David L. Harbaugh

David’s work on insurance transactions also includes outsourcing, fronting arrangements, marketing and distribution arrangements, captive formation, and self-insurance programs. He also regularly assists clients in the development of national business plans and the expansion of business models to new jurisdictions.

David counsels clients on Insurance Holding Company System Regulatory Act and ORSA compliance, and he has represented clients with respect to Form A, Form B, and Form D filings and exemption requests before a number of insurance departments across the country. David also has represented clients in state regulatory enforcement actions, including one matter that involved the successful negotiation of settlements with 41 different insurance departments.

Clients that value David’s more than 25 years of insurance insolvency experience turn to him when facing insolvency proceedings. David assists clients with the development of rehabilitation plans, workout transactions, and the prosecution of contested proofs of claim. For example, David represented the successful bidder for the assets and in-force insurance business of Executive Life (a $4.5 billion insurance insolvency), and was one of the principal drafters of the Executive Life rehabilitation plan. David also represented the Connecticut Insurance Commissioner in the design, development, and approval of the rehabilitation plan for Covenant Mutual Insurance Company. Most recently, he represented the successful bidder for the Medicaid managed care business and facilities of the DC Chartered Health Plan (in rehabilitation) in a court-approved sale.

Insurance Transactions

• Developed, designed, and secured regulatory approval (in 11 US and offshore jurisdictions) of the reorganization by corporate division of the Independence Blue Cross insurance holding company system.
• Represented a nationally recognized life insurer in connection with regulatory approval of the first AXXX/XXX reinsurance transaction to be filed for review with the Pennsylvania Insurance Department.
• Represented Sierra Health Services, Inc. in the $2.6 billion sale of Sierra’s national HMO insurance holding company system.
• Represented Educators Mutual Life Insurance Company in the sale by assumption reinsurance of blocks of health, disability, and life insurance businesses.
• Represented Educators Mutual Life Insurance Company in a subscription rights demutualization of the company and in the initial public offering of the life and health insurance company and an affiliated workers’ compensation insurance carrier.
• Served as independent counsel to the board of directors in connection with the subscription rights demutualization and initial public offering of a Pennsylvania property/casualty insurance holding company system.
• Represented the seller in the cross-border acquisition by a foreign insurance holding company system of a US workers’ compensation insurance holding company system.
• Negotiated a joint venture between two of Pennsylvania’s largest health insurers for the development of regional PDP and PPO products.
• Served as regulatory and transaction counsel for the proposed consolidation of two Blue Cross and Blue Shield plans in a transaction to create the nation’s fourth largest health insurer.
• Represented the buyer in the $110 million sale of a captive workers’ compensation carrier, including redomestication of the target from Hawaii to Nevada.
• Represented Philanthropic Mutual Insurance Company in an acquisition by merger of a Pennsylvania mutual industrial life and health insurance company.
• Advised Penn Mutual Life Insurance Company in the sale by assumption reinsurance of a $185 million block of disability insurance.
• Represented Penn Mutual Life Insurance Company as issuer in two separate surplus note private placements.
• Represented QCC Insurance Company as issuer in a surplus note private placement.
• Advised AmeriHealth Caritas in several transactions to organize regional Medicaid managed joint ventures.
• Advised Independence Blue Cross in several transactions to organize regional Medicare managed care joint ventures with other Blue Cross and Blue Shield plans.
• Represented Independence Blue Cross in several purchases and sales of commercial health insurers and health maintenance organizations in Texas, Florida, New York, New Jersey, Delaware, Puerto Rico, and Jamaica.
• Advised an insurance holding company in connection with a multibillion-dollar outsourcing agreement and a series of joint venture product line agreements and reinsurance agreements.
• Represented HomeServe USA in the design and launch of its national service contract business and in the acquisition of in-force service contracts from multiple sellers.
• Represented Independence Blue Cross and QCC Insurance Company in the negotiation of a marketing arrangement and fronting facility with Penn Treaty Network America Insurance Company for the sale of long-term-care insurance products.
• Advised AmeriHealth Casualty Insurance Company in the structuring and documentation of a fronting facility for the multistate sale of workers’ compensation insurance products with the Accident Fund Insurance Company of America.
• Represented Leucadia National Corporation and Colonial Penn Insurance Company in the purchase and sale of insurers and blocks of in-force insurance business.
• Represented Independence Blue Cross, QCC Insurance Company, Keystone Health Plan East, Inc., and AmeriHealth HMO, Inc. in connection with a $530 million purchase of Highmark Inc.’s interests in certain managed care insurance businesses.
• Advised AmeriHealth Caritas in the purchase of Medicaid managed care business and the formation of a Medicaid managed care joint venture with Blue Cross Blue Shield of Michigan.

Insurance Insolvency Representations

• Represented the winning bidder in the $4.5 billion sale of the assets and insurance business of Executive Life Insurance Company, and was one of the principal drafters of the Executive Life rehabilitation plan and a related enhancement agreement with NOLHGA.
• Represented Fidelity Mutual Insurance Company in the negotiation of its entry into court-ordered rehabilitation.
• Represented the Connecticut Insurance Department in the design and court approval of the rehabilitation plan for Covenant Mutual Insurance Company.
• Represented Independence Blue Cross and QCC Insurance Company in the commutation and recapture of a book of long-term-care insurance business following the court-ordered rehabilitation of Penn Treaty Network America Insurance Company.
• Represented AmeriHealth Caritas in the court-approved purchase of the assets and in-force business of DC Chartered Health Plan (in rehabilitation).
• Represented Mizuho Corporate Bank, Ltd. in the successful litigation of a contested $19 million proof of claim in the Reliance Insurance Company insolvency.

Other Representations

• Represented a mutual life insurance company in proceedings before the Pennsylvania Insurance Department in connection with a putative class action seeking the forced distribution of more than $800 million in surplus to the company’s policyholders.
• Represented several different national banks in a series of separate engagements involving the structuring and purchase of corporate-owned life insurance.
• Advised a national bank in connection with the purchase of insurance agency businesses and lines of affinity marketed products from another national bank.
• Advised a national bank in connection with the orderly wind-down of affinity marketed insurance products by consent order.
• Represented an insurance brokerage and its affiliates before state insurance departments and US and state law enforcement authorities in a 41-jurisdiction investigation of unlicensed insurance sales and failure to procure insurance pursuant to client orders.
Advised several investment managers in the review of, and the development of investment policies under, the life/health and property/casualty investment rules of 34 jurisdictions.