AGREEMENT REVIVES SUPERIOR GROUP.

Byline: Chris Sieroty Staff Writer

CALABASAS - State regulators on Friday announced an agreement reached with Kemper Insurance Cos. that finalizes the rehabilitation plan for Superior National Insurance Group Inc.

Scott Edelen, a spokesman with the state Department of Insurance, said Superior had also lifted the temporary suspension of claims-related payments, and checks were again being issued.

``We are acquiring the renewal rights to write workers' compensation policies to existing policyholders of Superior National Insurance,'' said Linda Kingman, a spokeswoman with Chicago-based Kemper.

The agreement is still subject to approval by a Superior Court judge in Los Angeles, she said.

``Not only are we pleased with Kemper's commitment to the claims operations, but also that the rehabilitation plan can now go forward, and we anticipate filing the final contract documents with the court within a week, said Richard G. Krenz, special deputy insurance commissioner, in a statement.

To acquire the rights to policies, Kingman said Kemper would pay $2.25 million and a 2 percent commission on business signed over the next three years to the state of California.

``We have pretty significant experience in workers' compensation,'' she said. ``We think we can bring our expertise to this business and do it in a way that will be profitable to us.''

Edelen said the deal, reached early Friday morning, ``allows for the rehabilitation and gives Kemper part of the package to bring Superior National back to viability.''

The next phase of the rehabilitation plan will be the application for a Liquidation Order early next month. The order ensures that all policyholders and claimants are protected, he said.

Kemper, headquartered in Chicago, had revenues of almost $3 billion last year.

Based in Calabasas, Superior National consists of five companies. Four of them - California Compensation Insurance Co., Combined Benefits Insurance Co., Superior National Insurance Co., and Superior Pacific Casualty Co. - were seized March 3 by regulators.

State regulators took over day-to-day operations at the state's largest workers' compensation insurer saying it lacked the reserves to pay claims.

Customers with questions about coverages or policies with Superior National can contact the Department of Insurance Consumer Hotline at 800- 927-HELP or [phone].