Courts Should Defer to Rehabilitator When Considering Liquidation Plans, Pa. High Court Rules

HARRISBURG, Pa. — When considering a plan to liquidate a troubled insurer, courts should defer to the expertise of the rehabilitator, the Pennsylvania Supreme Court has ruled in proceedings involving two Pennsylvania life insurers that are currently in rehabilitation.

However, in a July 20 opinion, the court majority held that the trial court’s decision to deny a former insurance commissioner’s petition to liquidate the insurers should remain undisturbed due to the commissioner’s misuse of the rehabilitation process.

Penn Treaty Network America Insurance Co. (PTNA) and its subsidiary, American Network Insurance Co. (ANIC), are Pennsylvania life insurers specializing in long-term care …