Just as Florida legislators gather in Tallahassee Monday, December 12, to start a special session to prop up the state’s besieged property insurance industry, a South Florida-based insurance company has voluntarily filed for petition under Chapter 11 of the Bankruptcy Code.
FedNat Holding Company, based in Sunrise, Florida said the move, which also includes “certain of its wholly-owned subsidiaries” filed in the voluntary Bankruptcy Court for the Southern District of Florida, will enable the company to maximize value for all stakeholders, and could include “reorganization of its business or a sale of its assets.”
In a press release, FedNat, which was founded in 1992, said they have approximately $6.5 million of cash on hand, which will support day-to-day operations and enable the Company to operate business and pay employee wages and benefits, while continuing to service their policy holders.
Back in September, FedNat became the became the sixth insurance company – and the 16th overall – to land on the liquidation-receivership list in which insurers stop writing future policies or simply withdraw from the Florida market, leaving thousands of homeowners without property insurance.
At that time, FedNat had been responsible for some 56,000 policies, among the largest home insurers in the state. Earlier in 2022, FedNat had 140,000 policies, before transferring some 83,000 to a related company, Monarch National Insurance Co which coincidentally.
To manage the restructuring, FedNat has hired GGG Partners, LLC as financial advisors, and Nelson Mullins Riley & Scarborough LLP as legal advisors. Previously, Katie S. Goodman, Managing Partner of GGG Partners, had been appointed to be the company’s Chief Restructuring Officer.
