The people and organizations involved in the sales and service of Workplace Benefits have a premier opportunity to network and learn at the Workplace Benefits Renaissance Meeting to be held on the corner of Bourbon and Canal Street in the heart of the French Quarter at the Astor Crowne Plaza Hotel, New Orleans, La. The dates are February 13, 14, & 15, 2007. This will be the 10th Benefits Renaissance Meeting, but the first under the “Workplace Benefits Association” label. Expected attendance is 125 of the leading Workplace Benefit vendors and 800 total workplace benefit consultants. The Members of the Workplace Benefits Association strive to bring an integrated solution through a master plan that involves a standardized employer guide and checklist. This procedure ensures that no important area is overlooked while providing the flexibility for each employer and employee to create an individual solution to their benefits and financial planning. (Proviso - The Workplace Benefits Association does not sell workplace benefits and is not in the business of offering advice) www.workplacebenefits.org Daily Quote: "To win you've got to stay in the game." - - Claude M. Bristol
1. INSURANCE COMMISSIONER JOHN GARAMENDI ANNOUNCES SETTLEMENT WITH PRUDENTIAL INSURANCE TO END PAYMENT OF UNDISCLOSED COMMISSIONS AND SERVICE FEES FOR EMPLOYEE BENEFIT GROUP INSURANCE COVERAGE The agreement calls for full disclosure of all commissions and other compensation in connection with group life, accidental death and dismemberment, long and short term disability, health (including long-term care), dental, vision and/or related group insurance coverage. SACRAMENTO – Insurance Commissioner John Garamendi on Tuesday announced that he has reached a settlement with Prudential Insurance Company of America to ensure that all compensation it pays to brokers will be disclosed to consumers. The settlement is the second such agreement he has reached related to the alleged abusive practices. “Prudential should be commended for following the example set by UnumProvident and agreeing to do what is right for California employers and employees,” said Commissioner Garamendi. “This settlement is recognition that brokers, agents and insurers owe their clients truth and honesty in their dealings and I encourage other carriers to follow this example.” The settlement is the latest step in the Commissioner’s continuing investigations and litigation into secret “contingent commissions” and related steering activities. It follows the earlier settlement with insurer UnumProvident. The Commissioner’s pending case, The People of the State of California by and through John Garamendi v. Universal Life Resources, Case No. GIC838913 (Cal. Super. Ct. San Diego), continues against defendants Metropolitan Life Insurance Company, Life Insurance Company of North America, Connecticut General Life Insurance, CIGNA Healthcare of California, Inc., CIGNA Dental Health of California, Inc., Hartford Financial Services Group Inc., Hartford Life and Accident Insurance Company, and Hartford Life Insurance Company. Among the notable terms of the agreement:
Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 2. UPDATE on Prudential Financial Settlements in Group Insurance Regulatory Investigations NEWARK, N.J.--(BUSINESS WIRE)--Prudential Financial, Inc. (NYSE: PRU) wishes to issue the following update to its release BW5709 (NJ-PRUDENTIAL)(PRU) Prudential Financial Settlement in Group Insurance Regulatory Investigation issued earlier Tuesday: Prudential Financial, Inc. (NYSE: PRU) confirmed today that its subsidiary, The Prudential Insurance Company of America, has reached separate settlements with the New York Attorney General and California Department of Insurance in connection with their investigations into regulatory matters involving its Group insurance business. Under the terms of the settlement with the NY Attorney General, the company agreed to pay $2.5 million as a penalty to the State of New York and $16.5 million into a fund to be paid to certain group insurance policyholders, and to make changes to its business practices. The separate settlement with the California Department of Insurance requires changes to business practices but no fines or remediation. Prudential cooperated with the authorities throughout the process and voluntarily implemented procedures for the disclosure of contingent commissions retroactive to January 2004. Under the terms of the New York settlement agreement, Prudential has also agreed to discontinue paying contingent commissions. The settlements resolve these investigations and are in the best interest of Prudential and its policyholders. www.prudential.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 3. More than One-Fifth of all American Retirees Forced into Retirement Earlier than Planned Sun Life Financial Survey Finds Layoffs, Illness, Injury and Family Obligations Can Necessitate Retirement Years Before Retirees Are Financially Prepared Wellesley, MA [Dec. 13, 2006] – Not only are many Americans financially unprepared for retirement, but a recent survey by Sun Life Financial (NYSE: SLF, TSX: SLF) of individuals forced to retire reveals that 22% of all retirees are forced into retirement several years before they had anticipated. The forced retirements have not only left retirees well short of their financial goals, but 69% of respondents also stated their overall retirement plans have been affected either a great deal or somewhat, requiring them to reduce expenses and change their lifestyles to adjust to their new status. Moreover, 55% of all respondents also say they were ineligible for Social Security benefits when they were forced to leave the workforce. “Not only are Americans not saving enough for their planned retirement, but our survey found that more than one in five will retire an average of eight years before they expected,” said Mary Fay, Vice President & General Manager, Annuities of Sun Life Assurance Company of Canada (U.S.). “Pre-retirees and Baby Boomers need to re-evaluate their retirement plans and prepare a contingency plan in case they are forced to undergo an unplanned retirement.” Sun Life Financial has posted an executive summary of the survey and graphics with the survey findings for viewing and downloads. Sun Life Financial’s survey on forced retirement also revealed the following: Impact of Forced Retirement Sixty-nine percent of all respondents said that forced retirement has affected their retirement plans. The response was highest for those under 55 years old, with 77% stating their retirement plans were impacted “a great deal” (57%) or “somewhat” (20%). Those with assets of less than $250,000 also said the forced retirement affected their plans “a great deal” (42%) or “somewhat” (34%). Slightly older respondents aged 55-64 were also affected by forced retirement, with 39% stating their retirement plans were affected “somewhat” and 33% claiming they were impacted “a great deal.” Seventy percent of the mass affluent, with liquid assets between $250,000 and $750,000, also said their retirement plans were affected. Respondents forced into retirement reported needing to make numerous lifestyle and financial adjustments to address the shortfall in anticipated earnings. These include Reduction in Expenses (61%), fewer vacations and social activities (47%), Collecting Social Security before they wanted to (43%) and Using Money from a 401(k) or IRA (30%). Healthcare insurance for themselves and/or their spouses was most cited as the financial obligation to be currently addressed beyond normal living expenses, with 53% of respondents aged 65 and older citing this obligation as most pressing. Causes of Forced Retirement The leading causes of forced retirement were Layoffs/Downsizing (44%), Personal Illness (32%) and Injury (14%). A higher percentage of women cited Family Obligations (10%) as a retirement cause compared to men (2%). Respondents 65 years old and older were more likely to cite Layoffs/Downsizing (58%) as the primary reason for having to retire earlier than planned, while respondents under age 55 were more likely to name Personal Illness (46%) or Injury (26%) as the cause. Retirement Age and Preparedness Of those surveyed, the average expected retirement age was approximately 64 regardless of respondent’s current age, and respondents were forced to retire on average approximately eight years earlier than expected. However, large differences exist between those who were prepared and unprepared for retirement. On average, those who were financially prepared for retirement when they were forced to leave work had expected to work for another 4.9 years, while those who were financially unprepared for retirement expected to be employed for another 11.4 years. Financial Preparedness The average respondent planned on accumulating approximately $1 million in retirement savings, but had accumulated only about half of that amount when they were forced to retire. The gap was most prevalent with respondents under the age of 55, who expected to retire with an average of $1.4 million in savings but only had $314,000 when forced into retirement. “It appears that unanticipated, forced retirement is occurring at an alarming rate, leaving the impacted retirees unprepared,” said Fay. “The survey findings reinforce the importance of pre-retirees to reassess their long-term financial plans and work with a financial advisor to prepare a ‘rainy day’ scenario to ensure they are protected in case the unexpected occurs.” www.sunlife.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 4. RMS PUBLISHES ASSESSMENT OF FUTURE FLOOD RISK IN NEW ORLEANS Stakeholders Urged to Consider Analysis of Future Risk Factors as Crucial for City Redevelopment Newark, Calif. - December 4, 2006 - Risk Management Solutions (RMS) today released an extensive report on the future flood risk faced by the city of New Orleans due to hurricane storm surges. The report, Flood Risk in New Orleans: Implications for Future Management and Insurability, outlines the ongoing threat of flood risk due to future hurricane storm surges and considers the role of insurance, the planning process, and the government in providing physical and economic protection so those living and investing in the city can have confidence that the risk is being effectively managed. In framing the debate for New Orleans' future, the report signals to those who hold a stake in the future of New Orleans, including the policy makers who are responsible for its safety and prosperity, that they must plan for a future that will undoubtedly be more hazardous than in the past. The report concludes that the threat of flooding in the city continues to increase due to a combination of three physical temporal factors: As a result of its location on thick recent delta sediments along the edge of an oceanic basin, the city is sinking at geologically rapid rates Over the last decade, global sea level rise has increased as a result of climate change and is predicted to accelerate into the future The level of Atlantic basin hurricane activity has risen, with the biggest increases for the strongest storms, particularly in and around the Gulf of Mexico These factors all serve to increase the storm surge flood hazard faced by New Orleans, and will significantly raise the risk of flooding in the city through the 21st century. "While this report concerns a single city along the U.S. Gulf Coast, the devastation caused by storm surge and flooding in New Orleans can be seen as a parable of our time," stated Hemant Shah, president and CEO of RMS. "These problems are shared by many cities along the U.S. Atlantic and Gulf Coasts, as well as other coastal cities around the world that face similar risks due to rising sea levels and increasing storm intensity associated with climate change." The report illustrates how the risk analysis involved in assessing insurability can be a useful tool for policy makers concerned with determining acceptable levels of risk. In addition, the use of catastrophe models to quantify the risk allows the individual components of risk (hazard, exposure, vulnerability) to be separated, so that uncertainties are explored along with alternative strategies for risk mitigation. "New Orleans has the opportunity to pioneer solutions that maintain the viability of the city while at the same time ensuring that risk to the city's citizens and businesses is maintained below acceptable and published thresholds," said Robert Muir-Wood, chief research officer of RMS. "As the leading independent provider of global risk information, RMS will be working to ensure that probabilistic risk analytics continue to remain at the heart of decisions about development, flood protection, and economic viability." www.rms.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 5. U.S. Tort Costs Total $261 Billion in 2005, According to Tillinghast Study Growth Rate for Tort Costs is the Smallest since 1997 STAMFORD, Conn.--(BUSINESS WIRE)--U.S. tort costs totaled $261 billion in 2005, which is approximately $880 per person and $4 less per person than in 2004, according to the 2006 Update on U.S. Tort Cost Trends from the Tillinghast business of Towers Perrin. The growth rate of tort costs in 2005 was 0.5%, which is significantly lower than the growth rate of 5.7% in 2004 and 5.5% in 2003. The $1.1 billion increase over tort costs in 2004 is the smallest since 1997. The 2006 Update analyzes U.S. tort costs from 1950 through 2005, with projections through 2008. The 0.5% rate of growth in tort costs was less than the overall U.S. economic growth (as measured by gross domestic product — GDP) of 6.3%. Since 1950, growth in tort costs has exceeded growth in GDP by an average of 2 to 3%. However, over the last 20 years, the ratio of tort costs to GDP has stayed within a relatively narrow range, at approximately 2%. “It’s difficult to say whether tort reform measures have impacted this slow down in tort costs growth,” said Russ Sutter, Principal. “We have yet to see what, if any, impact the class action reform legislation that was passed in February 2005 will have on future class action claims – as well as whether the newly elected Democratic Congress will have an impact. What has certainly had an impact on tort costs trends has been the decade-plus decline in auto accident frequency, as the basic auto accident is the single largest portion of U.S. tort costs.” U.S. tort costs growth since 1950 far exceeds U.S. population growth. Even after adjusting for inflation, tort costs per capita have risen by a factor of more than nine between 1950 and 2005; but, inflation-adjusted tort costs per capita were lower in 2005 than in 2003 and 2004. “The findings have shown that the trend toward more moderate increases in tort costs appears to be holding in 2006; however, continued lawsuits in the pharmaceuticals industry and obesity-related litigation, as well as asbestos claims and the backdating of options in U.S. corporations have the potential to change things going forward,” said Sutter. The report is available at www.towersperrin.com/tillinghast. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article
6. Swiss Re Executives Note Current Economic Conditions and Present Economic Analysis of Terrorism Risk Insurance NEW YORK, Dec. 12 /PRNewswire/ -- Swiss Re sees growth opportunities in the US insurance industry as risks are becoming more complex. That is the message from leading experts at Swiss Re. The Company's annual year-end economic and insurance industry review and outlook addressed the current reinsurance landscape and offered an economic analysis of the Terrorism Risk Insurance Act (TRIA). The event was hosted by Weldon Wilson, CEO of Life & Health North America and Global Admin Re. Wilson was one of several Swiss Re executives who discussed the state of the property & casualty and life & health reinsurance industries, TRIA and the overall US economy. Kurt Karl, Head of Economic Research & Consulting, North America, expanded on the current state of the US economy, saying that "The insurance industry needs to maintain underwriting discipline in an environment of potentially lower investment returns." Roger Ferguson, Swiss Re's Head of Financial Services, addressed the impact that TRIA has had on the US economy. Ferguson took an economist's views of the insurance markets and the implications for the insurability of terrorism risk, stating that "Asymmetrical and ambiguous information increases potential for market failure. We need to increase the body of knowledge about terror attacks. More importantly, we need to focus on public-private partnerships. Counter-terrorism policies, international cooperation and crisis management can reduce the risks associated with global terrorism." According to Ferguson, "An explicit government terrorism risk backstop would offer many advantages and a broader sharing of this kind of risk would also make lower premium rates possible, thereby reducing the threat of bankruptcy." Pierre Ozendo, Swiss Re's CEO, Americas Property & Casualty, focused on the insurance industry's recovery after the severe hurricane seasons of 2004 and 2005. Ozendo said, "The 2006 cat season has been shaping up as much better given the dearth of hurricanes. Combined ratios are down and investment yields and ROE have increased this year." "Despite the recovery from the 04 and 05 seasons and the benign season this year, we have to remain disciplined in our underwriting in order to reduce earnings volatility and establish stability in the industry as a whole," Ozendo said. "We also need to evaluate new ways to bridge capital and risk - securitization being a key practice that has been growing across the life and non-life areas alike. By August 25th of this year, USD 23 billion worldwide in reinsurance capacity was provided through outstanding ILS, with USD 8 billion in cat bonds and the remainder linked to life risks." Donna Kinnaird, President, Life & Health North America, brought perspective on the life and health market. She noted, "Direct insurance premiums are growing again in 2006, with demand moderating for mortality protection but accelerating for asset accumulation products. Product innovation has become a key driver for both direct companies and reinsurers. New direct products provide various retirement protection, guarantees and living care riders. Direct insurance companies continue to increase the amount of risks they retain and are moving from coinsurance to yearly renewable terms." Kinnaird also provided an insight regarding capital market transactions and direct insurance industry consolidation. "The increased availability of risk capital is accelerating consolidation and spin-off activities," she explained. "We are also seeing an increasing number of capital market transactions by both direct companies and reinsurers. We expect this trend to grow even more in the future years as companies access the capital markets to transfer risks and harvest embedded values." All presentations from the event, along with information about the speakers and other relevant documents and publications, are available on http://www.swissre.com. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 7. RESEARCH ALERT-Goldman cuts UK banks, insurance sectors Dec 13 (Reuters) - Goldman Sachs downgraded the UK banks, insurance, capital goods and pharmaceuticals sectors, while upgrading the telecoms, tobacco sectors and food producers. The brokerage cut its ratings on the banks sector to "underweight" and lowered pharmaceuticals, insurance and capital goods to "neutral". It upgraded the telecoms and tobacco sectors to "overweight" and raised food producers to "neutral". In a note, Goldman Sachs said complacency over the macro outlook leaves the UK market vulnerable to changing macro conditions, particularly as the dynamics of the market have changed in recent years. Since the 2003 trough, the UK market has fallen by an average of 5 percent during the four modest setbacks within the bull market, it said. The brokerage said it would see any correction as a buying opportunity in the UK market. Goldman Sachs said valuation continues to look very supportive for UK equities, particularly versus other asset classes. It forecast a 9 percent earnings growth in 2007. The brokerage said for 2007, it would favour undervalued growth, highlight potential leveraged buyout candidates and be cautious of stocks with high currency risk and exposure to a slowing U.S. consumer. (Reporting by Renu Pariyadath in Bangalore) © Reuters 2006. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 8. Wall Street eyes heart of darkness: global warming By Peter Bohan - CHICAGO, Dec 13 (Reuters) - The topic of the conference was climate change and the rhetoric was sobering, haunted by scientific projections of a roasted world for our children and a looming environmental disaster of Biblical proportions. But this was no talk shop of environmental activists. It was a meeting of Wall Street investors, insurance executives, state treasurers and pension fund managers, who between them manage about $3.7 trillion in assets. "The insurance industry has historically taken on social issues. I know of no social issue that is bigger than this one," said Tim Wagner, director of insurance for the state of Nebraska. The consensus of Wagner and others addressing the conference of the Investor Network on Climate Risk (INCR) was that institutional investors are still too near-sighted to factor climate change into their investment decisions. While there will be costs to the U.S. economy from climate change, the problem for Wall Street is that those costs are unknown and in the future. Many drew a parallel to the asbestos and tobacco industries, which were hit by lawsuits after the fact. Richard Sandor, head of the Chicago Climate Exchange, said it was up to every institutional investor to push companies to evaluate and estimate their climate risk. Investors need to do so for three reasons: financial risk from liabilities, investing opportunity in "green" technologies and rising public concern, said Win Neuger, chief executive at AIG Global Investment Group, a unit of insurance company American International Group Inc. (AIG.N: ). STORM DAMAGE For insurance companies, climate risks are already center stage following Hurricane Katrina, which caused about $125 billion in damage in 2005, with $45 billion covered by private insurers. Nebraska's Wagner estimated that Hurricane Andrew, which damaged or destroyed 125,000 homes from Florida to Louisiana in 1992, would cause $150 billion in damage if it hit Miami today -- one-third of the U.S. property and casualty insurance industry's capital base of about $450 billion. "Insurance availability will be an issue. Insurance affordability will be an issue," said Wagner, who heads the National Association of Insurance Commissioners' task force on climate change. Some $2 trillion in real estate was at risk from future storms in coastal communities of Florida alone, he said. "The increasing scientific consensus is that this represents a trend beyond natural variability and a likely increase for the future," said Gary Guzy of Marsh USA, a unit of insurance broker Marsh & McLennan Cos. (MMC.N: ). © Reuters 2006. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 9. Axis founding investor to sell 3 million shares NEW YORK, Dec 13 (Reuters) - Axis Capital Holdings Ltd. (AXS.N: ) said a private equity fund that is one of its founding investors will sell 3 million shares. Trident II, L.P. and related companies will sell the stake, or about 2 percent of Axis' outstanding shares, in a block trade to public investors, Axis said in a statement issued after markets closed on Tuesday. Trident will receive all net proceeds from the sale, which would be valued at about $103.8 million based on Axis' Tuesday closing price of $34.60 on the New York Stock Exchange. Axis shares fell 37 cents, or 1.1 percent, to $34.23 in Wednesday morning trading. Citigroup Corporate and Investment Banking will be the underwriter in the offering. Stone Point Capital, formerly the private equity arm of insurance broker Marsh & McLennan Cos. Inc. (MMC.N: ), manages the Trident Funds and has raised more than $3 billion for investments in insurance, employee benefits and financial services. Trident was a lead investor in Axis when it was formed in 2001.The private equity fund has been reducing its stake in Axis since 2005. Trident and its affiliates own about 15 percent of the Bermuda-based insurer, a source close to the company said, or 8.3 million common shares and 17 million Axis warrants. Stone Point's Trident funds and its predecessor companies have been investing in the Bermuda insurance market for more than two decades, having started by backing reinsurers Ace Limited (ACE.N: ) and XL Capital (XL.N: ). In April, private equity investors led by Stone Point established Bermuda-based Paris Re to take over the reinsurance business of French insurer Axa (AXAF.PA: ). In late 2005, the group led formation of Harbor Point, a $1.5 billion reinsurer formed to take over the reinsurance business of Chubb Corp. (CB.N: ). © Reuters 2006. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 10. Australia's QBE says to buy Praetorian for $800 mln SYDNEY, Dec 13 (Reuters) - Australia's QBE Insurance Group Ltd. (QBE.AX: ), said on Wednesday it has agreed to buy Praetorian Financial Group (PFG) for $800 million from German reinsurer Hannover Re (HNRGn.DE: ) and upgraded its 2006 profit forecast. The acquisition will add $1.4 billion to gross premium income on an annualised basis, QBE said. QBE, Australia's top insurer by premium income, said it expected profit after tax to be up around 30 percent in 2006 over last year, while its insurance profit would be around 20 percent of net earned premium. "They've acquired it for quite a reasonable price and it's a chunky acquisition," ABN AMRO analyst Graeme Petroni said, adding the profit upgrade was in line with market expectations. Before Wednesday's upgrade, analysts on average pegged QBE's annual net profit at around A$1.433 billion ($1.13 billion) for calendar 2006. "The significant improvement in profit outlook is due to better-than-expected market conditions and lower large losses and catastrophes for 2006 to date," Frank O'Halloran, QBE's chief executive said in a statement. QBE had previously forecast a profit after tax rise of 15 percent, and had provided guidance for insurance profit margins of 17 to 18 percent. The deal was subject to regulatory approvals, QBE said New York-based PFG writes 37 specialist property and casualty insurance programmes through various managing agents and specialist retail agency business through brokers. PFG was created by Hannover Re in 2005. ($1=A$1.27) © Reuters 2006. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 11. Hannover Re sees use for cash after unit sale FRANKFURT, Dec 13 (Reuters) - German reinsurer Hannover Re (HNRGn.DE: ) said it would use the cash freed up by the sale of U.S. unit Praetorian to assume more lucrative reinsurance risks, which could boost its 2007 returns. Shares in the world's fourth-largest reinsurer rose on Wednesday after it said the sale of Praetorian to Australian insurer QBE (QBE.AX: ) for $800 million, or 2.1 times the unit's book value excluding goodwill, freed up about 600 million euros ($796.4 million) in risk capital that could be put to other uses. The cash will allow Hannover Re to buy less of the expensive risk cover from other reinsurers and write more business in the highly profitable U.S. property catastrophe market, Hannover Re Chief Executive Wilhelm Zeller said. "The rates for this business are still very high, very attractive," he said. "We will easily not only compensate but overcompensate" for the lost earnings from Praetorian, Zeller told an analyst conference call. "For 2007 ... you can definitely expect an ROE (return on equity) of at least 15 percent again," Zeller added. Hannover Re shares rose 3.3 percent to 34.20 euros by 1231 GMT, outpacing a 0.5 percent rise in the DJ Stoxx index of European insurance shares <.SXIP>. The company also will be able to use some of the capital for a project in Germany to be unveiled early in the new year, but it declined to give details. (additional reporting by Simon Challis) © Reuters 2006. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 12. NEW EXPERT COMMENTARY FROM IRMI.COM There are now over 800 risk management and insurance articles on IRMI.com. Below you'll find summaries of some recent additions with links to the articles. THE ACTS OR DECISIONS EXCLUSION THAT TRIED TO SWALLOW THE POLICY - Jay Levin explains that while an acts or decisions insurance exclusion uses extremely broad language, courts enforce it in a common-sense manner. http://www.irmi.com/Expert/Articles/2006/Levin12.aspx IS ACCIDENT FORGIVENESS ETHICAL? - Dr. George Head discusses how accident forgiveness violates fundamental insurance principles to the detriment of all. http://www.irmi.com/Expert/Articles/2006/Head12.aspx RECENT COPYRIGHT CASE: NO CGL COVERAGE - Sanford Warren and Eric Klein relate a case reaffirming that the CGL policy is not intended to cover media risks. http://www.irmi.com/Expert/Articles/2006/Warren12.aspx HO, HO, HO, AND SAY GOOD-BYE TO 2006 - Peter Polstein takes a look at what to expect in 2007, particularly as respects S&P's new insurer capital adequacy model. http://www.irmi.com/Expert/Articles/2006/Polstein12.aspx Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 13. INSURANCE NEWSLINK Articles Recent articles added to INSURANCE NEWSLINK, the worldwide, strategic concise intelligence database of over 27,000 articles including interviews, uniquely analysed by company, market, research, regulatory, and IT topics. Please click here for a content overview and a 15-day free review. THE TIME EFFECTIVE WAY TO STAY AHEAD
Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 14. ImageRight Chosen #1 in U.S. Insurer Technology Survey Conyers, Georgia - December 12, 2006 - ImageRight, the leader in Property and Casualty Content Management and Workflow Solutions, announced today that it has been selected the #1 IT Vendor for Document Solutions in the 2006 U.S. Insurer technology survey. “This has been a great year for us,” said Ken Elias Sales Director of Advanced Solutions. “We have just signed our 350th insurance client, grown our presence in the United Kingdom and Bermuda markets and received several awards. Being ranked the #1 IT Vendor for Document Solutions in the U.S. Risk Survey is icing on the cake and makes me very proud of our product and our company.” www.imageright.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 15. Zywave Insurance Technology Now More Than 600 Brokers Strong Milwaukee, December 13, 2006 — Zywave, Inc., a leading provider of technology products and services for insurance brokers, today announced that more than 600 partners nationwide employ Zywave® technology solutions to grow and manage their agencies. According to company officials, this achievement reflects Zywave’s focus on building technology that serves as a critical platform for the insurance industry. "What we’ve done successfully is marry our insurance business knowledge with the technology side of the house," said Jim Mueller, president of Zywave. "Our success is gauged by how well we can develop the solutions an agency needs to grow revenue and then continue to support these efforts through training and implementation. Unlike technology companies whose obligation ends when you purchase their out-of-the-box solutions, Zywave builds ongoing relationships to better support the goals of our partners." www.zywave.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 16. Workers Comp, Market Conditions Highlight 2007 Legislative Agenda of Independent Insurance Agents, Brokers of NY (DeWitt, New York, Dec. 12, 2006) — A dysfunctional workers’ compensation system and downstate coastal market concerns are at the center of the 2007 Legislative Position Paper of the Independent Insurance Agents & Brokers of New York, Inc, the state’s oldest and largest insurance trade organization. The annual document is a compilation of the association’s priority issues for the upcoming legislative session. Currently, the New York state workers compensation system has the nation’s second highest cost to businesses and yet pays out some of the lowest weekly benefits to injured workers. A major contributor to the problem is unlimited permanent partial disability benefits. When injured workers can no longer perform their primary job assignment, they are eligible for lifetime PPD payments. Re-training or re-education are alternatives to these lifelong disbursements. Governor-elect Eliot Spitzer agrees with IIABNY on a PPD payment cap. Other states have varying time limits on these benefits. To view IIABNY’s 2007 Legislative Position Paper in its entirety, visit www.iiabny.org. Go to the “Government Affairs” section on the left and click on the text link for current Legislative Position Paper. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article KING OF PRUSSIA, PA. (Dec. 12, 2006) – MedRisk, Inc. has completely updated and upgraded its website www.medrisknet.com with a new look and navigation system. The claims services and specialty managed care company worked with design firm Malish & Pagonis to organize information so its various audiences can easily find sections they need. www.medrisknet.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 18. HILB ROGAL & HOBBS AGREES TO ACQUIRE LOAN PROTECTOR INSURANCE SERVICES RICHMOND, Va--Hilb Rogal & Hobbs Company (NYSE: HRH), the world's tenth largest insurance and risk management intermediary, announced today that it has signed a definitive agreement to acquire the operating assets of Loan Protector General Agency, Inc. and Loan Protector Tracking Services, Inc. (Loan Protector Insurance Services), a leading provider of customized insurance tracking programs and lender-placed insurance products to the mortgage industry. Terms of the transaction, which is expected to close on January 1, 2007, were not disclosed. Founded in 1991, the Cleveland, Ohio-based company expects, based on year-to-date performance, recorded revenues of approximately $8 million in 2006, and caters primarily to a client base of banks, savings and loan organizations, credit unions and mortgage companies. Ronald F. Wiser, President of Loan Protector Insurance Services, and his team of employees will continue to serve their customers’ needs from their Cleveland office, joining HRH’s Mid-Atlantic Region under the leadership of Vice President Steven C. Deal. www.hrh.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 19. Phoenix Companies Selects McCamish Systems for Executive Benefits Support and Administration ATLANTA--(BUSINESS WIRE)--Dec. 12, 2006--McCamish Systems, LLC has been chosen to provide 409A Technical Support and Plan Administration for The Phoenix Companies Inc.'s strategic effort in the executive benefits market. Phoenix will be utilizing three McCamish platforms to pursue the market. Deferral+(R) and Advisorfolio(TM) will provide 409A compliant plan design, documents and 409A plan implementation. McCamish's BPO services will provide plan administration and recordkeeping services. www.phoenixwm.com www.McCamish.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 20. INSURANCE NEWSCAST "Pictures Of The Day" -- Sponsored By:
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21. Cingular Provides Brooke With New Services in a Competitive Marketplace Leading Insurance Industry Franchisor Rolls Out Wireless Voice and Data Services To Enhance Agent Productivity and Customer Service ATLANTA, Dec. 13 /PRNewswire/ -- Brooke Franchise Corporation has selected Cingular Wireless to make voice and data services available to its network of more than 700 franchise locations in a highly competitive insurance industry. The two-year national contract gives franchisees access to a variety of devices and services, including those based on Cingular's UMTS/HSDPA technology. In addition to voice-only handsets, Cingular will provide Brooke Franchise Corporation and its franchisees with access to a portfolio of integrated voice/data devices, including the EDGE-based Cingular 8125 Pocket PC, Cingular 2125 Smartphone and HP iPAQ 6500 Pocket PC, and Cingular LaptopConnect cards enabled for Cingular's 3G-based BroadbandConnect service. www.brookecorp.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 22. Companies Should Review Codes of Ethics for Compliance with New Reporting Requirements. Cleveland, Ohio – December 14, 2006 – The Lawson Firm, a Cleveland-based law firm providing legal and compliance management services to the insurance industry, urges companies to review their codes of ethics in light of new annual and quarterly statement interrogatories adopted by the NAIC. The new interrogatories, which will appear on statement blanks starting with the statement for the first quarter of 2007, will require companies to state whether senior officers are subject to a code of ethics which includes the following standards: Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
The new interrogatories will also require companies to state whether their codes of ethics for senior managers have been amended and whether any provision of the code has been waived for any officer during the reporting period. www.lawsonfirm.net Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 23. GlobalOptions Combines Two Fraud Units, Forming New Investigative Division to Serve Insurance Industry New Company Named “GlobalOptions Fraud & SIU Services” NEW YORK--(BUSINESS WIRE)--GlobalOptions Group (OTCBB: GLOI) announced that it is combining its two industry-leading investigative units, CBR and Hyperion Risk. Effective immediately, the Nashville-based company will be known as GlobalOptions Fraud & SIU Services. The new GlobalOptions division, GlobalOptions Fraud & SIU Services, will now offer the market a broader range of services to help its client companies manage their insurance fraud. Included among GlobalOptions Fraud & SIU Services capabilities are: claims and background investigations services; on-scene accident investigations; corporate investigations; surveillance; fraud reporting; regulatory compliance; and vendor manager. In addition, the company’s proprietary program, GlobalTrak™, will allow a company to link case information to large loss reports, authority requests or client approval requests, and to access, share and run a variety of quantitative reports using up-to-the-minute data. The new division was formed following the acquisition of Hyperion Risk by GlobalOptions in August, 2006, when it was folded into CBR, an insurance investigative company led by Halsey Fischer. Florida-based Hyperion Risk was led by founder Frank Pinder, who now joins Halsey Fischer in the management of the new entity as Executive Vice President. www.globaloptionsgroup.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 24. National Health Partners Announces Plans to Expand Insurance Programs for Health Advantage One Company Sees New Programs as Key Driver for Continued Record Sales in 2007 HORSHAM, Pa.--(BUSINESS WIRE)--National Health Partners, Inc. (OTCBB: NHPR), a leading provider of unique discount healthcare membership programs, announced today that it plans to launch several new insurance programs that are being designed to work with the Company’s CARExpress healthcare discount program. The Company also announced that it sees sales continuing to grow at a record pace in 2007. The new programs are being created to combine specific health insurance benefits that complement the benefits of the Company’s CARExpress membership programs by reducing or even eliminating the remaining cost of the discounted service. This new “wrap-around” approach will provide significant advantages to consumers as well as businesses through a new low-cost approach that can reduce monthly insurance expenses by up to 70%. The Company expects to have a portfolio of up to 10 different programs under the Company’s newly created Health Advantage One Program. These programs are expected to be launched in January 2007. www.nationalhealthpartners.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 25. AAPPO Study Examines the Adoption of P4P and Other Incentive Programs in the PPO Industry LOUISVILLE, Ky., Dec. 12 /PRNewswire/ -- The American Association of Preferred Provider Organizations (AAPPO) announced today that it has released the results of its P4P study in a paper, entitled "PPO Approaches to Pay for Performance and Clinical Improvement Incentive Programs." AAPPO developed the case studies to identify potential pay for performance (P4P) models applicable to PPOs. PPOs offer a credentialed network of physicians and choice of providers. PPO networks can be built into a variety of insurance arrangements, including health savings accounts. This study, sponsored in part by Caremark Rx, Inc., examines the growth of P4P and other incentives to improve clinical performance of physicians while preserving the unique offerings of PPO networks. "Consumer demands for quality constantly challenge the healthcare community," says AAPPO President Karen Greenrose. "The PPO healthcare delivery model puts the control for medical decisions in the hands of the physician and patient, empowering both with a focus on the delivery of a high-level of quality care. We studied how incentive programs fit with the PPO model as a strategy to improve clinical quality," she explained. The study examines five PPOs in detailed case studies and highlights different incentive strategies used by PPOs to directly promote improvements in physician performance or to help build the infrastructure for measuring and improving quality. The paper also provides guidance for PPOs interested in developing a program. www.aappo.org www.caremarkrx.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 26. RenaissanceRe Announces $300 Million Public Offering of 6.60% Series D Preference Shares PEMBROKE, Bermuda--(BUSINESS WIRE)--RenaissanceRe Holdings Ltd. (NYSE:RNR) announced today it has agreed to sell in an underwritten public offering $300 million aggregate liquidation preference of its 6.60% Series D Preference Shares, with a liquidation preference of $25 per share. The Company currently expects to consummate the sale to the underwriters on December 15, 2006. RenaissanceRe anticipates using net proceeds from the offering to redeem all of its outstanding 8.10% Series A Preference Shares as soon as practicable following completion of the offering and to redeem all of its outstanding 8.54% Junior Subordinated Deferrable Interest Debentures on or as soon as practicable after March 1, 2007. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 27. NationsHealth Moves to NASDAQ Capital Market SUNRISE, Fla.--(BUSINESS WIRE)--NationsHealth, Inc. (Nasdaq: NHRX; NHRXW; NHRXU) today announced that The NASDAQ Stock Market, Inc. has approved the Company's application to transfer the listing of its securities from The NASDAQ National Market to The NASDAQ Capital Market. The Company anticipates that its common stock, warrants and units will begin trading on The NASDAQ Capital Market effective with the beginning of trading on December 13, 2006, under the current symbols “NHRX,” “NHRXW” and “NHRXU,” respectively. Until that time, the Company’s securities will continue to trade on The NASDAQ National Market under these symbols. www.nationshealth.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 28. NASD Fines Four Firms for Supervisory Failures Relating to Mutual Fund Sales Charge Waivers Edward Jones, RBC Dain Rauscher, Royal Alliance, and Morgan Stanley To Pay an Estimated $43.8 Million in Remediation to Customers; Morgan Stanley Credited for Taking Remedial Measures WASHINGTON, Dec. 13 /PRNewswire/ -- NASD announced today that it has imposed fines totaling $850,000 against four firms -- Edward D. Jones & Co., L.P. of St. Louis ($250,000), RBC Dain Rauscher Inc. of Minneapolis ($250,000), Royal Alliance Associates, Inc. of New York ($250,000), and Morgan Stanley DW Inc. of New York ($100,000) -- for failing to have adequate supervisory systems and procedures to identify opportunities for investors to purchase Class A mutual fund shares at net asset value (NAV), or without a front-end sales charge. Each firm was ordered to provide remediation to thousands of eligible clients who qualified for, but did not receive, the benefit of available NAV transfer programs. Based on estimates provided by each firm, Edward Jones will pay $25 million, plus interest; RBC Dain Rauscher will pay $6.8 million, plus interest; Royal Alliance will pay $1.6 million, plus interest; and Morgan Stanley will pay $10.4 million, plus interest. Each firm is required to retain a third party examiner to oversee the remediation process. "The failures on the part of Edward Jones, RBC Dain Rauscher, Royal Alliance, and Morgan Stanley to adequately supervise the identification and implementation of NAV transfer programs deprived their customers of substantial discounts on mutual fund purchases," said James S. Shorris, NASD Executive Vice President and Head of Enforcement. "Securities firms must learn all of the relevant pricing features of the fund shares they sell and ensure that eligible investors receive all available discounts and sales charge waivers, without exception." www.nasd.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 29. Selective Receives E-Fusion Award From A.M. Best BRANCHVILLE, N.J., Dec. 13 /PRNewswire-FirstCall/ -- Selective Insurance Company of America has announced it received the 2006 E-Fusion Award from A.M. Best Co. for innovative, business-focused agency integration technology. The award was presented at A.M. Best's 2006 E-Fusion Insurance & Technology Conference in Boston, MA. Selective received the award by increasing productivity and management for its independent insurance agents through its xSELerate(R) agency integration technology. "xSELerate(R) gives agents the ability to quote new and existing business and access claims and billing information directly from their agency management systems," said Jeff Kamrowski, Selective's senior vice president, Business Services Unit. "It eliminates double entry of data, reduces errors, increases transaction productivity, and most importantly, increases agents' service and response time to customers." www.selective.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 30. CIGNA Acquires vielife Through its CareAllies Operating Unit; Expands Consumer Engagement, Health Advocacy Capabilities Around the Globe BLOOMFIELD, Conn., Dec. 13, 2006 /PRNewswire-FirstCall/ -- CIGNA today announced it has further expanded its consumer engagement and health advocacy capabilities through its acquisition of privately held vielife, a U.K.-based leading provider of integrated online health management and coaching programs. vielife, based in London, provides health risk assessment, behavioral change programs and online coaching for over 1.3 million people in the United States, Europe, Canada, and Australia. Terms of the agreement were not disclosed. These online programs and other coaching and health advocacy programs offered by CIGNA are designed to help address the most common, costly – and preventable - causes of death and disability. According to the Centers for Disease Control and Prevention (CDC), chronic diseases, such as heart disease, cancer and diabetes, account for seven out of every 10 deaths and affect the quality of life of 90 million Americans. Also according to the CDC, adopting healthy lifestyle behaviors can prevent or control the effects of chronic diseases. CIGNA's coaching programs are targeted to healthy and at-risk individuals to help them make positive changes in health behaviors, such as becoming more physically active or eating more nutritiously, to reduce risks and to maintain or improve health. www.careallies.com www.vielife.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article
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