PrimeGuard Insurance Co; First Assured Warranty Corp; 1SourceAutoWarranty
Aloha…. You have reached the State of Hawaii Insurance Division’s informational website for inquires relating to PrimeGuard Insurance Company and its affiliated companies, 1SourceAutoWarranty, First Assured Warranty Corporation and WarranteeWise, Inc.
This site contains general information about these companies, as well as, status of Insurance Division actions and information intended to assist affected consumers and constituents in resolving their respective inquiries.
This site will be updated as more information becomes available.
March 12, 2014
On February 27, 2014, the Liquidation Court granted the Liquidator’s Motion for Approval of Final Distribution which granted the Liquidator the authority to distribute the remaining assets of the PrimeGuard Liquidation Estate. On March 10, 2014, the Liquidator received the signed Order Granting Liquidator’s Motion for: (1) Approval to Amend Recommendations Regarding Filed Claims; and (2) Approval of Final Distribution. A copy of this order can be found below. The Liquidator has now begun the process of making distributions to the class 2 claimants. However, because this is the largest claimant group ever handled, comprised of approximately 7,400 total claimants, there will inevitably be hurdles in locating claimants, issuing checks, and dealing with the USPS. Therefore, while the original mailing should be completed in the next few weeks, it may take months for some claimants to receive their checks. Due to insufficient funds to fully compensate class 2 claimants, this will be the final distribution of PrimeGuard assets. No other classes will receive payments.
January 20, 2014
On May 20th or 21st of 2013, all Class 2 claimants were mailed a Notice of Liquidator’s Motion for Approval of Final Distribution. The Notice of Liquidator’s Motion for Approval of Final Distribution informed all Class 2 Claimants of their claim value and anticipated payout based on the current funds of the PrimeGuard estate. The Liquidator has now filed the Motion for Final Distribution seeking Liquidation Court approval to make a distribution to all Class 2 Claimants. A copy of this motion can be found below. The hearing date has been set for February 27, 2014 at 9:30 am.
If the Motion for Final Distribution is granted by the Court, the Liquidator will begin issuing checks immediately. Such checks will be mailed via First Class Mail. This will serve as the final distribution of PrimeGuard assets. Any claimants with questions relating to the PrimeGuard liquidation should contact the PrimeGuard estate using the updated contact information below:
E-Mail: [email protected]
Telephone: (800) 860-3843
Facsimile: (808) 536-7349
Mail: PrimeGuard Insurance Co. – In Liquidation
P.O. Box 1350
Honolulu, HI 96807
January 30, 2013
At this time, the Liquidator is currently awaiting final determination of a tax assessment from the Internal Revenue Service (“IRS”). In December 2012, the Liquidator was notified by the IRS of an initial positive result in the Liquidator’s appeal of a tax assessment levied by the IRS. However, the Liquidator has yet to receive a final determination resolving this issue. When the final determination is received, the Liquidator intends to file its Motion for Final Distribution soon thereafter.
The Liquidator cannot provide a precise date as to when a final distribution will occur, as a final determination by the IRS is needed in order to ensure that each claimant receives the most compensation possible. Once this tax issue is resolved, the Liquidator will seek the approval of the Liquidation Court with respect to the amount to be paid to each claimant.
Prior to approval by the Liquidation Court, a letter will be sent via first class mail stating the exact amount that will be paid on your claim. The letter will advise you when a motion for court approval of the final distribution will be filed with the Court. Once final court approval has been received, the checks will be prepared and mailed via First Class Mail. Due to the necessity of Liquidation Court approval for numerous procedural steps the Liquidator cannot distribute funds to claimants until full court approvals have been obtained. At the present time the Liquidator expects to resolve the IRS issue and complete a final distribution by the end of the third quarter of 2013.
May 23, 2012
The Hawai`i Liquidation Court has, at this time, approved all of the Liquidator’s agreements with states holding statutory deposits.The Liquidator is, therefore, presently in the final process of collecting all remaining estate assets for distribution.
The Notice of Distribution sent to you in August 2009 stated which payment class you were a part of. Generally, former contract holders who filed a claim on time belong to Class 2.
The Liquidator anticipates making the final distribution payments to all Class 2 Claimants as soon as possible but due to the procedural requirements set forth by Hawai`i law, the distribution is not likely to occur prior to the fourth quarter of 2012. The Liquidator cannot provide a specific date as to when a final distribution will occur because the approval of the Liquidation Court is needed with respect to the claims that will be paid and the amount of each claim.
Prior to payments being distributed to claimants, a letter will be sent via first class mail stating the exact amount of that will be paid on your claim. The letter will advise you when a motion for court approval of the final distribution will be filed with the Court. Once final court approval has been received, the checks will be prepared and mailed via First Class Mail.
July 19, 2011
Order Granting Liquidator’s Motion for Order Approving Liquidator’s Agreement with the Insurance Commissioner of Wisconsin.
June 30, 2011
Order Granting Liquidator’s Motion for Order Approving Liquidator’s Agreement with the Virginia department of Agriculture and Consumer Services Commissioner.
June 27, 2011
Pending Court approval, the Liquidator anticipates making the final distribution payments to all Class 2 claimants in 2011.
The Notice of Determination sent to claimants in August 2009 stated which payment class claimants were a part of. In general, former contract holders who timely filed claims were considered to be a part of Class 2.
At this time, the Liquidator cannot give any assurances regarding the exact time when distributions will be made, or what amounts will be distributed. Court approval will need to be obtained before distributions can be made. When the Liquidator is ready to make payments, the Liquidator will send claimants letters via first class mail stating the exact amounts of each distribution. The letters will also serve as notice that the Liquidator will be filing a motion with the Court to obtain approval to make the final distribution. Upon receiving the required Court approval to make the payments, the checks will be prepared and mailed via first class mail as soon as possible.
May 2010: On JULY 1, 2010 at 9:30am, the Liquidation Court will hold a hearing on claimants’ objections to the Notices of Determination. Those claimants who filed an objection with the Liquidator will receive a copy of this Notice of Hearing via First Class Mail around June 1. As it states in the Notice of Hearing, objections and supporting evidence must be submitted to the Court with a copy to the Liquidator’s counsel not less than 8 days before the hearing date.
The Court also granted the Liquidator’s motion for approval of recommendations regarding claims for which there is no outstanding objection. This is the Court’s approval of the “Approved and Admitted Amount” shown on the Notice of Determination for all Class 2 claimants. This Order also established the priority, but not the amount, of claims below class 2.
Please keep in mind that the fact that the Court approved the “Approved and Admitted Amount” does not, by itself, mean that you will receive the “Approved and Admitted Amount” shown on your Notice of Determination. The Liquidator cannot give any assurances respecting whether or when a distribution will be made, or what amounts will be distributed. Additional Court approval will need to be received before distributions can be made.
Copies of the documents can be found by clicking on the link below.
February2009:We are currently still in the process of reconciling the claims information received. The Liquidator will issue a Notice of Determination when the Liquidator has gathered all sufficient information necessary.
Thursday, July 17, 2008: The Liquidation Court approved the addition of First Assured Warranty Corporation and its affiliated companies (Warrantee Wise, Inc. and 1sourceautowarranty.com, Inc.) to the liquidation proceedings of PrimeGuard Insurance Company, Inc. A copy of the “Supplemental Order of Liquidation” can be found by clicking on the link below.
Please refer to the prior posting below for more information about the status of the liquidation proceedings, including the issues that still need to be resolved.
Monday, June 30, 2008: The Federal bankruptcy proceeding of the First Assured Warranty Corporation (“First Assured”) and its affiliated companies (Warrantee Wise, Inc. and 1SourceAutoWarranty.com, Inc.) was finally dismissed by the Federal Bankruptcy Court in Colorado on June 4, 2008. Up until that time, the Federal bankruptcy proceeding prohibited the orderly and efficient liquidtion of PrimeGuard in the Hawaii liquidation court.
However, now that the federal bankruptcy case has been dismissed, the Liquidator is awaiting approval from the Hawaii Liquidation Court to include First Assured and its affiliates in the PrimeGuard liquidation proceeding in Hawaii. The Hawaii liquidation court is currently scheduled to hold a hearing on July 7, 2008 on this matter.
Assuming the Liquidation Court grants the Liquidator’s pending Motion, a distribution of funds may not likely beforthcoming in the near future. Among the many things that must still be resolved are the following: (1) the Liquidator must reconcile the claims that have been filed to date in both the Liquidation and Bankruptcy proceedings; (2) the Liquidator must issue a notice of determination as to the amounts approved (this may not be the amount that will be finally distributed but is only representative of what the Liquidator determines to be valid claims); (3) if there are any objections to the Liquidator’s determination, then hearings must be held by the Liquidation Court to resolve those objections; (4) the Liquidator must resolve claims and issues involving special deposits with various state insurance regulators; and (5) the Liquidator must obtain the Liquidation Court’s approval of any proposed Plan of Distribution.
In addition to the foregoing, the Liquidator is currently pursuing claims against other individual(s) and entities. These claims may take months to years to be finally resolved.
The Liquidator appreciates the patience of those interested in PrimeGuard and understands their interests in being provided updates on the status of pending proceedings. With that in mind, the Liquidator will continue to provide periodic updates as pertinent developments occur.
For those interested in the formal legal filings and proceedings, the following is a recap of the recent motions and actions:
3/18/08: Order Granting in Part Liquidator’s Petition for Final Order and Judgment Approving Liquidator’s Settlement with Shareholder’s Family and Affiliates and Petition for Good Faith Determination of Settlement
4/1/08: Order Granting Petition for Good Faith Determination of Settlement as to All Parties
4/1/08: Final Judgment (Re: Order Granting in part Liquidator’s Petition for Final Order and Judgment Approving Liquidator’s Settlement with Shareholder’s Family and Affiliates and Petition for Good Faith Determination of Settlement, filed March 18, 2008
4/10/08: Final Judgment (Re: Order Granting Petition for Good Faith Determination of Settlement as to All Parties, filed April 1, 2008)
5/22/08: Liquidator’s Motion for Leave to Add First Assured Warranty Corporation, 1SourceAutoWarranty.com, Inc. and Warrantee Wise Inc. as Respondents; Memorandum in Support of Motion; Declaration of Lanson K. Kupau Exhibits “A” – “C”; Notice of Hearing and Certificate of Service; Proposed Supplemental Order of Liquidation
6/4/08: Notice of Entry of order of Dismissal in Bankruptcy Matter; Exhibit “A”; Certificate of Service
PrimeGuard Insurance Co., Inc., was licensed by the State of Hawaii Insurance Division to provide insurance coverage to First Assured Warranty Corporation (“First Assured”), 1SourceAutoWarranty.com, Inc. (“1Source”), and WarranteeWise, Inc. (“WaranteeWise”), for their respective obligations arising from automobile service contracts and extended warranties that they sold and issued to consumers and automobile dealers for cars, motorcycles and other vehicles.
On Monday, December 19, 2005, the Court of the State of Hawaii issued an Order of Liquidation of PrimeGuard. The Order enjoined and restrained PrimeGuard from the transacting of further business. Respondent PrimeGuard was prohibitedfrom insuring any warranties issued by First Assured, 1Source or any other warranty company dated after the entry of Liquidation Order. First Assured, 1Source and any other warranty company were also enjoined from issuing any warranties that identified Respondent PrimeGuard as an insurer of such warranties. To the extent any such warranties were issued after the date of the Liquidation Order, to the extent those warranties identified Respondent PrimeGuard as an insurer, those warranties were deemed void and unenforceable as to Respondent PrimeGuard.
Telephone inquiries: (800) 860-3843 (toll free) or (808) 536-7334
Facsimile transmission: (808) 586-7349
Email: [email protected]
PrimeGuard Insurance Co. – In Liquidation
C/O State of Hawaii
DCCA – Insurance Division
P.O. Box 3614
Honolulu, HI 96811