National insurance company MAX faces liquidation

MutualAid eXchange MutualAid eXchange

MutualAid eXchange, more commonly known as MAX insurance, was found by a court to be insolvent on Aug. 22, initiating a process similar to bankruptcy.

The decision in Shawnee County, Kan., District Court terminated rehabilitation proceedings that had been pending since Aug. 8 and ordered liquidation of assets because the corporation was determined to be unable to pay its obligations. The court order stipulated coverage of insurance policies will continue for a maximum of 30 days from Aug. 22.

MAX formed in 2001, merging 11 corporations into one entity.

Headquartered in Overland Park, Kan., and offering auto, homeowners, farm, business and life insurance, MAX described itself as “founded upon the faith-based principles of the Mennonite, Brethren and related denominations.” Some examples of the corporations that came together to form MAX were Mennonite Indemnity Inc. and Mennonite Aid Association (Indiana-Michigan Conference).

According to the Kansas Insurance Department, MAX is licensed in 28 states with approximately 30,000 policies across the United States. The Aug. 22 court ruling appointed Kansas insurance commissioner Vicki Schmidt as liquidator, with the directive to take possession of MAX assets and administer them under the supervision of the court.

MAX does not track the proportion of customers who are Anabaptist. Representatives declined to respond to Anabaptist World, addressing all questions to Kansas City attorney Bruce Baty, assigned by the court as special deputy receiver to carry out the liquidation of assets.

Baty said on Aug. 28 that MAX reached out to the Kansas Insurance Department in early August to inform the agency of financial difficulties.

“It was really apparent that the company was insolvent, and we had to put the company into liquidation,” he said. “… We’re really in the initial stages of the investigation.”

MAX cited its “strong growth and development the past few years” in a 2021 news release announcing the retirement of David M. Wine as president and chief operating officer and promotion of chief operating officer Lisa Bage to CEO and president on Feb. 16 of that year.

Baty said storm damage claims rose sharply throughout the Midwest and South in recent years, stressing the company’s assets.

“2022 and 2023 have been historic years for the insurance industry,” he said. “These are claims we’ve never seen before, and this is not just MAX, it is other state and county mutuals as well.”

Through its Mutual Aid Ministries program, MAX contributed a portion of all premiums plus outside gifts to providing emergency financial help to people in difficult circumstances. Neither Baty nor MAX representatives would indicate when the program concluded and how much it distributed in its last fiscal year.

“It won’t continue going forward,” Baty said. “The program operated to the extent that the company had a net profit from operations. They would utilize a portion of those dollars for the ministries and, unfortunately, we are in a deficit situation.”

One week after the district court’s order, MAX customers had not been contacted to inform them policies would end 30 days after Aug. 22. Baty said MAX sent an alert to agents notifying them policies were being canceled, but Kansas statute guidance does not advocate email or phone communication to policy holders.

Tim Huber

Tim Huber is associate editor at Anabaptist World. He worked at Mennonite World Review since 2011. A graduate of Tabor College, Read More

Anabaptist World

Anabaptist World Inc. (AW) is an independent journalistic ministry serving the global Anabaptist movement. We seek to inform, inspire and Read More

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