Florida DFS Posts Autopsy Reports on 18 Insolvent Insurers, 2012-2017

May 23, 2022

A week after a Florida news report pointed out that few people seem to know that post-insolvency autopsies are required by law, the state Department of Financial Services has posted 18 of the reports for property insurers online.

The reports, which could help shine a light on the exact causes of some carriers’ insolvencies, don’t include some of the most recent liquidations. For property-casualty insurers, the reports run from 2012’s Coral Insurance Co. to AequiCap Insurance, National Group Insurance and Northern Capital in 2017.

The Miami Herald the Tampa Bay Times reported last week that few state officials knew about the post-mortem reports, which are done by accounting firms and could give insight on preventing insolvencies, as more Florida insures struggle to stay afloat. Only one report had been made available until now, the newspapers reported.

A spokesman for DFS said the autopsies can take months to complete and are not usually posted until litigation over the insolvency is completed. The link on the DFS website has been provided to lawmakers who are gathering this week in a special session to consider ways to prevent further insolvencies in the state’s distressed market.

One piece of legislation that has been filed for the session would require that initial autopsy reports be completed within two months of the initiation of insolvency proceedings, and a final report no later than 30 days after the final proceedings.

Some of the existing reports don’t provide great detail about the reasons for an insolvency. For National Group Insurance, for example, the analysis is 10 pages long. It notes that the company focused mostly on commercial auto and commercial property lines. The insurer had ceded all of its direct premiums and risk to its parent company, and its surplus remained stable and profitable until about 2010.

“The NGIC insolvency was a direct result of NIC being put in rehabilitation and the cancellation of the 100% quota share reinsurance agreement,” it concluded.

The autopsy did not show who wrote it or which accounting firm performed the examination.