Mission Insurance Group was a holding company for numerous subsidiaries consisting of licensed insurance companies, managing general agencies and other entities providing ancillary services. Its principal subsidiary, Mission American Insurance Co., in turn owned the Mission Insurance Company, Mission National Insurance Company and Enterprise Insurance Companies, collectively known as the "Mission companies," all based in California.
Mission Insurance Group also owned various noninsurance subsidiaries, the principals of which were Pacific Reinsurance Management Corporation, Mission Re Management Corporation, and Sayre and Toso Inc., a managing general agency that underwrote a substantial amount of business for the Mission companies.
At one time, the Mission companies had more than 540 reinsurers--many of which were based overseas. At its peak, the Mission companies and the various affiliates conducted business from 39 offices in 24 states, with more than 2,000 employees. In 1981, premium income was $342,919,000 with an operating gain of $40,929,000. By 1985, premium income was $264,388,000 with an operating loss of $377,574,000.
With Mission reporting huge losses in both 1984 and 1985, Ohio Reinsurance Corporation and other retrocessionaires involved in the reinsurance pools managed by Pacific Reinsurance filed suit in federal court against Pacific Reinsurance and Mission Insurance, alleging fraud, misrepresentation, concealment, breach of fiduciary duty and gross negligence and seeking rescission of the reinsurance agreements. Mission Insurance fronted for the majority of the business written by Pacific Reinsurance.
A second legal action followed, filed by Federal Reinsurance Corporation against Pacific Reinsurance with similar allegations. These actions received widespread publicity, and thereafter other reinsurers reneged on their obligations to honor reinsurance contracts. The resulting negative cash flow impact on the Mission companies was viewed by many to be the single most critical factor leading to the eventual liquidation of the company in 1987.
Mission Insurance Companies was one of 72 property/casualty insurers that failed during the period from 1984 to 1987 with an ultimate tab of $2.4 billion as of 1990. A congressional report, titled "Failed Promises: Insurance Company Insolvencies," prepared by the House Oversight and Investigations Subcommittee and released Feb. 7, 1990, followed more than a year of hearings and investigations into several insurer insolvencies, including Mission Insurance, Transit Casualty Company and Integrity Insurance Company.
Close Up of Vignette:
Common Stock Certificate, specimen, 1970’sPrinter: Security-Columbian / United States Bank Note Company Dimensions:
8” (h) x 12” (w)State: CA-California Subject Matter: Finance and Related
| Insurance Companies
| Specimen Pieces Vignette Topic(s): Allegorical Featured
| Allegorical Angel
| Hemispheres Featured Condition:
No fold lines, punch hole cancels in the signature areas and body, and some toning and edge faults from age.