January 28, 2020
As many of you are aware, United Security entered into a reinsurance treaty in 2016 in order to improve its financial results and risk-based capital, which had been affected by blocks of business purchased in the past. During an Examination of United Security Assurance Company, the Pennsylvania Department of Insurance (“PA DOI”) determined that the Reinsurer’s assets, which back the policyholder reserves for the business transferred to the reinsurer, were substantially invested in subsidiaries and affiliates of a large private company. The PA DOI and the Company have concerns about the Reinsurer’s assets and would like them to be transferred into other investments.
We have been working with the PA DOI, other insurance departments, and the Reinsurer for some time to try to resolve these concerns. Because it is going to take a significant amount of time to solve these issues, United Security has made the decision to stop accepting new business at this time. The company anticipates resuming writing new business at a future time after the reinsurance concerns are resolved.
This means that United Security will no longer accept new business as of Monday, January 27, 2020. We will, however, continue the underwriting review of business received no later than Friday, January 24, 2020. If you have questions about pending business you have submitted, please call Suzan Graf or Chris Coady at the home office by calling 800-872-3044.
Rest assured that this action in no way affects our current policyholders. We will continue to renew policies and pay renewal commissions.
The Board, management, and staff of United Security Assurance deeply regret any inconvenience this may cause you. Rest assured that all other operations of the company are in place and remain available to serve you and your clients.
President and CEO