Ambac Assurance's segregated account will not begin to make claims payments beginning in May because regulatory officials are not comfortable with the company's ability to pay claims, officials say.
The news came in separate statements issued April 22 by the company and the rehabilitator, the Wisconsin Department of Insurance.
"The rehabilitator is not satisfied that the conditions necessary for the plan to become effective have all been satisfied and believes that this decision is in the best interest of the policyholders," according to the regulator's statement.
Ambac Assurance says "there can be no assurances as to when policy-claim payments will resume."
In an e-mail, Michael E. Fitzgerald, managing director, investor relations for Ambac, says Wisconsin regulators "did not feel that the conditions to the effectiveness of the plan had been entirely satisfied, and as of this time, they have not provided the market with additional, more detailed information. Our announcement on Friday came in response to their decision, and we will provide such additional information to the market as it becomes available."
Ambac Assurance Corp. is domiciled in Wisconsin and is a subsidiary of Ambac Financial Group, based in New York.
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