Northeast Insurance Co., a Bermuda-based captive insurer serving several New York hospitals affiliated with a major Jewish nonprofit organization, has declared insolvency due to a rising number of child sexual abuse claims filed under New York’s Child Victims Act (CVA).
The company has initiated a “winding-up” process in Bermuda’s Supreme Court and concurrently filed for Chapter 15 bankruptcy in the U.S. District Court in New York, requesting recognition of the Bermuda liquidation proceedings.
Though Northeast stopped underwriting new policies in December 2017 and began winding down its existing liabilities, the insurer says it can no longer meet obligations on policies issued before that date.
As of June 2025, Northeast faced 30 lawsuits related to child abuse; this number increased to 53 by August. The unexpected surge nearly doubled the insurer’s total loss reserves and expense estimates from $15.7 million to $29.1 million—an amount the company admits it cannot cover.
The board has concluded that Northeast is insolvent both in cash flow and on its balance sheet and cannot raise enough funds to cover all anticipated settlements under the CVA.
Owned by five health nonprofits connected to the UJA/Federation of Jewish Philanthropies of New York, Northeast is also affiliated through shared shareholders with FFH Insurance Co.
Established in 1975, Northeast was formed to insure and reinsure medical malpractice, general liability, auto liability, directors and officers liability, and workers’ compensation for its shareholder hospitals, camps, nursing homes, and other UJA-affiliated nonprofits. From 2012 to 2015, the company also reinsured FFH Insurance Co. for hospital professional and general liability before terminating these contracts in 2017.
Among the hospitals covered by Northeast are Mount Sinai, Montefiore, Beth Israel, Maimonides, and Center Light Health System.
The New York Child Victims Act, passed in 2019, extended the statute of limitations for survivors of child sexual abuse, allowing previously time-barred cases to be filed until the survivor reaches age 55. This law has led to a significant rise in lawsuits against churches, schools, hospitals, coaches, municipalities, and other organizations. Several Catholic dioceses have filed for bankruptcy as a result.