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Notice of Pending Liquidation: Fairway Physicians Insurance Company, A Risk Retention Group


Monday, September 18, 2017

• Fairway Physicians Insurance Company, A Risk Retention Group (Fairway) is a District of Columbia (DC) domiciled association captive insurance company licensed to write professional and general liability insurance.

• A risk retention group (RRG) is a form of self-insurance and is a risk-bearing entity formed pursuant to the Federal Liability Risk Retention Act of 1986, U.S.C. §3901 et seq. (LRRA). Under the LRRA, an RRG is owned by its policyholders, is licensed under applicable insurance laws in the jurisdiction in which it is domiciled, and is authorized to do business in other jurisdictions in which the RRG files a registration. As the domestic regulator of Fairway, the District of Columbia Department of Insurance, Securities and Banking (Department) is the primary regulator of Fairway.

• On August 15, 2017, Fairway reported a surplus of $11,031.00 in its June 30, 2017 financial statement. The statutory minimum capital and surplus for a risk retention group licensed as a captive insurer in the District of Columbia is $400,000.00. Fairway reported a surplus balance of $3,182,476.00, as of December 31, 2016.

• Because of Fairway’s impairment of capital and surplus, Fairway, in a letter to the Department dated August 17, 2017, confirmed that Fairway had voluntarily ceased writing all business and was no longer writing any business, including new business, renewals, endorsements and tail policies. (Fairway had previously agreed to stop writing new business.) In addition, because of the impairment, the attached August 29, 2017 Order was issued by the Department to Fairway.

• On September 8, Fairway informed the Department that Fairway’s board had determined it is necessary and desirable for Fairway to be placed into liquidation and the board requested that the Department expedite the liquidation process. The Department responded it would move as quickly as possible to obtain a liquidation order.

• The Department is currently in the process of obtaining a liquidation order appointing the Commissioner as liquidator of Fairway. Once the liquidation order is signed by the DC Superior Court, the Department will distribute additional information regarding Fairway. The exact date on which the liquidation order is anticipated to be signed by the DC Superior Court is not currently known. The liquidation will be carried out in accordance with the provisions in the DC insurance law regarding liquidation of insurance companies (Title 31, Chapter 13 of the DC Code).