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07/11/08
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Your Insurance News "Strategic
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and Companies in the sponsored insurance and direct marketing arenas.
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M&A / ALLIANCES / EARNINGS
/ CAPITALIZATION
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California orders Allstate to
cut homeowner rates
Thu Jul 10, 2008 2:26pm EDT
HAMILTON, Bermuda (Reuters) - Insurer Allstate
Corp will have to lower their rates on California homeowner policies by
28.5 percent making an estimated $255 million in annual savings for
consumers, the state's insurance commissioner said on Thursday.
"In today's sputtering economic environment,
people need all the help they can get just to pay the bills," Insurance
Commissioner Steve Poizner said in a statement.
Allstate spokesman Peter DeMarco, in a
statement, said the company was "disappointed" in the order but planned
to comply.
Northbrook, Illinois-based Allstate had
initially filed for a 9.3 percent increase in homeowners insurance
rates, according to Poizner's statement.
He ordered the rate reduction after an
administrative judge recommended the cut. Consumers will save an average
of $242 per policy on an annual basis, according to the statement.
The rate order follows one earlier this year,
forcing Allstate to cut its auto policy rates in California by 15.9
percent.
Allstate is the largest publicly traded U.S.
insurer of homes and autos.
(Reporting by Lilla Zuill, editing by Richard
Chang)
© Thomson Reuters 2008 All rights reserved
|
1.
Lt. Governor John Garamendi Launches a National Health Care Reform
Campaign to Keep Presidential Candidates In Check |
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LOS ANGELES –
Bolstered by nurses, doctors, labor unions, small business
owners and women’s groups, Lieutenant Governor John Garamendi
yesterday unveiled a $40 million national health care reform
campaign to hold health insurance companies accountable and
provide quality, affordable health care for every American.
Garamendi sent a strong message to the presidential candidates
to make health care reform a priority. |
"For economic
reasons, for personal reasons, for national security reasons,
the health care debate must take place in this presidential
election,” Lieutenant Governor John Garamendi said. “The private
health insurance system today is a monumental rip-off of the
American public. It is based on moving money from public
services at places like this Los Angeles County Hospital to Wall
Street.”
The health care
reform campaign starts today with $1.5 million being spent on
national television, print, and online advertising. During the
next five months, the campaign plans to spend $25 million in
paid media in 45 states. Health Care for America Now will run
the national campaign starting with a financial commitment of at
least $500,000 from each of the 13 steering committee members
and a $10 million grant from Atlantic Philanthropies in New
York. Major labor unions will also be contributing to the
campaign.
Garamendi, a
leader of universal health care reform in 1976, during the
Clinton Administration and as California’s Insurance
Commissioner, said Los Angeles is a microcosm of the national
health care crisis. Emergency rooms, he said, are closing their
doors and there is a skyrocketing rate of uninsured children and
workers. California is home to six million people without health
insurance and residents are more likely to be denied coverage
for pre-existing conditions and denied coverage at work than
most states in the nation.
“All of us are
one job, one illness away from not having health care
insurance,” Garamendi said.
Click here to
listen to Lt. Governor John Garamendi’s speech on the health
care crisis and how Presidential candidates need to be held
accountable on the issue.
Lt. Governor
John Garamendi as a national leader on health care:
Lt. Governor
John Garamendi has been a national leader on universal
healthcare reform since 1976 and during the Clinton
administration.
As a California
legislator, Garamendi authored the Rural Health Act resulting in
clinics and medical services throughout California. Garamendi
also authored the Emergency Medical Systems legislation
improving trauma and emergency services.
As California’s
Insurance Commissioner, John Garamendi held health insurance
companies accountable and issued a Priced-Out Report on health
care saying, “We’re in a death spiral. People are being priced
out of the health care system.”
The National
Campaign
Health Care for
America Now is a coalition including ACORN, AFSCME, Americans
United for Change, Campaign for America's Future, Center for
American Progress Action Fund, Center for Community Change,
MoveOn, National Education Association, National Women's Law
Center, Planned Parenthood Federation of America, SEIU, United
Food and Commercial Workers, and USAction. |
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2.
With Kennedy's Help,
Senate Passes Medicare Bill |
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By
Kim Dixon
WASHINGTON, July 9 (Reuters) - A Medicare bill opposed by the White
House won final congressional approval on Wednesday with the help of
Sen. Edward Kennedy, who returned to the Senate floor for the first time
since brain surgery last month.
With Kennedy's dramatic and surprise appearance, he and fellow Democrats
overcame a Republican procedural hurdle and, on a voice vote, passed the
measure earlier approved by the House of Representatives.
"Aye," declared a smiling Kennedy of Massachusetts -- a Democratic icon,
the party's leading liberal voice and a longtime champion of expanding
health care. Democratic as well as Republican colleagues applauded.
"Win, lose or draw, I wanted to be here. I wasn't going to take the
chance that my vote could make the difference," Kennedy said after the
vote.
The bill would cancel a scheduled 11 percent pay cut to doctors who
treat Medicare patients. It is largely funded by cutting about $13
billion in reimbursements to insurers such as UnitedHealth Group Inc (UNH.N:
) and Aetna Inc (AET.N: ) that contract with the Medicare program.
The Bush administration opposes any effort to trim payments to private
health plans. The president has said the move would limit plan choices
for seniors. But doctors and the seniors' group AARP waged an aggressive
lobbying effort to prevent the doctors' pay cut.
"This is pretty much a done deal. The president is not going to win this
fight," Ipsita Smolinski, a health care analyst with JP Morgan, said
after the Senate vote.
The White House had no comment.
Medicare is the federal health insurance program for 44 million elderly
and disabled Americans. About 10 million seniors use the private plans
known as Medicare Advantage.
Last month, an effort to clear a Republican procedural hurdle on the
bill in the 100-member Senate came up one vote short of the needed 60.
After Kennedy cast his vote to end the roadblock, nine Republicans who
had earlier opposed the measure voted for the popular election-year
bill.
Kennedy underwent surgery for removal of a malignant brain tumor on June
3. He has been undergoing chemotherapy and was not expected to return to
the Senate until at least late this month.
But in a telephone call late Tuesday with Senate Majority Leader Harry
Reid, a Nevada Democrat, Kennedy said he wanted to come back early to
help in the fight for Medicare, aides said.
Kennedy entered the Senate to a standing ovation, accompanied by his
son, Rep. Patrick Kennedy, a Rhode Island Democrat. Following behind was
presumptive Democratic presidential nominee Barack Obama, an Illinois
senator.
Tourists in the normally quiet visitors gallery rose, applauded and
cheered Kennedy, his party's leading liberal voice. Kennedy's wife,
Vicki, and niece, Caroline Kennedy Schlossberg, were among those in the
packed gallery.
The bill garnered a veto-proof majority of 69 in favor, with 30 opposed.
Republican Sen. John McCain of Arizona was the only member of the Senate
not to vote. He was campaigning as his party's presumptive presidential
nominee. He told reporters traveling with him he would have opposed the
measure.
The shares of companies that operate one lucrative version of the
Medicare Advantage program, called "fee-for-service," will be weaker on
Thursday, predicted Lehman Brother analyst Tony Clapsis.
"The big losers are certainly anyone who is playing in the private fee
for service program," Clapsis said, citing Humana Inc (HUM.N: ),
Universal American Corp (UAM.N: ) and Coventry Health Care Inc (CVH.N:
). (Additional reporting by Richard Cowan, Thomas Ferraro; Editing by
Andre Grenon/Jeffrey Benkoe)
©
Thomson Reuters 2008 All rights reserved |
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3.
A.M. Best
Comments on Potential Impact of Medicare Legislation to Health Insurers |
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OLDWICK, N.J., July 10, 2008—A.M. Best Co. expects that health
insurers will take measures to counteract the impact of the
passage of bill H.R. 6331, which would impact plans
participating in Medicare Advantage (MA). Bill H.R. 6331 has
many provisions, but the largest potential impact to private MA
plans are: the elimination of deeming on the MA Private Fee For
Service (PFFS), the elimination of Indirect Medical Education (IME)
payments, the elimination of the regional MA stabilization fund
and the extension/expansion of MA Special Needs Plans (SNP) for
chronically ill individuals.
Historically, when Congress has passed legislation that resulted in a
reduction in Medicare funding, insurers modified benefits, increased
premiums and exited markets where the program could not be profitable.
A.M. Best expects a similar impact from the passage of Bill H.R. 6331.
The
elimination of deeming on the MA PFFS would require plans to have an
established network in place by 2011. The bill exempts areas with fewer
than two network plans available. The elimination of the IME payments
is likely to impact plans with a high urban-based Medicare population
where large teaching facilities are located. The elimination of the
stabilization fund will impact regional MA plans. While this
stabilization fund already had a phase-out provision, this bill
accelerates that schedule. The extension/expansion of MA SNP for
individuals who are chronically ill will provide MA coverage and care
management to participants who are currently not part of an MA program.
A.M. Best
expects current MA insurers to evaluate the impact of these changes.
Insurers may decide to either comply as in the case of PFFS, modify
benefits/premiums to offset impact to margins, or potentially withdraw
from the program either in its entirety or from select geographic areas.
Overall MA enrollment could be impacted by the enactment of this
legislation. As in the past, insurers will evaluate whether to remain in
the program, increasing premiums could potentially force some
individuals to return to traditional Medicare and future enrollees will
evaluate the programs available and cost in electing coverage.
Individuals will also evaluate other MA plans available in their areas
before making a decision to return to traditional Medicare. While
overall the future growth rate could be lower than the recent past,
shifts could occur within companies to different coverage options or
another insurer offering a plan in the same geographic area. Individuals
may elect a Medicare Supplement plan with traditional Medicare in place
of an MA plan, which is similar to what occurred in the past. Medicare
Supplement sales have been declining due to the increased offering of MA
plans, including PFFS, and growth in Medicare Supplement sales could
occur should insurers withdraw from MA.
A.M. Best
anticipates that smaller geographically concentrated companies may elect
to opt out of the program as the potential cost impact could be too much
to bear. For larger diversified companies, modifications of their
existing products and offerings are the most likely outcome. The
financial impact upon implementation of this bill could put additional
pressure on insurers to maintain/improve profitability on the commercial
market, a segment that is already facing competitive and economic
pressures. Furthermore, the potential for consolidation among insurers
could increase as smaller companies look for alternatives.
A.M. Best’s
current outlook for the health insurance sector is stable; however, with
risks on the rise, A.M. Best may revisit its outlook for the sector in
the near term. www.ambest.com
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4.
AIA Says Bill To Establish Federal Office Of Insurance Fills Critical
Need |
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WASHINGTON, D.C.,
July 9, 2008 – Gov. Marc Racicot, president, American Insurance
Association (AIA), today applauded a U.S. House subcommittee for
advancing legislation (H.R. 5840) that would establish an Office of
Insurance Information within the Federal Government.
Gov. Racicot’s
statement follows:
“Today’s vote by the
House Subcommittee on Capitol Markets is a recognition that an immediate
need exists for federal expertise regarding the important national and
international insurance trends in today’s rapidly changing and
globalized marketplace. This office will help the U.S. Treasury analyze
the important societal role that insurance plays in the domestic economy
and will provide urgently needed leadership by the U.S. in international
insurance regulatory policy making and agreements.
“The Office of
Insurance Information could be a tremendously valuable tool for enabling
the U.S. to speak with one voice on important insurance matters and for
establishing U.S. leadership globally on developing international
standards for insurance regulation.
“We thank Rep. Paul
Kanjorski for introducing this common sense piece of legislation and for
keeping it in the forefront. We look forward to working with him and
other members to continue moving this critical piece of legislation
forward.” www.aiadc.org |
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5.
Big “I” Applauds House
Subcommittee For Action On Insurance Regulatory Reform Legislation |
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Scott/Davis NARAB legislation will benefit agents and consumers
WASHINGTON, D.C., July 9, 2008— The Independent Insurance Agents &
Brokers of America (the Big “I”) applauds House Financial Services
Capital Markets Subcommittee Chairman Paul Kanjorski and other Members
of the Subcommittee for approving legislation to modernize insurance
regulation, especially H.R. 5611, the NARAB Reform Act, which will
reform nonresident agent licensing. Along with H.R. 5611, today the
Subcommittee approved H.R. 5840, the Insurance Information Act.
“The Big ‘I’ has long supported the use of targeted federal legislation
to reform the state system of insurance regulation, and we believe that
these bills are good examples of such reform,” says Robert Rusbuldt, Big
“I” President & CEO. “The most serious regulatory challenges facing our
members are the redundant, costly and contradictory requirements that
arise when they seek licenses on a multi-state basis. The NARAB Reform
Act solves these problems through targeted reform and modernization of
nonresident agent and broker licensing without affecting resident
licensing.”
The bipartisan NARAB Reform Act, introduced by Reps. David Scott (D-Ga.)
and Geoff Davis (R-Ky.) earlier this year, would provide for nonresident
insurance agent and broker licensing while preserving the rights of
states to supervise and discipline insurance agents and brokers. This
legislation modifies the original NARAB provisions of the Gramm-Leach-Bliley
Act to immediately establish NARAB as a private, non-profit entity
managed by a board composed of insurance regulators and marketplace
representatives. The NARAB board created by this legislation would not
be part of, or report to, any federal agency and would not have any
federal regulatory power.
“We believe that this type of targeted federal legislation makes the
appropriate reforms to the marketplace and improves insurance regulation
without having to take the unprecedented path of creating a new federal
regulator,” says Charles E. Symington, Jr., Big “I” senior vice
president of government affairs.
The Big “I” is an advocate for the state system of insurance regulation
and continues to oppose federal regulation, optional or otherwise.
However, the Big “I” believes that the state system cannot appropriately
and effectively address certain problems on its own and feels that there
is a vital role for Congress to play in helping to modernize state
regulation and make it more efficient.
“As indicated by the industry and congressional support for these bills
and the Subcommittee’s action today, targeted reform is the most viable
option for insurance regulatory reform. When enacted, the NARAB bill
will result in a more efficient and effective regulatory system, which
is good for consumers,” says Symington. “The Big ‘I’ is pleased that
the Subcommittee passed these bills, and we look forward to continuing
to work with Congress on these and other targeted reform proposals.”
www.independentagent.com |
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6.
Travelers Supports
Targeted Insurance Regulatory Reform Bills Passed by House Committee |
|
SAINT PAUL, Minn.--(BUSINESS WIRE)--The Travelers Companies, Inc. (NYSE:
TRV) today announced its support for two important pieces of legislation
passed today by the Capital Markets, Insurance and Government Sponsored
Enterprises Subcommittee. The legislation is the product of the
Subcommittee leadership, Chairman Paul Kanjorski and Ranking Member
Deborah Pryce. They have been working diligently with their colleagues
in Congress to move bipartisan reform proposals.
H.R. 5840, the Insurance Information Act of 2008, creates an office
within the Department of Treasury that will serve as the principal
advisor to the President and Congress on domestic and international
insurance policy issues. This office will assist the federal government
in its understanding of the increasingly global insurance industry and
bring important uniformity to U.S. insurance international trade and
regulatory policy.
H.R. 5611, the National Association of Registered Agents and Brokers
Reform Act of 2008, builds on the successful reforms contained in the
landmark Gramm-Leach-Bliley Act of 1999 designed to provide uniformity
and standardization in agent and broker licensing. States have struggled
to enact uniform national agreements that will allow agents and brokers
who are licensed and in good standing to operate in multiple states. The
bill creates a self regulatory organization that will allow agents and
brokers who are in good standing in their home states to apply for
membership and operate in multiple states or on a national basis.
Uniform non-resident licensing reform has long been the objective of our
independent agent and broker sales force and this bill achieves that
worthy goal. From the insurer perspective, we think the concept of
facilitating producer licensing on a multi-state basis to allow them to
operate more efficiently makes good business sense.
www.travelers.com |
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7.
Allianz of America
Supports Creation of Office of Insurance Information |
|
NOVATO, Calif.--(BUSINESS WIRE)--Allianz of America is in favor of
legislation that would establish an Office of Insurance Information
within the federal government. The measure – H.R. 5840, the Insurance
Information Act of 2008 – was approved today by the House Subcommittee
on Capital Markets, Insurance, and Government Sponsored Enterprises. If
passed by Congress, it would give the United States a national insurance
voice, which is especially important for developing international
insurance policy and trade agreements. The legislation was authored by
Rep. Paul Kanjorski (D-PA).
“Representative Kanjorski should be commended for his continued interest
in insurance regulatory reform and his commitment to practical,
bipartisan solutions to get the ball rolling on how insurance is
regulated in the U.S.,” said Chuck Kavitsky, president and CEO of
Allianz of America.
Passage of the bill would create an Office of Insurance Information
within the Department of the Treasury. The new office would analyze
information and issue reports regarding all lines of insurance, except
health. It would also establish federal policy on international
insurance matters and ensure that state insurance laws are consistent
with agreements between the United States and foreign governments or
regulatory entities.
Kavitsky also praised state insurance regulators for their support of
the Kanjorski measure. State regulators have traditionally opposed bills
that create federal insurance regulation such as an Optional Federal
Charter. |
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8.
The Hartford Commends House Financial Services Subcommittee For Support
Of H.R. 5840, The Insurance Information Act of 2008 |
|
H.R. 5840 benefits consumers by establishing insurance industry
expertise within the federal government.
HARTFORD, Conn.--(BUSINESS WIRE)--The Hartford Financial Service Group,
Inc. (NYSE: HIG) commends the House Financial Services Subcommittee on
Capital Markets, Insurance, and Government Sponsored Enterprises for its
unanimous support of H.R. 5840, The Insurance Information Act of 2008.
The legislation creates an Office of Insurance Information within the
United States Department of the Treasury, providing expertise within the
federal government to advise the secretary of the Treasury and the
president on all property, casualty, and life insurance issues. The
legislation also directs the office to coordinate federal efforts and
establish federal policy on international insurance matters. The
Hartford strongly supports this legislation.
www.thehartford.com |
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9.
RIMS Supports
Legislation Moved By Insurance Subcommittee |
|
House subcommittee tackles insurance issues to promote accessibility and
affordability
NEW YORK, N.Y., July 9, 2008—The Risk and Insurance Management Society
(RIMS) endorses the legislation marked up and favorably reported by the
U.S. House of Representatives Subcommittee on Capital Markets, Insurance
and Government Sponsored Enterprises. The Insurance Information Act and
the Increasing Insurance Coverage Options for Consumers Act were hot
topics at RIMS on the Hill legislative conference where RIMS members met
with members of Congress and staff to lobby for both bills in June 2008.
The two bills are legislative priorities for insurance buyers and risk
managers.
RIMS commends subcommittee chair Paul Kanjorski, D-Penn.; ranking member
Deborah Pryce, R-Ohio; Rep. Dennis Moore, D-Kansas; and Rep. Tom
Campbell, R-Calif., for their efforts to successfully move the
legislation that would better facilitate access to affordable insurance
for commercial consumers.
H.R. 5840: the Insurance Information Act of 2008 would create a federal
office of insurance information and establish, for the first-time, a
repository for the collection and dissemination of information at the
federal level within the U.S. Department of the Treasury. Additionally,
the bill has clearly defined and strictly limited preemptive powers
applicable only if state laws conflict with United States international
trade agreements.
H.R. 5792: Increasing Insurance Coverage Options for Consumers Act of
2008 expands upon legislation passed in 1981 and 1986 to address a need
for those businesses that purchase commercial property insurance. It
expands the Liability Risk Retention Act to allow risk retention groups
to offer commercial property coverage in addition to general liability
insurance.
Both H.R. 5840 and H.R. 5792 were approved as amended unanimously and
are fast-tracked to go to the floor of the House of Representatives for
consideration without action by the Financial Services Committee.
For more information on RIMS legislative activities, visit
www.RIMS.org/LegislativeAction. |
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10.
The Council’s
Countersignature Victory Now Complete |
|
WASHINGTON – The Council of Insurance Agents & Brokers said today its
six-year legal battle to wipe all countersignature statutes off the
books is finally over, but President Ken A. Crerar served notice that
the association’s fight against protectionist barriers in the insurance
marketplace has only just begun.
The last holdout state clinging to the countersignature requirement,
Nevada, fell into The Council’s win column today, which was the deadline
for the state to file a petition of appeal with the U.S. Supreme Court
of a previous federal court ruling holding the countersignature law to
be unconstitutional. Officials from the state Department of Insurance
indicated that no appeal petition would be filed.
Countersignature laws awarded resident agents a percentage of the
commission for business placed by out-of-state brokers even though there
was no work involved, just their signature on a form. Nevada had been
unable to enforce the countersignature requirement on non-resident
brokers since April of this year. That was when the 9th Circuit Court
of Appeals in San Francisco upheld the earlier ruling in favor of The
Council by U.S. District Judge James C. Mahan, who found “no rational
basis” for the countersignature requirement.
“July 9 is the true Independence Day this year for Council members,”
Crerar said. “Although our members spent millions to eradicate these
statutes, they stand to realize millions more that will flow to their
agency’s bottom lines now that they are finally free of countersignature
commission-sharing.”
“This is the end of an absurd protectionist requirement that served only
the self interests of small protectionist agents and not their clients,”
Crerar continued. “But it also is time for this industry to look at
itself and see what else is out there that serves no purpose other than
protecting weaker operations by posing barriers to business. That
includes excess and surplus lines, anti-rebating laws and anything else
that does nothing to support our clients and everything to skew the
market.”
“This victory is the beginning,” he declared. “This isn’t the end.”
Nevada and Florida were the first states The Council sued to
eliminate countersignature requirements in 2002. U.S. District Judge
Robert Hinkle threw out the Florida statute in 2003, and The Council
then filed suit against all the remaining states and territories with
similar statutes – West Virginia, South Dakota, the U.S. Virgin Islands
and Puerto Rico – seeking a similar result.
The West Virginia legislature repealed that state’s countersignature
statues rather than seek to defend them in court, so that lawsuit was
dropped. In the other jurisdictions, U.S. District Court judges ruled
in favor of The Council’s summary judgment requests, saying the
countersignature laws were clearly unconstitutional.
The Council was represented in all the federal court cases by its
general counsel, Scott Sinder of the Washington law firm Steptoe &
Johnson.
Founded in 1913, The Council is the premier association for commercial
insurance and employee benefits intermediaries. The Council represents
the leading commercial brokers and agents in the United States and
abroad. Council members annually place 80 percent of all commercial
property/casualty premiums in the United States and administer billions
of dollars in employee benefits accounts.
www.ciab.com |
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11.
Will Insurer Ace
Limited Be Dropped From Indexes? |
|
By
Lilla Zuill
HAMILTON, Bermuda, July 9 (Reuters) - Ace Limited's plans to redomicile
to Switzerland, due to go to a shareholder vote on Thursday, have raised
questions over whether it will be able to keep its place in the S&P 500
and Russell 1000 indices, which are predominately made up of U.S.
companies.
"There is a high probability that the stock will be removed from the
Russell 1000 and a moderate probability that it could be removed from
the S&P 500," following the planned move, Citigroup analyst Joshua
Shanker said in a note on Tuesday.
The Russell Index has strict rules about which companies it can include
in its index while the S&P 500 looks at broad criteria, including how
active a company is in the United States, a significant area of business
for Ace.
"A
back of the envelope calculation suggests as many as 45 million shares
could be sold by indexers," added Shanker, who cut his price target on
Ace shares to $58 from $73.
But Goldman Sachs, in a Wednesday note, said the concern over whether
Ace would be thrown off the S&P could be "overdone". It said it was
maintaining its $70 target on the shares.
An
Ace spokesman said the company had no comment on whether its plans could
affect its index standings.
Calls for comment from the Russell Index and S&P were not immediately
returned.
Ace shares fell nearly 4 percent to $53.45 on the New York Stock
Exchange on Wednesday.
The insurer, which is incorporated in the Cayman Islands but based in
Bermuda, said earlier this year it would move its holding company to
Zurich, Switzerland in a bid to reduce reputational, political,
regulatory and financial risks.
Shareholders will vote on the planned move at its annual meeting in
Bermuda, which begins Thursday and is expected to wrap up on Monday.
Ace sells a broad range of insurance coverage mostly to commercial
customers around the globe. It was founded in Bermuda, a leading
offshore insurance center, more than two decades ago. (Editing by Leslie
Gevirtz)
© Thomson Reuters 2008 All rights reserved |
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12.
J.D. Power and
Associates Reports: Erie Ranks Highest in New Buyer Satisfaction With
the Auto Insurance Purchase Experience |
|
Although Satisfaction is Higher When a Local Agent is Involved, More
Buyers are Purchasing New Policies via Direct Channels
WESTLAKE VILLAGE, Calif., July 10 /PRNewswire/ -- Erie ranks highest
among 18 major auto insurance companies in satisfying new buyers with
the purchase experience, according to the J.D. Power and Associates 2008
Insurance New Buyer Study(SM) released today.
The study examines the purchase behaviors and overall satisfaction of
buyers who shop for a new auto insurance company. Three key factors are
measured to determine overall satisfaction. In order of importance, they
are: distribution channel (50%), price (29%) and policy offerings
(21%).
Erie ranks highest in the study with a score of 896 on a 1,000-point
scale, performing particularly well in the price factor. The Hartford
closely follows Erie in the rankings (894), while State Farm ranks third
overall (893). State Farm performs particularly well in both the
distribution channel and policy offerings factors. USAA, a financial
services provider open only to the U.S. military community and their
families, and therefore not included in the rankings, also achieves a
high level of customer satisfaction.
The 2008 Insurance New Buyer Study is based on responses from 8,452
consumers who requested an auto insurance price quote from at least one
competitive insurer in the past 12 months and includes evaluations of
17,677 unique carrier quotes. The study was fielded in April 2008. To
download a copy of the 2008 Insurance New Buyer Study Management
Discussion, go to:
http://www.jdpower.com/corporate/library/download/?files=9998902. To
view a video on the 2008 Insurance New Buyer Study, go to:
http://www.jdpower.com/corporate/news/releases/pressrelease.aspx?ID=2008084
Customer Satisfaction Index Ranking
Based on a 1,000-point scale
Insurance Provider Overall Satisfaction Score Power Circle
Rating
Erie 896 5
The Hartford 894 5
State Farm 893 5
Liberty Mutual 886 4
American Family 880 4
GEICO 876 4
Nationwide 875 3
MetLife 873 3
Automobile Club Group 867 3
Industry Average 867 3
Allstate 863 3
Esurance 860 3
Safeco 855 3
Travelers 855 3
Farmers 849 2
Progressive 844 2
AIG 840 2
Mercury 835 2
Automobile Club of Southern California 808 2
*USAA 922 5
*USAA is an insurance provider open only to U.S. military personnel and
their families and therefore is not included in the rankings.
Included in the study but not ranked due to small sample size are: Amica
Mutual, Auto-Owners, California State Automobile Association, COUNTRY,
Encompass and GMAC.
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13.
U.S. Safety and
Mobility Crisis Looms for Aging Baby Boomers, AAA Foundation Warns |
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Licensing and Alternative Transportation Not Prepared for Aging Drivers
Surge
WASHINGTON--(BUSINESS WIRE)--By 2025, people aged 65 and older will
account for 25 percent of U.S. drivers, yet state licensing systems and
mobility alternatives for older drivers for the most part are inadequate
and inconsistent, the AAA Foundation for Traffic Safety warns. Issued
today, the AAA Foundation report notes seniors and their families face
serious challenges in maintaining personal mobility, including
determining whether they remain capable of safely operating a motor
vehicle, whether their driving can be improved, or — if unable to drive
safely — how they can continue to be mobile.
To
address the complex challenges presented by an aging population of
motorists, the AAA Foundation brought together a cross section of top
transportation and health experts from federal and state governments,
insurance industry, medical profession, universities and advocates for
the elderly. The workshop proceedings detail specific recommendations to
improve licensing systems, including encouraging voluntary reporting of
potentially dangerous drivers by health care professionals and others,
expanding the use of medical advisory boards, and enhancing the training
and education for everyone involved in identifying and protecting
high-risk drivers.
“When you hear the thunder, it’s too late to build the ark, yet states
are not doing enough to prepare for the flood of older drivers that will
be behind the wheel in the coming years,” AAA Foundation President and
CEO Peter Kissinger said. “Nobody should have their car keys taken away
simply because they reach a certain age. Instead, states should screen
all drivers applying for new or renewed licenses to ensure they are
medically and functionally fit to drive through procedures like eye
exams and in-person renewal – but that is not happening. If remedies
aren’t put in place today, we can expect a significant rise in highway
safety deaths in the years ahead. That should concern all of us, young
and old alike.”
Organizations such as the American Association of Motor Vehicle
Administrators (AAMVA) and others have begun the hard work of developing
strategies, like model driver screening procedures, to help motorists
continue driving for as long as safely possible. And the AAA Foundation
believes a continued focus and increased action, in addition to what is
already being done, is needed to ensure consistency across all 50
states. Therefore, with the aid of its panel of experts, the AAA
Foundation outlined specific actions that states and licensing agencies
should be taking today, including:
--
Licensing:
--
Base licensing decisions on functional performance and medical fitness
to safely operate a motor vehicle, as measured objectively through
systematic screening and assessment.
--
Standardized training:
--
Ensure consistent education and training for clinicians, licensing
personnel and law enforcement to teach them about existing laws,
regulations, and proper procedures for reporting medically or
functionally unfit drivers.
--
Recruitment:
--
Increase the number of qualified people who can provide comprehensive
driver testing and rehabilitation services.
--
Mobility Alternatives:
--
Encourage communities to increase the availability of affordable
alternative transportation options and work with DMVs to centrally
collect this information and make it readily available to the public.
The report also notes a significant lack of comprehensiveness and
consistency in medical advisory boards (MABs). Fourteen states lack any
type of MAB. As such, the report recommends that all states establish
and fund active MABs to conduct individual case reviews and provide
input to policy development. For those states that already have MABs,
they should be enhanced by providing greater incentives for physician
participation. Beyond the creation of MABs, state licensing policies and
practices should put into place standard reporting laws that provide
civil immunity for clinicians, law enforcement, and licensing personnel
who report people they believe may be medically unfit to drive.
Older drivers and their caregivers can find helpful information to deal
with the very personal and difficult nature of addressing challenges
related to senior driving at www.SeniorDrivers.org. For a copy of the
full report, 2008 License Policies Workshop Proceedings please visit
www.AAAFoundation.org.
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14.
Bank of America CEO:
Recession "feel" may last year |
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By
Jonathan Stempel
NEW YORK (Reuters) - Bank of America Corp (BAC.N: ) Chief Executive
Kenneth Lewis has offered a gloomy outlook for U.S. consumer and
business sentiment, saying some people may feel as if the economy is in
recession for the next year.
"I
think we'll start a gradual recovery toward the middle of next year,"
Lewis, who heads the nation's largest retail bank, said in a speech on
Wednesday in Los Angeles. "Until then, depending on what sector of the
economy you're in, it will feel slow and may feel like a recession."
Lewis nevertheless said poor economic sentiment would not weigh on
operations so much that the Charlotte, North Carolina- based bank need
consider raising dilutive capital or cutting its dividend, as have many
smaller rivals.
"I
can only say what I've said in the past -- we have no reason to cut the
dividend and raise any capital," he said in response to an audience
question.
The bank's dividend yield is above 11 percent.
Bank of America shares closed on Wednesday down $1.48, or 6.29 percent,
at $22.06 amid a broad decline in banking shares. They rose to $22.80 in
after-hours trading after Lewis discussed the bank's capital needs.
Lewis spoke near the former home of Countrywide Financial Corp, which
was the largest U.S. mortgage lender before Bank of America acquired it
last week in a $2.5 billion rescue.
Lewis said borrowers will remain cautious, pinched by $4 a gallon
gasoline, soaring food costs, and plunging housing prices, including
declines of nearly 30 percent in California.
In
the first quarter the economy grew at a 1 percent annual rate. Lewis
expects similarly weak second-quarter growth.
On
Tuesday, the chief executive of another major U.S. retail bank, JPMorgan
Chase & Co's (JPM.N: ) Jamie Dimon, said market conditions "could
actually get worse."
Meanwhile, billionaire Warren Buffett has said several times this year
the economy is in recession, which he defined as when people and
businesses do less well than several months earlier.
Lewis said Bank of America expects to work out at least $40 billion in
home loans in the next two years to help some 265,000 borrowers avoid
foreclosure.
Analysts expect the bank to post a fourth straight decline in quarterly
earnings on July 21 as credit losses rise.
Analysts look for Bank of America to report second-quarter profit,
excluding items, of about $2.9 billion, or 64 cents per share, Reuters
Estimates said. Profit on that basis was $1.30 per share a year earlier.
(Additional reporting by Jennifer Martinez in Los Angeles; Editing by
Jeffrey Benkoe and Andre Grenon)
©
Thomson Reuters 2008 All rights reserved |
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15.
Wall Street Happens To
Like Fair Value Accounting |
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By
Rachelle Younglai
WASHINGTON, July 9 (Reuters) - Accounting rules that require companies
to value hard-to-price assets at current prices are favored by investors
and big banks even though critics complain that this has exacerbated the
credit crisis.
"Fair value" or "mark to market" accounting methods are used for the
hardest-to-value assets such as mortgage-backed securities. The rule is
a way of accounting for assets and liabilities based on how much they
are currently worth as opposed to using historical values.
"It provides the most complete information, the most reliable and says a
lot about the firm's risk management," Kurt Schacht, managing director
with the CFA Institute, said on Wednesday at a Securities and Exchange
Commission meeting to examine fair value accounting.
But now that the credit markets are tight, fair value accounting has
been blamed for contributing to the credit crisis by forcing companies
to use complex methods to value assets where there is little trading to
set market prices.
Nevertheless, investors have embraced fair value and say it allows them
to truly see what's on the balance sheet and helps them understand which
assets are under stress.
Matthew Schroeder, managing director at investment bank Goldman Sachs
(GS.N: ), supported the accounting rule and said when market illiquidity
"just means you have to work harder."
"I
don't think we have an alternative (to fair value)," he said. (Editing by Braden Reddall)
©
Thomson Reuters 2008 All rights reserved |
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16.
Annuityspecs.com
Provides Central Resource for News on SEC’s Proposed Rule 151A |
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AnnuitySpecs.com, the insurance industry’s one-stop shop for all
information pertaining to Indexed Annuities, has formed a central
resource for all news pertaining to the SEC’s proposed Rule 151A. On
Wednesday, June 25th 2008 the Securities and Exchange Commission (SEC)
proposed a rule (Rule 151A) that would change the securities status of
Indexed Annuities from fixed insurance products to registered,
securities products. There is a formal comment period that will extend
until September 10th, 2008. During that time, interested parties have
the opportunity to comment to the SEC on their own position on this
matter. After the formal comment period, the SEC will make their
decision and possibly change the securities status of the now fixed
insurance products. Once the decision is made, there will be a one-year
period until the decision is final.
www.annuityspecs.com |
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17.
Local Fire Company To
Receive Grant For Critical Safety Equipment
|
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New Protective Gear Is Vital Component in Protection of Firefighters
During Emergency Incidents
MALANAPAN, N.J. (July 10, 2008) – It is the most important equipment a
firefighter needs when responding to an emergency and now Gordons Corner
Fire Company will be receiving several of the newest, most effective
models.
Englishtown-based Brooks Insurance Agency, Inc. is partnering with
Fireman’s Fund Insurance Company to award an $8,954 grant to the Gordons
Corner Fire Company for new sets of turnout gear (jacket, pants, boots
and helmet).
www.firemansfund.com. |
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18.
INSURANCE NEWSCAST "Pictures Of The Day"
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U.S. can't rule out al Qaeda in Istanbul attack.
The flag-draped coffins of three slain police officers are carried by
their colleagues during a funeral ceremony at the police headquarters in
Istanbul July 10, 2008. REUTERS/Fatih Saribas
Read Entire Story!!!
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Dutch court rejects bid to sue UN over
Srebrenica. A Bosnian Muslim woman looks at coffins containing the
remains of her family members inside Potocari memorial cemetery July 10,
2008. The remains of her relatives will be buried during a funeral
ceremony for the victims of the 1995 Srebrenica massacre on Friday. The
Bosnian Serb forces slaughtered some 8,000 Bosnian Muslim men and boys
after the former United Nations "safe zone" fell into their hands in
1995. REUTERS/Nikola Solic (BOSNIA AND HERZEGOVINA)
Read Entire Story!!!
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Dow Chemical to buy Rohm and Haas for $18.8 bln.
A view of the Rohm and Haas booth at the American Coatings Show (ACS in
Charlotte, North Carolina, June 3, 2008. REUTERS/Handout
Read Entire Story!!!
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Top Democrat may back new offshore drilling:
report. An offshore oil platform is seen in the Gulf of Mexico in a file
photo. REUTERS/Jessica Rinaldi
Read Entire Story!!!
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Georgia's President Mikheil Saakashvili (R) and
U.S. Secretary of State Condoleezza Rice take part in a joint news
conference after their meeting in Tbilisi July 10, 2008. Rice on
Thursday called on Russia to help resolve tension in Georgia's rebel
regions rather than contributing to it and demanded an end to violence
in the regions. REUTERS/David Mdzinarishvili (GEORGIA)
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Jesse Jackson: Obama "talking down" to blacks. A
combination image showing Democratic presidential candidate Barack Obama
(L) and Rev. Jesse Jackson. REUTERS/Chip East (R)/Tami Chappell (L)
Read Entire Story!!!
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Britain's Prince William (C) returns to his ship
HMS Iron Duke after taking part in a disaster relief rehearsal on the
island of Monserrat, July 7, 2008. REUTERS/John Stillwell/pool
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U.S. Treasury Secretary Henry Paulson (L) rubs
his eyes as he and U.S. Federal Reserve Board Chairman Ben Bernanke (R)
testify at a hearing of the House Financial Services Committee on
Capitol Hill in Washington July 10, 2008. REUTERS/Jonathan Ernst (UNITED
STATES)
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A herd of elephants walk near the Nadlimanskoye
settlement outside the Ukrainian Black Sea port of Odessa July 10, 2008.
Employees of the city zoo take their elephants out for walks several
days a year. REUTERS/Yevgeny Volokin (UKRAINE)
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A girl wades through a flooded area past stacked
tombs in a cemetery inhabited by informal settlers in Navotas, Metro
Manila, July 10, 2008. REUTERS/John Javellana (PHILIPPINES)
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