Guarantee Insurance Co. agrees to state receivership
Florida Insurance Commissioner
After a financial audit found the company overstated its level of capitalization in 2016, the
According to a spokeswoman for the
Both companies are controlled by
"While
By transferring the funds to Mariano, Guarantee violated state law prohibiting "direct or indirect notes or other evidence of indebtedness of any director, officer, or controlling stockholder of the insurer, except as to [authorized] policy loans," Altmaier's letter states.
"Further, the Office has identified other transactions involving parties with known association to
Guarantee's attorney,
A
In addition, Altmaier's letter said Guarantee violated state law by availing itself of reinsurance credit "at a time that it knew that it did not have sufficient cash and invested assets to cover this liability."
The letter said Guarantee's board of directors met on
Mariano served as Guarantee's CEO, director and chairman through 2015 but was not listed as an officer of the company in its 2016 annual report filed with the state
In
Richardson said in August that Patriot was working with the state on Guarantee's reorganization and Friday said Patriot provided the company with a
Guarantee wrote about
Impacts on Patriot of the receivership and order to "rehabilitate or liquidate" Guarantee remain to be seen and depend on whether Guarantee will emerge continuing as a customer of Patriot, Richardson said.
Richardson said Patriot would not be put out of business if forced to cut all ties with Guarantee. "We've been working to diversify," he said. "We do business with a number of other carriers."
In a statement,
"We understand the impact to consumers that the receivership process can have, and we will do everything in our power to protect consumers from detrimental impacts that may be caused by this situation," Carr said.
[email protected], 954-356-4071, twitter: twitter.com/ronhurtibise
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