) for the protection of its policyholders, creditors, and the general public. The Receiver and Special Deputy Receiver, through the Permanent Order, have been given the authority to run the affairs of Spirit in compliance with applicable Court orders and the laws of the state of Nevada.
The Receiver has elected, as permitted by paragraph 17 of the Permanent Order, to impose a full suspension and moratorium on disbursements owed by Spirit, to include the payment of insurance claims, insurance defense costs, mediation costs, and other such costs related to the defense or adjudication of insurance policy claims. This moratorium is effective as of the date of entry of the Permanent Order, February 27, 2019.
DOES ANY PROVISION CONTAINED IN THE COURT’S PERMANENT ORDER TRIGGER THE APPLICABILITY OF THE NEVADA INSURANCE GUARANTY ASSOCIATION OR ANY OTHER STATE INSURANCE GUARANTY ASSOCIATION?
Answer: No. Pursuant to NRS 695E.200(5), risk retention groups shall not “[j]oin or contribute financially to the Nevada Insurance Guaranty Association, or to any similar organization or fund in this state[.]” Further, NRS 695E.200(5) provides that “the provisions of chapter 687A of NRS [the Insurance Guaranty Association animating statutes] do not apply to a risk retention group. A risk retention group and its insured’s shall not accept any benefit from such an organization or fund for claims arising out of the operation of the risk retention group.” As such, Insurance Guaranty Association coverage is not applicable in this case.
Risk retention groups, such as Spirit, are also not covered by the state insurance guaranty associations of other state jurisdictions.
Paragraph 18 of the Permanent Order mandates that “all evidences of coverage, insurance policies and contracts of insurance of SCARRG[Spirit] are hereby terminated effective on April 15, 2019, unless the Receiver determines that any such contracts should be cancelled as of an earlier date.” The Receiver has decided, upon review of all the applicable facts and circumstances, that Spirit’s in-force insurance policies are to be canceled effective on the earlier of April 15, 2019, or the date when the insured ceased making premium payments to Spirit (and insurance coverage on active policies is provided through April 15, 2019, provided that premiums are paid by insured’s to the Company through such date).
For copies of documents, additional information, and to address receivership questions, contact the Special Deputy Receiver as follows:
Cantilo & Bennett, L.L.P.
Special Deputy Receiver
Spirit Commercial Auto Risk Retention Group, Inc.
11401 Century Oaks Terrace, Suite 300
Austin, Texas 78758