Oregon Insurance Commissioner Ted Kulongoski has been appointed receiver of two financially ailing health and life insurance companies that have some policy holders in Utah.
An order issued this week by the Marion County Circuit Court gave Kulongoski control over the National Hospital Association and its subsidiary, First Farwest Life Insurance Co.Kulongoski said the two companies are more than $18 million in the red because they didn't keep premium rates high enough to cover rising medical costs.
The insurance commissioner said the state Department of Insurance and Finance will oversee the processing of claims from policyholders while the the companies are under his control.
"We intend to process claims and do the best we can," he said.
The companies are licensed to do business in Oregon, Washington, Alaska, California, Idaho, Nevada, Utah, Arizona, Montana, Wyoming, Colorado, New Mexico and Louisiana.
Utah's Insurance Department said First Farwest had sold more than $1.19 million in policies during 1987. Last year's figures are not available yet.
The companies have more than 57,000 individual policyholders, including 8,200 Oregon residents. Another 30,000 Oregonians are covered under group policies with the companies.
The insurance department didn't have a breakdown of how many customers the companies have in the other states, although Kulongoski said much of the companies' business is in California.