Fla.-Based Vanguard Fire & Casualty Ordered into Liquidation

March 26, 2007

Leon County (Florida) Circuit Court Judge Terry P. Lewis ordered Maitland-based Vanguard Fire & Casualty Company into liquidation, effective today to ensure policyholder claims continue to be paid.

The Department of Financial Services was named receiver in January for purposes of rehabilitation and has paid more than $6 million in claims using company assets, but determined the company’s cash and reserves are not enough to keep up with claims.

The department has a request pending in the same court asking for permission to allow the company’s approximately 57,000 homeowner policyholders to be offered replacement coverage by either Royal Palm Insurance Co. or Security First Insurance Co.

If the court approves, replacement coverage will be effective April 25, 2007, or upon expiration of the policyholder’s Vanguard coverage, whichever occurs first. Policyholders also will be free to choose other companies for coverage.

“Getting the company into the liquidation process will allow us to immediately begin paying claims from the state’s Florida Insurance Guaranty Association,” said Florida Chief Financial Officer Alex Sink, who as CFO oversees the department. “Our top priority is to take care of policyholders and ensure their claims are paid.”

The company consented to being placed in receivership for rehabilitation on Jan. 19. At that time, Vanguard had already announced it had stopped writing new coverage in early January and would not write renewal coverage after April 19, 2007. As a result of the liquidation order, signed on March 22, Vanguard homeowner policies will be canceled at 12:01 a.m. on April 25, 2007.

Questions relating to current Vanguard policy, coverage and claim issues should be directed to Vanguard Fire & Casualty Co. at (866) 830-6423.

Beginning on March 26, claimants who need to check on the status of an existing claim, or report a new claim, should call the Florida Insurance Guaranty Association at (866) 928-4310.

Source: www.fldfs.com

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