Credit: Bloomberg || Graph of Penn Treaty’s stock price 2002-2009
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I wrote about this last in October 2009 in a piece lovingly entitled: At Last, Death! (speaking of the holding company, not the insurance subsidiaries). I’m going to quote the whole piece here, because it says most of the things that I wanted to say when I heard the most recent news about Penn Treaty, where the underlying insurance subsidiaries are finally getting liquidated. It will be the largest health insurer insolvency ever, and second largest overall behind Executive Life.
Alas, but all good things in the human sphere come to an end. Penn Treaty is the biggest insurer failure since 2004. Now, don’t cry too much. The state guaranty funds will pick up the slack. The banks are jealous of an industry that has so few insolvencies. Conservative state regulation works better than federal regulation.
Note that Genworth is down 60% since I wrote that, against a market that has less than tripled. If their acquirer doesn’t follow through, it too may go the way of Penn Treaty. (Give GE credit for kicking that “bad boy” out. They bring good things to “life.” ]]>😉