FOR IMMEDIATE RELEASE
COURT APPROVES PAYMENTS TO MIDLAND CREDITORS
Superintendent of Insurance Howard Mills announced today that the creditors of Midland Insurance Company with policy related claims are being mailed their pro-rata share of over $50 million.
"Midlands policy related creditors have every reason to be thrilled with the progress New Yorks Liquidation Bureau has made in recent months toward disbursing millions of dollars that are rightfully due them," said Superintendent Mills, who as the states chief insurance regulator also serves as the Liquidator of Midland Insurance Company.
The New York County State Supreme Court approved a Petition and Distribution of Assets Plan submitted by Jody S. Hall, Special Deputy Superintendent of Insurance, as agent to Superintendent Mills. This distribution is the first one since Midland was declared insolvent in 1986. Special Deputy Superintendent Hall, under the supervision of Superintendent Mills, has initiated significant changes to the administration of Midland and other New York insolvent insurance estates in order to lessen the hardship on creditors affected by insolvencies.
The approved Petition and Plan recommends that the Midland insurance insolvency proceedings should remain open until all creditors claims, whether policy related or not, are adjudicated. The Plan requires that any disputes with such creditors be resolved and all recoverable reinsurance and other assets of this estate be collected and distributed to the creditors. Moreover, Superintendent Mills, as Midlands Liquidator, received the Courts permission to make additional, periodic distributions of assets in the future when such distributions are feasible and prudent.
Approximately 1,100 Class 2 creditors qualify for this first disbursement of 10% of the claim amount allowed. Class 2 creditors are identified as policy related claimants, and are individuals or corporations that have a claim against a policy issued by Midland. This class of creditors includes some of Americas largest Fortune 500 companies for claims arising from asbestos, environmental hazards, tainted blood, breast implants and other toxic torts that continue to come into the New York Liquidation Bureau (NYLB) from incidents that occurred decades ago. Among Midlands other creditors are 47 of the nations state guaranty funds. This initial distribution will give these state guaranty funds a needed financial boost and provide a safeguard for individual workers compensation claimants.
"We anticipate that this initial distribution will be the first of what the Liquidation Bureau hopes will be a number of payments to Midlands policy related creditors," said Special Deputy Superintendent Hall.
Founded in 1959, the Midland Insurance Company was a New York-domiciled insurer and had offices at 160 Water Street, Manhattan. Midland was declared insolvent by order of the Supreme Court of the State of New York in 1986.
Since that time, NYLB has been charged with oversight of the Midland estate and has adjudicated more than 17,000 creditors claims to date. More than 4,000 claims remain open, many of them amongst the most complex. Many of Midlands largest creditors were briefed on the NYLBs current Distribution of Assets Plan at a meeting held on Tuesday, November 29, 2005 at the Insurance Departments Manhattan office. Another such meeting is scheduled to take place in mid to late June 2006.
To access a copy of the approved Petition and Distribution of Assets Plan, log onto www.nylb.org, click onto Estates, then Domestic Liquidations, and link to the Midland Insurance Company icon. If you have any further questions, please contact Special Deputy Superintendent Jody S. Hall at 212-341-6500 or by email at firstname.lastname@example.org.