Indiana electric co-op fighting insurance company

Hoosier Energy Rural Electric Cooperative, which serves most of Southern Indiana, is thriving but threatened with bankruptcy -- by "an atrociously convoluted deal" it made with an insurance company six years ago, Gretchen Morgensen writes in her "Fair Game" column in The New York Times.

The deal is much too complicated to explain in a short blog item, but Morgenson says it illustrates how "collateral damage from the credit crisis continues to crop up in the most unlikely places." It's also a tale of how investment bankers used a non-profit's tax-exempt status to rack up millions in fees and rob the Treasury of tax revenue. And how John Hancock Life Insurance Co. filed the default notice just as Hoosier Energy was about to strike another deal to avoid it. Hoosier believes John Hancock is trying to use the situation "to generate a quick $120 million," Morgenson writes.

Here's a map of the Hoosier service area, its headquarters, five generating stations and 18 member cooperatives, which have 800,000 member-customers: