The Vermont superior court for Washington County has placed Global Hawk Insurance Company Risk Retention Group (Global Hawk RRG) into liquidation as of June 8, 2020.
The liquidation is being handled by the Vermont Department of Financial Regulation, as Global Hawk RRG is domiciled within the state.
This comes when the court determined that Global Hawk RRG is insolvent and “further dealings of business would be hazardous, financially or otherwise, to its policyholders, its creditors or the public,” in line with the June 8 liquidation order. Global Hawk was originally fashioned as a risk retention group in 2003 in South Carolina. The company re-domesticated to Vermont on Feb 20, 2009 and was licensed to try and do business as a risk retention group writing automobile insurance coverage for motor transport carriers.
As of December 31, 2019, Global Hawk RRG reportable assets of $42.7 million, as well as $37.6 million liquid cash and investment assets, and liabilities of $34.9 million. At that time, Global Hawk was registered in ten jurisdictions, not including Vermont, and had in-force coverage in seven states, in line with a June 5, 2020, planned order for liquidation issued by Michael S. Pieciak, commissioner for the Vermont Department of Financial Regulation.
As of April 30, 2020, the company was providing commercial auto insurance to 1,008 vehicles. Its case reserves, or defense and indemnity reserves on identified claims, as of April 30 destroyed $11.9 million on 224 open claims. This figure, over ten times the company’s assets the previous month, doesn’t absolutely state Global Hawk RRG’s actual policy obligations.
As a result it excludes consideration of losses that are incurred but not yet reported or its obligations for unearned premium upon termination of the in-force business, consistent with the planned order of liquidation. “The company is a risk retention group and so deeply insolvent that the vehicles are effectively uninsurable,” the planned order stated. “Further, as a result of Global Hawk RRG having targeted on insuring little hauling operations…it is reasonable to assume that the members could lack the monetary scale to soak up and pay uninsured losses.” Pieciak wanted to alert producers and members in order that they will secure different commercial auto insurance coverage, the proposed order stated.
For creditors that believe they have a claim or may have a claim within the future against Global Hawk or one of its insureds, a proof of claim form should be filed so as to preserve the claim. If a proof of claim isn’t filed before the filing deadline of December 8, 2021, creditors might not receive any distribution from the Global Hawk liquidation proceeding, consistent with the Vermont Department of Financial Regulation website.