DEPARTMENT OF INSURANCE NOTICE OF PUBLIC HEARING
Notice is hereby given of a public hearing regarding the proposed acquisition of control of DIRECT GENERAL INSURANCE COMPANY (the “ACQUIRED INSURER”), an Indiana-domiciled insurance company and a wholly-owned subsidiary of ELARA HOLDINGS, INC. (“ELARA”), a Delaware corporation, by NATIONAL GENERAL HOLDINGS CORP. (“NGHC”), a Delaware corporation and BLUEBIRD ACQUISITION CORP. (“BLUEBIRD”), a Delaware corporation and a wholly-owned subsidiary of NGHC, which proposed acquisition of control is to be effected through a merger of BLUEBIRD with and into ELARA. For purposes of this Notice, NGHC, BLUEBIRD, Leah Karfunkel and the other ultimate controlling persons of NGHC are collectively referred to herein as the “ACQUIRING PARTIES”.
The hearing will be held at the date, time and place specified below:
Date: October 27, 2016 Time: 10:30 a.m. (Indianapolis time)
Place: Indiana Department of Insurance, 311 West Washington Street, Suite 103, Indianapolis, Indiana 46204-2787
The hearing will be held pursuant to Indiana Code § 27-1-23-2 and conducted as required by that statute as supplemented by the Indiana Administrative Orders and Procedures Act, Indiana Code § 4-21.5-1 et seq. Except as otherwise provided in Indiana Code § 27-1-23-2, the hearing and subsequent determination shall be subject to Indiana Code § 4-21.5-3.
Stephen W. Robertson, Insurance Commissioner of the Indiana Department of Insurance, or the Commissioner’s duly appointed designee, will preside as the administrative law judge at the hearing and shall approve the proposed acquisition of control only if, by a preponderance of the evidence, the Commissioner or designee finds that:
(1) the acquisition of control would not tend to affect adversely the contractual obligations of the ACQUIRED INSURER or its ability and tendency to render service in the future to its policyholders and the public;
(2) the effect of the acquisition of control would not be substantially to lessen competition in any line of insurance business in any section of this state or tend to create a monopoly therein;
(3) the financial condition of any of the ACQUIRING PARTIES is not such as might jeopardize the financial stability of the ACQUIRED INSURER or of any corporation controlling such insurer, or prejudice the interest of its policyholders;
(4) the plans or proposals which any of the ACQUIRING PARTIES has to (a) liquidate the ACQUIRED INSURER or any such controlling corporation, (b) sell its assets or consolidate or merge it with any person or entity, or (c) make any other material change in its investment policy, business, corporate structure or management, are fair and reasonable to policyholders of the ACQUIRED INSURER and in the public interest; and
(5) the competence, experience, and integrity of those persons who would control the operation of the ACQUIRED INSURER are such that the acquisition of control would not tend to affect adversely the general capacity or intention of the ACQUIRED INSURER to transact the business of insurance in a safe and prudent manner.
Cynthia D. Donovan, Chief Financial Examiner of the Indiana Department of Insurance, 311 West Washington Street, Suite 103, Indianapolis, Indiana 46204-2787, has been designated to provide information regarding this transaction to all interested persons upon request. A copy of the Form A Statement, the supplements and amendments thereto, and other related materials filed with the Commissioner by the ACQUIRING PARTIES and that are part of the public record are available at the office of the Indiana Department of Insurance for all interested persons to examine. Copies of those materials will be provided to policyholders of the ACQUIRED INSURER upon written request to Ms. Donovan at the address above. Information concerning the hearing, schedule and procedures may be obtained by telephoning Ms. Donovan at (317) 232-2408.
Any member of the public interested in the proposed acquisition of control may attend the hearing. Each of the ACQUIRING PARTIES, the ACQUIRED INSURER and any corporation controlling it, policyholders of the ACQUIRED INSURER, and any other person whose interests may be affected by the proposed acquisition of control shall have the right to appear and become a party to the proceeding. In accordance with Indiana Code § 4-21.5-3-21, any such person wishing to become a party must submit to the Indiana Insurance Commissioner “Attention Stephen W. Robertson” at the above address, a petition for intervention setting forth facts demonstrating the person’s standing to become a party under Indiana Code § 27-1-23-2(k). Any petition for intervention must be submitted to the Indiana Insurance Commissioner, with copies sent via mail to all parties named in the record of proceeding. Each party shall have the right pursuant to Indiana Code § 27-1-23-2(k) to present evidence, examine and cross-examine witnesses, and offer oral and written arguments and, in connection therewith shall be entitled to conduct discovery proceedings in the same manner as provided in the Indiana Rules of Trial Procedure. A party who fails to attend or participate in the hearing, or other later stage of this proceeding, may be held in default or have a proceeding dismissed under Indiana Code § 4-21.5-3-24.
By Order of the Indiana Department of Insurance
Stephen W. Robertson, Indiana Insurance Commissioner, Indianapolis, Indiana
October 14, 2016
31925346 10/19, 2016 hspaxlp 16-217