Date:      April 10, 2003

To:         All Interested Persons

From:     Craig R. Petersen, Deputy Director

On March 5, 2003, the state court in New Hampshire ordered Home Insurance Company into rehabilitation. This rehabilitation order does not trigger the Michigan Property and Casualty Guaranty Association.

All claims against Home Insurance Company pending before the Bureau of Workers’ & Unemployment Compensation and the Workers’ Compensation Appellate Commission can and should proceed in the normal manner. However, any cases pending before the Michigan Supreme Court or the Michigan Court of Appeals are stayed pursuant to the state court’s order entered March 5, 2003.

The Insurance Code, MCLA 500.7945 provides that all proceedings in any court of law in which an insolvent insurer is a party, is obligated to defend, or has assumed the defense of a party, be stayed for 6 months after the date a receiver is appointed. However, in Yeager v. Booby Trap Lounge, 171 Mich App 185, 429 NW2d 620 (1988), the Michigan Court of Appeals specifically held that the statute was clear and unambiguous that this provision only applied to proceedings in a court of law, not administrative proceedings.

If you have any questions, please contact Mark Long at mclong@michigan.gov or 517-322-5996.