Two weeks after South Carolina’s insurance regulator took steps to place Atlantic Coast Life Insurance into rehabilitation, another state’s commissioner has suspended the company amid concerns about its finances.
“In making the decision to suspend Atlantic Coast’s COA (certificate of authority), the Office determined that Atlantic Coast is impaired and that another insurance supervisory official, namely the South Carolina Department of Insurance, initiated rehabilitation proceedings…” reads a final order from Florida Commissioner Michael Yaworsky, signed Wednesday, Sept. 30.
Atlantic Coast Life is domiciled in South Carolina but was authorized to do business in Florida in 2006 as a life and health insurer. It is part of Advantage Capital Holdings, or A-Cap, led by CEO Kenneth King, which is in the midst of a scheduled takeover by Oaktree Capital Management.
The life insurer and its reinsurance subsidiary, Southern Atlantic Re, are overexposed to collapsed investment firm 777 Partners, and have failed to disclose some investments with affiliate firms, the regulators have said.
Just days after SCDOI Director Michael Wise petitioned a court to place the insurers into rehab earlier this month, A-Cap filed suit against Wise, charging that he was acting recklessly. A day later, A-Cap dropped the lawsuit and agreed to put the dispute into mediation. That came shortly after the AM Best financial rating firm downgraded the financial strength rating for Atlantic Coast Life and another A-Cap insurer, Sentinel Security Life.
A-Cap officials released a statement Thursday about the latest development:
“We disagree with the Florida Office of Insurance Regulation’s action and intend to work in good faith to resolve this matter expeditiously. In the meantime, Atlantic Coast Life remains focused on meeting its obligation to policyholders and completing the capital raise and corporate restructuring initiatives now underway.”
Yaworsky’s order went into some detail about Atlantic Coast Life and its financial picture. The insurer began as a family-owned operation in 1925. In 2015, it became part of New York-based Advantage Capital, (not affiliated with a New Orleans investment firm of a similar name).
In Florida, Atlantic Coast has focused mostly on annuities. As of August this year, the firm held 6,001 annuity policies, 986 life insurance policies, and 19 accident and health policies. It reported almost $13 million in total premium collected so far this year, the DOI order notes.
Based on the insurer’s own financial reports, Yaworsky’s office found that Atlantic Coast has not maintained adequate surplus, its surplus has deteriorated, and the firm is now impaired and may not be able to pay out on its policies.
The company in September 2025 reported an $86 million surplus, which would appear to be almost $30 million more than the required statutory minimum. But Florida law limits the value of investments in subsidiaries and affiliated firms that an insurer can count toward surplus. That meant that Atlantic Coast actually had an “impaired surplus” of almost $140 million, Yaworsky’s order explained.
And by the second quarter of this year, Atlantic Coast reported a surplus of $47 million—less than the required surplus of $55 million. When the statutory limits on investments were considered, the impaired surplus had ballooned to $170 million, the order notes.
The Florida suspension will remain in effect until the Florida Office of Insurance Regulation determines that Atlantic Coast is no longer impaired, the order reads. The insurer must immediately cease soliciting new or renewal business in Florida and should notify agents and brokers. It “shall continue to service all Florida in-force policies and shall honor its liability for losses and unearned premiums if they continue to exist.”
“Atlantic Coast’s concerning financial condition led to our office issuing an Immediate Final Order and urgent notice to insurance agents to halt any further transactions within Florida,” Yaworsky said in a statement to Insurance Journal Thursday. “The Florida Office of Insurance Regulation has been closely monitoring this matter, and like all states, Florida has a wide array of tools to monitor the financial condition of insurers, and we will continue to take action when necessary.”
Yaworsky’s concerns parallel some of Wise’s, as spelled out in the South Carolina rehabilitation filing.
“Respondents have placed policyholder funds into high-risk and inappropriate investments in violation of South Carolina law and their agreements with the Department,” according to the South Carolina petition.
A-Cap and King have previously disputed claims that its past dealings with 777 Partners might prevent Atlantic Coast from making good on promises to policyholders.
Read More: A-Cap Insurers Face South Carolina Claim They’re ‘Financially Hazardous’
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Top photo: Yaworsky speaking at the Florida Legislature.
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Florida
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