Preliminary Loss Estimates Announced for Chilean Quake

March 11th, 2010 by Iris | No Comments | Filed in earthquake insurance, world events

Bermuda-based Everest Re Group has announced its preliminary loss estimate for exposures relating to the earthquake in Chile and the recent European windstorm known as Xynthia. The total? Earthquake: $225 million, Xynthia: $25 million. Representatives of the company told the press that the “…currrent estimates for these events are based on underwriters’ preliminary analyses and judgments, client input and discussion, event modeling and profiling of exposed limits.”

The company spokesperson elaborated, explaining, “Current industry loss estimates for the magnitude 8.8 earthquake in Chile range between $4 billion and $10 billion while the range of industry losses for the European Windstorm Xynthia is $2 billion to $4 billion. The Company expects it will be several months before relative clarity emerges with respect to its ceding companies’ underlying losses from these two events and as new information emerges these estimates may need to be adjusted.”

Joseph V. Taranto, Chairman and CEO Of Everest also commented, telling the press in a statement released yesterday: “We are extending our full support to our ceding company clients as they deal with the devastation caused by these events. Ours is a business of risk and we have ample capacity to absorb these losses. As such we are prepared to handle these claims in an effective and efficient manner.”

Meanwhile, insurance carriers with most of their policyholders here in the United States continue to urge consumers, especially those in known active fault areas, to purchase earthquake insurance sooner rather than later.

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Supreme Court Agrees to Hear Childhood Vaccine Case

March 9th, 2010 by Iris | 1 Comment | Filed in health insurance, insurance news

Reuters is reporting that the United States Supreme Court stated on Monday that it had agreed to hear a Pennsylvania case involving a lawsuit filed by parents of s child who suffered seizures after her third round of the standard childhood DPT (diptheria-tetanus-pertussis) vaccine. The suit was filed against vaccine manufacturer Wyeth, which was purchased by Pfizer, Inc., last year.

The issue at hand involves the National Childhood Vaccine Injury Act of 1986, which states that no vaccine manufacturer “…shall be liable in any civil action…” for injuries that “…resulted from side effects that were unavoidable even though the vaccine was properly prepared and was accompanied by proper directions and warnings…”

After conflicting lower-court rulings, the high court agreed to hear the case.

The Georgia Supreme Court ruled that Federal law does allow some design defect claims against vaccine manufacturers, but a U.S. appeals court based in Philadelphia, PA, ruled that Congress had expressly prohibited such claims in order to protect drug manufactures from liability.

Representatives of the Obama administration also offered comment, stating that the Federal law did expressly prohibit design defect lawsuits in state court, but said that with the conflicting rulings, getting the Supreme Court involved was warranted.

Attorneys for the administration also said that as long as the issue remains unresolved, manufacturers’ concern about potential liability may be a detriment to the public health, because it could deter the development and production of vaccines.

In response to the Supreme Court’s announcement, Pfizer made a statement saying it was “…hopeful that the Supreme Court will affirm…” the Philadelphia appeals court ruling. “Pfizer is pleased that the U.S. Supreme Court has agreed to resolve this legal issue, which is of critical importance to national public health policy,” the company said.

Currently, there are roughly 5,000 claims alleging a link between childhood vaccines and neurological damage (including autism) pending under the process set under Federal law. The legal issue would affect the ability of all of those claimants to seek damages under state law as well.

The patient in the Pennsylvania case is Hannah Bruesewitz, whose parents allege that her seizure disorder and serious developmental delay are directly related to toxins inherent in the design of the DPT vaccine. After they were rejected by the Federal compensation process, the Bruesewitzes filed a lawsuit in state court, but the appeals court and a Federal judge both ruled that their lawsuit was disallowed by Federal law.

The Supreme Court is expected to hear arguments in the case and to issue its decision during its upcoming term that begins in October.

Meanwhile, Pfizer shares fell 1 percent to $17.30 in morning trading on the New York Stock Exchange.

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Flood Insurance and Other Programs Temporarily Restored

March 5th, 2010 by admin | 1 Comment | Filed in cobra insurance, flood insurance

Earlier this week, the U.S. Senate passed legislation that included an extension for the federal flood insurance program until the 28th of March. The extension means that the NFIP (National Flood Insurance Program) can once again issue new policies, something it hasn’t been able to do since its authorization expired at midnight last Friday. The issuing of new and renewal policies has now resumed.

Brad Carroll, press secretary with FEMA, said in a statement, “This reauthorization allows for policies to continue to be issued and renewed. Individuals who were seeking to renew their policies or purchase a new policy during the brief period between February 28 and March 2, when the NFIP was not reauthorized, may now proceed with their purchase. Existing policies were not impacted by the brief lapse in Congressional authorization and continue uninterrupted.”

On February 26, the NFIP had issued a memo that included guidelines for operations during a hiatus, but the several-day hiatus that followed almost immediately did not affect any claims payouts.

Other programs reauthorized through this emergency legislation include COBRA benefits and unemployment insurance.

The National Flood Insurance Program currently covers about 5 million people.

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El Nino Dissipating, but Effects Not Gone

March 4th, 2010 by admin | No Comments | Filed in flood insurance, homeowners insurance

Reuters is reporting today that the currently active El Nino weather anomaly, which causes abnormal warming of the water in the equatorial parts of the Pacific Ocean, is dissipating, and – in the Northern Hemisphere – it should be gone by early summer, though there is a chance it may merely weaken substantially, and linger throughout 2010.

Reuter’s information comes directly from the CPC – the federal government’s Climate Prediction Center – which is part of the United States National Oceanic Atmospheric Administration (NOAA). Their recent monthly update reported that the hallmark warm Pacific waters are slowly cooling, and that such an easing will result in “…neutral conditions” in June or July. However, the CPC also said that there are, “…everal models (which) suggest the potential of continued weak El Nino conditions through 2010, while others predict the development of La Nina conditions later in the year.”

Typically, El Nino results in chaotic global weather patterns, most notably in the Asia-Pacific region. It was first noticed by Latin American anchovy fisherman in the 19th century, who nicknamed it “Little Boy,” a reference to the Christ child, because it traditionally arrives around Christmas time. The opposite anomaly, La Nina, leads to cooler waters in the Pacific Ocean, and is often said to spark storm formation during the annual Atlantic hurricane season.

The 2009-2010 El Nino has been moderate to strong, says the CPC, with sea surface temperatures remaining warm through February, but is is also linked to the severe winter storms which have hammered the eastern United States. It was also blamed for a weak monsoon which caused severe damage to the Indian cane crop, forcing the price of sugar to a 29-year high. In addition, El Nino is believed to be connected to a severe dry spell which has hit the countries of Indonesia and the Philippines, forcing the later to increase their rice imports. The Philippines is already the world’s largest importer of the grain.

As the year progresses, the United States should expect above-average rainfall in the southwestern and south-central states, and Florida, and below-average precipitation in the Great Lakes and Pacific Northwest regions.

The “good” news – at least for residents of the Atlantic seaboard, is that if El Nino continues into June, it may hinder the formation of Atlantic hurricanes this year.

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Safeco, Republic Write New Homeowners Policies in Coastal Mississippi

March 3rd, 2010 by admin | No Comments | Filed in insurance specialists

Mississippi state Insurance Commissioner Mike Chaney announced recently that Safeco Insurance has plans to offer homeowners insurance, including wind coverage, in southern part of his state. Beginning in mid-March, Chaney says, the company will offer between 500-1,000 homeowners policies with wind coverage.

For homeowners who live in places frequently hit by hurricanes, wind coverage is on an equal par with flood insurance as a key form of coverage, but many insurers have restricted wind coverage in Mississippi, or even stopped offering it completely to new or nonrenewed policyholders who are also coastal residents.

Mr. Chaney believes Safeco will also offer discounts to customers who want to strengthen their homes, in order to minimize hurricane damage, though that will be sometime in the future.

Safeco is not the only new player on the Mississippi coast, however. Chaney said that another major company, Republic Insurance Group, is also writing new homeowner policies for clients with property near the shore, and those policies also include wind coverage.

A lingering effect of Hurricane Katrina is that many policyholders with coastal property have been forced into the state-run wind pool. This pool maintains rates higher than the private market.

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Flood Insurance, other Programs, Not Extended by US Senate

March 2nd, 2010 by admin | No Comments | Filed in cobra insurance, flood insurance, insurance news

Last week, the United States Senate failed to vote on several bills meant to extend federal programs including unemployment, COBRA, flood insurance, and transportation project funding, before their expiration dates on Sunday, February 28th. Why? Because one senator, Jim Bunning (R-KY) has concerns enough about how to pay for such programs, that he’s blocked final approval of any of them.

The result of this is that all of those programs could be in political limbo for a week or so, until the Senate finds away to either approve the extensions without Bunning, or assuage his worries. Practically, this means that – for example – the National Flood Insurance Program (NFIP) will not be able to issue any new policies, approve renewals, or increase coverage amounts, until reauthorization has been approved by Congress.

Senator Bunning maintains that Congress has not met the requirement of paying for the requested extensions, either via new funding or budget cuts. He says he does support the extensions, but feels funding should be clear before they’re approved. Mr. Bunning is not seeking re-election after his current term ends.

On the Senate floor, Bunning said, “The only difference I have, and some of my good friends from the other side of the aisle, is that I believe we should pay for it. There is a right over the last three years of the Democratically controlled Congress. We have run up $5 trillion in debt. There has to be a time to stop that.”

In response, Senate Majority Leader Harry Reid vowed that the extension measures would pass by week’s end, but he also criticized the Republican senator’s delay tactics, explaining, “We talk a lot about Senate procedure in our debates, and that’s often appropriate. But it’s also often complex. The catch here is that these benefits do not need to expire. We have the ability right now to extend them for just a short time until we work out a longer-term solution. It is irresponsible not to. It is immoral.”

If the extension measures are approved, flood insurance would only be extended through March 28th of this year – just a month. There have already been other short-term extensions within the past year.

The United States House of Representatives has already approved the flood insurance extension.

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American Lung Association wants Smoking Cessation Coverage in Your Health Plan

March 1st, 2010 by admin | No Comments | Filed in health insurance, insurance specialists

Whille the debate over health insurance reform rages on, one topic not being highlighted is coverage for smoking cessation programs. According to the American Lung Association, such a program is a key strategy in the battle to reduce tobacco usage, and the health issues that result from it.

In a report released last November, “Helping Smokers Quit: State Cessation Coverage 2009,” the ALA provided an overview of various services and treatments offered in each state, by both private and public health care plans. At present, the report says, only six states provide comprehensive smoking cessation coverage for Medicaid recipients, and only five provide such coverage to state employees.

ALA president and CEO, Charles D. Connor said in a press release, at the time the report was made public, “Helping smokers across the country quit must be an integral part of any reformed health care system. Policy makers at the federal and state levels have a responsibility right now to ensure that the nearly 46 million smokers in this country have the help they need to quit.”

Added American Lung Association Chief Medical Officer Norman H. Edelan, M.D., “The addiction to tobacco is extremely deadly and costly. The single most important thing a smoker can do to improve his or her health is to quit smoking, which may take multiple tries and various treatments to stop using tobacco products for good.”

In addition to the fact that tobacco kills roughly 443,000 people in there are surveys which show several reasons for quitting, and for providing coverage to help people quit. They include:

  1. Studies have shown that smokers’ lives are more than 13 years shorter than non-smokers’.
  2. Quitting smoking saves hundreds of dollars in health care premiums.
  3. Helping people quit has the potential to save thousands of dollars in health care expenditures, per smoker
  4. Helping people quit helps save lives.
  5. Surveys show that 70% of tobacco users want to stop using tobacco.

Connor emphasizes, “All public and private health care plans should fully cover ALL FDA approved tobacco cessation treatments recommended by federal clinical practice guidelines. The American Lung Association urges Congress and the President to ensure all smokers are provided with comprehensive coverage for cessation treatments in any health care reform proposal that becomes law.”

What does comprehensive coverage entail? According to the ALA, it should include:

  • Easy access to the seven cessation medications
  • Access to the three forms of nicotine addiction counseling recommended by U. S. Department of Health and Human Services (HHS).

The American Lung Association recommends that private insurance plans offer comprehensive cessation coverage and also encourages states to require all insurance companies to cover these treatments. Currently, only seven states (Colorado, Maryland, New Jersey, New Mexico, North Dakota, Oregon and Rhode Island) have such requirements. It is believed that the lack of coverage leaves smokers who wish to quit, left without clinically proven cessation treatments.

Dr. Edelman explains, “”Smoking is extremely addictive for most people and quitting ‘cold turkey’ generally isn’t effective. The majority of smokers need help quitting. Unfortunately, smokers don’t always have easy access to these treatments and face barriers to coverage like costly co-pays and limitations on the duration of treatments.”

And Connor re-iterates, “Helping more Americans quit smoking remains a top public health priority for the American Lung Association. Quitting smoking also has economic benefits. Savings on smoking-related medical expenses benefit smokers, insurance companies, employers, and governments. We are here to provide expert support and proven resources that have helped more than one million people quit smoking for good.”

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State Farm Excels at Consumer Satisfaction

February 27th, 2010 by admin | No Comments | Filed in auto insurance, homeowners insurance, insurance news

It should be no surprise that our current unstable economy has affected everything from the amount of merchandise on store shelves to the number of people taking vacations, but what may be surprising is that the adverse effects are extended to the quality of service we receive from providers in many different industries. Such quality decreases are generally connected to job layoffs and spending cutbacks, as well as the low morale both of those things tend to instill. The end result: a vicious cycle in which consumers move their business elsewhere, or stop purchasing given services entirely.

One industry where the economy is having such an effect is property and casualty (P&C) insurance. The good news is that there are some companies still treating their customers well. According to a recent report from The American Customer Satisfaction Index, or ACSI, the customer service quality leader in this industry is State Farm.

The ACSI was developed by the University of Michigan, and uses a 100-point rating scale. In the most recent rating of finance and insurance companies, State Farm earned a customer satisfaction score of 82, with GEICO and Progressive following closely at 81 and 80 points, respectively. Notes in the latest index release state that larger property and casualty insurance companies have scored better than smaller ones with regard to consumer perception.

Overall, the finance and insurance sector showed slight improvement in customer satisfaction from the third to fourth quarter of 2009, with the property and casualty insurance sector averaging a customer satisfaction score of 80 in comparison to the average 77.1 in the finance sector as a whole.

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Public Support Badly Compromised by Health Care Debate

February 25th, 2010 by admin | No Comments | Filed in health insurance

Michael McAuliff, writing for the New York Daily News hit the nail squarely on the head with the article “President Obama’s Health Care Summit Will Be Political Theater of Highest Order.” One cannot help but get the feeling of Christians and lions in the arena (with no implied suggestion about which side is which) in the current national debate over health care reform.

Actually, if you take that analogy a little farther, both sides are being gobbled up by the same hungry carnivorous beast — partisanship. From the moment Obama announced his health care summit in the spirit of compromise and indicated it would be televised, the Republicans started looking for an ambush that may or may not have been there.

On Monday, February 22, Obama announced his own health care plan largely in line with the legislation currently sitting on the table in the Senate — with a $950 billion price tag attached to it.

Americans can read what the White House has to say about the current state of health care and reform efforts on its official website. The opening statement on that page reads:

Over the past year the House and the Senate have been working on an effort to provide health insurance reform that lowers costs, guarantees choices, and enhances quality health care for all Americans.

The only problem with that is that in the process, the members of Congress from both parties have done so with a nasty spirit, routinely mischaracterizing the other’s position, and allowing rumors to run rampant in the American public.

They’ve sacrificed one of the most important elements of health care reform in the United States — public support.

Regardless of what they do manage to get passed, reclaiming that support and clearly articulating to the American people any set of new rules, regulations, and “benefits” will be a major hurdle for our warring, partisan “leaders.”

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Health Care Summit Faces a Bigger Challenge than Just Health Care

February 23rd, 2010 by admin | No Comments | Filed in health insurance

On the eve of a “bipartisan” summit on health care legislation scheduled for Thursday, February 25, the web is alive with talk about how the current stalemate can or can’t be resolved. The New York Times weighed in Sunday with an interesting piece on, “How the G.O.P. Can Fix Health Care.”

Provocatively, the article opens by leveling blame at President Obama, Nancy Pelosi, and Harry Reid for failing to achieve reform “because they fundamentally don’t believe in markets, incentives and the power of hundreds of millions of people to make smart choices about their health. It’s just not in the Democratic leaders’ DNA.”

The health care summit will be televised via C-SPAN and few people who plan to watch expect to see bi-partisanship at its best. The op-ed contributors for the Times piece single out the practice of “volume-based” reimbursement as a major factor in escalating health care costs.

The article goes on to discuss “value-based” reimbursement to “align the incentives of doctors, hospitals, pharmaceutical makers, and other health care providers.” The authors are making a case for high performance based on measurable outcomes and proven standard of practice paired with the intelligent use of information technology.

It all sounds great, but the profit motives involved for each of these industries — and health care in this country is comprised of separate industries with clearly identifiable self-interests — are so large and so buoyed by the efforts and monies of lobbyists, even this approach seems to be so much pie in the sky.

The health care debate has highlighted the broken nature of Washington, where party alignments clearly outweigh the public good. Health care isn’t going to be an affordable option for recession-plagued Americans until the costs of drugs are brought in line with reality and insurance companies are prevented from arbitrarily raising rates and denying necessary procedures — or coverage itself — based on risk management rather than human need.

The challenge President Obama and Congressional leaders face is not just unraveling a badly flawed health care system, but of getting their political colleagues to quit thinking about their re-election campaigns long enough to get something done. Everyone can agree the problem exists, but no one is ready to walk the political plank and make big changes.

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