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WE ARE HEARTENED that a measure of reason finally has prevailed in the litigation over CIGNA Corp.'s reorganized property/casualty insurance business, but it's going to take more than one rational court ruling to straighten out this mess.

It's also going to take CIGNA and especially the Pennsylvania Insurance Department to begin acting responsibly by sharing vital actuarial information with policyholders and by seeking their approval to transfer their coverage to CIGNA's runoff facility.

The Pennsylvania Commonwealth Court on March 5 vacated Pennsylvania Insurance Commissioner Linda S. Kaiser's approval of CIGNA's reorganization into an active operation for its in-force business and a runoff operation for most of its liabilities, including 80% of its asbestos and environmental liabilities. Most significantly, the court found that Ms. Kaiser wrongfully denied CIGNA policyholders a trial-like hearing on their concerns over the adequacy of the runoff entity's capital and reserves.

The security of the entity responsible for paying their claims is a valid concern of the highest order for policyholders, notwithstanding the $1.35 billion in capital and reinsurance that CIGNA has committed to the facility.

The fact is that CIGNA and the department have not demonstrated whether that protection is enough because they have refused to share the data on which it is based. Indeed, their legal maneuvering with a Tillinghast actuarial report on the runoff facility's financial strength does not foster confidence in their assertions that policyholders are better off than they were before the reorganization.

After the final motion in the last appeal of this case has been heard, we hope that policyholders have the black and white proof they won from the Commonwealth Court that shows either how well or how poorly the runoff facility would protect them.

Of course, that point of contention stems from another fundamental issue in this case: whether moving policies to the runoff facility from the CIGNA company that originally wrote the coverage is a novation, which requires prior policyholder approval.

CIGNA maintains that the coverage was moved through a series of mergers among its subsidiaries, which would not require policyholder approval.

But, describing the transaction as purely a merger is like calling a mule a thoroughbred. We believe that the transaction began with a novation.

Before all the merger activity, CIGNA divided its main subsidiary, Insurance Co. of North America, in two. One half retained most of INA's liabilities and merged into the runoff entity. But, the other half retained the company's in-force business and the INA name and continues as part of CIGNA's active operation. That means the insurer that originally wrote most of the policies that have been moved into the runoff facility did not fully move into that facility as well.

Policyholders, though, still most likely will have to endure a new hearing before they would be able to exercise their right for a say in the future of their coverage.

Appropriately so, the court banned Ms. Kaiser, a former senior counsel for CIGNA, from further involvement in the case. It did not rule on her conflict of interest, though it reminded her in a footnote of the importance of avoiding even the appearance of impropriety. The court held she could not be an impartial adjudicator in the new hearing because she already approved CIGNA's reorganization once.

The court, though, will allow Ms. Kaiser to appoint the new adjudicator. We hope she investigates whether she legally may appoint an adjudicator from outside the department. Given the department's stated close work with CIGNA during its reorganization planning, selecting an outside adjudicator is the only way to attain the fairness that the Commonwealth Court stressed is so important "to promote faith and integrity in the government."

In the meantime, CIGNA and the department say it is business as usual for the company, insisting the court did not overturn CIGNA's restructuring along with the regulatory approval of that transaction. We think that stance is disingenuous and means the issue will be needlessly litigated further in ongoing coverage disputes between CIGNA and policyholders.

It is proper that the court granted buyers access to the information on which CIGNA and regulators relied to for this restructuring, as well as a new opportunity to argue for their right to decide where their risks reside.

Only when policyholders have a fair chance to assess their protection under the restructuring will the controversy surrounding this transaction be put to rest.