State takes over Merced insurance company unable to pay out claims after Camp Fire
MERCED, Calif. (KFSN) -- Known as one of the deadliest fires in California history, The camp fire left thousands of people without homes.
The damage so devastating, it put a Merced county insurance company out of business
"It completely overwhelmed this company. Looking at the number of claims that they would have , and it left them insolvent," said Nancy Kincaide, Department of Insurance.
State regulators are taking over Merced Property and Casualty company because they can't pay out all the expect claims from the massive fire.
A judge approved the liquidation proceeding on Monday at the Merced County Superior Courthouse.
Documents state the company faces about 64 million dollars in outstanding liabilities located in Paradise, but the their assests are compromised at approximately $23 million.
A spokesperson for the department of insurance says the company had 200 policies in Butte County, but doesn't know how many people impacted by the fire held insurance with the company.
"No one can remember a time when a property management company could become insolvent. we haven't seen a company is a similar financial situation so I think people can be assured that everything is fine," said Kincaide.
The company's website posted a notice about the liquidation order, however, no one at the site would comment on the insolvency or how many employees work at the business.
California Insurance Garuntee Associates will take over the claims and start working with policy holders.
We spoke with the executive director of CIGA , and he believes a big reason for the insurance company's closure comes down to location.
"It was heavily concentrated in the Sacramento, central valley, and didn't write in a lot of places. It didn't have a lot of spread of risk," said Wayne Wilson, CIGA Executive Director.
Wilson hopes they'll have information on the claim by next Monday, and will start working to asses the damage in areas impacted by the devastating fire.
