PROVIDENCE – A decision by Superior Court Judge Michael Silverstein has cleared the way for The Beacon Mutual Insurance Co. to begin making payments to the State of Rhode Island and thousands of policyholders.
On July 27, the workers’ compensation insurer had entered into a consent order with the R.I. Department of Business Regulation, in which the company agreed to pay $1 million in administrative penalties, half within 30 days of the agreement and the other half on or before Dec. 15, plus another $1.5 million in penalties that was suspended, pending the company’s compliance with the DBR’s recommendations and the remainder of the agreement.
In the consent order, Beacon also agreed to distribute about $7 million to holders of policies that were initiated between Oct. 1, 2005, and Sept. 30, 2006, and remained in effect for at least six months. Eligible policyholders are to be paid no later than March 31, under criteria that are being developed by the DBR.
Today, Beacon made its first $500,000 payment to the R.I. General Treasurer’s Office.
That payment had been delayed after three Beacon policyholders filed seeking to block the agreement. Arguments in the case were heard last month.
But in his seven-page decision, issued yesterday afternoon, Silverstein wrote: “The Court believes that permitting an end run around the regulatory process, reducing the amount of the agreed penalty and withholding from eligible policy-holders approximately $7 million does not serve the public interest.”
The Beacon Mutual Insurance Co. of Warwick – established by legislation enacted in 1990, by the R.I. General Assembly, as the State Compensation Insurance Fund – is the largest writer of worker’s compensation insurance and commercial property casualty insurance in Rhode Island. Additional information is available at www.beaconmutual.com.
