Tuesday, December 22, 2009
Tuesday, September 8, 2009
Thursday, September 3, 2009
The pay-as-you-drive program will enable insurers to offer a new option for consumers who choose to take advantage of it. Companies can continue to offer traditional insurance based on estimated mileage. However, as soon as regulations go into effect, they can also offer a verified mileage program instead of, or in addition to, a traditional estimated mileage program.
Poizner originally proposed the pay-as-you-drive regulations last summer to make a new, more mileage-accurate auto insurance option available for California consumers. The regulations were last revised in August 2009. Revisions made to the regulations in August are reflected in the final regulations.
The regulations also allow insurers to offer discounts to drivers who opt to purchase a mileage verification policy. Any auto insurance program, including a pay-as-you-drive program, must be approved by Poizner before being placed on the market for consumers to purchase.
If a driver elects to purchase a pay-as-you-drive policy, the insurer would verify the driver's miles through a variety of methods, including odometer readings taken by the insurer or its agents or vendors, auto repair dealers, smog check stations, self-reporting by the policyholder or a technological device placed in the consumer's vehicle. The final regulations explicitly prohibit insurers from gathering location data from consumers for automobile rating purposes through the addition of a technological device. The regulations would not affect existing multipurpose devices such as GM's Onstar system or the use of a technological device as part of an emergency roadside assistance program.
The final regulations incorporate changes based on feedback from consumer groups, the insurance industry and other interested parties. The primary changes from the initially proposed regulations to the final, submitted regulations include:
- Language that encourages insurers to offer a price per mile, or prepaid mile option for drivers.
- An allowance for insurers to apply to sell mileage verification policies in addition to mileage estimation policies; or they may apply to sell mileage verification policies only.
- Language that requires an insurer that offers a pay-as-you-drive plan to specify when filing with the department the exact types of mileage verification the insurer will accept.
- The final regulations explicitly require insurers to offer and make available all mileage verification methods equally, to all applicants and insured drivers with a mileage verification policy.
- The use of location data is still prohibited for most purposes. The final regulations make it clear that they do not prohibit insurers and motor clubs from offering optional devices to drivers to identify the location of the vehicle for the purpose of an emergency road service, theft service, map service or travel assistance service.
Last August, the Environmental Defense Fund estimated that if 30% of Californians participate in pay-as-you-drive coverage, California could avoid 55 million tons of CO2 emissions between 2009 and 2020, which is the equivalent of taking 10 million cars off the road. This would save 5.5 billion gallons of gasoline and save Californians $40 billion dollars in car-related expenses. Additionally, the California Air Resources Board has recommended the adoption of pay-as-you-drive as one of the means to meet future climate change gas reduction targets.
The final regulations will go into effect pending approval by the Office of Administrative Law, which has 30 days to approve the regulations. As soon as regulations are in effect, which could be as soon as October 2009, insurance companies may apply to offer pay-as-you-drive plans. Pending the Commissioner's approval of a pay-as-you-drive insurance plan submitted to the Department, consumers will be able to purchase a pay-as-you-drive policy.
The office of Suffolk County District Attorney Thomas Spota arrested John Rusnak, 48, of Syosset for workers’ comp fraud. Rusnak is the owner of Colt Contracting Corp.
Francis Hunt, an investigator with the Insurance Department’s Frauds Bureau, said Rusnak is accused of defrauding the state Insurance Fund of $104,000 in lost workers’ comp premiums by concealing the payroll of eight workers.
Rusnak could be sentenced to up to four years in prison if he is convicted. A hearing will be held in Suffolk County Court.
In May 2006, the Ohio Department of Insurance, the Delaware County Sheriff’s Office, the West Virginia State Police and the West Virginia Office of the Insurance Commissioner began investigating the three individuals as they had filed a significant number of insurance claims. Claims filed included acts of arson, theft, auto accidents and disability / personal injury claims.
The investigation revealed the three suspects would purchase vehicles from local car dealerships using fraudulent documents and employment information, and would take out credit disability insurance. Shortly after obtaining vehicles, the suspects would then contact the insurance carrier and report they were injured and/or disabled. In order to maximize the length of time the insurance company would have to pay on the vehicle, the suspects would alter disability forms obtained from their provider and submit them to the insurance carriers.
The three individuals are scheduled to be arraigned on Sept. 9.
In "Catastrophes and Performance in Property Insurance," a policy report from the Independent Institute, economists Patricia Born and Barbara Klimaszewski-Blettner reveal that post-disaster property insurance regulation actually drives up the prices it purports to control. Drawing data from the National Association of Insurance Commissioners, and the Swiss Re Sigma reports, the scholars argue that strict regulatory environments induce higher losses from unexpected catastrophes, as firms are unable to adjust prices in light of changing conditions. Notably, commercial insurers experience less loss following catastrophes than the homeowners insurance market due to greater flexibility and fewer constraints.
The authors demonstrate that in states such as Florida, regulations that include premium limitations or exit restrictions can cause severe market distortions that may result in "an inadequate supply of insurance coverage." When restrictions on premium adjustments are enforced, insurers "may choose to exit the market if rates are not adequate to maintain solvency. This, in turn, prompts regulators to impose exit restrictions or cancellation bans." Addressing wide variations in state-level regulation, Born and Klimaszewski-Blettner dissect the phenomenon of "regulatory chain reactions," in which one intervention seems to establish the "necessity" for more government action. This snowball effect actually exposes taxpayers and consumers to greater risk when disaster hits.
Considering the staggering losses by insurers in 2005 -- $45 billion for Hurricane Katrina alone -- the authors propose several reform measures to protect both insurers and policyholders. They propose deregulating prices and a reform of residual market solutions "with emphasis on allowing market forces to operate more freely in responding to the insurance needs." In considering low-income people in affected areas who are unable to move or afford coverage, they suggest that even direct state subsidization of premiums is preferable (but hardly ideal) to keeping premiums artificially low, while cautioning that "incentive-incompatible subsidization of premiums -- for example, for new buildings in high risk areas" -- must be avoided.
Wednesday, September 2, 2009
The results of the survey will provide information regarding agency compensation practices, commission structures, incentive awards, travel and other data related to agent management practices. This insurance company survey is free of charge to Ward Group clients and a summary of results will be made available to all participating individuals. Companies may also contact Ward Group to see if they are eligible for discounted or waived participation fees through membership with Ward alliance organizations.
This study will be conducted from Sept. 1 – Oct. 15, 2009 and results will be distributed by December 1, 2009. Participants are invited to attend a webinar presentation on the study’s findings conducted by Ward Group in December.
To participate or to request more information on the survey, contact Vince Albers at email@example.com.
A recent analysis of the latest government data by the American Insurance Association (AIA) shows that auto and traffic safety efforts over the past 40 years have significantly reduced the number of accident-related injuries and fatalities.
- Recently released federal highway data shows a continuing drop in motor vehicle fatality rates over the 40-year period from 1968 to 2008, as well as a decline in the motor vehicle traffic injury rate despite an increase in vehicle miles traveled.
- For example, Americans drove close to one trillion miles in 1968, compared to nearly 3 trillion in 2008. Over those four decades, the motor vehicle traffic fatality rate dropped from 5.19 deaths per-100 million vehicles miles traveled in 1968 to a record-low 1.27 deaths per-100 million vehicle miles traveled in 2008. Additionally, over the past 20 years the injury rate has dropped from 169 injuries per-100 million vehicle miles traveled in 1988 to 80 injuries per-100 million vehicle miles traveled in 2008. By examining the underlying rates rather than simply looking at the total number of deaths and injuries, these statistics take into account any fluctuations in vehicle miles traveled and show that improved safety measures are the leading cause for the pronounced reduction in fatalities and injuries.
- AIA’s analysis goes a step further to highlight how the safety-promoting efforts of the insurance industry and other groups have made a critical difference. By looking at the current year vehicle miles traveled and using the fatality rate of historical years, AIA has estimated the amount of people that would have been killed or injured had there been no improvements at all in vehicle and traffic safety. Even with these positive trends, drivers should always drive defensively.
- A copy of AIA’s analysis can be found at: http://www.aiadc.org/AIAdotNET/docHandler.aspx?DocID=327085
The fires are spread from as far north as Siskiyou County to Riverside County in Southern California.
By Tuesday, there were seven major fires across the state. The devastation was more severe in the Station Fire which so far has destroyed 18 residences and consumed 121,762 acres in Los Angeles County. Another fire which ravaged 63 homes and businesses near Auburn, was 80 percent contained by Tuesday afternoon.
During a press conference on Tuesday at a command center in Southern California, Gov. Arnold Schwarzenegger declared a state of emergency in San Bernardino County in the wake of two major fires that have led to the evacuation of Oak Glen as well as hundreds of other evacuations in nearby Yucaipa.
State Fund has set up dedicated customer service lines to provide assistance to Southern California policyholders whose operations were impacted. Policyholders are encouraged to contact State Fund's Customer Service Center at (800) 388-0902 to make arrangements for September 2009 payroll reports and payments. This program will be offered to employers through a series of newspaper announcements and mailings to all State Fund policyholders in the affected area.
Tuesday, September 1, 2009
"The grim reality is that the fishing industry is averaging one death per month," said Marcel Ayeko, TSB's director of Marine Investigations. "Sixty people have died in accidents over the past five years, and we need to find out why."
As an independent government agency, the TSB conducts dozens of full investigations into marine accidents every year. These result in public reports that contain a host of conclusions, concerns, and safety recommendations, but Ayeko said the problem is bigger than any one event. This study, he added, is expected to be the first to provide an overall view of the situation across the country. "We'll talk to everyone: vessel owners and operators, fishing associations, government, unions, and - above all - the fishermen," Ayeko continued.
"We already know there are systemic issues," he said, noting that small fishing vessels have the highest rate of marine accidents in Canada. With over 200 incidents reported to the TSB annually, "these issues need to be formally identified - to the regulators, the industry, and the fishermen themselves - so that we can improve safety and reverse this tragic trend."
The study will also look at the risks and challenges experienced by members of the fishing community when they set out for a day's work and will be released to the public and industry stakeholders when completed. To help with this, historical data and case studies of selected accidents in Canada will be analyzed, as will occurrences from other nations, including the United States, the United Kingdom and several Nordic countries. "The further in-depth we go," said Ayeko, "the more solid facts we'll uncover to help make the fishing industry safer."
Since 1992, the TSB has made 42 recommendations aimed at improving fishing vessel safety, and it has repeatedly drawn attention to critical safety issues that contribute to accidents. These include vessel stability, structural integrity, unsafe operating procedures, the use of lifesaving equipment, and the impact of fishery resource management plans and practices on the overall safety of fishing vessels.
- A tropical storm becomes a hurricane when winds reach 74 miles per hour.
- The National Hurricane Center began naming tropical storms in 1953.
- The naming of hurricanes alphabetically, alternating male and female names, began in 1979.
- For the United States, September has had more major hurricanes than all other months combined.
- However, five of the most devastating hurricanes did not occur in September: Katrina (August 2005), Andrew (August 1992), Camille (August 1969), Audrey (June 1957) and Hazel (October 1954).
- The 2005 Atlantic hurricane season was the most active Atlantic hurricane season in recorded history, repeatedly shattering previous records.
- Hurricane Katrina was the most costly hurricane in U.S. history, costing an estimated $75 billion.
- The three deadliest hurricanes in US History are: Galveston, TX (1900) with 8,000 people reported killed; Lake Okeechobee, Fla. (1928) with 2,500 reported dead; and Katrina (2005) where 1,800 people perished in Louisiana and Texas.
- Only three hurricanes, in the past 100 years, have hit landfall as a category 5: Florida Keys (1935); Camille (1969) in Mississippi, southeast Louisiana and Virginia; and Andrew (1989) in southeast Florida and southeast Louisiana.
- The average life of a hurricane is nine days.
Storms are full of surprises, and while experts predict near-normal activity this hurricane season, there are potential mishaps that can happen even if a storm doesn't make an appearance on a trip. Anticipating the unexpected - such as medical emergencies, flight delays, identity theft or a natural disaster at home before leaving - and covering it with travel insurance will protect travelers from surprises. Travelers can find out more about CSA and travel insurance by contacting their travel agent.
- A new Best’s Review cover story informs life/health agents how to value their businesses to plan for retirement or acquisition. “What’s Your Agency Worth?” tells the story of how a life insurance agency owner in Woodland Hills, California, found an investor that allowed her business to grow and also provided her with a long-term exit strategy.
This kind of story is likely to play out in coming years as owners of life/health agencies look for a way to access capital, find a buyer so they can retire, or both. About 26% of all life/health and property/casualty agents are self-employed, according to the U.S. Bureau of Labor Statistics.
Many life/health don’t have succession plans in place or know what their agencies are worth, said Chris Greis, president and founder of Leaders Partners Inc. Some principals plan to work until they drop, he said, or look for a young producer to come in and take over. Both of these plans are fraught with risk, he said.
The California life agency, Time Financial, was sold to an insurance wholesaler, but at the time of the sale the buyer and seller didn’t know the value of the business, said Kate Kinkade, Time’s president.
Measuring a life/health agency’s worth isn’t as simple as applying EBITDA or (earnings before interest, taxes, depreciation and amortization) as you can in valuing a P/C agency. Life/health agencies require a holistic view — evaluating the quality of the firm’s contractual relationships, market conduct record, insurance carriers and the kinds of retailers and brokers with which it works.
“What’s Your Agency Worth?” also features a sidebar containing three experts’ advice on selling a life/health agency.
September’s Other Highlights:
To read these articles and more, subscribe to Best's Review by visiting www.bestreview.com, calling the A.M. Best customer service department at (908) 439-2200, ext. 5742, or e-mailing your request to firstname.lastname@example.org.
- DriveCam Inc., a global Driver Risk Management (DRM) company, announced support for legislation requiring states to pass laws banning text messaging while operating a moving vehicle. DriveCam also expressed support for the Distracted Driving Summit announced by the U.S. Department of Transportation where transportation leaders, members of Congress and safety groups will come together to reduce accidents and fatalities caused by distracted driving. DriveCam has been invited to participate in the Summit.
The bill (S. 1536) – Avoiding Life-Endangering and Reckless Texting by Drivers (ALERT Drivers) Act – was prompted in part by studies by Virginia Tech and the University of Utah, which found that drivers were much more likely to crash if texting while driving, according to Sen. Charles Schumer, D-NY, one of four sponsors of the legislation. These studies found that texting was more distracting to drivers than using a hand-held cellular telephone or being intoxicated.
- "DriveCam unequivocally supports the goals of this bill," said Brandon Nixon CEO of DriveCam. "With a database of 13.5 million risky driving events, we see what’s happening on our nation’s roads every day. Texting is on the rise, as are the number of incidents – and deaths – as a result of this selfish behavior. Road safety is of paramount importance in ensuring every American’s right to get from one place to another safely."
Currently, texting while driving is banned in the District of Columbia and 14 states, including Alaska, California, Minneapolis, New Jersey and Virginia. Maryland's ban takes effect Oct. 1. The New York legislature recently passed such a measure and sent it to the governor for signature. This federal bill would require other states to write laws prohibiting text messaging by drivers or risk losing 25 percent of their annual federal highway money. States would have two years to enact such laws.
Monday, August 31, 2009
Fire officials have ordered mandatory evacuations for residents of the 10,000 homes under threat. The city of Los Angeles today issued a mandatory evacuation order for an area of Sunland-Tujunga bordering the Angeles National Forest from roughly Alpine Way on the north to Haines Canyon Avenue on the east.
According to one fire spokesman, The Station Fire had increased to 85,576 acres as of Monday morning. The blaze is only 5 percent contained while being fueled by dry air and protected by the steep terrain in and around the Angeles National Forest.
Officials are keeping a close eye on the blaze, which is being aided by warm temperatures and low humidity, as it creeps closer to the Mount Wilson Observatory. The facility holds 20 television and radio transmission towers along with fire and police communication equipment.
Tragically, two firefighters died Sunday when their vehicle went down a steep enbankment as they were battling the Station Fire.
Officials identified the dead as Capt. Tedmund Hall, 47, and Spc. Arnaldo Quinones, 35.
Two residents who ignored mandatory Station Fire evacuation orders were severely burned when they decided to wait out the blaze in a hot tub, according to sheriff's officials.
"Our hearts are heavy as we are tragically reminded of the sacrifices our firefighters and their families make daily to keep us safe," California Governor Arnold Schwarzenegger said in a statement issued Sunday. "This is a devastating day for firefighters everywhere, and Maria and I join all Californians in expressing our gratitude and sadness. Our hearts go out to their loved ones."
Both were severely burned when flames ripped through their Big Tujunga neighborhood Saturday.
The Station Fire began Wednesday and had destroyed 18 structures by Sunday. The fire also is threatening 500 businesses and 2,000 other structures. The blaze grew over the weekend in an area that has not witnessed a major fire in more than six decades.
Schwarzenegger declared a state of emergency Friday as a result of the Station Fire. He has also declared a state of emergency in Monterey County, where one blaze, called the Gloria Fire, has burned approximately 6,500 acres, and another, called the Bryson Fire, has charred more than 3,000 acres.
The company worked with the offices of the Massachusetts Division of Insurance Commissioner and the Massachusetts Attorney General to resolve all matters related to regulatory issues with the Division of Insurance dating back to 2003, and to litigation brought by the Attorney General’s office dating back to 2004. HealthMarkets stated that given the unique environment regarding health insurance in Massachusetts, marketing only ancillary products, underwritten by its subsidiary insurance companies, is the best business strategy going forward.
This decision has no impact on the company’s marketing efforts outside the state of Massachusetts.
HealthMarkets subsidiaries have approximately 27,000 health insurance members in Massachusetts, and will continue to service those members and administer the health insurance plans currently in-force in the state, consistent with the terms of the settlement agreements.
As a result of the voluntary agreements, the company will make payments totaling $15 million to the Commonwealth of Massachusetts, from which $11.25 million will be used by the Attorney General’s office to provide restitution or other relief to Massachusetts residents who meet certain criteria and $750,000 will be used for attorney’s fees and related costs. The payment includes a $3 million civil penalty and the company will be implementing a claims reassessment program under the terms of the agreement with the Division of Insurance. In addition, the companies have previously paid amounts of more than $2.1 million in claims remediation in Massachusetts since litigation commenced.
This endorsement, offered by only a limited number of insurance companies, was designed to provide additional protection for RV owners who sell their units on a consignment lot. Distributed exclusively through appointed agency partners, National Interstate is currently offering consignment coverage in 27 states, and the endorsement is available on both new and existing policies.
Most RV insurance policies list RV consignment as an excluded usage, meaning that when an RV owner places their unit for sale on a consignment lot, physical damage coverages are removed. In addition, RVs are seldom, if ever, insured under the dealership's policies.
National Interstate offers a portfolio of specialty products for recreational vehicle owners. The company is rated "A" (Excellent) VIII by A.M. Best Company. To learn more about National Interstate's consignment coverage, contact Jason Sinkovitz at 800-929-1500, or email: Jason.Sinkovitz@NATL.com.
Friday, August 28, 2009
While it’s true that many markets are flush with choice, people living in some states have few options for insurance — with almost all consumers ending up in the same plan, according to an article in BestWeek U.S./Canada. An early 2009 report from the Government Accountability Office that ranked the market share of insurers in each state pointed out that 17 states had a single insurer that served at least half of the market.
Also, in BestWeek Europe, Belgian insurer Fortis has reported a group net profit after minority interests of 886 million euros (780.6 million pounds) for the first half of 2009, showing a marked recovery from the same period of 2008, when it made a profit of just 25 million euros. This was driven by a number of events related to the closing of the transactions with BNP Paribas, the Belgian State and Fortis Bank, as well as a net-of-tax charge of 301 million euros related to the legal dispute with Fortis Capital Co. Ltd., the company said.
The death of Sen. Edward Kennedy, beyond its tragic weight for his friends, constituents and public admirers, further highlights a basic math problem that his Democratic colleagues in the Senate have been facing, according to an article in BestWeek U.S./Canada. It takes one vote away from Democrats, dropping the number they can muster to 59 — not a filibuster-proof majority. But the truth is, they never experienced filibuster freedom.
Homeowners often have only minutes to evacuate, and in a panic may forget critical items such as financial documents, medications and other items.
Those not immediately threatened by fire should take the time to create a home inventory and family evacuation plan in the event that fire threatens their neighborhood. In other fire prone areas, residents should create a defensible space around their homes by trimming trees and shrubs on their property.
B-roll illustrating evacuation do’s and don’ts, as well as information on preventing underinsurance and creating a home inventory, is also available for your review on IINC’s Web site at www.iinc.org and the IINC Spots podcast at www.iincspots.org. Information specific to wildfire preparation and recovery is also available at “Disaster Central” at http://www.iinc.org/pages/The%20Wildfire%20Page.
California Insurance Commissioner Steve Poizner announced that he will file a lawsuit to have the $1 billion sale of State Compensation Insurance Fund (SCIF) assets declared unconstitutional.
Poizner indicated the transaction could lead to major workers' compensation insurance costs for California's construction firms, agricultural industry and other small businesses.
"In these tough economic times, the state should be doing everything possible to create jobs, not use budget gimmickry to hurt the economy," Poizner said in a statement. "The Schwarzenegger Administration simply got it wrong with their proposal and the Legislature failed to adequately scrutinize the consequences."
- "Selling SCIF at fire-sale prices could further destabilize the workers' comp market in California, and Commissioner Poizner is right to demand a halt to the governor's plans," according to the Los Angeles-based group Consumer Watchdog.
Overall, SCIF sells close to one out of every five workers' compensation insurance policies in the state.
- The lawsuit will likely be filed in Sacramento County Superior Court in the coming days.
Thursday, August 27, 2009
The Department of Insurance receives referrals of suspected fraud cases from insurance companies, local law enforcement agencies and directly from consumers. CDI enforcement officers carefully examine every case that is brought to the Department's attention.
CDI saw an alarming 31 percent increase in suspected vehicle arson fraud cases in 2008 as compared with referred cases in 2007. (In 2007, CDI received 344 referrals for suspected automobile arson; in 2008, CDI received 451 referrals for suspected automobile arson.) Overall, the Department received almost 300 additional suspected vehicle theft and vehicle arson cases statewide in 2008 than in 2007. CDI received approximately 200 more suspected vehicle theft fraud case referrals in 2008 than in 2007.
While the total number of suspected fraud case referrals received by CDI for all automobile fraud categories (including inflated damages, vandalism and hit and run,) has remained relatively constant since 2007, suspected vehicle arson and theft referrals have noticeably increased.
Poizner oversees 16 CDI Enforcement Branch regional offices throughout the state. Close to 1900 insurance fraud-related arrests have been made by the Department of Insurance's enforcement division since Poizner took office in 2007 - more arrests than have been made during any other two year period, under any previous insurance commissioner.
Failure to Maintain Mandatory Insurance Coverage
All but two states make having some kind of protection mandatory in order to operate vehicles legally. Driving without proof of financial responsibility may result in citations and even the impounding of vehicles. Some states may even suspend driving privileges and vehicle registrations and the penalties and fines incurred will most likely turn out to be far more costly than having maintained coverage in effect.
Furthermore, a person financing a vehicle is usually required by their lien holder to have "Comprehensive and Collision" coverage in order to protect their automobile for physical damage and theft. Failure to maintain such coverage may lead to the forced placement of a policy by the financing institution where the premium is usually much higher than what an individual would normally pay, resulting in an increased financial burden.
The Dangers of Uninsured or Underinsured Driving
Various types of coverage are designed to protect an insured's investment in their vehicle, pay medical damages and cover legal liability to other's injury or damages as a result of an accident. Without a policy in force or without the proper coverage, a person would have to bear the entire cost in the event of an accident, leading to a crippling financial loss.
It's far too expensive and dangerous to cancel or lower coverage. As advised by most government-issued consumer guides, comparison shopping for the right insurer increases the chances of finding affordable premiums without having to compromise the desired protection.
- Small business owners are struggling to provide health insurance for their staff and do not feel confident in determining the health insurance that best fits their employees’ needs, according to a new survey by the National Association of Insurance Commissioners (NAIC). The finding highlights the need for more insurance education, even as the debate over national health care reform continues around the country.
In the NAIC survey, conducted July 22-31, among a participant sample of 500 small business decision makers, 64 percent of small business owners responded that they are not confident picking a health insurance policy that fits their budgets and their employees’ needs. One-third admitted that they cannot afford to provide health insurance to their employees.
Additionally, the study found a clear gap in understanding the fiscal responsibilities associated with offering health insurance. Of the small business owners surveyed, 60 percent said they are not confident they understand the tax implications of paying for a portion of their employees’ health insurance premiums. Only 27 percent say they understand all the factors that can affect their small group health premiums.
“In this economic environment, small business owners need to be especially mindful of any decision that will affect their financial future,” said NAIC President and New Hampshire Insurance Commissioner Roger Sevigny. “Now, more than ever, it is important they get smart about their choices and consider the implications that making a bad decision could have on their business and their employees’ future.”
Wednesday, August 26, 2009
Under a settlement with the Missouri Department of Insurance, United Healthcare has agreed to reexamine at least 50,000 claims filed by chiropractors who treated the company’s policyholders. The Department of Insurance found United Healthcare violated state insurance laws by limiting coverage to 26 visits per year. In other cases, the department says the company failed to evaluate the medical necessity of treatment before denying claims.
For any chiropractic claims it finds were improperly denied, United Healthcare must reimburse the physicians for those claims, plus interest. In some cases, consumers may have paid the bills, rather than the chiropractors. Those consumers should contact United Healthcare at 800-873-4575. Patients or chiropractors with questions about the settlement can the Department of Insurance Consumer Hotline at 1-800-726-7390 or visit insurance.mo.gov.
The department conducted a market conduct examination of United Healthcare, after patients and chiropractors filed complaints about the company denying claims. A 2004 Missouri law requires health insurance companies to cover the costs of at least 26 chiropractic visits per year without prior authorization.
For the first 26 visits, coverage can only be denied if the treatment is determined not to be medically necessary. The department’s exam reviewed United Healthcare chiropractic claims since the law took effect.
The Insurance Department's Mobile Command Center will be located at Mt. Carmel Church, 165 Central Ave. in Silver Creek from 8 a.m. to 8 p.m. on Thursday and Friday. Personnel staffing the command center will be available to answer inquires regarding insurance policies and coverage, as well as to assist with insurance-related complaints.
The mobile command center is currently located at Gowanda Village Hall at 27 East Main St.
In addition to the on-site disaster recovery assistance, residents seeking help on insurance questions may also contact the Department's Disaster Hotline 1-800-339-1759 on weekdays between 9 a.m. and 5 p.m.
Homeowners' policies do not usually cover damage from floods, but such coverage is available through the National Flood Insurance Program. Owners of damaged vehicles whose automobile insurance policies contain comprehensive coverage, also known as "other than collision," are covered for flood damages.
The disaster recovery efforts follow serious flooding that occurred Aug. 9-10.
"I heard Santa Barbara residents loud and clear when they called for an opportunity to voice their concerns about the Fair Plan and the availability of homeowners insurance in their neighborhoods," said Poizner. "I am here today to work directly with homeowners and all stakeholders to address these issues. I'm proud to say that through productive negotiations, we have already worked with the Fair Plan to make significant changes, based on feedback from wildfire survivors. I look forward to the progress we will continue to make together."
Poizner welcomed all stakeholders to attend the hearing for the purpose of gathering information and feedback from policyholders, insurance agents and brokers, consumer groups and Fair Plan representatives.
The Commissioner plans to use information gathered in the course of the hearing process to determine recommendations he may make to improve the availability of private homeowners insurance in wildfire areas, and how Fair Plan policies are assigned.
Poizner has been working with consumers through town hall meetings and hearings to assess concerns about Fair Plan policies. In working with the Fair Plan to highlight major concerns, the insurer has already submitted revisions to they way they write fire policies. Major proposed changes include an increased dollar amount of coverage available for building code upgrades. When fire victims rebuild homes, they must comply with up-to-date building code regulations. This can be costly, and the Fair Plan has agreed to increase the previous limit to reflect the high cost of upgrading older residences to meet modern building code standards.
Another change submitted as a result of Poizner's work is the creation of a separate policy limit for living expenses when policyholders lose their homes. Previously, living expenses incurred while a home was rebuilt would be deducted from the rebuilding limit of the policy. The Fair Plan is now working to create separate coverage limit for living expenses.
Poizner continues to work with Fair Plan and policyholders to address major concerns and make changes and improvements to the policies written by the Fair Plan.
With a strong presence in Texas, Oklahoma and Kansas, CAA is a managing general agency (MGA) looking to further expansion across the country to strengthen the independent agency system through profitable growth and exceptional service for its member agencies.
"By joining CAA, our agency gained access to new insurance markets and programs that will provide our customers and prospects with broader solutions for a variety of risks," said Bill Siddons III, new CAA member and vice president of Hill County Insurance Agency. "Not only does Hill County Insurance Agency benefit from the external relationships CAA built with insurance providers, but it has already begun to tap into the wealth of industry knowledge fostered among the 42 high-caliber CAA member agencies."
Started in 1912 and family-owned and operated by the Siddons family since 1921, Hill County Insurance Agency has provided a full range of personal and business insurance solutions to central Texas residents for over 90 years. W.W. "Bill" Siddons, Jr., president, took the helm as the second-generation leader at Hill County Insurance and began managing the office in 1956. W.W. "Bill" Siddons, III, vice president, joined the agency full time in 1990. His industry participation includes serving as past president of the Independent Insurance Agents of Central Texas. Also he served on the Agent Advisory Boards of the Hochheim Prairie Insurance Co., Allstate Insurance Company, and Blue Cross Blue Shield Insurance Company.
"Bill Siddons is a very professional insurance agent who wants to grow his agency in central Texas, and we at CAA are proud to have him as a new member," said Bill Bridges, CAA chairman and executive vice president of Duncan, Fraser & Bridges, Pampa, TX. "We have already seen Bill's skills go to work for the Independent Insurance Agents of Texas where he actively serves on the board of directors alongside chairing several committees. We know Bill's broad experience and networking capabilities will greatly benefit CAA."
CAA's member agencies convene on a quarterly basis to knowledge share, discuss industry issues, review its relationships with insurance carriers, and assess CAA operations. Highlights from the recent board meeting include:
- New member presentation to independent agency prospects,
- Insurance carrier presentations by Swett & Crawford Group, Service Lloyds Insurance Company, Fireman's Fund Insurance Company and Brown & Brown Inc.
- Brown & Brown sponsored social for CAA members,
- Swett & Crawford sponsored lunch for CAA members,
- Member golf tournament at Falconhead Golf Club in Austin, TX.
Tuesday, August 25, 2009
The new product, offered exclusively to qualified Travelers National Accounts, Construction and Discover Re customers, provides clients an alternative to posting Letters of Credit (LOCs). Discover Re is the "unbundled" alternative risk transfer unit of Travelers.
Customers that qualify for the Money Market Collateral Account option will be directed to a licensed representative of the securities firm administering the Money Market Collateral Account, who will provide a prospectus, details on investment options and instructions on how to proceed.
From there, customers will have the ability to invest the collateral provided to Travelers in a number of National Association of Insurance Commissioners (NAIC) approved Money Market Mutual Funds, U.S. Treasuries or other government instruments. The disbursement of interest, dividends or other investment income in excess of the required collateral amount may be requested on an annual basis.
The poll, taken in June 2009 shows that 18 percent of Washington drivers who use electronic devices admit to reading or sending text messages while driving, although University of Utah research suggests such behavior increases the likelihood of accidents eight-fold. Only six percent of respondents using electronic devices admitted to texting behind the wheel in February 2008.
The poll also showed that while more drivers are tapping messages on cell phones than before, a higher percentage of Washington drivers think the behavior is dangerous.
PEMCO found that 45 percent of those polled are more concerned with the driving distractions caused by text messaging than other distractions like talking on a cell phone, speeding or driving while tired - which is up significantly from the 32 percent of drivers who reported their concern for texting in 2008.
The poll also showed that a significant majority of Washington drivers want the laws surrounding texting to be strengthened. Currently, Washington classifies cell-phone related violations as secondary offenses, which means that the driver must be committing a primary violation like speeding to be cited for texting or talking without a hands-free device.
However, PEMCO's June 2009 data shows that 70 percent of drivers believe that the text-messaging law should be changed from a secondary to a primary offense. Similarly in 2008, 73 percent of drivers agreed texting should be a primary offense.
Surprisingly, when it comes to talking and driving, the poll showed data suggesting an increased acceptance for Washington's hands-free cell phone law as a secondary offense. In 2009, 58 percent support the law as a primary offense, which is down from 60 percent in 2008 and 65 percent in 2007.
This latest PEMCO poll further shows drivers are unclear whether talking on a hand-held cell phone while driving is a primary or secondary offense, with 50 percent incorrectly reporting it as a primary offense.
Overall, 94 percent of respondents do know that using a cell phone behind the wheel is against the law, with a majority reporting that it should only be legal to use a cell phone if using a hands-free device.
* Employers Direct Insurance Company (EDIC) (www.employersdirect.com) has signed a definitive agreement to sell the renewal rights of its direct placed workers’ compensation insurance policies to GNW-Evergreen Insurance Services LLC (www.gnw-evergreen.com).
Headquartered in Encino, GNW-Evergreen is one of the largest independent insurance brokerages based in Southern California. EDIC has previously announced that they are discontinuing direct sales and plan on distributing their workers’ comp policies exclusively through independent agents and brokers in the future.
EDIC will appoint GNW-Evergreen as a producer in Arizona, California, and Nevada following the close of the sale.
Types of businesses eligible for this program are: Retail Stores, Restaurants, Fast Food Restaurants, Doughnut Shops, Deli's, Coffee Shops, Bakeries, Dry Cleaners and over 80 additional types of small businesses.
The new program offers:
- Small retail, service providers and restaurants the ability to have the same benefits as larger retailers, service providers, restaurants and franchises
- Potential dividend to the Association and its Members
- Loss Prevention and Safety Programs
- Local specialized agents
- Award winning claims services
- Specialized Coverage's including:
- Employment Practices
- Property & Casualty
- Workers' compensation
- Commercial Auto
- Business Interruption
- Group Life and Long Term Care
- Financial Solutions
Monday, August 24, 2009
CIGNA-appointed health insurance brokers and agents licensed in Florida can now generate instant quotes on Individual and Small Group health plans for consumers in the Sunshine State.
In addition to quoting CIGNA plans for Florida consumers, Norvax quote engine users can also generate quotes for CIGNA Individual and Small Group plans in Arizona, Colorado, Florida and Texas.
For more information about the Norvax Quote Engine, health insurance agents and brokers can call 1-866-466-7829 ext. 1, or visit the Norvax Web site at www.Norvax.com. Consumers can access this technology directly through Norvax's consumer Web site www.gohealthinsurance.com.
According to prosecutors, in November 2008, Wendall Martin asked James Pryor and Sidney Ulmer to burn down his house in Pittsburg to collect insurance money on the home.
Martin has pled guilty to solicitation to commit a felony for his part and will be sentenced on Oct. 5.
Pryor pled guilty to burning the home at Martin’s request, and will be sentenced next month.
Ulmer will face a jury trial in December on charges of arson.
The conference will feature workshops and forums on such topics as Risk Management for Insurers, Reinsurance Modernization, Credit & Market Risk and more, each led by renowned industry professionals.
The two-day conference will be held at Citizens Bank Park, home of the World Champion Philadelphia Phillies, located at One Citizens Bank Way in Philadelphia. At the conclusion of the first day, all attendees are invited to attend the ballgame versus the Washington Nationals.
Friday, August 21, 2009
While at A.M. Best’s booth, attendees will learn how they can:
More information about the conference is available at www.cpcusociety.org.
Ventura County (Calif.) District Attorney Gregory Totten announced that Paul Lafflitio (DOB 6/25/1984) of Simi Valley was sentenced after previously pleading guilty to felony evading a peace officer and felony auto insurance fraud.
- Lafflitio was placed on formal probation for three years and ordered to serve 218 days in the Ventura County jail. He was ordered to pay restitution of $1,278 to Alliance United Insurance Company and an additional $1,592 to the property owners where he crashed his truck.
- On March 25, 2009, at 9 p.m., two Simi Valley Police Department officers were working undercover in an unmarked patrol vehicle. They were stopped for a red light at the intersection of Sycamore and Royal when they saw a silver Dodge Ram pick-up truck approach the intersection. The Dodge failed to stop for the red light. As the Dodge drove through the intersection, one of the officers shined his spotlight into the cab of the Dodge and got a good look at the driver, Lafflitio. The officers tried to pull over the Dodge but the truck sped away. Lafflitio drove at times between 90 and 100 mph while fleeing from the officers. Because he was driving so fast and recklessly, the officers decided to terminate the pursuit. Minutes later, however, the officers discovered Lafflitio's truck crashed and abandoned on private property off Wood Ranch Parkway.
- The officers discovered Lafflitio was the registered owner of the truck and called him. Lafflitio answered his cell phone and told the officers that he was “night-clubbing” in Hollywood . He added the vehicle must have been stolen from where he last parked it in Simi Valley . He said he would come to the police department the following day to report it stolen. Unbeknownst to Lafflitio, both officers got a good look at him driving as the pursuit began.
- Additionally, cell phone tracking evidence placed Lafflitio in Simi Valley at the time of the pursuit, not in Hollywood as he told the officers. When Lafflitio arrived at the Simi Valley Police Department the next day, he was identified and arrested.
- The officers subsequently learned that prior to arriving at the police department, Lafflitio called Alliance United Insurance Company and falsely reported his vehicle was stolen.
(CMS G2™) platform, KCS’ flagship compliance automation solution.
Esurance has licensed the CMS G2 Database Module (DBM) to house their licensing data. Essentially, the DBM is a unique and powerful database that manages securities and insurance compliance data in one centralized solution. DBM offers the ability to view, track and manage data for carriers, firms, branches and registered individual representatives and producers.
For Esurance, it will also manage the electronic submission of appointments and appointment terminations to the Departments of Insurance for processing.
The CMS G2 system gives Esurance agents read-only access to the database, providing 24/7 access to license information. Esurance plans to roll out this feature in early 2010. In addition, Esurance will utilize the CMS G2 NIPRSM alerts to automatically update portions of their database, eliminating most manual verification of license effective dates.
“CMS G2 is a powerful tool for Esurance’s licensing department. Now we can quickly and reliably manage the licensing and appointments of our producers,” said Kim Zanola, licensing supervisor at Esurance.
Thursday, August 20, 2009
The arrest came as the result of an investigation by the California Department of Insurance (CDI). Along with the arrest, CDI froze Baiden's bank accounts and seized numerous properties (listed at bottom) throughout the Los Angeles area estimated at $4 million. His primary residence was located in an exclusive, gated hilltop neighborhood in Diamond Bar.
The case is being prosecuted by the Los Angeles County District Attorney's Office. Each count is a felony and, if convicted on all counts, Baiden faces a maximum of 40 years in prison as well as $3.2 million in fines.
In September 2008, CDI received a referral from State Fund alleging that Baiden, doing business as Nurse Connection Inc., was underreporting his workers' comp payroll on the quarterly payroll reports. According to the referral, State Fund received an anonymous tip that Baiden had falsified payroll records as well as California and federal tax filings for the years 2001-07. It is alleged that Baiden misrepresented $20 million in Nurse Connection's payroll to conceal the actual risk to the insurance carrier, thereby illegally reducing his workers' comp insurance premiums. State Fund's estimated loss over this seven-year period is approximately $1.4 million.
Based on the investigation, additional charges may be filed at a later date.
The company, a subsidiary of GEICO, will sell homeowners, renters, boat and other types of insurance coverage. GEICO will invest $2.4 million in the expansion, creating an estimated 300 new jobs over three years and laying the foundation for future growth.
To support the company’s efforts, GEICO will receive an estimated value of $1.5 million in Empire Zone tax credits over the next five years from Empire State Development. Further, the company will receive sales tax exemption on equipment purchases from the Amherst Industrial Development Agency and an extension of low-cost power to 2013 from the New York Power Authority for the company’s Amherst facility. Additionally, the Erie and Niagara County Workforce Investment Boards will provide GEICO with workforce training assistance, as well as connect available workforce with the company.
Swinton Commercial has found a 23% rise in enquiries from women looking to purchase van insurance from this time two years ago. The growing number of female entrepreneurs or women working in trade professions such as plumbers and electricians is believed to be responsible for the rapid rise in 'Fem-Van' drivers.
A poll of 1,000 female van drivers by Swinton Commercial, found that 81% use the van as part of their own business and 19% drive on behalf of an employer. The survey also uncovered that the main use of the female van, or 'fem-van' was for deliveries.
Despite preconceptions, the most popular 'fem-van' colour was white (78%) followed by silver (17%) and thankfully only one female admitted to driving a pink van.
Collision repairers, insurers, and industry partners came together and took advantage of the opportunity to attend this event to learn new tools and techniques, strategies, and best practices to help drive high operational performance in their businesses.
The Conference brought industry participants together, offering each group valuable information targeted toward their specific business needs. Guest speakers inside and outside of the industry gave special presentations to help collision repairers learn about the tools and tactics they can leverage to help their operations gain a competitive edge and power the future of their business as the industry rebounds.
Claims professionals participated in informational roundtable discussions on events impacting the claims industry and shared their innovative and alternative perspectives. The Industry Parts Panel, for example, moderated by Mitchell's Vice President of Industry Relations, Greg Horn, included panelists such as Insurance Auto Auctions Senior Vice President Don Hermanek, American Honda Parts Marketing/Collision Group Assistant Manager Gary Ledoux, APU Solutions CEO Charles Lukens, Car-Part.com President Jeff Schroder; and LKQ Corporation's Vice President of Operations Rob Wagman, who discussed the current challenges of the collision parts supply and offered insight into how to overcome these obstacles. All Industry Week attendees participated in joint sessions to hear from highly-acclaimed key-note speakers, to network, and share best practices and management techniques.
Mitchell's Industry Week Conference also included the annual meeting of the Mitchell Editorial Advisory Board, a longstanding entity that has convened since 1989, to tackle the critical issues affecting both insurers and shops. Editorial Advisory Board members represent both large and small repair shops, insurers and industry organizations, all of whom are committed to improving the business performance and experience of all participants in the collision repair process.