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1. Ceridian agrees to be bought for $5.3 bln By Megan Davies NEW YORK, May 30 (Reuters) - Ceridian Corp. (CEN.N: under pressure from an activist hedge fund, agreed to be bought by private equity firm Thomas H. Lee Partners [THL.UL] and insurance company Fidelity National Financial Inc. (FNF.N: for $5.3 billion, the business services company said on Wednesday. Ceridian had been battling with Pershing Square Capital Management, a hedge fund and major shareholder, which wanted the company to spin off its Comdata division and replace its board. Pershing told Ceridian in a letter earlier this year that the company had "underperformed and failed to achieve its business potential for more than a decade." Ceridian said in a statement on Wednesday it had conducted a "comprehensive review process" in which it evaluated a "number of strategic alternatives available" including options related to Comdata. The all-cash $36-a-share deal is a premium of about 17 percent to Ceridian's closing share price on Feb. 12, the last trading day before it said it retained Greenhill & Co. as financial advisers to explore strategic alternatives. It said the previous month it had hired a financial adviser to help review its business, including a possible Comdata spin-off. Minneapolis-based Ceridian's main human resources outsourcing division offers payroll, benefits administration, and other services to companies. Comdata offers payment processing and is an issuer of credit cards and debit cards. Jacksonville, Florida-based Fidelity National Financial provides title insurance. Title insurance, commonly offered in the United States, gives buyers and lenders protection against defects in a property that later may come to light -- such as a third party having a prior ownership claim on that property. Ceridian's shares closed at $34.19 on Wednesday. The deal is subject to shareholder and regulatory approval. SHAREHOLDER PRESSURE Sources previously told Reuters that Pershing founder William Ackman felt he and other shareholders stood to make significantly more money should Ceridian be split up rather than sold. In addition to pressure from Pershing, activist investment firm Relational Investors had also been agitating for changes at Ceridian. Relational founder Ralph Whitworth in February wrote to Ceridian and said investors were not satisfied with its performance. But in an April interview, Whitworth said Relational had sold all its Ceridian shares, saying he had "bigger fish to fry." Pershing could not be immediately reached for comment on Wednesday's deal. Editing by Steve Orlofsky/Braden Reddall (C) Reuters 2007. All rights reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article Wachovia Securities President and Chief Executive Daniel Ludeman will keep that role in the combined brokerage firm. A.G. Edwards Chairman and CEO Robert Bagby will be chairman. Bagby, reached at his St. Louis office, said he could not comment on the deal. The combined organization should achieve expense efficiencies of $395 million after taxes by 2009, or 10 percent of its most recent fiscal year-end expense base, Wachovia said. Wachovia expects to record merger-related and restructuring charges and exit cost purchase accounting adjustments of about $860 million after taxes in connection with the deal. The Charlotte, North Carolina-based company said it expects the transaction to close in the fourth quarter of 2007, to add to earnings in the first full year following the closing and provide an internal rate of return of 24 percent. Prudential Financial, Inc. (PRU.N: ) owns 38 percent of Wachovia Securities. Before the deal was announced, A.G. Edwards shares were up 22 percent this year. A.G. Edwards said in its latest proxy filing that its total shareholder return lagged the return of the Standard & Poor's stock index during the five-year period ended February 28. But the brokerage said its shares outperformed a six-member peer group including Merrill Lynch & Co. (MER.N: ), the world's largest brokerage company; Charles Schwab Corp. (SCHW.O: ) and Morgan Stanley (MS.N: ), posting a 71 percent return compared to the peer group's 27 percent gain during that period. Albert G. Edwards, founder of the brokerage, was appointed by Abraham Lincoln as assistant secretary of the Treasury. He served in that position under five presidents until 1887, when he formed the firm with his son. Wachovia Securities reports to David Carroll, president of Wachovia Corp.'s Capital Management Group. (Additional reporting by Tim McLaughlin) © Reuters 2007. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 3. Pay bias cases face 6-month limits: Supreme Court Tue May 29, 2007 12:38PM EDT By James Vicini WASHINGTON (Reuters) - The U.S. Supreme Court handed business groups a victory on Tuesday by ruling that federal law limits pay discrimination lawsuits to a six-month period after the alleged unlawful employment practice occurred. By a 5-4 vote, the high court rejected the argument that an employee can sue over the amount of a current paycheck, based on employment decisions that occurred long ago outside the six-month, statute-of-limitations period. Business groups and the Bush administration had argued the statute of limitations should begin when the alleged bias occurred. Businesses had been concerned about being held liable for pay claims dating back years before the filing of a discrimination lawsuit. The ruling was a defeat for Lilly Ledbetter. She had sued Goodyear Tire & Rubber Co., claiming that after 19 years at the company's plant in Gadsden, Alabama, she was making $6,000 a year less than the lowest-paid man for the same work. Ledbetter claimed the disparity existed for years and was primarily a result of her gender. A jury agreed, but a U.S. appeals court overturned the award because she had waited too long to bring her lawsuit. The Supreme Court's conservative majority agreed. Justice Samuel Alito rejected Ledbetter's argument that pay discrimination is harder to detect that other types of employment discrimination. "Ledbetter's policy arguments for giving special treatment to pay claims find no support in the statute and are inconsistent with our precedents," Alito wrote in the opinion. The courts four liberals -- Justices John Paul Stevens, David Souter, Stephen Breyer and Ruth Bader Ginsburg -- dissented. © Reuters 2007. All rights reserved Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 4. Barclays settles insider trading charges Wed May 30, 2007 12:17PM EDT By Emily Chasan NEW YORK (Reuters) - Barclays Bank (BARC.L: has agreed to pay about $10.9 million to settle charges of illegal insider trading in bond securities, the U.S. Securities and Exchange Commission said on Wednesday. In court documents filed in New York, the SEC alleged that Barclays and Steven Landzberg, the former head proprietary trader for Barclays' U.S. distressed debt desk, illegally traded millions of dollars of bond securities between March 2002 and September 2003, based on material, nonpublic information received through bankruptcy creditor committees. Barclays and Landzberg agreed to the settlements without admitting or denying the allegations, the SEC said. To settle the charges, Barclays agreed to pay a civil penalty of $6 million, disgorgement of nearly $4 million and prejudgment interest of $971,825, the market regulator said. Landzberg, 40, of Waccabuc, New York, will pay a civil penalty of $750,000, the SEC said. He will be permanently prohibited from participating in any creditors committee in any federal bankruptcy court proceeding involving an issuer of securities, the SEC said. The complaint charges that Landzberg obtained the nonpublic information as Barclays' representative on six different official creditors committees in bankruptcy proceedings. Barclays allegedly made illegal trades in notes or securities of Conseco Inc. (CNO.N: Galey & Lord Inc., Pueblo Xtra International Inc., Desa International Inc., Archibald Candy Corp., and Air 2 US, a leasing company related to United Airlines parent UAL Corp. (UAUA.O: "Barclays' Compliance Department failed to impose informational barriers or otherwise enforce policies or procedures to prevent Landzberg from trading such securities on the basis of material nonpublic information," the complaint said. Barclays spokesman in New York had no comment on the settlement, but pointed to a March regulatory filing from the bank that said it has cooperated with the SEC staff during the commission's investigation. In the filing, Barclays said it "independently addressed the practices, policies and procedures at issue in 2003, prior to the commencement of the SEC investigation, and none of the employees engaged in such trading activity is currently employed by Barclays." Landzberg could not immediately be reached for comment. (Additional reporting by Martha Graybow) © Reuters 2007. All rights reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 5. RIMS Launches Online Legislative Action Center New features enable risk professionals to become more engaged in government affairs New York, N.Y., May 31, 2007 – In an effort to involve its members in government affairs and lobbying initiatives, the Risk and Insurance Management Society, Inc. (RIMS) has launched the RIMS Legislative Action Center on its website at www.RIMS.org/LegislativeAction. “RIMS has made it easy for risk professionals to become more active in government affairs,” says Terry Fleming, member of RIMS Board of Directors and director of the division of risk management for Montgomery County, Maryland. “RIMS is recognized in government as the voice of risk management, but we need members to become more supportive. RIMS Legislative Action Center will provide the risk management industry with the tools necessary to reach out to members of Congress and make their voice heard.” RIMS Legislative Action Center provides information and updates on key federal legislative initiatives, including the Terrorism Risk Insurance Act (TRIA), Surplus Lines Reform Legislation and Optional Federal Charter. It also provides an extensive database on members of Congress, including voting scorecards and links to their websites. Additionally, to facilitate grassroots efforts, the website provides risk managers the opportunity to identify their local elected officials and send a personalized message via e-mail and mail—a feature that is particularly valuable during critical voting periods. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article
It’s not by chance we’ve made our Accident plans easier to sell! In our constant effort to update and improve one of the industries most diverse product portfolios we have made significant changes to the rate classifications and our proposal and split case processes regarding these products. The rate classes have been condensed down to two classifications A and B, and we have determined fewer unacceptable groups. We are also eliminating the need for proposals. You can quote from the rate sheets without having to go through the proposal process. On top of this we have expanded your ability to fit our Accident plans to your client’s exact needs. You may offer Class A rates and Class B rates within the same company. Finally, in order to ensure a clean transition, the new rate classes will be available only to new groups on an ongoing basis. This improved market position for the AccidentSelect® I, II, and TransAccident® plans have given us a reason to celebrate! We are inviting you to register and win the Game of Chance Accident Sales Contest.
For more information call 1-800-400-3042, send an e-mail to twminfo@aegonusa.com, or visit our contest information website. 6. Ernst, Deutsche may face fines in tax shelter case: report Thu May 31, 2007 8:16AM EDT NEW YORK (Reuters) - Ernst & Young (ERNY.UL: and Deutsche Bank (DBKGn.DE: could face monetary sanctions rather than criminal charges in a U.S. tax shelter probe, The Wall Street Journal reported on Thursday, citing unnamed sources. U.S. prosecutors charged two current and two former partners of the accounting firm on Wednesday with tax fraud conspiracy arising out of the sale of tax shelters. The indictment came after years of investigations into the sale of aggressive tax shelter strategies. Sixteen former partners at rival "Big Four" firm KPMG (KPMG.UL: are also facing trial in September. Ernst & Young is discussing settlement options that would probably fall short of an indictment, but include monetary sanctions, the paper said. Prosecutors are also continuing their probe into Deutsche Bank, which is alleged to have helped arrange financing for tax-shelter products, the paper reported. Ernst & Young was not immediately available to comment. Deutsche Bank spokesman John Gallagher declined to comment. In a statement on Wednesday, Ernst & Young said it had made changes to its tax practice. "The individuals who were indicted are two former partners and two partners who have been on administrative leave," Ernst & Young spokesman Charles Perkins said. "They were part of a small group within the firm, disbanded years ago ... Ernst & Young has cooperated with the government from the beginning of its investigation, and we will continue to do so." In July 2003, Ernst & Young agreed to pay $15 million to the IRS to end an investigation of tax shelter marketing. © Reuters 2007. All rights reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 7. Wellpoint CFO resigns, violated code of conduct Thu May 31, 2007 8:44am ET CHICAGO (Reuters) - Wellpoint Inc. (WLP.N: ) said its chief financial officer, David Colby, resigned after an internal investigation revealed that he violated the health insurer's code of conduct. The board of directors named Wayne DeVeydt as his successor, effective immediately. In a statement, the largest U.S. health insurer said its investigation did not reveal illegal conduct and that the violations were not related to Wellpoint's business. "Given the nonbusiness nature of the violations, the company will make no further comment on the circumstances resulting in the resignation," Wellpoint said in a news release. Shares of Wellpoint, which reported its membership rose about 2 percent to 34.9 million as of the end of March, have risen 7.25 percent year to date. The shares closed at $84.40 the New York Stock Exchange on Wednesday, just off their record of $85.45, set on May 17. © Reuters 2007. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 8. Celebrating Its 55th Anniversary, Aus Unveils Its Newly Designed Website: www.onlineAUS.com On Monday, May 21, 2007, AUS unveiled its newly designed Web site. The new site is a continuation of AUS's commitment to the financial services industry. The Next Fifty-five Years AUS President, Robert Adler won’t make projections out to 2062, but he does make a promise to his audience: AUS will keep doing what it’s done, only better. We're constantly developing and improving AUS, combing and revising the content, improving what we have and introducing new resources. This summer we will be introducing AUS's newest feature, Concepts Illustrated. Easy to understand graphics coupled with executive summaries, all cross-referenced to our extensive Main Libraries. Companies who are active in the advanced sales marketplace, as well as companies who are considering entering this marketplace, will find AUS to be informative, educational and useful. For more information regarding AUS, please visit our website, www.onlineAUS.com. A free 14-day trial is available at the website. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 9. 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 10. DOZENS ARRESTED ACROSS FIVE COUNTIES IN REGIONAL INSURANCE FRAUD BUSTS Schemes Employed By Rings Included Setting Vehicles Ablaze, Falsifying Stereo and Rim Receipts, and $1.7 Million in Workers’ Compensation Insurance Premium Fraud FRESNO – Today California Insurance Commissioner Steve Poizner, with Fresno County District Attorney Elizabeth A. Egan, Kern County District Attorney Ed Jagels, Kings County District Attorney Ron Calhoun, Merced County District Attorney Larry Morse II, and Tulare County District Attorney Phil Cline, unveiled the results of concerted, multiple investigations into alleged auto insurance and workers’ compensation insurance fraud over the past year. Over the past few days, law enforcement officers fanned out over five counties to serve 58 arrest warrants for insurance fraud and related charges, such as grand theft, receiving stolen property and perjury. Four suspects were already arrested and charged late last year. Another suspect is in federal custody; a hold has been placed on him to answer for the local charges. Insurance fraud costs California consumers and businesses an estimated $15 billion per year. A total of 66 suspects will be charged (three persons were already in custody on unrelated charges and were re-arrested) with insurance fraud. Each count of insurance fraud is a felony and carries a maximum sentence of up to five years in state prison and/or a fine of $50,000, as well as the possibility of being ordered to pay an undetermined amount of fines and restitution. “Today’s arrests have dealt a death blow to these elaborately organized schemes. By working together, we’ve crippled their ability to continue their concerted rip-off of the system,” said Insurance Commissioner Steve Poizner. “Insurance fraud isn’t victimless. Every man, woman and child in California essentially pays a $500 ‘fraud tax’.” Fresno County District Attorney Elizabeth A. Egan said, “The large number of suspects arrested is indicative of the magnitude of insurance fraud. It concerns me to see our citizens paying higher premiums and increased consumer prices due to criminals taking advantage of the insurance system. I want to thank Insurance Commissioner Steve Poizner, and the Department of Insurance investigators for working closely with the Central Valley law enforcement agencies in our fight against insurance fraud.” The suspects arrested either provided, assisted, or verified false receipts which were to be used to obtain insurance monies through fraudulent insurance claims for aftermarket stereo equipment, custom wheels and tires, and performance parts. Scams of this type cost insurance carriers, and ultimately consumers, in the southern San Joaquin Valley an estimated $200,000 per year. Operation Scratch n’ Play investigators visited most of the aftermarket stereo, custom wheel and tire, and performance parts stores in Fresno, Kings, Madera, San Luis Obispo, and Tulare Counties. An undercover investigator discussed an item he or she wished to purchase with the store’s personnel or owner, telling the store’s representative that he or she did not have enough money to purchase the item at this time, but that an insurance claim was going to be filed that the vehicle had been stolen or burglarized. The store’s representative then produced a backdated receipt showing that cash was used to purchase the selected item, which would indicate to the insurance carrier that the item was purchased and subsequently stolen during the supposed theft. The fraudulent receipts provided to the undercover investigators ranged from $800 to $5,000. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article
11. Professional Insurance Agents Say Check Your Insurance Before Hurricane Flags Fly WASHINGTON, May 30 /PRNewswire-USNewswire/ -- With the start of the Atlantic hurricane season on June 1, the National Association of Professional Insurance Agents is reminding homeowners to review their insurance coverage before the warning flags fly. "As you prepare for the hurricane season, don't forget to check your insurance," said PIA National President Donna L. Pile. "Be sure your coverage is up-to-date. Don't take chances, call your professional insurance agent and be sure." The National Hurricane Center in Miami has released its predictions for this season, which begins June 1 and runs through November 30. Forecasters are calling for 13 to 17 named storms, seven to 10 hurricanes and three to five major hurricanes which are Category 3 and above. "With expectations for an active season, it is critically important that people who live in East and Gulf coastal areas, as well as the Caribbean, be prepared," said Bill Proenza, director of the National Hurricane Center. Speaking of the lull in storms in 2006, Proenza added, "We're always concerned that infrequency can be disarming." www.pianet.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 12. Hurricane and Summer Rainy Season Begins; FEMA Strongly Urges Consumers to Protect Their Property With Flood Insurance WASHINGTON, May 31 /PRNewswire-USNewswire/ -- June 1 marks the official arrival of the 2007 hurricane and summer rainy season and FEMA's National Flood Insurance Program (NFIP) strongly urges homeowners, business owners and renters to learn their flood risk and protect their property with flood insurance. This year, flood risk is especially high: experts predict above-average hurricane activity, with a 75 percent chance of a major hurricane hitting the United States and the potential for as many as 17 named storms anticipated for the season. Residents living both inside and outside of a high-risk flood area should know their flood risk and consider purchasing a flood insurance policy. Last year, one in three flood insurance claims came from low- to moderate-risk areas. The average premium for a yearly flood insurance policy is around $500, a cost equivalent to a year's subscription to cable television. "This hurricane season, it's important to prepare now to avoid getting caught with the unexpected expense of flood repairs. Standard homeowners insurance does not typically cover flood damage. Flood insurance backed by FEMA's National Flood Insurance Program provides homeowners, business owners and renters with the best protection available against flooding," said David Maurstad, Assistant Administrator of Mitigation and Federal Insurance Administrator for FEMA's National Flood Insurance Program. "Too many properties located in high-risk flood areas continue to be uninsured or underinsured against floods. We urge all Americans to learn their flood risk and take steps to protect themselves." Without flood insurance, residents will likely have to cover repair costs out of their own savings -- and future. In fact, just two inches of water can cause up to $7,800.00 in total losses, including replacement costs for carpeting, flooring, drywall and baseboard molding, along with new lamps, bookshelves and cleanup fees. Homeowners without flood insurance may have to absorb the financial losses on their own or seek limited funding from other sources. To date, the average flood insurance claim for 2006 flood events is approximately $25,000. To learn more about the damage floods can cause, visit http://www.floodsmart.gov/floodsmart/static/testthewaters.jsp. Even without the threat of hurricanes, flooding remains a serious threat throughout the United States. Recent flood activity in Midwest and New England shows the extensive and costly flood damage that heavy rainfall can cause. And last year, every state in the country suffered a flood during the summer season. You don't have to live on the coast or in a high-risk area to experience flood damage. Flood insurance is available through about 90 insurance companies in more than 20,300 participating communities nationwide to renters, business owners, and homeowners. In low- to moderate-risk areas, residents can protect their properties with lower-cost Preferred Risk Policies (PRPs) that start at just $112 a year. Individuals can learn more about their flood risk by contacting their insurance agent, visiting http://www.floodSmart.gov or calling 1-800- 427-2419. FEMA coordinates the Federal government's role in preparing for, preventing, mitigating the effects of, responding to, and recovering from all domestic disasters, whether natural or man-made, including acts of terror. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 13. A.M. Best Comments on the Impact of NAIC Reinsurance Collateral Proposal OLDWICK, NEW JERSEY, U.S.A., May 30, 2007—A.M. Best Co. has reviewed the potential impact of the NAIC’s Reinsurance Evaluation Office proposal that will grant credit for ceded reinsurance. As a result of that review, A.M. Best expects that there are only a handful of U.S. property/casualty companies that will see a material negative impact on their Best’s Capital Adequacy Ratio (BCAR) if collateral for reinsurance recoverables was changed. This review was conducted by recalculating each individual company’s BCAR after removing all of the credit for collateral currently included in the capital model. For Best’s Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 14. RAA RELEASES 2007 FIRST QUARTER REINSURANCE RESULTS WASHINGTON, D.C. ‑‑ According to a survey of reinsurers’ statutory underwriting results conducted by the Reinsurance Association of America (RAA), a group of 22 U. S. property‑casualty reinsurers wrote $6.7 billion of net premiums during the three months ended March 31, 2007. The reinsurers’ combined ratio was 89.8 percent, compared with the combined ratio of 98.4 percent reported by a similar group of reinsurers for the three months ended March 31, 2006. The ratio is attributable to a 65.0 percent loss ratio and a 24.8 percent expense ratio. The survey is available on the RAA website at http://www.reinsurance.org. An annual subscription to the RAA’s quarterly Reinsurance Underwriting Report is available from the RAA by calling 1-800-259-0199, or for more subscription information, contact Kaitlin Hocutt at Hocutt@reinsurance.org. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 15. Schip Guidelines - Principles For Health Insurance Coverage For Children And Families From the Health Policy Consensus Group May 22, 2007 Members of the Health Policy Consensus Group offer the following guidelines to policymakers for consideration during debate over reauthorization of the State Children's Health Insurance Program (SCHIP). We also offer a brief summary of our larger vision of expanding access to health insurance. COMPONENT #1: FUNDING FOR SCHIP SHOULD BE REDEPLOYED TO MORE EFFECTIVELY EXPAND COVERAGE TO CHILDREN WHO ARE MOST IN NEED AND GIVE THEM ACCESS TO PRIVATE HEALTH INSURANCE. COMPONENT # 2: TAX POLICY GOVERNING THE PROVISION OF HEALTH INSURANCE SHOULD BE FAIR AND EQUITABLE. COMPONENT #3: EXPAND PRIVATE SECTOR COVERAGE FOR LOWER-INCOME WORKING FAMILIES THROUGH DIRECT ASSISTANCE, INCLUDING VOUCHERS OR REFUNDABLE HEALTH CARE TAX CREDITS FOR THE PURCHASE OF HEALTH INSURANCE. COMPONENT # 4: ESTABLISH GREATER FLEXIBILITY IN THE USE OF SCHIP AND MEDICAID FUNDING. In summary, we recommend a combination of more equitable tax treatment for all health insurance purchasers, additional assistance for lower-income people, and state flexibility to turn SCHIP and Medicaid benefits into defined contributions. Redeploying these funding sources, coupled with contributions from individuals and families, would facilitate the integration of children with their parents' health insurance coverage, would allow families to have the security of health insurance, and would dramatically expand access to health coverage for American families. *For more information, please see "Reforming the Tax Treatment of Employment-Based Health Insurance," a statement of the Health Policy Consensus Group presented to the President's Advisory Panel on Federal Tax Reform in 2005, and Empowering Health Care Consumers through Tax Reform, University of Michigan Press, 1999. Both available at www.galen.org. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 16. AIA To Urge Stronger Support From State Regulators Of Insurer’s Limited Anti-Trust Exemption WASHINGTON, D.C., May 31, 2007– The American Insurance Association (AIA) will urge state insurance regulators to be more forceful in their support of the limited exemption from federal antitrust laws currently in the McCarran-Ferguson Act and their opposition to Congressional efforts to repeal that exemption, during the National Association of Insurance Commissioners (NAIC) meeting June 1-4 in San Francisco. “We are looking for strong confirmation that the NAIC is doing all it can to support McCarran’s antitrust provisions,” said David Snyder, AIA Vice President and Assistant General Counsel. “Failure to do so will result in new federal layers of regulation on top of the existing state regulatory system, erosion of areas where insurers can compete in a free market environment, and an uncertain legal climate. Such a result will be bad for consumers, insurers, and state regulators.” The McCarran-Ferguson Act (McCarran), approved by Congress in 1945, delegates authority to regulate the business of insurers to the states. McCarran creates a limited exemption from federal antitrust laws to the extent that the business of insurance – not the business of insurance companies – is regulated by the states. This limited exemption from federal antitrust laws is designed to prevent federal antitrust enforcement from undercutting insurance regulatory systems established by the states. “Both regulators and insurers have an interest in efficient and effective regulation, and they both should want to avoid duplicative, even potentially contradictory regulatory mandates from other agencies,” Snyder stated. “While we have a reform agenda for the state regulatory system, as long as the states are designated regulators, then they should perform those functions without second-guessing by antitrust enforcers or consumer agencies. For this reason it’s important for the NAIC to speak clearly in support of McCarran-Ferguson’s limited antitrust exemption.” AIA expects to continue to be engaged in discussions surrounding climate change. “We have worked with the NAIC as it has looked at the climate change issue and have summarized the environmentally friendly activities of insurers,” Snyder said. “However the recent course of action seems to be focused not on useful action, but on increased disclosures by insurers. These mandates could put insurers at odds with traditional regulatory concepts such as prudent investing. Insurers are not responsible for global warming, but increasingly realize that they can, if allowed to do so, send important signals about comparative risks, stated Snyder. www.aiadc.org Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 17. A.M. Best Special Report: U.S. Long-Term Care — 2006 Market Review OLDWICK, N.J.--(BUSINESS WIRE)--According to a recent special report by A.M. Best Co., over the past several years, the individual long-term care insurance industry has been impacted by numerous challenges, which have led to declining sales and lower-than-expected overall profitability. Consequently, individual long-term care sales are running only near the early to mid-1990s levels, as many companies have de-emphasized this product line due to less than anticipated profitability, and as the products themselves have become considerably more expensive over the past five years. The market continues to be concentrated among a limited number of large carriers, and the top 10 companies continue to represent the vast majority of total business. Genworth remains the largest writer of individual long-term care policies. Smaller carriers continue to find it more difficult to compete within this industry. A significant portion of the premium growth has been generated by premium rate increases rather than new sales. Additionally, no participant in the industry, including the leading companies, has reported consistently healthy statutory profits on the long-term care blocks. Despite current demographic trends that suggest increased demand for long-term care, statistics show that current penetration is only 10% and has not reached the high levels predicted for the industry years ago. Approximately half of long-term care policyholders have coverage with a company that no longer actively sells long-term care insurance. The regulatory climate has forced undisciplined insurers to exit the market, while the larger, better-capitalized carriers were able to remain active in this product line. Some carriers left the market as a result of financial or strategic difficulties, while others have remained, repriced products and tightened underwriting practices. Since 2000, six companies listed among the top 10 individual long-term-care producers (Aegon, CNA, Conseco Senior Health, Fortis, IDS Life and Lincoln Benefit) have stopped selling new business in this product line. A.M. Best has observed some newer players, such as Guardian and New York Life, entering the market in recent years. New competitors have tended to be large, strongly capitalized and well-diversified organizations. The new entrants benefit from having more industry data on which to base their pricing and assumptions than did their forerunners in the long-term care market, which currently are grappling with how to best manage their underperforming, older blocks. Over the past number of years, there has been a very limited number of potential acquirers of long-term care business because of the poor performance of the older blocks of business. A.M. Best believes another potential future solution to move these risks off insurance companies’ books and release capital might be the securitization of more seasoned blocks. At this point, though, securitization for long-term care business is more theory than reality. On a positive note, long-term care writers have become more disciplined with respect to the market and have become more aware of the challenges of the industry. Many companies have realized the primary focus should be generating profitable growth as opposed to being market driven. Based on the expanding senior population, which is maintaining longer and healthier life spans, A.M. Best expects the long-term care insurance market to grow over time. To date, however, the long-term care industry has not been able to penetrate the market to the extent previously expected. A.M. Best believes that sustained, positive sales momentum is not likely for at least a few years. The individual long-term care market likely will continue to experience growing pains for awhile. A.M. Best continues to have a negative outlook on the individual long-term care segment overall, as it will take additional time to conclude whether the current products being sold are priced accurately. www.bestweek.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 18. L.A. Care Launches Ad Campaign Targeting Uninsured LOS ANGELES, May 30 /PRNewswire/ -- L.A. Care Health Plan, the nation's largest public health plan, will launch a new advertising campaign this week targeting low-income Hispanic uninsured families. Nationally recognized advertising agency La Gente de RLR was awarded the account in February, and is handling all creative development, production, media planning, and media buying. Through this effort, L.A. Care hopes to reach uninsured families who are eligible for government-sponsored health care programs (such as Medi-Cal and Healthy Families) but are not enrolled for a variety of reasons. "L.A. Care has a vision of a healthy community made possible by health care that is accessible and responds to people's needs in a way they can understand," said Howard Kahn, CEO of L.A. Care. "Part of that effort is to ensure L.A. County residents know the health care options available to them." With nearly 800,000 members, L.A. Care provides health care coverage for low-income and vulnerable populations through Medi-Cal, Healthy Families and L.A. Care's Healthy Kids. Currently, more than two million people in Los Angeles County are uninsured, of which over one million are Latino. Many uninsured are eligible for government sponsored health insurance, but they are not enrolled due to cultural and language barriers that make it difficult for some to apply, while others simply do not know that they eligible for free or low-cost health insurance programs. To view the "Oranges" campaign, please visit http://www.lacarecampaign.com. www.lacare.org Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 19. MIB Life Index Reports North American Life Insurance Activity Down 1.6% in April WESTWOOD, Mass., May 30 /PRNewswire/ -- North American application activity for individually underwritten life insurance was off -1.6% in April year-over-year, according to the MIB Life Index (SM). The year-to-date (YTD) decline of -4.6% over January-April 2006, compares less favorably to a -1.1% decline seen during the first four months of last year, January-April 2006/2005. Month-over-month, April's application volume was down -2.8% from March 2007 levels. www.mib.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 20. INSURANCE NEWSCAST "Pictures Of The Day" -- Sponsored By:
View INSURANCE NEWSCAST "Sports Pictures Of The Day" View INSURANCE NEWSCAST "Entertainment Pictures Of The Day"
21. The Main Street America Group Announces Expanded Surety Bond Capacity Provides Independent Insurance Agents and Their Customers Enhanced Surety Opportunities JACKSONVILLE, Fla., May 31 /PRNewswire/ -- The Main Street America Group, a super regional property-casualty insurance carrier, announced today the U.S. Treasury Department has raised its NGM Insurance Company's single surety bond capacity threshold with limits available up to $54 million per bond. Main Street America has provided a full line of competitively priced surety products to Main Street businesses and individuals since 1961 through its network of independent insurance agents. "The U.S. Treasury Department's increase of our surety capacity is a reflection of the financial strength and stability of our company," said Brian Beggs, Main Street America's vice president of bonds. "The greater capacity will enhance our ability to meet the surety bond needs of our agent-customers and their customers. Surety bonds complement our property-casualty insurance business to provide individuals and businesses with a full line of protection products." www.msagroup.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 22. Life Producers See Business Spike over Past 12 Months Agent Media Study shows life insurance agents expect sales to continue upward CLEARWATER, FL (May 31, 2007) - A recent study by Agent Media, publisher of the Agent's Sales Journal and Insurance Marketing magazine, shows that life insurance producers have seen their business trend upward over the past 12 months, mirroring the recent positive performance of the life industry as a whole. Thirty-four percent of respondents said their sales have picked up over the past year, and 41 percent say they've remained steady. But 70 percent expect their sales to increase over the next 12 months, something experts say is buoyed by innovative new products and features that have flooded the marketplace over the past few years. www.AgentMediaCorp.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 23. S&P: As Solvency II Approaches, European Insurers Should Ignore It At Their Peril, Says Report LONDON May 30, 2007--Insurance is experiencing a revolution globally, which is changing the competitive landscape. Solvency II promises much for market efficiency in Europe, but insurers and supervisors are far from ready, according to a report ("Beware Solvency II: As The 2010 Implementation Date Looms Closer, European Insurers Should Ignore It At Their Peril") published today by Standard & Poor's Ratings Services. Quantitative Impact Study 3 (QIS3) is under way, and the Framework Directive is likely to be published in July. With no sign yet of slippage in the planned 2010 implementation date, Solvency II is beginning to loom large. "We believe it will have a profound impact, although many insurers have yet to evaluate its effect on them, feeling that it is not sufficiently imminent to warrant a full analysis," said Standard & Poor's credit analyst Rob Jones. "This is a stance they may come to regret," he added. The European Commission, European Parliament, Council of Ministers, and Europe's supervisors will need to proceed cautiously with Solvency II's implementation to allow an orderly transition. Further quantitative impact studies, with fully representative participation, will be crucial in determining the financial and operational readiness of Europe's insurers. www.ratingsdirect.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 24. HSBC Reveals Billions Contributed by Older People In the US, 60 and 70 year olds contribute $40 billion to the economy in tax and voluntary work 70 is the new 50, as people feel healthier for longer Largest study of older people ever undertaken: 21 countries, 21,000 people NEW YORK, May 22 /PRNewswire-USNewswire/ -- The third annual HSBC Future of Retirement study, the largest study of aging and retirement ever undertaken, has found that, far from being a drain on society, older people are huge contributors to the economic and cultural wellbeing of their nations. Conducted with Oxford University's Oxford Institute of Ageing, The Future of Retirement project surveyed 21,000 people in 21 countries and territories. The study explodes the myth that older people are dependents whose care drains vital resources from nations struggling to cope with aging populations. In fact, through taxation, volunteer work and the provision of care for family members, HSBC has found that those in their 60s and 70s are the foundations upon which their nations build. For further information log on to http://www.ageingforum.org Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 25. Anthem Blue Cross and Blue Shield Keeps Promise to Members: Enhanced Consumer- Driven Health Plans and Services Now Available to Individuals and Small Businesses DENVER, May 23 /PRNewswire/ -- Anthem Blue Cross and Blue Shield is now offering new consumer-driven health plan (CDHP) options for small group employers and individuals that will change the way consumers think about health care -- helping them to lead healthier lives while also helping them gain control over the rising cost of care. These products and services have been available to large businesses in Colorado since January. Anthem will offer the following core CDHP products: -- Lumenos(R) Health Reimbursement Account -- Lumenos Health Savings Account -- Lumenos Health Incentive Account -- Lumenos Health Incentive Account Plus Consumers who choose Lumenos products will be eligible for extensive preventive care benefits and personal health coaching, as well as smoking cessation and weight management programs. In addition, most consumers will receive financial rewards for completing various wellness programs. www.wellpoint.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 26. Asparity Quantifies Consumer Behavior for Health Care Benefits DURHAM, N.C.--(BUSINESS WIRE)--Asparity Decision Solutions found that employees who used decision support during the 2007 enrollment season made different — and more cost-effective — health care choices that better met their needs than employees who did not use decision support (nonusers). Asparity provides decision support and data solutions in the areas of employee benefits and operational risk. The company owns patented technology in conjoint analysis and advanced software applications that it delivers directly to corporate clients and through strategic partners. The company is headquartered in Durham, N.C. with offices in Amarillo, Texas. www.asparity.com Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 27. China to let insurers invest more abroad: official Thu May 31, 2007 1:10AM EDT Email This Article | Print This Article | Reprints[-] Text [+] BEIJING (Reuters) - China will soon let insurance firms plough more money into equities and other assets overseas, including London and New York, and allow them to set up fund companies, a senior regulatory official said on Thursday. Sun Jianyong, a director of the China Insurance Regulatory Commission, told reporters that his commission would soon issue long-awaited rules to permit domestic insurers to invest 15 percent of their total assets abroad, up from 5 percent now. Given that Chinese insurers assets totaled 1.97 trillion yuan ($257.5 billion) at the end of 2006, the move could potentially release up to 300 billion yuan into overseas markets. "We are going to lower all the basic regulatory thresholds so they can invest abroad," said Sun, who is in charge of the department dealing with how insurers invest their money. ($1=7.649 Yuan) © Reuters 2007. All rights reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 28. Israel's Clal Insurance buys U.S insurer Guard JERUSALEM, May 31 (Reuters) - Clal Insurance Enterprises Holdings (CLIS.TA: one of Israel's largest insurance companies, said on Thursday a wholly owned subsidiary had bought U.S. insurer Guard Financial Group Inc. Clal had previously announced it would pay $120 million for the privately owned insurer and an additional amount in three years, based on Guard's net profit and capital. Clal said in a statement to the Tel Aviv Stock Exchange it had paid an additional $10 million for Guard, which focuses on workers' compensation. In order to help finance the acquisition, Clal said it had received a loan of $46 million from an international bank. Clal is a subsidiary of holding company IDB Development Corp. (IDBD.TA: Return to Headlines - - Print Article / Read Entire Article / E-Mail Article 29. Morgan Stanley to buy Australia's Investa Thu May 31, 2007 4:20am ET By Michael Smith SYDNEY (Reuters) - Morgan Stanley's (MS.N: ) real estate unit agreed to buy Australia's Investa Properties Ltd. (IPG.AX: ) for A$4.7 billion ($3.9 billion) on Thursday, the nation's third-largest property trust takeover. Morgan Stanley Real Estate offered A$3.08 for each Investa share, its second major acquisition in the past week. Morgan Stanley said earlier this month it has acquired US$121.5 billion of real estate assets worldwide since 1991 and that it also manages $55.6 billion in real estate assets on behalf of its clients. ($1=A$1.21) (Additional reporting by Jane Williams and Cecile Lefort) © Reuters 2007. All Rights Reserved. Return to Headlines - - Print Article / Read Entire Article / E-Mail Article
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