Mission Insurance and the state Department of Insurance announced Tuesday a new agreement for the rehabilitation of the Los Angeles-based insurer, which was declared insolvent and placed under state conservatorship late last year.
Under the plan, which will be presented to a Los Angeles Superior Court judge on March 6, most of the financial obligations of Mission Insurance and its subsidiaries would be assumed by Mission American Insurance, California Insurance Commissioner Bruce Bunner said.
Mission American Insurance is a subsidiary of Los Angeles-based Mission Insurance Group, which was established as part of a rescue effort by Mission Insurance Group's major shareholder, privately held American Financial Corp. of Cincinnati. Mission Insurance Co. is also a subsidiary of Mission Insurance Group.
Ailing Mission Insurance's primary business was writing direct liability, property and workers compensation insurance policies as well as administering reinsurance pools in which Mission would reinsure other companies' policies, assuming part of the risk in exchange for a share of the premium payments. Mission Insurance would then parcel out some of the risk to yet another layer of reinsurers.