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1. Bush health care plan looks to states for action Tue Jan 23, 2007 9:43am ET WASHINGTON (Reuters) - States may have to roll back some or all of their laws that mandate health insurance cover under President George W. Bush's plan to reform health care, the White House said on Monday. The White House and the Health and Human Services Department offered a few details of the plan to help cover some of the 47 million Americans without health insurance, which Bush plans to highlight in Tuesday's State of the Union speech. He also previewed it in his radio address on Saturday. Under the plan, states could subsidize health insurance premiums directly, they could establish high risk pools for the sickest people, and could help individuals and small businesses create their own insurance pools. "States that provide their citizens access to basic, private insurance at an affordable price would be eligible for funds under the Affordable Choices Initiative," the White House said in a statement. To get the federal money states would need to make health insurance affordable by such means as "reducing benefit or premium mandates," it said. Currently, each state has its own set of mandated conditions that health insurers must cover. For example, South Carolina has a law requiring insurers to pay for at least one night in the hospital for women who have just given birth. Requirements to cover mental health conditions are also legislated by states, although Congress has considered several federal approaches. Bush also proposes allowing people to buy health insurance offered only in other states. "The secretary of HHS would be able to redirect federal payments away from institutions (such as hospitals) and to needy individuals in eligible states. These grants would allow states to help low-income individuals purchase private health insurance," the White House statement added. States already work with the federal government under the Medicare, Medicaid and children's health insurance plans for the elderly, needy and the very young. Some groups have called for expanding these services, but Bush's plan emphasizes private insurance. Bush's plan would consider employer-provided health insurance to be taxable income but also allow a one-time general deduction, similar to the mortgage deduction. Some Democrats said they would oppose Bush's plan. "The President's so-called health care proposal won't help the uninsured, most of whom have limited incomes and are already in low tax brackets," said California Democratic Rep. Pete Stark, Chairman of the Ways and Means Health Subcommittee. "But it will hurt middle-income Americans, whose employers will shift even more cost and risk to their employees," he added. Stark said he instead favored expanding Medicare. © Reuters 2007. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 2. Auto union may run some retiree benefits: WSJ Tue Jan 23, 2007 2:47am ET - NEW YORK (Reuters) - Detroit auto makers and the United Auto Workers are examining a plan that would shift to the union the responsibility for tens of billions of dollars in retiree health-care liabilities, The Wall Street Journal reported on Tuesday, citing people familiar with the matter. The preliminary discussions highlight the determination of the UAW and the auto makers to find a way to restructure the auto industry without resorting to bankruptcy-court protection, the Journal said. General Motors Corp. has hired advisers who worked on a similar deal between the United Steelworkers and Goodyear Tire & Rubber Co. last month. GM is looking at "a number of health-care options," but declined to be more specific, the Journal quoted a spokeswoman as saying. GM officials could not be reached. UAW officials also could not be reached for comment. © Reuters 2007. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 3. Royal & Sun shares rise on U.S. court verdict LONDON, Jan 23 (Reuters) - Shares in UK insurer Royal & SunAlliance (RSA.L: ) rose on Tuesday after it said a U.S. court had dismissed a $900 million claim against it by motor giant General Motors (GM.N: ). RSA said it welcomed the ruling of the Michigan Circuit Court that General Motors is not entitled to coverage for its asbestos and environmental liabilities. GM had brought the lawsuit to force RSA to reimburse its massive defence costs from asbestos-related lawsuits, put at $850 million to $900 million. RSA's U.S. subsidiary insured GM against liability claims between 1954 and 1971. RSA maintained that both parties understood there was no coverage under the policies for these claims. © Reuters 2007. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 4. Hannover Re says storm did not trigger bond FRANKFURT, Jan 23 (Reuters) - German reinsurer Hannover Re (HNRGn.DE: ) said on Tuesday winter storm Kyrill, which ravaged Europe last week, was not strong enough to trigger its $150-million wind storm "catastrophe bond" launched last year. The company also did not expect to have an estimate of claims until Friday at the earliest, a company spokeswoman said. "The bond was not triggered but we have other retrocession covers in place," she said, referring to Hannover Re's ability to pass on damage claims it receives either through securitisations or to other reinsurers. The storm struck Europe on Jan. 18 with hurricane-force winds that lasted two days, causing damage, power disruption and flooding in the United Kingdom, France, the Netherlands and Germany. It was reported to have killed at least 39 people. Catastrophe risk modelling company AIR Worldwide Corp. estimated insured losses from the storm would be between 4 billion euros and 8 billion euros (about $5.2 to $10.4 billion). AIR said it was the worst storm to hit Europe in eight years. Hannover Re launched the $150 million euro bond in order to transfer to the capital markets its risks from heavy wind storm claims in Belgium, Denmark, France, Germany, Ireland, the Netherlands and the United Kingdom. But the bond is designed to protect Hannover Re against risks from storms expected to occur once every 50 years. Based on the estimate released so far from AIR, Kyrill would fall into the category of storms occurring once every 5-13 years, industry observers say. Catastrophe or "cat bonds" are one of a range of innovative instruments with which insurers and reinsurers spread the risk of huge claims -- such as hurricane damage -- to the financial markets, as conventional cover for these risks from other insurers has become increasingly hard to find. Investors in catastrophe bonds are attracted by their relatively high interest payments, but their invested principal is at risk if a major storm occurs. While reinsurers like Hannover Re or Munich Re (MUVGn.DE: ) may have to foot some of the bill for Kyrill damage claims, such storms also remind insurers why they need reinsurance cover, helping to support reinsurance prices after a lack of European wind storms in recent years put downward pressure on prices. © Reuters 2007. All Rights Reserved Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 5. Citigroup honcho fired amid tension over expenses-WSJ NEW YORK, Jan 23 (Reuters) - Citigroup's Todd Thomson, whose departure was announced on Monday, left amid tension over his judgment and expenses, including his use of the company's jet, the Wall Street Journal reported on Tuesday. In November, Thomson flew to China with a group of Citigroup employees in the Citigroup corporate jet, the Journal reported. But the employees had to make their own arrangements to get back to the United States, as Thomson flew home on the corporate jet with CNBC correspondent Maria Bartiromo, the Journal said in its late editions, citing a person familiar with the matter. A spokesperson for CNBC was not immediately available for comment, but the Journal said a network spokesman said Bartiromo asked for, and received permission to fly in the plane, and CNBC paid for it. A spokesman for Citigroup declined to comment. Thomson developed a reputation at Citigroup as a spendthrift with corporate funds, the Journal said. His office was known as the "Todd Mahal," and featured a fish tank, the newspaper said. In a statement released by Citigroup on Monday, Thomson said, "I am looking forward to exploring new challenges." © Reuters 2007. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 6. Fortune 100 Company Pension Plans Reach Full Funding in 2006, Towers Perrin Analysis Finds However, $160 Billion in Deferred Pension Costs Must Still Be Recognized on Corporate Balance Sheets STAMFORD, Conn.--(BUSINESS WIRE)--For the first time since 2000, the assets of defined benefit pension plans offered by Fortune 100 companies exceed plan liabilities, estimates Towers Perrin, a global professional services firm. The estimates show that the defined benefit pension plans are 102.4% funded in aggregate at year-end 2006, up significantly from the 91.6% aggregate funded level at the end of 2005. The improved funding picture reflects favorable investment returns in 2006 as well as an increase in interest rates and a high rate of contributions by plan sponsors. Towers Perrin estimates that the 79 Fortune 100 companies that offer defined benefit pension plans now hold an aggregate pension funding surplus of roughly $23 billion at year-end 2006. www.towersperrin.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 7. A.M. Best Special Report: The Battle for Position — Health Insurers Align Their Operations with Changing Markets OLDWICK, N.J.--(BUSINESS WIRE)--Health insurers and managed care companies can grow larger and more profitable in 2007 and beyond—if they choose the right markets and products and work efficiently. Some segments are enjoying moderating medical cost trends and technology driven savings, but other lines are seeing intense competition. Companies will seek to maintain or establish strategic positions that set the stage for future profits, according to the 2007 Health Review/Preview report from A.M. Best Co. Some companies will position themselves through mergers and acquisitions. Whatever path they take, health insurers may find that today’s secure position is vulnerable tomorrow. In regional and national markets, profitability has remained favorable for both for-profit and nonprofit insurers. Publicly traded companies can expect continued strong earnings as they combine administrative efficiencies with stable medical cost trends. Robust earnings for many nonprofit companies have boosted their capital positions, but moving into 2007, A.M. Best expects lower earnings in the nonprofit segment. Medical cost trends generally have moderated to the upper single digits, but more expensive technologies and prescription drugs could drive this higher. A.M. Best believes the medical loss ratio for most companies has bottomed out, due to the decline in medical cost trends. To maintain or increase operating margins, insurers will need to find other ways to lower total costs. As health insurance premiums rise each year, employers continue to pursue lower-cost alternatives. More employers are offering high deductible plans. Consumer driven health plans make individuals more responsible for their health care spending, and A.M. Best expects the number of members in consumer-driven plans to continue growing. Still, it will remain a small percentage of all insureds. The commercial group market is very competitive, and employer groups are migrating from company to company. Probably the health insurance sector that has seen the stiffest competition over the past year is Medicare supplement. Medicare Advantage and private fee-for-service products have made a big impact on the senior health market. Open enrollment periods for Medicare Part D prescription drug plans also have offered more products at varying prices. The competitive landscape has changed, and national managed care companies have moved aggressively into senior health. The big Medicare news for 2006 was the implementation of the prescription drug program on January 1, 2006. Total enrollment in Medicare Part D was 16.6 million as of November 1, 2006. www.bestweek.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 8. A.M. Best Special Report: Blind Curve Ahead—Are U.S. Life Insurers Prepared for What’s around the Bend? OLDWICK, N.J.--(BUSINESS WIRE)--The road ahead looks smooth at first glance for U.S. life insurers, with operating earnings on the rise and strong, stable balance sheets. Equity markets are improving, the credit environment is benign, and interest rates have risen from historical lows. Insurers are renewing their focus on the key discipline of risk management, according to the 2007 Life and Annuity Review/Preview report from A.M. Best Co. However, A.M. Best believes life insurers are approaching a blind curve where events could adversely impact the industry’s financial strength. These include potential effects from a pandemic, another terrorist attack or a significant correction in the equity markets. Also looming over the industry are net outflows for some large variable annuity writers, competition from banks and mutual funds, a prolonged inverted yield curve and a likely downturn in the credit cycle. The industry’s product mix has shifted from protection to asset accumulation and, more important, to more complex products. These are more difficult for consumers to understand; are more difficult for agents and brokers to explain; and bring more policyholder optionality and risk to the insurance company than ever before. Major players are looking to bolster their competitive positions through pricing, acquisitions and expansion to new markets. This is likely to place pressure on the ability of smaller companies to compete as A.M. Best believes scale and financial flexibility are key drivers of success in the life and retirement savings arena. Meanwhile, ever changing accounting and regulatory rules add complexity and expense. A.M. Best does not expect these factors to hurt ratings in the near term, but over the long term, the industry will be challenged to keep earnings growing at current rates and to accumulate capital. In turn, A.M. Best expects this to put pressure on ratings. A.M. Best believes the life insurance industry and the capital markets have become increasingly entwined, a direct result of the industry’s heightened risk profile, consumer demand and the economic realities of low interest rates and uncertain credit and equity markets. As a result, the life industry’s balance sheet looks much different today than it did just a decade ago. In today’s insurance marketplace, the prudent use of these capital market tools is becoming a core competency for the larger players. A.M. Best believes, however, that the industry needs to continue to focus on the core, fundamental financial and risk-management practices of sound underwriting and pricing, asset and liability management, credit analysis and spread management as the primary tools to build financial strength. www.bestweek.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 9. A.M. Best Special Report: The Calm After the Storms — Record-Setting Results Let P/C Industry Catch Its Breath OLDWICK, N.J.--(BUSINESS WIRE)--Another year of devastating catastrophe losses was expected for 2006, but Mother Nature spared the property/casualty industry and allowed carriers to report record-setting results: Not only was an underwriting profit achieved—a rare feat—the combined ratio fell to its lowest level since 1953. All this occurred amid price softening and a modest increase in competition, according to the 2007 Property/Casualty Review/Preview report from A.M. Best Co. Despite the limited catastrophe losses in 2006, rates for catastrophe-prone areas will remain elevated. This reflects more conservative pricing, reduced capacity for certain segments and higher reinsurance costs on these risks. A soft market prevailed in most other lines and segments, with a gradual release of the tight knot previously surrounding terms and conditions. Still, underwriting is expected to remain generally prudent, despite these early indications of potential future problems. In addition, new capacity has entered the market and is placing more demands on profitability targets. On another front, those writing in terrorism-exposed areas will face important underwriting decisions as the extension of the Terrorism Risk Insurance Act (TRIA) comes to an end. It is uncertain how much, if any, permanent federal protection will be in place. Workers’ compensation companies are particularly exposed, given their inability to exclude this risk and the lack of affordable reinsurance protection. Limited capacity and widespread nuclear, chemical, biological or radiological (NCBR) exclusions offer little reassurance to these carriers. As the ability to quantify concentration exposures becomes that much more critical, enterprise risk management (ERM) remains at the forefront as a means for companies to measure all their risks and the correlation of these risks. Modeling companies have come forward to provide the much more detailed information that rating agencies seek on insurers’ largest events and how these events correlate. The question then becomes how much surplus can insurers lose—or are they willing to lose—without jeopardizing their current ratings or keeping their management teams awake at night. Given this greater scrutiny of exposures, many insurers are looking for increased protection through traditional reinsurance. Many are also looking at alternative sources such as catastrophe bonds, industry loss warranties and sidecars. Following the significant catastrophe losses of 2005, these additional forms of capacity increasingly have been used and, for some insurers and reinsurers, represent a material component of their capital management strategies. Although the industry was spared in 2006 from a major event, it would be naive to think these exceptionally strong results will continue in 2007 and beyond. In the volatile and cyclical property/casualty industry, another devastating event is sure to come. It may be terrorism, a natural catastrophe, a stock market crash, under-reserving or simply undisciplined underwriting. The impact of this event, or events, will be split unevenly between those companies that have prepared themselves through ERM and prudent underwriting, and those that continue to ride the market cycle with their fingers crossed. www.bestweek.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 10. Foundation for Taxpayer and Consumer Rights: Mandated Health Insurance Will Not Be Affordable Until Insurers are Regulated to Control Costs SANTA MONICA, Calif., Jan. 22 /PRNewswire-USNewswire/ -- Quality health insurance will not be affordable until it is paired with rules that require prior approval of premiums, limit insurer overhead and profit, and ensure rate changes are justified, said the nonprofit Foundation for Taxpayer and Consumer Rights (FTCR) today. Every state considering an individual health insurance mandate will address the same question, and insurer oversight is the only solution, said FTCR. "A mandate for health insurance makes it the duty of the state to require that quality policies are also affordable. Something has to give: either the big bucks lifestyle of insurers and the rest of the medical industry or policyholder benefits. Regulation reins in the excesses of the medical establishment to make benefits affordable," said Carmen Balber, consumer advocate with FTCR. The board implementing Massachusetts' health care law will issue recommendations today defining what it means to be insured in the state. A committee recommended degrading the standards for minimum insurance coverage on Friday because preliminary bids from private health insurers were too expensive. At an average $380 a month, those policies would cost someone making $30,000 a year more than 15% of their income, before considering deductibles, co-pays and other uncovered expenses. "California and other states trying to require families to buy health insurance must understand what Massachusetts is learning-that working people struggling to stay in the middle class can't afford to buy what the private insurance market will sell them," said Judy Dugan, research director of FTCR. "A family of four in Boston with just over $60,000 in before-tax income -- the upper limit for access to a subsidized policy -- would have to pay about $10,000 a year for the minimal private policies being considered by Massachusetts, and then would face a $4,000 yearly deductible. Year over year, that cost would push financially stressed families into bankruptcy." FTCR has called for state laws to limit bloated health insurer overhead and profits by requiring a review of their finances and prior approval before they can raise rates. Such review is already required of auto insurers in California under voter-approved Proposition 103, and has saved motorists at least $24 billion since 1988, according to the Consumer Federation of America. Regulation must be combined with bans on "junk insurance" policies that may look cheap but fail to cover actual health care costs and do not limit out of pocket costs-an even faster route to bankruptcy, said FTCR. "California faces a tougher struggle than Massachusetts," said Dugan, "because its health insurance market is more fragmented, inefficient and dominated by for-profit insurers and HMOs. But the Bay State will have no better luck in providing affordable universal health coverage until insurers are forced to give something up too." FTCR's recommendations for minimum coverage standards to the board last week, including a cap on out of pocket costs, no limit on what insurers must pay per treatment and affordable prescription drug coverage, can be found at: http://www.consumerwatchdog.org/resources/MCC_ltr.pdf FTCR outlined the need for rate regulation to achieve affordability in a letter to Governor Schwarzenegger: http://www.consumerwatchdog.org/resources/letter1.10.07.pdf Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 11. Midwest Health Care Startups Raise $792 Million in 2006 - Investments Up 25 Percent From 2005 Minnesota, Michigan, and Ohio Lead States CLEVELAND--(BUSINESS WIRE)--Midwest health care startups reported $792 million in total investments in 2006, according to the Midwest Health Care Venture Investment Report released by BioEnterprise. The total represents a 25 percent increase over 2005, a significant jump that outpaces national industry growth. “2006 was the breakout year for the Midwest as a whole: a record amount of financing across 135 separate companies, a number of successful public offerings, and several significant exits through acquisitions,” said Baiju R. Shah, President of BioEnterprise. “Venture capitalists are increasingly finding rewarding investment opportunities in the Midwest and we expect the momentum built in 2006 will continue into 2007 and beyond.” Additional data about Health Care business activity in the Midwest can be viewed at http://www.bioenterprise.com/reports/index.html. Sources: Compiled by BioEnterprise team from Venture Wire, Private Equity Week, Wall Street Journal, Venture Source, SEC Filings, company press releases, and www.biospace.com. www.bioenterprise.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 12. Swiss Re Integrates US Brokered Reinsurance Business into One Entity BARRINGTON, Ill., and CALABASAS, Calif., Jan. 22 /PRNewswire/ -- Swiss Re today announced it has finalized and received regulatory approval for the integration of GE Reinsurance Corporation into the Swiss Reinsurance America Corporation legal entity. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 13. Sweeping Changes to Come for “NAIFA in the 21st Century” Strategic Plan calls for focus on service to “the customer,” sophisticated delivery of value FALLS CHURCH, VA (January 22, 2007)—The National Association of Insurance and Financial Advisors (NAIFA) is implementing dramatic changes to meet the needs of its members. Called “NAIFA in the 21st Century,” the plan addresses the need for NAIFA to create “customer value . . . and dedicate itself to their members’ success like no other industry organization.” On Friday, NAIFA’s Board of Trustees approved a strategic plan that calls on NAIFA to strengthen its core product, legislative and regulatory advocacy, create new products and services, and utilize technology to deliver products so members have “total ease and convenience of access.” To do this, NAIFA will create products and services that its members said they need in the areas of advocacy, education, training and networking. NAIFA will deliver the newly created products using wireless and computer technology so members have “on demand” access. NAIFA’s Strategic Planning Committee based its recommendations on an extensive study of members, lapsed members and prospective members conducted by Ketchum, Inc. “I think the message in the plan comes across loud and clear—we are putting the needs of our members, our customers, before anything else,” said David E. Smithkey, CLU, RFC, NAIFA’s immediate past president and chair of the Strategic Planning Committee. “To deliver the value they expect requires NAIFA, in many ways, to let go of the past and embrace change.” Maximizing technology to deliver value, the plan points out, minimizes reliance on the distribution system in place for more than 100 years. That system relied on the nation’s network of local NAIFA associations to deliver that value. “Times have changed, and so should NAIFA,” Smithkey said. “NAIFA has communications options that it must utilize to help the 21st century advisor succeed.” Instead of requiring members to join a local association, the plan calls for local membership to be optional beginning in September 2008, and allow advisors to choose to join a local association or not, and belong to any local association they want, if they perceive additional value in doing so. Membership in both a state and the national association will be required. The plan also calls for an extensive marketing program to “showcase” NAIFA’s new products and services. “When we build the 21st century NAIFA, we have to tell people about it,” said John Davidson, LUTCF, NAIFA’s president. “We will tell advisors nationwide that we are ready to serve our members in a much more effective way.” Added Davidson: “I’m excited about this plan. It represents the best thinking of the best in the industry. It’s a tremendous body of work that will position NAIFA and its members for growth and prosperity in the 21st century.” www.naifa.org Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 14. Climate Change, Election Results Signal Need for New Strategies by Insurers, Say IN Magazine Features INDIANAPOLIS (January 22, 2007) — A couple of hot issues are featured prominently in the latest issue of IN magazine, the quarterly publication of the National Association of Mutual Insurance Companies (NAMIC). Climate change and the November elections are explored from the insurance industry’s perspective. Contributing Editor Lisa Floreancig looks at the dicey issue of climate change, which many scientists and prognosticators blame for an upswing in recent hurricane activity. The article examines the scientific research on recent changes in global temperatures and whether it’s the result of human activity. More importantly, it discusses the role of the insurance industry. Floreancig cites a recent study by the Ceres investor coalition that says U.S. insurers have seen a 15-fold increase in insured losses from catastrophic weather events in the past three decades and warns of potentially facing larger financial losses ahead. She also identifies tactics underway in the insurance industry to meet the challenge. AIG, for example, has developed strategies to mitigate the damage from severe weather and lessen the financial load on insurers and policyholders. “Climate change is truly an issue causing people to take note — not only in the insurance industry, but in scientific, public policy, government, and corporate circles worldwide,” said IN magazine Editor-In-Chief Jon Gorman. “We have just tried to introduce the discussion in this issue of the magazine with a well-researched and written analysis of where the issue stands today.” Changes in the national political environment are the focus of an article by Marliss Browder, NAMIC’s senior federal affairs director. After spending 12 years in the minority, the Democrats now control both the U.S. House and Senate. Browder looks at the implications for insurers. “The good news is that most property/casualty insurance issues that are likely to be considered in the new Congress are not partisan, political issues, although the philosophies and core constituent groups in some cases will drive the approach,” she points out. “There will be many new congressional members who will be unfamiliar with our industry.” The Democratic wind that blew through the country in November is also likely to result in some very different state legislative priorities in 2007, says NAMIC’s Associate Director, Public Policy David Reddick, in an article on the state election results. Unfavorable bills could emerge in states like Colorado, Maryland, Massachusetts, and Oregon, where both the governor's office and state legislative chambers are controlled by Democrats. Legislation related to credit-based insurance scoring and natural disasters are likely to appear. On the other hand, Reddick notes the good news in Oregon and South Dakota, where voters rejected measures unfavorable to consumers. “The midterm election analyses in this issue of the magazine are among the most in-depth and accurate that I have seen,” Gorman said. “NAMIC’s government affairs staff have proven once again to be on the front lines in both the federal and state legislatures, as well as in state insurance departments on behalf of NAMIC member companies.” www.namic.org Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 15. Commissioner Steve Poizner Issues Declaration of Insurance Emergency in Agricultural Freeze Commissioner expedites insurance adjusters to State of California for agricultural devastation SACRAMENTO - Anticipating that the magnitude of the agricultural freeze devastating California's crops and pending insurance claims will create a shortage of qualified insurance adjusters, California's new Insurance Commissioner Steve Poizner issued an Emergency Declaration today to help expedite insurance claims from the disruption of California's agricultural industry. "Today, I am issuing a declaration which will dispatch additional insurance adjusters to the state of California to assist the agricultural community with insurance claims resulting from the disastrous freezing temperatures," said Commissioner Poizner. "During this state of emergency, I want to ensure that our farming communities avoid the red tape and get paid quickly so they can get back to the business of farming." Today's proclamation from the Department of Insurance will allow out-of-state insurance adjusters to be dispatched to California's agricultural community to assist in California's state of emergency. The declaration comes as the Department of Insurance surveys California insurers and determines that outside adjusters will be in overwhelming demand for claims, just days after Governor Arnold Schwarzenegger proclaimed a state of emergency due to extreme low temperatures and freezing conditions which began January 11. Preliminary data indicates that there may be more than one billion dollars of damage to California agricultural products, including approximately $700 million in damages to citrus crops, as well as extensive damage to avocado and strawberry crops. Approximately 90% of crops in California are covered by crop insurance, and during a state of emergency the state's claims adjusters would be in high demand, causing severe delays. The last time an Insurance Commissioner issued this type of declaration was in November 2003 in response to wildfires in Southern California. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 16. Rep. Slaughter and Biggert Announce Bi-Partisan Genetic Non-Discrimination Legislation Washington, DC - Rep. Louise M. Slaughter (D-NY-28), Chairwoman of the House Rules Committee, was today joined by Rep. Judy Biggert (R-IL-13) and Sharon F. Terry, Chair of the Coalition for Genetic Fairness, in announcing the reintroduction in the House of the Genetic Information Nondiscrimination Act (GINA). "This bill is the culmination of a bipartisan effort to prohibit the improper use of genetic information in workforce and insurance decisions," Rep. Slaughter said. "In the 12 years since I first introduced GINA, the need for this legislation has grown exponentially. Scientific research has advanced so quickly that we cannot afford to wait any longer. This bill will allow us to preserve America's health and protect our scientific edge, all while defending the privacy of our citizens." "We will never unlock the great promise of the Human Genome Project if Americans are too paranoid to get genetic testing," said Rep. Biggert, a chief sponsor of the legislation in the 109th Congress. "Without the protections offered by H.R. 493, these fears will persist, research at NIH will slow, and Americans will never realize the benefits of gene-based medicines." "This bill is about our children, our future, and ensuring that Americans cannot be discriminated against in health insurance and employment decisions," said Sharon Terry. "As an advocate and as the Chair of the Coalition for Genetic Fairness, I understand the promise of genetic medicine and am appalled by the experiences of the many individuals and families who have experienced genetic discrimination." "Congresswoman Slaughter, Congresswoman Biggert, Congresswoman Eshoo, and Congressman Walden demonstrate robust vision and courage to introduce legislation that will make it possible for people to benefit from new genetic tests and technologies," she added. BACKGROUND H.R. 493, the Genetic Information nondiscrimination Act, or GINA, is a bi-partisan bill co-sponsored by over 150 Members of Congress. The legislation was introduced in the House by Rep. Slaughter, Rep. Biggert, Rep. Anna Eshoo (D-CA-14), and Rep. Greg Walden (R-OR-2) on Tuesday, January 16th. GINA makes it illegal for group health plans and health insurers to deny coverage to a healthy individual or charge him or her higher premiums based solely on a genetic predisposition to a specific disease. The legislation also bars employers from using individuals' genetic information when making hiring, firing, job placement or promotion decisions. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 17. Horton Group Named Assurex Global Partner COLUMBUS, Ohio, USA (January 22, 2007)—The Horton Group, headquartered in Orland Park, IL, a Chicago suburb, recently was named a Partner firm of Assurex Global, the world’s largest privately held insurance, risk management and employee benefits brokerage group. Horton joins 116 other Assurex Global Partners with more than 500 offices in over 70 countries on six continents. Each agency that is selected as a Partner is the strongest insurance agency or brokerage in its respective region. www.assurexglobal.com www.thehortongroup.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 18. Online Tool Helps Businesses Identify Risk WESTFIELD CENTER, Ohio, Jan. 23 /PRNewswire/ -- Westfield Insurance has introduced a new online Risk Control Assessment to help businesses identify their risk issues. The 24-question survey, on http://www.WestfieldInsurance.com, is available to all visitors and provides a customized report of strengths and weaknesses, along with tangible action steps to help improve the ability to control loss. Westfield Insurance partnered with Virtual Horizons to create the Risk Control Assessment. Virtual Horizons ( www.VirtualHorizons.com ) is an interactive marketing and design firm in Fairlawn, Ohio. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 19. Travelers Launches New Risk Control Web Site — Delivers Up-to-Date Information to Help Customers Achieve Better Control of Their Exposures HARTFORD, Conn.--(BUSINESS WIRE)--Travelers today announced its new Risk Control customer Web portal, a one-stop shop for answers to many risk control questions. riskcontrol.com highlights not only the products and services Travelers Risk Control offers, but also provides a wealth of risk control information, including timely, pertinent news alerts that can help prevent losses and even save lives. “The goal of our new Web site is to give customers – both nationwide and around the world – a competitive advantage. The site gives users access to information about risk control topics that are relevant to the unique exposures our customers face in their enterprises,” said Bob Brody, Senior Vice President of Risk Control. “The site can be very helpful in providing tools to the small business owner who is just starting to develop a risk control program, but also can help larger businesses complement their existing programs. This is simply another example of how Travelers works very hard to ensure that its offerings are in-synch with the needs of its customers.” For more information, please visit our Web site at www.travelers.com/riskcontrol or www.riskcontrol.com, contact your Risk Consultant or e-mail Ask-Risk-Control@travelers.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. Florida Insurance Crisis Triggers Some Snowbirds to Extend Florida Stay BOCA RATON, Fla., Jan. 23 /PRNewswire/ -- Many retirees from the North who rent for several months in Florida are shortening their stay because of higher rental rates that have increased to keep up with spiraling insurance rates. However, the reverse is true for those who own a Florida home. Some snowbirds hit by skyrocketing insurance rates and increased real estate taxes are extending their Florida stay in hopes of reducing expenses by avoiding northern taxes. 183 days is the magic number. But will it work? Allan R. Lipman, an attorney who has authored two books on the subjects answers the question at http://www.snowbirdguide.com . In a 35 minute free audio webcast, he answers the 10 questions most frequently asked by Florida snowbirds who are either considering a change of domicile to Florida or who have already done so. Lipman, who has a law office both in Florida and New York, lives in Boca Raton during the winter. "Hit with higher expenses, both up north and here in Florida, many snowbirds are opting to downsize their northern home, quit their northern country clubs and extend their stay in Florida," observes Lipman. The motive is not only the weather, but to avoid northern state income taxes and state estate taxes. Florida has neither. As a bonus, Florida caps annual increases in real estate assessments to 3% for snowbirds who make the domicile change. Also, it has repealed its annual intangible tax on stocks and bonds. Assuming a snowbird is otherwise qualified, income taxes in New York and some other northern states may be avoided if a snowbird is not present in the northern state for more than 183 days in a calendar year but it is critical that a diary be kept and that the days are properly counted. For example, in New York if the plane lands in New York at 11:00 p.m. on a Friday and departs at 6:45 a.m. on a Sunday, New York counts both Friday and Sunday as a full day in New York. "Northern states are becoming more aggressive and a domicile audit should be anticipated," warns Lipman. At http://www.snowbirdguide.com, Lipman, who has defended snowbirds against challenges by state auditors since 1977, explains how to prepare for an audit and how to respond if an audit occurs. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 22. Consumer Directed Health Plans Present an Opportunity to Reduce Health Insurance Premiums PALO ALTO, Calif., Jan. 23 /PRNewswire/ -- The consumer directed health plans (CDHP) market is still in the developing phase as most health insurers have only begun to offer these products to all accounts across multiple geographic regions. As health insurance premiums continue to increase, more employers are likely to offer CDHPs to their employees, pushing up enrollment rates. The new study from Frost & Sullivan ( www.healthcareIT.frost.com ) U.S. Consumer Directed Health Plan Markets finds that premium revenues for the market were $39.7 billion in 2006 and is likely to reach $399.1 billion in 2012. If you are interested in a virtual brochure, which provides financial executives, investment professionals, marketing directors, business development executives, and other industry participants an overview of the latest analysis of the U.S. Consumer Directed Health Plan Markets, then send an e-mail to Melina Trevino, Corporate Communications, at melina.trevino@frost.com with your full name, company name, title, telephone number, e-mail address, city, state, and country. We will send you the information by email upon receipt of the above information. www.frost.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 23. Marsh Granted Industry-First License in China BEIJING--(BUSINESS WIRE)--Marsh today announced it has been awarded China’s first ever Wholly-Owned Foreign Enterprise (WOFE) insurance broking license. The new license provisions, subject to tax and regulatory approvals, are in-line with China’s World Trade Organisation commitments to open its insurance industry to foreign investment. Under terms of the new licensing agreement, Marsh’s existing risk consulting business will have its scope expanded in China to include brokerage for insurance of large scale commercial risk, brokerage for reinsurance, brokerage for international marine, aviation, and transport insurance. The firm will operate in China as Marsh (Beijing) Insurance Brokers Co. Ltd. www.marsh.com.cn Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 24. Tower Group, Inc. Announces Issuance of $20 Million of Subordinated Debentures in Connection with an Offering of Trust Preferred Securities NEW YORK--(BUSINESS WIRE)--Tower Group, Inc. (NASDAQ: TWGP) announced today that it intends to raise $20 million through the offering of subordinated debentures. The subordinated debentures have stated maturities of 30 years, pay interest quarterly and are redeemable at par on or after five years from the date of issuance. The interest rate is fixed at 8.155% for the first five years and the coupon rate will float quarterly thereafter at the three-month LIBOR interest rate plus 300 basis points. The trust preferred offering is expected to close on or about January 25, 2007. www.twrgrp.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 25. Tower Group, Inc. Announces Pricing of 2,704,000 Shares of Common Stock NEW YORK--(BUSINESS WIRE)--Tower Group, Inc. (NASDAQ: TWGP) announced today the public offering of 2,704,000 shares of its common stock at $31.25 per share. The underwriters have an option to purchase up to 405,600 additional shares of common stock from Tower to cover over-allotments, if any. The lead manager of the public offering is Friedman, Billings, Ramsey & Co. Inc. and Cochran Caronia Waller Securities LLC, Keefe, Bruyette & Woods, Inc. and KeyBanc Capital Markets, a division of McDonald Investments Inc. are the co-managers. www.twrgrp.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 26. Wharton MBA Students Gain Venture Capital Education by Joining $18-Million, Student-Run University Venture Fund SALT LAKE CITY & PHILADELPHIA--(BUSINESS WIRE)--Diving in for a swim-with-the-sharks approach to entrepreneurial business education, students from the Wharton School of the University of Pennsylvania, the oldest collegiate business school in the world, are now working with University Venture Fund (UVF), the nation’s first and largest student-run private equity firm. UVF students raised an unprecedented $18 million from limited partners to invest in the high-risk/high-reward world of venture capital. www.uventurefund.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 27. World Insurance Report: Customer Satisfaction is No Guarantee of Loyalty To Retain Profitable Clients Insurers Must Master their Enterprise Data to Segment and Understand Customers Better Insurers who Support Distributors with Easy Data Access and Updated Tools Deliver More Value to Customers NEW YORK--(BUSINESS WIRE)--A satisfied insurance customer isn’t necessarily a loyal one, according to the first World Insurance Report, a groundbreaking international study of over 10,000 insurance customers, insurers and distributors released by Capgemini, one of the world’s foremost providers of Consulting, Technology and Outsourcing services and the European Financial Management & Marketing Association (EFMA) today. The report findings indicate that customer satisfaction does not equate with customer loyalty. While very few customers surveyed in the report expressed outright dissatisfaction over either the type or quantity of interactions they have with insurers or agents, almost 40 percent of non-life insurance customers switched providers in the last five years. “Rising Internet use is increasing transparency in the industry, providing customers with better access to information on product specifications and pricing — and increased bargaining power. As a result, customers have become more self sufficient, price-sensitive and less loyal,” said Bertrand Lavayssière, managing director, Capgemini Global Financial Services. “To serve informed customers better and stem the loss of profitable customers, insurers will need to hone their customer retention strategies and achieve a comprehensive yet discerning view of what it is specifically that customers’ value.” To improve their ability to more effectively meet customers’ needs and ultimately attain profitable growth and customer retention, the report concludes that insurers must seek to gain an understanding of the precise drivers of retention – and fully partner with their distributors to generate added value for their customers. For more information about individual service lines, offices and research is available at www.capgemini.com or for a copy of the 2006 World Insurance Report visit www.capgemini.com/worldinsurancereport Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 28. Meir Eliav Speaks About Life Settlements for Rated Securitizations NEW YORK--(BUSINESS WIRE)--As the life settlement investment market rapidly expands, 30-year finance industry veteran and president of Legacy Benefits, Meir Eliav offered his perspective on the opportunities of this important alternative investment at a major conference in New York on January 18 and 19. Joining a distinguished panel of finance leaders at the “Emerging Investment Strategies in the Secondary Life Market” conference, Eliav spoke about his firm’s experience in 2004 as the first ever to originate a portfolio of life settlement assets for a securitization transaction. The offering was rated by Moody’s and underwritten by Merrill Lynch. The rated securitization broadened the appeal of this investment class to mainstream institutional and high-net-worth investors and represented a genuine recognition of its value in the investment marketplace. “By putting actuarial expertise to new use,” Eliav explained, “Legacy Benefits was able to purchase and combine policies into a portfolio that provided bond-like performance, with stable interest payments and principle returns. Merrill Lynch and Legacy used the portfolio and related insurance contracts as collateral for an offering of notes.” www.legacybenefits.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 29. Aetna Signs Agreement with St. James Parish Hospital NEW ORLEANS--(BUSINESS WIRE)--Aetna (NYSE: AET) announced today that it has reached agreement with St. James Parish Hospital on a three-year contract, expanding hospital and physician access for its members in the New Orleans area. Under the new contract, which took effect Jan. 1, Aetna members can receive covered in-patient and out-patient services, at in-network rates, at St. James Parish Hospital’s Lutcher, La. location. www.aetna.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 30. Prudential Closes $130 Million Loan for South Bay Galleria REDONDO BEACH, Calif.--(BUSINESS WIRE)--Prudential Mortgage Capital Company announced today that it recently originated a $130 million loan ($100 million A-Note on behalf of its conduit and $30 million B-Note on behalf of its General Account) for the South Bay Galleria in Redondo Beach, California. Prudential Mortgage Capital is the commercial mortgage lending business of Prudential Financial, Inc. (NYSE:PRU). www.prudential.com/mortgagecapital Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 31. New Orleans Recovery Chief to Lead Global Warming Project for Lincoln Institute Research By Edward Blakely Will Focus on Adaptation to Harmful Impacts in Coastal Cities CAMBRIDGE, Mass., Jan. 23 /PRNewswire-USNewswire/ -- Edward J. Blakely, a professor of urban planning at the University of Sydney and recently named by New Orleans Mayor Ray Nagin to lead the rebuilding effort following Hurricane Katrina, will lead research on how cities can adapt to climate change for the Lincoln Institute of Land Policy.Blakely, former deputy mayor of Oakland and former dean at the New School University of New York, was named a research fellow for 2006-2007 to study how global warming threatens cities worldwide, through devastating changes in natural systems near densely populated communities. www.lincolninst.edu Return to Headlines - - Print Article / Read Entire Article / E-Mail Article
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