Georgia Nonstandard Auto Insurer to Assume Business of Troubled Texas Carrier, ACCC


A portion of the personal auto insurance business of a Texas insurance company that appeared to be headed for liquidation at the end of November is being assumed by a Georgia-based insurer.

Embark General, headquartered in Atlanta, said it is assuming the Alabama and Texas nonstandard auto business of Houston-based ACCC Insurance Co., which was placed into receivership on Oct. 21 at the request of the Texas Department of Insurance. A request for an order of liquidation of ACCC was filed on Nov. 24 by the TDI-appointed Special Deputy Receiver (SDR) for ACCC, Prime Tempus Inc., which found the company to be insolvent.

Embark General said it would assume ACCC’s business through Embark General subsidiary Nations General Insurance Agency. The effective date of its assumption of ACCC’s business is Dec. 1, subject to final court approval. The company said it is actively working with TDI and the SDR to ensure a smooth transition.

With a concentration on the nonstandard personal auto insurance market, Embark General offers property/casualty insurance programs network of independent insurance producers. It has operations in Texas, Florida, Georgia and California, with affiliated offices in Sandy Springs, Ga., and Orange County, Calif. In addition to nonstandard auto, Embark General offers insurance products for the property and small commercial markets.

In addition to Alabama and Texas, privately held ACCC sold insurance products in Georgia, Mississippi, New Mexico and South Carolina, and is licensed in 20 states. According to the application for liquidation, “ACCC issues non-standard automobile insurance policies, bodily injury policies, and property damage policies with policy terms ranging from 30 days to one year, with roughly half of the policies having 30-day terms.”

In a message to ACCC employees dated Nov. 17, Craig A. Koenig, representing the SDR, Prime Tempus, said no new business would be written by ACCC going forward and that a financially secure insurer was being sought to take over ACCC’s book of business.

In a statement released on Dec. 15, Embark General President Bill Caldwell said his company is “committed to sound financial growth through a combination of strategic acquisitions and responsible product pricing in our existing markets. This is our third acquisition of this type and we have developed a core competency in efficiently transitioning distressed books of business on to our platform. We look forward to delivering the outstanding products and services that our new ACCC clients deserve.”

Additional communication about its assumption of ACCC business will be provided directly to clients and agents, according to Embark General’s announcement.

ACCC’s reported surplus had substantially declined between the end of 2018 and June 30, 2020, at which time the company had a policyholder surplus of $8,365,247, the liquidation application states.

The Nov. 24 application for liquidation of ACCC said the company is insolvent and “is in a condition such that proceeding with the conduct of its business would not be in the best interest of its policyholders, creditors or the general public.”

ACCC earlier this year had obtained a $7,902,800 federal Paycheck Protection Program (PPP) loan, but as of Nov. 24 there was no indication that the loan had been forgiven. If accounted for as a liability, the PPP loan further reduces the company’s surplus, the SDR noted.

“The history of ACCC’s operations reflect an ongoing pattern of losses and erosion of surplus. ACCC cannot continue to underwrite policies without an increase of the risk of loss to creditors, policyholders, or the public. Its business is not profitable, so its losses continue to mount,” the liquidation application states.

In April 2019, TDI hit ACCC Insurance and ACCC General Agency with a $110,000 penalty for certain practices associated with its named driver policies that the insurance department found not to be in compliance “with all laws applicable to named driver policies.” (Order No. 2019 – 5916)

TDI’s 2019 Annual Legislative Report on Market Conditions showed that for 2019, ACCC Insurance ranked 18th in terms of market share for personal auto insurance in the state, though it only held a 0.96% share of the market. The company had $221,473,617 in direct written premiums for 2019 and an underwriting loss of $17,025,329, according to TDI’s market share report.