Liquidation Ordered For Illinois Earth Care Workers Compensation Self-Insurance Pool

CHICAGO, IL - The Circuit Court of Cook County Illinois has granted Insurance Director Nathaniel S. Shapo's petition to place Illinois Earth Care Workers Compensation Trust into liquidation. An Illinois group workers compensation self-insurance pool, Earth Care was placed under an Order of Liquidation on October 26, 2000, based on the Department of Insurance's findings that the pool was insolvent by at least $6 million.

Earth Care has been in conservation since August 19, 1999. Pursuant to his statutory authority under the Illinois Workers Compensation Act, Director Shapo had previously ordered the company to assess its members in an amount sufficient to cure the deficiencies in its financial condition. However, Earth Care has been unable to recover adequate funds from its members, and the Director moved to place the company into liquidation for the protection of claimants and creditors. Simultaneously, the Director as Receiver has ceased paying all claims.

Illinois Earth Care Workers Compensation Trust was organized in December 1992 under the Illinois Workers Compensation Act for the purpose of administering a program of group self-insurance for workers compensation loss exposures for selected members of the Land Improvement Contractors of America. The Trust's most recent financial statements reflect approximately $3 million in direct premium as of December 31, 1998. The Liquidation Order contains an injunction prohibiting suits against the Trust outside of the liquidation proceedings.

The Illinois Workers Compensation Act also establishes a Group Self-insurers Insolvency Fund, which can be activated whenever the Director of Insurance shall determine that compensation or medical services provided by the Act may be unpaid by reason of default of an insolvent group self-insurer. Although the Fund currently has limited monies, claimants interested in pursuing claims against the group self-insurers insolvency fund should contact Gary Gayle at the Illinois Industrial Commission at (312) 814-6560.

The liquidation proceedings are being handled on behalf of the Director of Insurance by the Office of the Special Deputy Receiver, 222 Merchandise Mart Plaza, Suite 1450, Chicago, Illinois 60654; (312) 836-9500.