March 15, 2001
Contact: Lucas Hamilton
Morrison, Montana Benefits and Life Co. reach agreement
Montana State Auditor John Morrison reached an agreement with executives of Montana Benefits and Life Co. Wednesday to suspend the sale of new policies until the financial picture of the company improves. He appointed former Deputy Insurance Commissioner Frank Cote to supervise the company.
Kalispell-based MBLC insures 16,000 Montanans, primarily providing health coverage and a small amount of life insurance.
"Our company has been working hard to overcome financial difficulties and we appreciate the assistance of Commissioner Morrison," said Milt Datsopoulos, the company's attorney and a member of its board. "We are on the brink of selling the company and policyholders will not notice any difference in service or coverage. A sale will mean that shareholders will see a marked improvement in the coming years."
MBLC formed last spring with the assumption of health insurer Montana Medical Benefit Plan of Kalispell by Montana Life Assurance Co., a life insurance company based in Missoula.
"I appreciate that MBLC has worked with us to make sure consumers are not harmed," said Morrison, Montana's Commissioner of Insurance. "Our job is to make sure policyholders are protected and to take any steps necessary to ensure that they are. We take that job very seriously."
Montana-domiciled health insurance companies are required to maintain a minimum capital surplus of $300,000 pursuant to the Montana Code.
In a recent financial filing, MBLC had fallen below that amount. The Auditor's Office moved to place MBLC under supervision to protect the company's insureds and creditors, and to prohibit them from writing new business until its finances improve. The company will be required to continue to service existing policyholders, including paying claims in a timely manner.
"In the short term, our goal is to ensure that policyholders are protected and claims are paid properly," Morrison said. "Long term, our goal is to help find new major investors who can make this company profitable again. This would allow the company to remain domiciled in Montana, providing good service to policyholders and value to the stockholders who have invested over the years."
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