Special insurer gives Trump its fraud guarantee | Insurance business America
The billionaire boss is known for car loans with high interest rates and high risk
Insurance News
By Kenneth Araullo
Thanks to a specialty insurer, Donald Trump has secured a $175 million bond in connection with his ongoing civil fraud trial in New York, effectively halting collection efforts against him for the $454 million judgment awarded.
Knight Specialty Insurance, operating under the broader Knight Insurance Group, is the underwriter for Trump’s appeal bond.
Don Hankey, the billionaire CEO of Knight Insurance Group, told The Associated Press that a combination of cash and bonds served as collateral for the bond. Hankey is known for its ventures into providing high-risk, high-interest loans to car buyers with less than perfect credit.
“That’s what we do at Knight Insurance, and we’re happy to do it for anyone who needs a bond,” Hankey said, also explaining that he had no personal contact with Trump.
Founded in 2013, Knight Specialty Insurance is a B++ (AM Best) rated primary insurer. The parent company has assets of $23.4 billion worldwide and is part of the Hankey Group of Companies.
Hankey, on the other hand, is currently ranked 128th on the Forbes 400 and is number 317 on the list of world billionaires.
Trump secures bond – what happens next?
The bail prevents the state from seizing Trump’s assets during his appeal, a development confirmed by recent court documents.
A New York appeals court ruling required Trump to post bail within 10 days after the court agreed to a reduction in the bail amount needed to halt enforcement efforts against him.
The bond acts as a financial guarantee, ensuring payment of the full judgment amount plus accrued interest if the appeals court upholds the original judgment. Conversely, if Trump prevails in his appeal, he would be exempt from paying the state and would receive back the funds used for the bond.
Trump’s legal team, which included attorney Alina Habba, said: “As promised, President Trump has posted bail. He looks forward to enforcing his rights on appeal and overturning this unfair verdict.”
Before the appeals court’s intervention, which reduced the required bail amount, New York Attorney General Letitia James had been preparing to launch debt collection actions against Trump, potentially targeting his significant assets.
That litigation stems from a judge’s Feb. 16 ruling that found Trump misrepresented his net worth in financial reports used to back loans and insurance policies. Trump has denied these claims, saying his financial reports understated his assets and contained disclaimers that would not be taken at face value by lenders or insurers.
The state’s Appellate Division is expected to hear arguments in September. The timing is in the critical weeks of the presidential election campaign. Under New York law, appealing a judgment does not automatically stop enforcement unless a bond is posted, which provides a temporary stay on debt collection actions, a relief that Trump has now secured.
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2024-04-02 15:27:27
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