RECIPROCAL OF AMERICA AND
THE RECIPROCAL GROUP
  In Receivership for Liquidation  

 

FILING A CLAIM AND THE PROOF OF CLAIM PROCESS
Question: What is the Proof of Claim process?
   
Answer: The State Corporation Commission of the Commonwealth of Virginia (the "Commission") has ordered that all parties who wish to assert a claim(s) against the Companies are required to follow the Proof of Claim process. The Proof of Claim process is the procedure through which any party that believes it has an actual or potential claim (contingent or unliquidated) against the Companies must submit it to the receivership in accordance with the Proof of Claim Instructions on the Proof of Claim Form (or its equivalent). With two exceptions described under the question below titled "Who must file a Proof of Claim," submission of a claim is necessary for the claimant to be eligible for payment or reimbursement from the Companies.
   
Question: Who must file a Proof of Claim?
   
Answer: If your claim arose under a direct insurance policy issued by ROA, and this claim was properly filed with ROA as of October 28, 2003, then you do not need to file a new claim for the same amount. Administrative expense claims for services rendered or goods supplied to the Companies, at the request of the Deputy Receiver after January 29, 2003, are not subject to the Final Bar Date and need only be submitted as such claims come due. All other claimants who believe they have an actual or contingent claim, even if unliquidated, should have submitted their claim(s) in order to be eligible for payment. These claims must be submitted in accordance with the Proof of Claim Instructions on the Proof of Claim Form (or its equivalent) with supporting information, and were subject to the Final Bar Date (September 30, 2004).
   
Question: Should I file a Proof of Claim if my claim is within the deductible limits of my policy?
   
Answer: Yes. You should file a Proof of Claim even if your claim is within the deductible limits of your policy so that ROA can keep track of the aggregate amount of your claims.
   
Question: What is a contingent claim?
   
Answer: A contingent claim is a claim that has not been asserted or one for which payment is not yet owed, because it is dependent upon a future event or an event that may never happen. For example, an insured with an occurrence-based policy may file a contingent claim in anticipation of an occurrence-based claim that may never occur.
   
Question: What is an unliquidated claim?
   
Answer: An unliquidated claim is one for which liability has been established, but the exact amount has not been determined. For example, an unliquidated liability claim is one that the parties agree (or a court has ruled) is owed, but for which the parties have not agreed upon the amount and no judgment has been rendered so determining.
Question: By when must I have filed my claim?
   
Answer: On October 28, 2003, the Commission entered its Order Setting Final Bar Date and Granting Deputy Receiver Continuing Authority to Liquidate Companies. Therein, the Commission established a "Final Bar Date" of September 30, 2004. The Final Bar Date is the date on or before which all parties wishing to assert claims against the Companies, whether actual or contingent and whether or not liquidated, should have filed their claims. Your claim must have been received on or before September 30, 2004.
Question: I have a new claim. Should I file a Proof of Claim?
   
Answer: Yes. You should send your claim to the claims department at the Companies. All compensability requirements for workers’ compensation claims and coverage requirements for liability claims must still be met for a claim to be considered.
Question: Will claims filed after the Final Bar Date be paid?
   
Answer: Claims received after the Final Bar Date, may not be paid until the approved timely filed claims of all other creditors have been paid in full. Those approved claims received after the Final Bar Date will then be paid in order of priority, if sufficient assets are available.
Question: What information is required when I file my claim?
   
Answer: The Proof of Claim Instructions and a Proof of Claim Form are provided in the Documents section of this web site to assist in submission of the claim. All blanks on the Proof of Claim Form must be completed. The Proof of Claim Form must be notarized, and sufficient information and documentation to support your claim must be attached. If you chose not to use the Proof of Claim Form provided on this web site, be sure to include all of the information requested by that form in your submission.
Question: What backup documentation should I file with my Proof of Claim?
   
Answer: You should file all of the supporting documentation that you have. For example, you should include itemized copies of any bills for which you are requesting reimbursement, copies of the checks by which you paid the bills, copies of medical records or reports that support the billing, etc. If other documentation is required to process the Proof of Claim, the claims department at the Companies will contact you and request it.
Question: Can a Proof of Claim be supplemented?
   
Answer: Yes. Assuming you submitted a claim on or before the Final Bar Date, you can file supplemental information prior to the "Claims Liquidation Date." The Claims Liquidation Date is the date by which all claims must be non-contingent (right to payment established) and liquidated (exact amount known). The Claims Liquidation Date will follow the Final Bar Date and will be set by the Commission in the future. Supplemental information should be submitted to complete the original claim because if a claim is still contingent and/or unliquidated on the Claims Liquidation Date, it will be permanently barred from payment or reimbursement. Additionally, a supplemental Proof of Claim should be filed (1) for any additional reimbursements or payments not requested in your initial proof of claim, or (2) to complete the claim filed in your initial proof of claim. However, you will not be allowed to provide supplemental information that was known, or should have been known, at the time you submitted your initial claim.
Question: How will I know whether my Proof of Claim was received?
   
Answer: You should have received a letter from ROA acknowledging receipt of your Proof of Claim and assigning your claim a class. If you sent in a Proof of Claim, but did not receive a letter, you should contact the claims department at the Companies. They can confirm the receipt of your Proof of Claim and send you a copy of the letter.
Question: I received the Proof of Claim acknowledgment letter. How do I know if my claim was approved for payment?
   
Answer: A "Notice of Claim Determination" will be issued for all Proofs of Claim. The Notice of Claim Determination will set forth whether or not your claim has been approved for payment, and (in most cases) if approved, for how much. If your claim has been approved, you will receive your Notice of Claim Determination and you may receive a check for 17% of the approved amount. (See the CLAIM PAYMENTS FROM THE RECEIVERSHIP ESTATE section of the Frequently Asked Questions.) If you disagree with the decision set forth on this Notice of Claim Determination, you can appeal in accordance with the Receivership Appeal Procedure. For information on the Receivership Appeal Procedure, see THE RECEIVERSHIP APPEAL PROCEDURE FOR THE ADJUDICATION AND APPEAL OF CLAIM DECISIONS section of the Frequently Asked Questions.
Question: Have the Companies began making payments on the Proofs of Claim that have been filed?
   
Answer: See CLAIM PAYMENTS FROM THE RECEIVERSHIP ESTATE.
Question: What can I expect to receive if I submit a properly filed and approved Proof of Claim?
   
Answer: A Proof of Claim, if approved, will entitle you to payment by the receivership estate of the Companies in the amount of benefits due under the policy and not paid by another party, such as a state insurance guaranty association ("GA") or your employer. For example, if you are a service provider for workers’ compensation benefits, (i.e., a lawyer, a doctor, a pharmacy, etc.) you may be entitled to payment of bills for covered services you rendered which were not paid by any other party. If you are a workers’ compensation claimant that has received an award from a settlement or judgment, you may also be able to receive payment of the award. If you are insured under a liability policy, a claim has been made against you within coverage of the policy, and your liability claim is approved, you may be entitled to payment of any judgment or settlement and reimbursement of defense costs, subject to applicable conditions and limits.
Question: If a GA is paying my claim, should I file a Proof of Claim?
   
Answer: Generally, no. A Proof of Claim, if approved, will entitle you to reimbursement by ROA for payments made by you that would have been made by ROA if it had not gone into liquidation. In the case of a service provider, you may be entitled to payments not made to you and not reimbursed by another party, such as a GA or your employer, that would have been made if ROA had not been placed in liquidation. If your claim is being paid by a GA you may not have any unreimbursed expenses and, thus, would not have to file a Proof of Claim.
Question: What do I do if I believe that the GA is obligated to pay my claim but it refuses to do so?
   
Answer: The laws governing the GA in each state generally provide remedies and appeal rights as to GA claims decisions. In addition, you should advise the Special Deputy Receiver of such matters at office of the Special Deputy Receiver, by telephone or in writing. In some cases, the Special Deputy Receiver may be able to explain the reason for the GA’s decision, or assist you in obtaining a correct decision if the original decision was incorrect.
Question: What is a "net worth" provision or exclusion applicable to GA coverage?
   
Answer: Some GA statutes include a provision that if an insured, or in some states any party filing a claim, has a net worth equal to or exceeding a given amount, the GA will either deny the claim altogether or pay the claim and seek reimbursement from the insured.
Question: If the insured meets or exceeds the "net worth exclusion" requirements of the GA and its claim is, therefore, not paid by the GA, should a Proof of Claim be submitted?
   
Answer: Yes. If a claim is denied or the GA seeks reimbursement from the insured, the insured must file a Proof of Claim in order to be eligible for payment.
Question: If the GA and my employer have both declined to make payments on my claim, should I file a Proof of Claim?
   
Answer: Yes. A Proof of Claim, if approved, will entitle you to payment by ROA of amounts to which you are entitled under the policy, that would have been made by ROA if it had not gone into liquidation, provided they have not been paid by another party, such as a GA or your employer. If you do not file a Proof of Claim with the required documentation your claim will not be considered for payment by the ROA receivership estate.