EG Insurance Takes Over Policies of Defunct Windhaven MGA The Hearth

A new managing general agent has taken over the policies of Windhaven Insurance Company subsidiary The Hearth Group and will begin writing new business in Florida and Texas in the near future.

EG Insurance Agency, based in Florida and Texas, has acquired the rights and records to the business related to managing general agent The Hearth’s programs, written on State National Insurance Company paper, after the company ceased business operations last month. EG will take over all of The Hearth business in Florida and Texas and will be working with agents in both states. The number of policies impacted was not publicly disclosed.

EG Insurance, or Embark General Insurance Agency, LLC, delivers property and casualty insurance programs through a network of independent insurance producers and has operations in Dallas, Miami, Austin, Texas and Tampa, Fla., with affiliated offices in Sandy Springs, Ga. and Orange County, Calif.

The move was first announced in an email sent to appointed agents with The Hearth. The message, sent on March 11 from EG Insurance President Raimundo Ruiz, said for EG Insurance to “service your business and your existing customers we have acquired the rights and records to that business. This means that effective immediately we will be providing the same level of service, technology and claims service that you are accustomed to.”

The message further states that EG will not be writing new business at the present time, but instead focus on the existing policies that were serviced by The Hearth.

“Once we are comfortable that we have all of the kinks worked out we will reopen for new business. We first wanted you to know that we will be manning the phones and helping with your business immediately,” the message reads. “We are working with our carrier partners to reconcile business records and intend to send commission checks out very soon. As part of this process we will need to obtain new producer contracts and should have those out to you in the next couple of days so please look out for them and return immediately.”

Tampa, Fla.-based The Hearth Insurance Group had offered homeowners insurance through State National Insurance Co. in Florida since 1990, and also offered coverage in Texas. According to its website, The Hearth Group and Windhaven Insurance Co. wrote more than $500 million in premium in the state of Florida and had 700 employees.

The Hearth was an entity of auto and home insurer Windhaven, which alerted its agents and employees in Florida at the end of February that it was winding down the insurance operations of its entities that also included Windhaven National Insurance Co. and software company ClutchAnalytics in addition to The Hearth, and that its assets were being foreclosed on by a lender intending to sell them.

Additionally, Texas-based private passenger auto insurer Windhaven National Insurance Co. was ordered into liquidation by the Texas Department of Insurance on March 5.

As an MGA, The Hearth wrote its policies on the paper of State National Insurance Group, which told Insurance Journal in a statement that all policies written via The Hearth, “remain valid and that the strong security supporting their policies is unaffected.”

In a follow-up email to agents, EG Insurance clarified that it did not purchase any Windhaven assets and is not in control of anything to do with Windhaven Insurance Co. or Windhaven National Insurance Co. EG Insurance said it will continue to “handle all service work and claims adjusting services for [The Hearth] programs and are committed to providing for your agency needs for the long-term.”

EG Insurance said in its agent communication that it hopes agents “appreciate the fact that we have been willing to step into this situation to help you and our mutual customers.” The company also works with Old American County Mutual.

A company spokesperson for EG Insurance told Insurance Journal March 16 it is now actively servicing Hearth policies and adjusting claims, including processing endorsements, bills and renewals.

“We are proud to report that most of the business experienced no interruption in service through the completion of the transaction and that we anticipate writing new business again in the near future,” the company said.

It is not currently taking new business but is focused on “ensuring that all processes and services are up to the standards of the EG organization and anticipate being able to write new business in the near future.”

EG Insurance said it is also currently working with a number of key constituencies to deliver unpaid commissions on legacy premium account trusts.

“At EG, we are deeply committed to the personal lines market, and hope that our willingness to step into the prior company’s shoes for the sake of impacted customers and independent agents demonstrates the depth of that commitment. We look forward to working with these customers and agents for many years to come,” the company said.

The Florida Association of Insurance Agents said it met with EG Insurance officials to understand the transition of business previously written by Florida independent agents by The Hearth, including the payment of past commissions.

“It is our understanding that several more issues will be resolved by EG Insurance in the coming days, such as clearing a back log of agent commissions and issuing new appointment agreements. FAIA is monitoring the situation to assist with what will hopefully be a smooth transition,” said FAIA President Jeff Grady.

Related:

• Auto Insurer Windhaven National Ordered Into Liquidation by Texas Court
• Windhaven Insurance Ceasing Operations, Assets to be Auctioned Off
• Florida Auto Insurer Windhaven Placed Into Rehabilitation
• Rehabilitation of Florida Insurer Windhaven Deemed ‘Useless’; Judge Orders Liquidation

Topics Florida Texas Agencies Insurance Wholesale