Affirmative Insurance creditors seek to convert cases to Chapter 7

By Mark Reccek

Bethlehem, Pa., Dec. 30 – Affirmative Insurance Holdings, Inc.’s official committee of unsecured creditors sought court approval to convert the cases to Chapter 7 from Chapter 11, according to a motion filed Wednesday with the U.S. Bankruptcy Court for the District of Delaware.

The committee argues the estates are insolvent and the company has no business remaining to reorganize.

According to the motion, the committee said converting the cases to Chapter 7 will permit an independent Chapter 7 trustee “to pursue and seek to monetize unliquidated and contingent assets for the benefit of the debtors’ creditors, including holders of the debtors' approximately $100 million in unsecured debt.”

Additionally, the committee said converting the cases to Chapter 7 will prevent the debtors' estates from accumulating more expenses related to a Chapter 11 case.

A hearing is scheduled for Jan. 19.

Affirmative Insurance is a Burr Ridge, Ill.-based producer and provider of personal non-standard automobile insurance policies to individual consumers. The Chapter 11 case number is 15-12136.

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