I am concerned that KFS was not able to sell the Lincoln to an actual run-off management company...and here we are with run-off consultants managing Lincoln. This just does not sound good to me: having claims staff in a company going out of business doing adjudication on claims in run-off. Not good...and that Lincoln Run-Off is going to go on for a very long time. Sorry guys, it just doesn't make good business sense...but i suppose that's what makes a market.
There are so many negatives at KFS - most (but not all) due to Lincoln - that it is very hard to see the company surviving.
A year ago, I did an analysis of Lincoln, and could hardly believe how bad things were, and the obvious lack of KFS mgmt skill and attention to huge, GLARING problems at Lincoln that had gone on for years. I had no prior involvement with the company, so it was a fresh, unbiased business review for a client. In short Lincoln was a godawful mess, and Kingsway was STILL in denial at that time as to how serious the mess was.
Factor in a financial meltdown and huge portfolio losses, not to mention severely declining income going forward in its core FI portfolio, to pay escalating claims that can only spiral higher in a recession, and you've got real problems to deal with!
I know this current set of "managers" is trying hard to persuade investors that they are making a fresh start, and can somehow pull this off - but I agree, the odds are very long. It looks like a sure BK within a few months - I wouldn't touch this thing long.
Is there any precedent for a state dept of insurance to place a voluntary run-off into receivership? I mean if things continue to deteriorate at Lincoln...particularly claims...will the state of PA move to protect the public?