New York Merchant Bakers Insurance Company ("NYMB") was incorporated in New York as a mutual property and casualty company on June 6, 1932, and commenced business on May 4, 1932. It was authorized to convert to a stock property and casualty company on January 31, 1995. NYMB was a subsidiary company of the parent Home State Holdings Inc., a Delaware Corporation, as was Home Mutual Ins. Co. of NY ("HMIC"). In January 1996, the Home State New York Pool was formed which included NYMB and HMIC. This called for all business to be pooled and combined losses and expenses prorated as follows: NYMB (85%) and HMIC (15%).
NYMB was licensed in New York and primarily wrote private passenger and commercial (black and silver cars) auto coverage and some commercial multi peril. It bought reinsurance protection in the form of a quota share and excess of loss treaties.
On August 5, 1997, NYMB (and HMIC) was deemed insolvent and placed into rehabilitation. In October, 1997, the Superintendent as Rehabilitator entered into an agreement with the Roberts Plan (Eagle Insurance) whereby they would assume all private passenger business in effect as of October 1, 1997.
This agreement did not include the commercial auto policies which were cancelled October 1997. NYMB issued payment of $1.2M and would receive a 5% ceding commission on all policies that renewed. On January 26, 1998, the company was placed into liquidation. (HMIC was placed into liquidation on January 14, 1998).