Office of the Special Deputy Receiver

Representing Jennifer Hammer, Director of Insurance, Illinois Department of Insurance

The Administrative Employer Group, Inc.

Welcome to the webpage for The Administrative Employer Group Inc. On April 21, 2008, The Administrative Employer Group Inc. was ordered into liquidation. Jennifer Hammer, Director of Insurance of the State of Illinois, is the statutory and court-affirmed Liquidator. By Illinois law, the Director may appoint a Special Deputy Receiver to administer the receivership. The Office of the Special Deputy Receiver has been appointed to assist in the day-to-day administration of the liquidation proceedings under the direction of the Director. Here is additional information on The Administrative Employer Group Inc:
Liquidation Date: April 21, 2008
Claim Filing Deadline May 18, 2009
Contingent Claim Deadline: May 18, 2010
Docket Number: 07 CH 23319
  Click here to view the Administrative Employers Group, Inc. docket and upcoming court dates maintained by the Clerk of the Supervising Court.
Related Documents and Links:  
Financial Statements and Independent Auditors' Report
Receivership Pleadings and Orders
Statement of Affairs
Statement of Changes in Cash and Invested Assets
Contact OSD Staff

Latest News:  

Historical Data:  

In February of 2005, RCA issued a 10-day notice of cancellation for the non-payment of premium. AEG and certain affiliated entities commenced litigation against RCA in New Jersey state court. That court ultimately entered an order holding that the RCA policy was cancelled effective August 19, 2005. Although the policy issued by RCA was cancelled, AEG continued issuing certificates of insurance purporting to provide workers compensation coverage under the RCA policy until on or about August of 2007. Because AEG’s issuance of the certificates of insurance constitutes the unauthorized transaction of the business of insurance, Guaranty Fund coverage is not available.

In conjunction with a due diligence of possible causes of action undertaken on behalf of an affiliated company (Employers Consortium V, Inc., in Liquidation), a decision was made to retain Clausen Miller for purposes of pursuing claims against a company, Leading Edge Group Holdings, Inc., owned by AEG’s controlling person (Allen Hilly). The causes of action relate to the transfer of funds from AEG to Leading Edge over an 11-month period during 2006.  A default judgment was entered in favor of AEG/ECI in the action filed against Leading Edge.  Judgments were entered in the amount of $7,176,619 for AEG and $7,090,387 for ECI.  Outside counsel is seeking to pursue recovery on the judgments in an action pending in federal court in New Jersey. Hilly is under federal indictment in New Jersey with respect to these transfers.

On April 21, 2008 an Order of Liquidation with a Finding of Insolvency was entered against The Administrative Employer Group, Inc. (“AEG”). The liquidation proceedings follow the commencement of a conservation proceeding on August 27, 2007. These actions were taken following the Division of Insurance’s determination that the company was transacting the unauthorized business of insurance and was insolvent. On November 17, 2008, an order was entered approving claim filing deadlines and procedures. Claims must be asserted by way of a proof of claim form.

AEG is wholly owned by Professional Employer Holdings, L.L.C., a Delaware limited liability corporation. Although AEG was licensed in Illinois as a professional employer organization (“PEO”), it was never licensed for purposes of transacting the business of insurance. Pursuant to its statutory obligations as PEO, AEG provided its clients companies with workers compensation coverage. Commencing in late 2004, AEG obtained workers compensation coverage from the Reinsurance Company of America (“RCA”).

On June 27, 2013,  the Circuit Court of Cook County, Illinois entered and order terminating the conservation proceedings, closing the estate of Michael A. Ward and discharge of the Conservator.  The AEG and ECI estates are still pending in the liquidation proceedings.

Based upon best estimates and barring any unforeseen circumstances, the Liquidator expects that an interim dividend of 75% will be distributed by the end of the second quarter of 2015 on all timely filed claims allowed at the policyholder priority Level (d) of the Illinois statutory distribution scheme. This Good Faith Estimate is based upon information available and the circumstances known at the time that it was made. Before relying on this estimate in making any decisions, be aware that the underlying facts and circumstances upon which it is based are subject to change.

On July 23, 2015 the Supervising Court approved the Liquidator's application for an order authorizing
the Director to declare an 80% interim dividend on all timely filed claims allowed at level (d).

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