Workers’ Comp Executive recently reached out to Nicholas Roxborough to comment on the new cease and desist order signed by California Insurance Commissioner Dave Jones, barring Applied Underwriters from selling its EquityComp program in California.
Roxborough told Workers’ Comp Executive that, “the Order provides additional evidence that Applied has engaged in wrongdoing. It provides exquisite foundational evidence for existing lawsuits, and on a going forward basis, it may provide some sort of assurance that Berkshire may act properly like other carriers.”
The order also prevents Applied from enforcing its unusually high runoff loss development factors, or LDFs, and other important provisions in its existing unfiled and unapproved reinsurance participation agreements (RPAs) in California. It calls for CDI and Berkshire actuaries to come up with an acceptable set of LDFs that will apply to policies and RPAs.
“Fortunately, this issue remains at the court of appeal for both the CDI and our client Luxor Cabs who already – and successfully – argued that the arbitration clauses are unenforceable as a matter of law.”
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