NC Supreme Court clears path for liquidation of Lindberg-owned life insurers

NC Supreme Court clears path for liquidation of Lindberg-owned life insurers | Insurance Business America

Legal Insights

NC Supreme Court clears path for liquidation of Lindberg-owned life insurers

Dismissal of appeal advances liquidation of two entities

Legal Insights

By
Kenneth Araullo

The North Carolina Supreme Court has allowed the withdrawal of a petition for discretionary review in the case of “Causey v. Southland National Insurance Corp,” dismissing the remaining issues in the ongoing legal matter involving life insurance companies owned by former insurance executive Greg Lindberg.

This decision clears the way for the liquidation process of Bankers Life Insurance Co and Colorado Bankers Life Insurance Co, according to North Carolina Insurance Commissioner Mike Causey.

A report from AM Best said that both companies, along with Southland National Insurance Corp, are owned by GBIG Holdings LLC, a company wholly owned by Lindberg.

The case began in 2018 when the three life insurers were placed under administrative supervision after Causey expressed concerns that the companies might be unable to meet their financial obligations.

Over two years into the supervision, Causey filed a petition to liquidate Southland National Insurance Corp. due to insolvency. In response, GBIG Holdings filed an objection to the liquidation petition in April 2021 and requested a continuance to allow for discovery.

However, in December 2022, a trial court denied the motion for a continuance and ordered the companies into liquidation, leading to GBIG’s appeal of the decision.

Commenting on the Supreme Court’s recent decision, Causey stated that dismissing the appeal allows the liquidation process to advance, enabling policyholders to receive relief through state guaranty associations. Causey also said he was committed to ensuring that policyholders are repaid.

This ruling comes during a challenging period for Lindberg, who recently had an appeal denied in a separate $524 million breach of contract lawsuit in the 4th Circuit Court of Appeals.

What are your thoughts on this story? Please feel free to share your comments below.