May 7 2021

Just The Facts: For those impacted by Omega Insurance Bankruptcy!

For those impacted by Omega Insurance Bankruptcy here is a link to the website put together by the court appointed liquidators with information and updates on the process. All updates should be posted here.
Omega Insurance Company sold a product named “Pregnancy Care” that was insurance that covered surrogate pregnancies. Ryan Park testified in bankruptcy court that due to the pandemic and surrogacy cases dropping they were unable to continue and filed for bankruptcy. He did not mention, at that time, a lawsuit that was currently impacting the company under which they were organized.
At a meeting of creditors today the Liquidators for the Performance Insurance Company SPC (the segregated portfolio under which Omega Insurance Company was organized) shared that there were currently $6 million dollars in claims by insured which includes premiums and medical bills and other fees (like paying a professional to settle debts, attorney fees,etc.). There are also claims by providers of about $100,000 and an unknown amount of a claim by the Kentucky lawsuit.
An ad hoc committee was formed, the members are Lisa Stark Hughes (GSMoms), Nick Smith (Intended Parent), Ryan Terwedo (SurroPlans), Michael Challey (Northwest Surrogacy Center), and Justin Leonard (attorney for Northwest Surrogacy Center and impacted IPs and GCs).
The Liquidators also mentioned that their legal team is currently considering filing a claim with the D&O policy and their legal team is currently looking at that. They would need an additional $250,000 to $500,000 put up to fund this aspect though and there are not enough funds. Originally, when claims were assessed (oly medical claims) and it looked like there might be only $3 million dollars in claims there were some companies considering putting up these funds and then adding that amount as a claim. Now, with the total claims so far over $6 million dollars and $100,000 in provider claims and an unknown amount from the Kentucky lawsuit, my opinion is that this funding would now be less likely unless there was a way to limit what would be covered by the D&O policy to ensure this investment could be recovered.
It is unclear at the moment if the $6 million dollar in claims is only from Omega claims or if other insurance companies covered by Performance were also included in that number.
Please watch the website for more updates and we will also provide updates here on Just the facts.

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