No, the companies are not in liquidation at this time. The companies are still in rehabilitation. On January 6, 2009, the Commonwealth Court of Pennsylvania issued orders of rehabilitation for both companies and appointed the Pennsylvania Insurance Commissioner as rehabilitator. On October 2, 2009, the Rehabilitator filed petitions for liquidation of the companies with the Commonwealth Court of Pennsylvania. The Rehabilitator filed amended petitions for liquidation on October 23. The final decision on liquidation is pending with the court. The companies will remain in rehabilitation until the court orders otherwise.

According to the Rehabilitator's court filings, the Rehabilitator, the companies' management and their consultants have determined that future claims will exceed future revenues and current reserves. They concluded that PTNA and ANIC will be unable to fully fund long-term future obligations.

According to the Rehabilitator's court filings, the Rehabilitator worked for several months during 2009 with two actuarial consulting firms to review the companies' financial condition and future financial projections. The analysis by the Rehabilitator's actuaries that was presented to the court in October was based on higher projected claims costs and lower projected investment returns than their initial analysis. The updated analysis indicated that PTNA would have a capital and surplus of negative $1.3 billion and ANIC would have capital and surplus of negative $45 million if appropriate reserves for future claims were held. In addition, the Rehabilitator determined that there are no available transactional alternatives (such as capital infusion, reinsurance or sale) that would be fair to and in the best interests of the companies, their policyholders and other affected parties.

The Rehabilitator filed petitions for liquidation on October 2 and filed amended petitions for liquidation on October 23, 2009. The Commonwealth Court is considering the petitions. The judge may decide to hold hearings and/or request additional information from the Rehabilitator, the companies, and other interested parties before a ruling is made. This process could take several months.

Until an order of liquidation (or another order that would stop the companies from paying claims in full) is entered by the court, all claims will continue to be paid by the company in accordance with the terms of your policy. You must continue to pay your policy premium when due to continue the coverage afforded by your policy. If the court enters an order of liquidation, future claims for Ohio policyholders will be subject to the Ohio Life & Health Insurance Guaranty Association (OLHIGA) coverage limit for health insurance, which is $100,000 per person.

When an insurance company enters a period of financial difficulty and is unable to meet its obligations, the insurance commissioner in the company's home state initiates a process – dictated by the laws of the states – whereby every attempt is first made to help the company regain its financial footing. This period is known as rehabilitation. If it is determined that the company cannot be rehabilitated, the company is declared insolvent, and the laws of the state require the commissioner to ask the state court to order the liquidation of the company.

You will receive notification from the Rehabilitator or Liquidator if and when the court issues a liquidation order. After that, OLHIGA, working with the liquidator, will continue to communicate with you about guaranty association coverage and the implementation of any plans that will impact the administration of your policy.

The Pennsylvania liquidation statute states that policies will continue in force for thirty days after the entry of a liquidation order, with some exceptions. To the extent that your policy is guaranteed renewable (and most all of the long-term care policies are guaranteed renewable), OLHIGA will continue your policy in force if the premium continues to be paid, and benefits under the policies will be paid in full when due, subject to our maximum payment obligation of $100,000 for any one individual.

OLHIGA covers policyholders who are residents of Ohio at the time a company is placed into Liquidation. Residents of other states are usually covered by the Life & Health Insurance Guaranty Association in their own state.

OLHIGA is triggered to provide coverage when an order of liquidation with a finding of insolvency has been issued against an insurance company by the court. That means that OLHIGA’s coverage obligations begin at that point. When and how OLHIGA will take over the administration of policies and payment of claims will depend on the structure of the liquidation plan for a company.

Yes, long-term care insurance is typically considered health insurance for guaranty coverage purposes.

Not necessarily. Like the FDIC, state guaranty associations have maximum benefit limits. These limits are established by state law; and, in Ohio, long-term care insurance policy benefits are covered by OLHIGA like other forms of health insurance up to a maximum benefit of $100,000 per person.

Any claims in excess of OLHIGA’s limits are not within the scope of OLHIGA’s statutory responsibility. If you have a claim in excess of OLHIGA’s limits, you should submit a claim to the Liquidator and seek payment from the insurance company's assets.

Yes. If you are paying premiums to the company, you must continue to do so even after the company has been placed into rehabilitation or liquidation. Premiums will go to OLHIGA after a liquidation to help provide you continuing coverage; and, if you stop paying premiums, your insurance benefits may be terminated.

While the companies remain in rehabilitation, you should continue to contact PTNA/ANIC Policyholder Services at 800-362-0700, ext: 3190 for policy or claim information.

OLHIGA has no information about your specific policy at this time, and will only become directly involved after an order of liquidation has been entered by the court.