South Carolina regulators have suspended the license of a captive insurer that sold liability insurance to owner-operators and small fleets.
It was the first time the state has shut down a "captive," which is an insurer established by a corporation or association to handle risks of the company or group for specific types of coverage.
Commercial Truckers Risk Retention Group Captive Insurance Co. is headquartered in Oakwood, Ga., with an office in Columbia, S.C. Most of its customers are in California and other Western states. It is owned by the National Alliance of Commercial Truckers.
According to The Post and Courier of Charleston, S.C., the S.C. Department of Insurance said the company violated its business plan by signing up fleets with up to 100 trucks, instead of the smaller fleets with 15 units or fewer or owner-operators. The insurer, in business since January, was not in good financial condition, according to regulators. Published reports indicate that the policies being issued were all legitimate, but the company didn't have enough cash to continue accepting new business.
Earlier this year, the insurance department asked the company to post more money and place controls on claims handling and general operations. When the company did not comply, the agency in June ordered the carrier to stop adding new customers. At the end of July, the company was ordered to stop renewing existing policies. On Aug. 20, it canceled policies and took over operations to pay creditors. The company has enough cash in bank accounts and from outstanding premiums to pay claims.
It was the first time the state has shut down a "captive," which is an insurer established by a corporation or association to handle risks of the company or group for specific types of coverage.
Commercial Truckers Risk Retention Group Captive Insurance Co. is headquartered in Oakwood, Ga., with an office in Columbia, S.C. Most of its customers are in California and other Western states. It is owned by the National Alliance of Commercial Truckers.
According to The Post and Courier of Charleston, S.C., the S.C. Department of Insurance said the company violated its business plan by signing up fleets with up to 100 trucks, instead of the smaller fleets with 15 units or fewer or owner-operators. The insurer, in business since January, was not in good financial condition, according to regulators. Published reports indicate that the policies being issued were all legitimate, but the company didn't have enough cash to continue accepting new business.
Earlier this year, the insurance department asked the company to post more money and place controls on claims handling and general operations. When the company did not comply, the agency in June ordered the carrier to stop adding new customers. At the end of July, the company was ordered to stop renewing existing policies. On Aug. 20, it canceled policies and took over operations to pay creditors. The company has enough cash in bank accounts and from outstanding premiums to pay claims.
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