The California Insurance Guarantee Association, an organization that pays the claims of insolvent insurance carriers, recently announced that Executive Director Lawrence Mulryan will retire after 13 years of service.
Mulryan will continue to serve as executive director until June 30, when Gray Gordon Davis will become the new executive director. Davis’ insurance background includes working for Hartford and Kemper.
Mulryan said that the biggest challenge he faced during his time at CIGA was the virtual collapse of the workers’ compensation market in California.
“All of a sudden we had one company after another (25 companies in all) that became insolvent and major parts of the California workers’ comp market became insolvent and became our obligation,” Mulryan said. “We moved up to a high of 85,000 open files and we had a payout of claims of $100 million a month. The challenge was not only how to handle that from an administrative standpoint but also to fund it. We did both. I think we did both without missing a payment. Also, no claimant was harmed or hurt at all by this.”
Mulryan explained that CIGA had to eventually get additional assessment capacity, so he came up with the idea of floating a bond, which nobody tried before. “We got that passed by the Legislature so I went to the market and got those bonds sold and we’re now using that for our workers’ comp,” he said. “We were able to successfully continue to handle our claims in a professional and cost-effective way even though we had virtually run out of money. We’ve done a lot of things; we’ve computerized our functions and done a lot of good things but I think that’s the one area where I’m most proud of our organization.”
Mulryan said that he will continue to work on some projects for CIGA through the end of 2005. His future plans may include joining a law firm on a for-counsel basis.
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