SCC NAMED RECEIVER OF RECIPROCAL OF AMERICA

RICHMOND – The State Corporation Commission (“SCC”) today has been named receiver by the Circuit Court of the City of Richmond for Reciprocal of America (“ROA”) and ROA’s attorney-in-fact, The Reciprocal Group (“TRG”). After an examination, the SCC’s Bureau of Insurance found ROA and TRG to be in a hazardous financial condition.

    ROA is a Virginia-domiciled insurance reciprocal writing primarily hospital professional liability and workers’ compensation insurance. ROA and TRG are headquartered in Glen Allen, Virginia.

    ROA recently experienced financial difficulties because of poor claims experience and the inability of its Bermuda-based reinsurer, First Virginia Reinsurance, Ltd., to honor its reinsurance obligations. The Circuit Court has appointed Commissioner of Insurance Alfred W. Gross as Deputy Receiver. Commissioner Gross will make efforts to rehabilitate ROA and will oversee the management of the company for the protection of its policyholders.

    ROA will continue to pay all claims arising under ROA’s policies of insurance. A moratorium has been placed on the payment of all other claims until the Deputy Receiver completes his evaluation of ROA’s financial condition. ROA will no longer issue new or renewal insurance policies.

    The Bureau of Insurance continues to monitor the capacity of the insurance market for professional liability insurance for health care providers. Policyholders with questions about the receivership are encouraged to call the SCC’s Bureau of Insurance. From within Virginia, the toll free number is (800) 552-7945. Callers may also dial direct at (804) 692-0467, or they may call ROA at (804) 747-8600.

For additional information, contact kschrad@scc.state.va.us

State Corporation Commission
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