Applied Underwriters Answers Amended Complaint in ‘EquityComp’ Action

OMAHA, Neb. — Applied Underwriters Inc. and its captive reinsurer, Applied Underwriters Captive Risk Assurance Company Inc. (AUCRA), have answered an amended complaint alleging they used a “mislabeled” reinsurance participation agreement (RPA) in their “EquityComp” workers’ compensation program to evade regulators’ oversight.

In a Jan. 20 filing before Judge John M. Gerrard of the U.S. District Court for the District of Nebraska, defendants wholly deny plaintiff Coyle Trucking Inc.’s allegations that the RPA violates public policy and is therefore void.

Coyle, a Pennsylvania company, bought Applied’s EquityComp program for workers’ compensation insurance. The program includes a guaranteed cost workers’ …