Adirondack Insurance Exchange customers face coverage cancellations amid company collapse
CLIFTON PARK - Some home and auto owners who have insurance policies with Adirondack Insurance Exchange will find themselves without coverage this month unless they have found a new carrier.
The cancellations are the next step in the winding down of the Buffalo-based company, which had brought in a large number of customers in recent years due to its low rates.
"Hopefully their existing agents made moves," said John Graham, a broker/owner at Doug Neil Insurance in Clifton Park. He explained that he hopes most consumers have contacted their local agents and found new coverage by now.
"We're still getting dribs and drabs," Graham said of former customers of the company that need new coverage.
As of Oct. 1, customers whose coverage with the company expires between then and Dec. 31 no longer have insurance protection unless they have found another carrier.
News of the company's pending collapse first emerged in May when Demotech, a company which follows the insurance industry, withdrew its financial stability rating from Adirondack. That came amid reports of the insurer's deteriorating finances and statements that they would need a 40 percent rate hike to stay solvent.
"Adirondack Insurance Exchange has been facing a surplus shortage for the last several years due to the severe increase of the cost to settle claims. ... Due to the rapid rise in loss costs and the need for further rate infusion, the capital of Adirondack has deteriorated over the past few years," Demotech said at the time.
By late July, the company said they were leaving the New York market and shutting down future coverage there.
In its letter to customers, Adirondack Insurance Exchange noted that claims made prior to the announced shutdown will still be paid.
Insurance has been in the news lately, especially with the hurricanes that have torn through Florida, North Carolina and other parts of the South in recent months and years.
But the problems with Adirondack Insurance Exchange were a different issue.
In 2023, the company reported a $32.5 million loss, according to the state Department of Financial Services. The company was selling personal lines of insurance in New York since 2006.
It wasn't immediately clear how many policy holders of Adirondack Insurance Exchange still needed coverage. Calls to the company were not returned on Tuesday.
This story was originally published October 16, 2024, 3:31 PM.
