Back of the Yards Neighborhood Council Risk Management Association Workers Compensation Self-insurance Pool Ordered into Liquidation

CHICAGO, IL -- The Circuit Court of Cook County Illinois granted Illinois Insurance Director Nat Shapo's petition to place the Back of the Yards Neighborhood Council Risk Management Association Workers Compensation Trust, a/k/a Back of the Yards Risk Management Association (BYRMA), into liquidation. An Illinois Group Workers Compensation Self-insurance Pool, BYRMA was placed under an Order of Liquidation on January 22, 2001, based on the Department of Insurance's findings that the pool was insolvent by at least $7 million.

BYRMA was originally placed in conservation on April 21, 1999, and subsequently into rehabilitation on December 20, 1999. Pursuant to the statutory authority under the Illinois Workers Compensation Act, Director Shapo had previously ordered the company on two separate occasions to assess its members an amount sufficient to cure the deficiencies in its financial condition. However, BYRMA 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 Liquidator has ceased paying all claims.

BYRMA was organized in May 1993 pursuant to the Illinois Workers Compensation Act to provide group self-insurance for workers compensation loss exposures for selected members of the Back of the Yards Neighborhood Council, Inc.

BYRMA's most recent financial statement reflects approximately $3.6 million in direct premium as of December 31, 1998. The Liquidation Order contains an injunction prohibiting suits against BYRMA outside of the liquidation proceedings.

The Illinois Workers Compensation Act also establishes a Group Workers' Compensation Pool 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 pool. Although the fund currently has limited monies, claimants interested in pursuing claims should contact Robert Enoex at the Illinois Department of Insurance at (217) 782-2867.

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.