- IMPORTANT RECEIVERSHIP DOCUMENTS FOR
- POLICYHOLDERS, CREDITORS, AND INTERESTED PARTIES
IMPORTANT INFORMATION CONCERNING THE LANCET INDEMNITY RECEIVERSHIP
On April 12, 2019, in a case styled State of Nevada ex rel. Commissioner of Insurance, in her Official Capacity as Statutory Receiver for Delinquent Domestic Insurer v. Lancet Indemnity Risk Retention Group, Inc., a Nevada Domiciled Association Captive Insurance Company, Case No. A-19-791409-B, Dept. No. 18, the Eighth Judicial District Court of Nevada (“Receivership Court”) issued its Permanent Injunction and Order Appointing Commissioner as Permanent Receiver of Lancet Indemnity Risk Retention Group, Inc. (the “Permanent Receivership Order”). Pursuant to the terms of the Permanent Receivership Order, the Commissioner was appointed Permanent Receiver (“Receiver”), and the firm of Cantilo & Bennett, L.L.P. was subsequently appointed by the Receiver as Special Deputy Receiver of Lancet. As provided by the Permanent Receivership Order, the Receiver and Special Deputy Receiver are authorized to conduct the business of the Company and to administer its affairs for the protection of all secured creditors, insureds, policyholders, general creditors, and other interested parties wherever situated.
IMPOSITION OF MORATORIUM ON PAYMENTS
The Receiver has elected, as permitted by paragraph sixteen of the Permanent Receivership Order, to impose a full suspension and moratorium on disbursements owed by Lancet, 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 Receivership Order, April 12, 2019. The Receiver encourages you to contact current defense counsel (i.e., for any insured claims where you are now being defended by the Company through outside litigation counsel) and to make arrangements as best you can for the continued defense of claims brought against you as an insured of Lancet—if the claimant is not willing to stay litigation against you. For insureds that agree to pay their own defense costs for claims covered by the Company and/or pay money to settle claims covered by Lancet’s insurance, they are entitled to submit claims for those paid defense costs or claim settlements (i.e., as covered by a Lancet insurance policy) to the Receiver. The Receiver provides no guaranty of reimbursement of defense costs and claim payments made directly by insureds, or the timing of any reimbursement payment that may be approved, as this will depend on the extent of any future distributions made by the Receiver, including a review and approval that paid costs and claims are covered by a Lancet insurance policy.
CANCELLATION OF LANCET INSURANCE POLICIES
The Permanent Receivership Order mandates that “all evidences of coverage, insurance policies and contracts of insurance of LANCET are hereby terminated effective on April 30, 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 Lancet’s in-force insurance policies are to be canceled effective on the earlier of April 30, 2019, or the date when the insured ceased making premium payments to Lancet (and insurance coverage on active policies is provided through April 30, 2019, provided that premiums are paid by insureds to the Company through such date).