My February 18 Insight column for Insurance Advocate magazine called for the elimination of the New York Liquidation Bureau — a seemingly drastic but, in my view, necessary remedy for the gross mismanagement and lack of accountability under the existing system. In that column I stated that I would offer alternatives to the existing system. Hence in my March 4 Insight column, I discuss a truer course for the effective and open management of insolvent insurers through the designation of special agents retained on an estate-by-estate basis rather than through a full-time staff over-invested in an archaic, unaccountable, covert system.
My March 4 column, accessible here, focuses on the appointment by Superintendent Muhl in 1995 of such an independent agent in the liquidation of United Community Insurance Company (UCIC), and compares the success and effectiveness of the independent agent versus the management of UCIC by the liquidation bureau after it took back control from the independent agent in 2009. As explained in my column, the most interesting aspect of the use of an independent agent in the UCIC estate was that it fit clearly within the existing statue. In fact, it is a better fit than the Liquidation bureau, which has no direct foundation in the statute!