South Carolina bars A-Cap insurers from writing new policies in 2025

South Carolina became the second state this month to bar an Advantage Capital Partners-controlled life insurer from writing new business after Dec. 31.

“Atlantic Coast Life Insurance Company and Southern Atlantic Re, Inc. have been directed to cease writing all new business, effective December 31, 2024,” reads a statement from Michael Wise, director of the South Carolina Department of Insurance.

“These companies have also been instructed to notify all producers who sell their products and other relevant persons or entities of this directive; and, they are to confirm that they have provided such notice,” the statement adds. “Moreover, in the event the companies do issue any new policies and new annuities after December 31, 2024, they must cancel them and return to the purchaser all money received within five business days.”

South Carolina regulators declined further comment on the circumstances surrounding the decision.

On Dec. 2, Utah Insurance Commissioner Jonathan T. Pike signed an order barring Sentinel Security Life Insurance Co. and a pair of reinsurers from writing new business in the state after Dec. 31.

All of the insurers are owned by Advantage Capital, known as A-Cap.

According to Utah examiners, the three insurers doing business in its state “are in a Hazardous Financial Condition and that such condition presents an immediate and significant danger to the public health, safety, or welfare, and that immediate action is necessary and in the public interest.”

A spokesperson for A-Cap could not be reached for comment Wednesday. The company released this statement following the Utah order:

“A-CAP vigorously disputes the flawed valuation conducted by an unqualified firm. A-CAP stands by its valuation work, which was validated by two highly qualified and independent valuation firms, and is challenging the Order to protect its policyholders, its investors, and the interests of the broader aviation leasing industry participants.”

A-Cap endured a tumultuous 2024.

According to reporting by Semafor, A-Cap sold blocks of life policies to 777’s reinsurance arm, while separately loaning hundreds of millions to 777 Partners itself and various portfolio companies.

In a May lawsuit, Leadenhall Capital Partners, a London-based asset manager, claimed that it provided 777 Partners with more than $600 million in financing. Leadenhall said it later learned that roughly $350 million in assets serving as collateral for the loans either were not in 777’s control or had already been pledged to other lenders.

A-Cap is also named as a defendant, with the firm telling the New York Times that the claims are “baseless.”

Also in May, Sentinel Security and Atlantic Coast Life Insurance, another A-Cap insurer, sued to prevent AM Best from downgrading their financial strength ratings from B++ to B-. That lawsuit was later settled.

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InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.