As Hurricane Ian bore down on the west coast of Florida, the department petitioned and received court approval to liquidate FedNat Insurance Company (FedNat) on September 27, 2022. FedNat is the sixth Florida and ninth Louisiana insurance insolvency of 2022. The Department filed the petition after the company admitted that it did not have sufficient cash to complete the May 13, 2022 Consent Order agreement to wind down its business and provide for an orderly runoff of its claim obligations. The FedNat, Monarch National and Maison policies subject to that consent order were canceled effective 45 days back in June 2022. The liquidation order triggers the Florida Insurance Guaranty Association (FIGA) and the guaranty funds in the other licensed states.
Monarch National Insurance Company (Monarch) assumed 83,000 FedNat policies via an assumption reinsurance agreement effective June 1, 2022. Monarch remains a going concern. Under this agreement and per the liquidation order Monarch is responsible for all policies and claims on the assumed business from June 1, 2022 forward. Any claims incurred prior to that date that remained unpaid on those assumed policies would fall under the FedNat liquidation order and be covered by the appropriate guaranty association.
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