NOTICE TO ALL POLICYHOLDERS, CLAIMANTS, CREDITORS, SHAREHOLDERS, AND ALL OTHER PERSONS OR ENTITIES INTERESTED IN CASTLEPOINT NATIONAL INSURANCE COMPANY NOTICE IS HEREBY GIVEN that on July 28, 2016, the Superior Court of the City and County of San Francisco entered an Order Appointing Conservator, in the case entitled , Case No. Pursuant to the Conservation Order, the California Insurance Commissioner has been appointed as the statutory Conservator of Castlepoint National Insurance Company (“Castlepoint”).
The Conservation Order authorizes and empowers the Commissioner, through his Conservation & Liquidation Office, to conserve Castlepoint and its assets for the benefit of Castlepoint’s claimants, creditors and shareholder, as provided in Sections 1010 through 1062 of the Insurance Code of the State of California.
The collateral consists of letters of credit, funds or securities held in trust, and cash collateral held by the insurer on an unsegregated basis.
Cash collateral is reported as an asset on the insurer’s balance sheet with an offsetting liability.
Many of the commercial property/casualty insurers in a corporate holding company system enter into various kinds of insurance agreements pursuant to which the policyholders provide collateral to the insurer in order to secure future obligations to pay losses.
The collateral requirements are typically set forth in a separate payment agreement governing the entire insurance program with the insured.
The Superior Court has set a hearing on the Commissioner’s motion to approve the proposed Conservation and Liquidation Plan for September 13, 2016, at a.m., in Department 302, at 400 Mc Allister Street, San Francisco, California, 94102.Even when the transactional documents are clear that the historical insurance rights are to be transferred as part of the transaction, the transacting parties need to be aware of arguments that the insurers will bring to bear in their attempts to use the transaction as an opportunity to avoid their coverage obligations. Specifically, insurers routinely argue that so-called "anti-assignment" or "consent to assignment" conditionin their insurance policies relieve them of coverage obligations when an assignment of insurance rights has taken place without their consent. On July 21, 2010, the rig experienced another severe weather event.It was damaged again, in part because of the modifications caused a portion of the rig to detach and float out to sea, where it remained for nearly thirty hours in rough waters.A number of courts have adopted the Successor Insured Position that, while an insurer cannot be required to insure a third party for new occurrences that relate solely to the third party's conduct after the transfer in question, a policyholder is free to assign or otherwise transfer its insurance rights relating to occurrences that began prior to the transfer without having to obtain the insurer's consent. As a result, the insurers in Henkel and these other cases were able to avoid paying substantial amounts in coverage to the Successor Insured to which the policyholder had attempted to assign coverage.