Area insurance company placed into receivership

PARAGOULD — Recent natural disasters have forced a Pulaski County Circuit Judge to place an area insurance company into receivership with the state Insurance Commission, with officials saying they will work to help customers with claims and other issues.

On Wednesday, Circuit Judge Herbert Wright approved the receivership plan for United Home Insurance Company in Paragould. State insurance officials said the company, which has 21,793 customers in Arkansas, has operated in Paragould for nearly 100 years.

As part of the receivership, officials said the process will allow the company to be rehabilitated.

In a media release Friday, state insurance officials said the proceeding was done due to a decline in the company's financial condition due to "substantial weather-related losses."

As part of the proceeding, Insurance Commissioner Alan McClain will assume management of the company, work to fix existing problems, operate the company and create a plan to rehabilitate the business.

Officials said if the rehabilitation process cannot be done, McClain's office will file paperwork with the court for an order of liquidation.

"Recent natural disasters have had a devastating effect on businesses throughout the state and the nation, and unfortunately the insurance industry is not immune," McClain said in a media release. "Our goal with this process is to make sure that the company's policyholders with outstanding claims get the money they need and deserve. If you have a policy with United Home, you are still insured and you can still file a claim."

Officials also said people who have policies with the company will see those policies continue, policy holders can also file claims as usual and must continue to pay their monthly premiums when they are due to avoid a loss or gap in coverage.

McClain said Friday that the commission's staff of financial analysts typically review insurance company records on a regular basis and that they have been in contact with the company for at least a year on the issue.

The insurance company's board also consented to the receivership plan and the situation was not adversarial in court, McClain said.

Officials also noted the receivership plan does not apply to the company's affiliate, Farmers Home Mutual Home Insurance Company.

A woman who answered the phone Thursday at the company's Paragould office said they did not wish to comment on the situation.

Anyone with questions about policyholders, claimants, agents, brokers, attorneys or the rehabilitation process can call the company at 800-467-0723 or Deputy Receiver Michael Surguine at 501-371-2776 or by email at michael.surguine@ arkansas.gov.