Archive for March, 2010

Senate Approves COBRA Extension Bill

March 12th, 2010 by admin | Comments Off | Filed in cobra insurance, health insurance

It was reported on Wednesday that the United States Senate voted 62-36 to approve a $138 billion bill that temporarily halts cuts in Medicare payments to doctors, and also extends COBRA premium subsidies and Medicaid assistance.

Senate Majority Leader Harry Reid (D – NV) said in a statement to the press, “This week’s bill helps those who have been hit the hardest. Among other things, we’re going to extend unemployment benefits to those looking for work, cut taxes for families and businesses, and protect Medicaid so low-income families can afford healthcare.”

Specifically this new bill will postpone a 21% cut in Medicare physician payments until October 1, 2010, though physician groups are still hoping that Congress will offer a more permanent solution to Medicare’s sustainable growth-rate (SGR) formula, which is based on the health of the economy at any given moment. Payment cuts to doctors have been looming since 2003. This SGR measure is likely to cost almost $7.5 billion between now and 2020.

In addition, the bill contains a six-month extension of additional federal financial aid to the state Medicaid programs, and extends COBRA and unemployment insurance benefits through the end of this year.

The bill is not unopposed. Naysayers argue that it isn’t fully offset, and will add more than $100 billion to the federal deficit over the next ten years. Senator George LeMieux (R – FL) said during floor debate that while some of the programs in question may be good for the states in the immediate future, “…at some point a senator has to stand up and say … no more bankrupting the country.”

With Senate approval, the bill has now been sent back to the House of Representatives, which already passed an earlier version of it. As of close of business on Wednesday, it was still uncertain whether there would be a conference between the Senate and House, or if the House would simply vote on the bill as altered by the Senate, before passing it along to the President.

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Preliminary Loss Estimates Announced for Chilean Quake

March 11th, 2010 by admin | Comments Off | 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 admin | Comments Off | 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 | Comments Off | 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 | Comments Off | 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 | Comments Off | 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 | Comments Off | 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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