Best's Review articles from December 2004

Best's Review archives from December 2004

Fair play.(Editor's Prologue)
December 1, 2004... It's called fair-value accounting, but insurers question whether it's fair to them. The International Financial Reporting Standard is set to replace the various country-based accounting standards among members of the European Union on Jan, 1,...

Class-action firms and new cases.(Comment)(Letter to the Editor)
December 1, 2004... Your article of Nov. 1 called "Suiting Up" included an unfavorable comparison of the number of "new" cases started by Milberg Weiss Bershad & Schulman LLP as compared to the number of "new" cases started by my former partner at Lerach Coughlin...

Quote/unquote *.(Comment)(Letter to the Editor)
December 1, 2004... "The changing market conditions have not had a measurable impact on managers' ability to buy insurance. Their behavior is still the same. Most insureds are buying the same coverage. There has been talk that some clients are exploring lower...

Life leader dies; served company since age 16.(People in Insurance)(Obituary)
December 1, 2004... Joseph R. Bixby, chairman of Kansas City Life Insurance Co., Kansas City, Mo., died Nov. 8. He was 79 and had been with the company over a 63-year span that began when he was a teenage clerk during summer vacation in 1941. Phil Bixby, now...

Insurance insiders mostly content with state election results.
December 1, 2004... Unlike in past elections, when new crops of freshman regulators arrived at the National Association of Insurance Commissioners to take part in the decision-making process, this year's election largely seems the thing insurance lobbyists' dreams...

Endurance Specialty Holdings Ltd.(People in Insurance)(Brief Article)
December 1, 2004... Endurance Specialty Holdings Ltd. named Michael Fujii head of development of Endurance's U.S. insurance business. The expansion of Endurance Specialty into the U.S. insurance market, according to the company, comes with its entrance into the...

PMA Capital Corp.(People in Insurance)(Brief Article)
December 1, 2004... PMA Capital Corp. named Lisa A. Hanssen assistant vice president and assistant general counsel. In her new role, Hanssen is responsible for general corporate matters, corporate governance and regulatory compliance issues. Hanssen joined PMA in...

Independent Financial Marketing Group.(People in Insurance)(Brief Article)
December 1, 2004... The Independent Financial Marketing Group named JoAnne K. Novak chief operating officer. Novak is responsible for the group's insurance agency, broker dealer, administrative services, training and information technology. Previously, Novak...

P/C industry: downgrades outpace upgrades for fourth consecutive year.(By the Numbers)(Brief Article)
December 1, 2004... The basis for the majority of rating downgrades for the property/casualty industry continues to be the adverse development of prior accident-year loss reserves, especially for commercial lines carriers that are exposed to longer-tail liability...

Annual rating activity, U.S. property/casualty industry--2003-2004.(By the Numbers)(Brief Article)(Illustration)
December 1, 2004... Annual Rating Activity, U.S. Property/Casualty Industry--2003-2004 On a rated-entity basis. 2003 2004 Rating Category Level ...

Rating changes, top 15 commercial lines writers, United States--July 2003-July 2004.(By the Numbers)(Illustration)
December 1, 2004... Rating Changes, Top 15 Commercial Lines Writers, United States--July 2003-July 2004 Rank is based on net premiums written in 2003. ($ Millions) 2003 Net Rating ...

Meetings.(Brief Article)(Calendar)
December 1, 2004... Dec. 4-7 National Association of Insurance Commissioners, Winter National Meeting, New Orleans Marriott, New Orleans. Phone: (816) 783-8101. Fax: (816) 783-8109. Web site: www.naic.org. Dec. 10-12 Southern Agents...

Congress told changes needed in regulations.(People in Insurance)(Brief Article)
December 1, 2004... To the group of insurance executives and industry lobbyists gathered before a Senate panel in mid-November, New York Attorney General Eliot Spitzer presented a clear and potentially chilling message: He thinks the insurance industry is...

Top three brokers get provisional OK in U.K.(People in Insurance)(Brief Article)
December 1, 2004... In a move to ease concerns in the insurance industry over recent U.S. investigations into broker practices, the United Kingdom's insurance regulator issued provisional authorizations for the world's three biggest brokers to continue doing...

Election results.(Supreme Court)(Brief Article)
December 1, 2004... ILLINOIS Changes are expected as Republican Lloyd A. Karmeier earned more than 55% of the votes in the state's Fifth District, which has long been considered unfriendly by the industry. MISSISSIPPI Reform might be unlikely here....

Spitzer takes on group life and health.
December 1, 2004... Firing his second major salvo against what he called "anti-competitive" practices in the insurance industry, New York Attorney General Eliot Spitzer has filed suit against Universal Life Resources Inc., accusing the Del Mar, Calif.-based group...

Best's rating changes.(Ratings)(Illustration)
December 1, 2004... This edition of Best's Rating Changes reflects all rating changes--assignments, changes or placed under review--that occurred for life, health and property/casualty insurers domiciled in North America, as well as international insurance...

Guide to best's financial strength ratings.(Ratings)(Illustration)
December 1, 2004... GUIDE TO BEST'S FINANCIAL STRENGTH RATINGS A Best's Rating is an independent opinion, based on a comprehensive quantitative and qualitative evaluation, of a company's balance sheet strength, operating performance and business profile....

Reserving judgment: the advent of the International Financial Reporting Standard finds European insurers in a gray area when it comes to accounting for insurance contracts.
December 1, 2004... Key Points * As the international accounting standard goes into effect in the EU Jan. 1, one crucial issue for the insurance industry remains unresolved and will occupy the IASB for the next few years--how to account for liabilities...

Selling to soldiers: allegations of inappropriate sales of insurance and investments on military bases may forge a stronger partnership between the insurance industry, state regulators and the Department of Defense.(Life)
December 1, 2004... Key Points * Products involved in the on-base selling to members of the military have all been legal. * Military bases have been prone to market-conduct problems due to uneven enforcement by base commanders and the Department of...

Taking care of business: E-Fusion 2004: information technology tackles insurers' problems in compliance, regulation and operations.(Technology)
December 1, 2004... Information technology can help insurers comply with the recent spate of regulations, achieve better alignment of company businesses, drive innovation, expedite underwriting and enhance agent relations, according to insurers who spoke at...

On the road again: as truck traffic increases, inland marine insurers who cover truck cargo stand to gain more premiums and higher profits.(Inland Marine)
December 1, 2004... Key Points * Tractor-trailer underwriters base their policies and premiums on a number of factors, including how many miles a trucker drives in a year. The more miles and cargo, the greater the exposure. More exposure means more premium....

Inland marine, top writers, United States--2003: rank is based on 2003 direct premiums written.(Inland Marine)(Illustration)
December 1, 2004... Inland Marine, Top Writers, United States--2003 Rank is based on 2003 direct premiums written. ($ Thousands) 2003 Direct % Premiums...

Ocean marine, top writers, United States--2003: rank is based on 2003 direct premiums written.(Ocean, Fire & Allied)(Illustration)
December 1, 2004... Ocean Marine, Top Writers, United States--2003 Rank is based on 2003 direct premiums written. ($ Thousands) 2003 % ...

Fire & allied lines, top writers, United States--2003: rank is based on 2003 direct premiums written.(Ocean, Fire & Allied)(Illustration)
December 1, 2004... Fire & Allied Lines, Top Writers, United States--2003 Rank is based on 2003 direct premiums written. ($ Thousands) 2003 Direct % ...

Inland marine, top writers by U.S. State--2003: rank is based on 2003 direct premiums written.(Ocean, Fire & Allied)(Illustration)
December 1, 2004... Inland Marine, Top Writers by U.S. State--2003 Rank is based on 2003 direct premiums written. ($ Thousands) Direct % of No. of Premiums U.S. Premium State ...

Ocean marine, top writers by U.S. state--2003: rank is based on 2003 direct premiums written.(Inland and Ocean Marine)(Illustration)
December 1, 2004... Ocean Marine, Top Writers by U.S. State--2003 Rank is based on 2003 direct premiums written. ($ Thousands) Direct % of No. of Premiums U.S. Premium State ...

Fire & allied lines, top writers by U.S. State--2003: rank is based on 2003 direct premiums written.(Fire & Allied)(Illustration)
December 1, 2004... Fire & Allied Lines, Top Writers by U.S. State--2003 Rank is based on 2003 direct premiums written. ($ Thousands) Direct % of No. of Premiums U.S. Premium...

St. Paul Travelers augments U.S. Museum Coverage.(Brief Article)
December 1, 2004... St. Paul Travelers rolled out its enhanced Museum Coverage Form for U.S.-based cultural establishments. The policy protects works held by cultural institutions at their locations, on exhibition, or on loan to other organizations. It also...

State farm's commercials feature agents on the job.(State Farm Mutual Automobile Insurance Co.)(Brief Article)
December 1, 2004... State Farm's ad campaign saluting the experience and personal touch of its agent force debuted during Major League Baseball's 2004 World Series in October. The campaign, called "True Stories," features State Farm agents relating experiences of...

Hagerty covers lowriders.(Hagerty Collector Car and Boat Insurance)(Brief Article)
December 1, 2004... Lowriders are becoming a fast-growing segment of the collector car hobby and Hagerty Insurance has added two categories of lowriders to the list of customized and collectible vehicles it will insure. Hagerty defines lowriders as a car or...

Getting it right: insuring to value is a fundamental that often is overlooked for short-term, illusory market-share goals.(Underwriting Insight)
December 1, 2004... An auctioneer wouldn't price an antique without knowing its age any more than a manufacturer would price a drug without knowing the cost of development. But decision makers in the property/casualty insurance business often overlook the full...

Doing more with more: multiline captive agents and independent producers compete to answer the modern customer's demand for one-stop financial shopping.
December 1, 2004... Key Points * Proponents of the multiline captive agency system champion its effectiveness in providing for virtually every need of the insurance customer. * The contract that Farmers Insurance Group has with its agents permits them to...

Preventing double identity: insurance agents can advise customers on ways they can decrease their exposure to identity theft.(Loss/Risk Management Insight)
December 1, 2004... There's a risk that insurance agents cannot afford to ignore. Identity theft is one of the fastest growing crimes in America--and the cost to the victim can be much more than many can imagine. Identity theft can range from unauthorized use...

Underwriting cycles becoming line specific.(Conferences)(Brief Article)
December 1, 2004... The underwriting cycle, always a challenge to reinsurers, is evolving in ways that will test their ability to prosper in a market that itself is becoming more difficult and less predictable. "Perhaps the shape of the cycle has changed, but...

Reinsurers reviewing capital-management plans.(Baden-Baden)
December 1, 2004... The volatility of the property/casualty pricing cycle has increased the cost of capital and changed the perception of the average investor toward the industry, Thomas Hurliman, managing director of Zurich Financial Services Group, said at the...

Spitzer's Investigation could stall insurers' agenda.(New York Attorney General Eliot Spitzer)
December 1, 2004... The ex-president of the National Association of Insurance Commissioners--now the president of the Property Casualty Insurers Association of America--said he left the regulators' group and his post as South Carolina's insurance regulator in part...

P/C Industry profitability unlikely to change.(Conferences)(Property and casualty insurance industry)
December 1, 2004... The Property/Casualty Insurers Association of America asked a panel of four--Joseph Brandon, chairman and chief executive officer of General Reinsurance Corp., and company presidents Mark Watson III of Argonaut Group Inc., Neal Menefee of...

Lost in transition: caught between their parents' health-care coverage and affording their own, young adults account for 30% of the nation's uninsured. Insurers are responding with affordable policies and education campaigns touting the necessity of health insurance.(Uninsured)
December 1, 2004... Key Points * Young adults between the ages of 19 and 29 account for 30% of the nation's uninsured, according to The Commonwealth Fund. * Aging out of parents' health plans and working for low wages and in jobs that don't offer health...

Do it themselves: by offering customer self-service, health-care can deliver the higher levels of service today's consumers demand, while also managing costs.(Health)
December 1, 2004... Key Points * Not only does customer self-service help reduce costs and please customers, it has become a requirement for doing business in today's marketplace. * Customer self-service gives customers direct control over the full range...

Customer self-service up and running.(Technology)
December 1, 2004... Online Premium Billing Harvard Pilgrim Health Care services about 800,000 members with health-maintenance-organization, preferred-provider-organization, point-of-service and Medicare plans. In addition to its members, its customers include...

Trend turns, more purchase coverage for cyber crime.(Technology Notes)
December 1, 2004... Cyber crimes are on the rise-both in frequency and sophistication, according to a recent white paper, entitled "Cyber Risk and Insurance for Financial Institutions--A Reality Check" by global insurance broker Willis Group Holdings Ltd. ...

The American Insurance Association.(Web News You Can Use)(Brief Article)
December 1, 2004... The American Insurance Association, which represents more than 450 U.S. insurers, has contracted with Learn.net Inc. to be AIA's strategic partner for providing improved knowledge and learning management capabilities to the U.S. insurance...

Cigna HealthCare.(Web News You Can Use)(Brief Article)
December 1, 2004... Cigna HealthCare has teamed with Post-N-Track Corp. to deliver faster claims submission and tracking for health-care providers, billing entities and transaction aggregators. The service is available through a direct, universal, secure Web-based...

Esurance.(Web News You Can Use)(Brief Article)
December 1, 2004... Direct-to-consumer personal auto insurance company Esurance launched a new service powered by eStara Inc.--eStara's Push to Talk--a fully-hosted, Voice over the Internet "click-to-call" service. The click-to-call feature allows Esurance...

Best of breed or super suite? Whether dealing with enterprise resource planning or business-process applications, insurers have many choices when selecting systems.
December 1, 2004... While business decisions continue to be made around the pros and cons of enterprise application suites vs. best-of-breed applications, the importance of these types of decisions increases regularly. Most recently, while the Microsoft-SAP merger...

Failure to communicate: insurers can help reduce the burden of medical malpractice lawsuits by urging their policyholders to improve physician/patient relationships.(Medical Liability)
December 1, 2004... Key Points * Many malpractice cases are due to poor communications and mismanaged expectations. * Health-care providers should use comprehensive informed-consent procedures to reduce malpractice litigation. * Researchers found...

He didn't mean to do it, again: the criminal-acts exclusion of a homeowners policy can be found to have very different interpretations.(Legal Insight)(Column)
December 1, 2004... In my September column, I wrote about a court finding that an insured who intentionally punched another man in the head and caused serious injury is not entitled to insurance coverage (State Farm Fire and Casualty Insurance Company vs....

Calculating scenarios: new risk-based capital requirements are changing how variable annuity writers understand risks.(Variable Annuities)
December 1, 2004... Key points * The living-benefit guarantees of variable annuities pose investment-market risks for direct writers. * Current risk-based capital requirements do not address these risks. * Stochastic modeling helps insurers better...

ING Employee Benefits.(New Products and Services)(Brief Article)
December 1, 2004... ING Employee Benefits has launched Horizon Whole Life, a policy to be marketed to employees at the work site as a supplement to benefits provided by employers. The product offers guaranteed issue for qualified employer groups, spouse and...

Mutual Protective/Medico Life Insurance Companies.(New Products and Services)(Brief Article)
December 1, 2004... Mutual Protective/Medico Life Insurance Companies have ceased marketing long-term-care insurance, citing greater persistency than expected, difficulties in pricing, diminishing investment returns and "overall market skittishness." Tim Hall,...

The Principal Financial Group.(New Products and Services)(Brief Article)
December 1, 2004... The Principal Financial Group has introduced Variable Universal Life Income, a life policy designed to generate retirement income. It features a rider that returns the cost of insurance, a death-benefit guarantee to ages 100, 85 or 65, three...

MetLife, Pru offer new strategies for retirement.(MetLife Retirement & Savings)(Prudential Financial Inc.)
December 1, 2004... Two insurance industry giants have developed retirement-income schemes that urge individuals to do something that goes against human nature: defer gratification. Prudential Financial was first out of the box with its Income Bridge Approach...

Annuity benefits prove their value.(Marketplace)(Brief Article)
December 1, 2004... In the secular bull market of the 1980s and 1990s, critics of variable annuities had a great time panning the value of the product's death benefit as worthless. But from 2001 to 2003, variable annuity writers paid contract beneficiaries death...

Chicken or egg? Deciding what the core business driver of a company is helps in choosing between a focus on sales or investments in order to be more successful.(Selling Insight)
December 1, 2004... As enterprise risk management and planning take a greater hold in the insurance industry, the dilemma of coordinating sales and investment strategies becomes more significant. The issue resembles that of the chicken-or-the-egg debate, but with...

After TRIA goes away: with the Terrorism Risk Insurance Act due to expire in 2005, insurers and policyholders must develop long-term solutions that deliver financial stability and accountability.(Terrorism)
December 1, 2004... Key Points * The Terrorism Risk Insurance Act will expire on Dec. 31, 2005. * Insurers must create and support a new, long-term back-stop solution. * An alternative to TRIA is to require terrorism coverage as part of all...

Positives of outsourcing: insurance companies can achieve an initial 15% to 30% in savings by outsourcing certain core functions.(Selling Insight)
December 1, 2004... With increasing acceptance of full-cycle customer interaction in the insurance industry today, more and more customer-centric companies are discovering that it is not only cost effective--but profitable--to outsource certain noncore...

Study: insurance rates for hospitals and physicians may slow in 2005.(Loss/Risk Management Notes)(Brief Article)
December 1, 2004... The three-year trend of high insurance rates for hospital professionals and physicians shows signs of slowing in 2005, according to a study by Aon risk services experts. Aon's Hospital Professional Liability and Physician Liability 2004...

Commercial premiums, especially in large accounts, continue to drop.(Brief Article)
December 1, 2004... Commercial property/casualty insurance premiums continued to decline during the third quarter of this year, with two-thirds of all large and medium accounts experiencing drops of up to 20%. An additional one in 10 large accounts saw premiums...

Montpelier Re and OPIC form new facility.(Montpelier Re Holdings Ltd.'s units, Montpelier Reinsurance Ltd. & Montpelier Agency Ltd.)(Overseas Private Investment Corp.)(Brief Article)
December 1, 2004... Montpelier Re Holdings Ltd. said its wholly owned operating subsidiaries, Montpelier Reinsurance Ltd. and Montpelier Agency Ltd., have entered into agreements with the Overseas Private Investment Corp. to form an insurance facility to...

A unit of Zurich Financial opens Dallas office.(Zurich Financial Services)(Brief Article)
December 1, 2004... Schaumburg, Ill.-based Zurich Financial said its Management Solutions Group business unit has opened a regional office in Dallas. Zurich staff members are available to assist agents and brokers with a wide range of management liability...

AIG expands specialized workers' comp coverage.(AIG Aviation Inc.)(Brief Article)
December 1, 2004... AIG Aviation Inc., a subsidiary of American International Group Inc., said it's now offering Specialty Workers' Compensation coverage to meet the growing need of employers who place separate workers' compensation coverage for a corporate flight...

A taste for travel: insurance groups will experience local flavors in a variety of cities, including Phoenix; Miami; Kohler, Wis.; Burlington, Vt., and Kapalua, Maui, Hawaii.(Meetings)(Calendar)
December 1, 2004... 2005 Meetings Index ACORD/LOMA: May 22-24 American Association of Health Plans: Feb. 2-4, March 7-9, June 8-10 American Association of Insurance Services: April 10-12 American Association of Managing General Agents: May 1-4...

The winding road to reward: Rule 144A securities offerings can be a good source of capital for mutual insurance companies, but getting there requires effort.(Rule 144A Offerings)
December 1, 2004... Key Points * In a Rule 144A offering, an investment bank or syndicate of investment banks purchases the securities from the company and then resells the securities to investors at a higher price. * The disclosure and due diligence...

Crossing borders: importing prescription drugs, illegally or legally, into the United States isn't expected to have a significant short-term impact on health insurers, but long-term could be a different story.(Health Insurance)
December 1, 2004... Key Points * Nearly 20 million packages of prescription drugs are estimated to be shipped into the United States each year--a supply worth more than $3 billion. * Many health plans believe drug importation has had little, if any,...

Get in the groove: poised to become president and chief executive officer of John Hancock Life Insurance Co., James M. Benson has co-written a book aimed at helping financial-services sales representatives succeed.(Book Review)
December 1, 2004... Key Points * About 90% of financial services salespeople will leave the industry in their first five years. * Many who fail do so because they are looking in the wrong place for sales. * The average face amount for Manulife in...

Consider more than price: many people view term life insurance as a commodity, but agents serve their clients best by considering factors other than cost.(Underwriting Insight)
December 1, 2004... Price is important, but it's rarely the determining factor when purchasing a big-ticket item such as a car, refrigerator or even a cell phone. Before hunting for the lowest price, savvy consumers shop for the features they want, review consumer...

Be very afraid: reality television stunts put the fear in insurance underwriters.(Underwriting)
December 1, 2004... Ever since the rise of so-called "reality" television shows--particularly those that specialize in the shocking and the bizarre--millions of viewers around the world have been able to sit before their televisions each night for the vicarious...

Allstate Floridian stops writing new policies in parts of Florida.(Brief Article)
December 1, 2004... Until Allstate Floridian knows how Florida's legislative landscape will look on issues such as policyholder deductibles and the hurricane catastrophe fund, the state's second-largest homeowners insurer in terms of market share has stopped...

Marsh to cut 3,000 jobs as 3Q net drops 94%.(Marsh and McLennan Companies Inc.)(third quarter)(Brief Article)
December 1, 2004... Continuing with efforts to refashion both its business model and its public image in the wake of fraud allegations raised by New York state Attorney General Eliot Spitzer, Marsh & McLennan Cos. confirmed the termination of several senior...

Calif. approval clears way for Anthem/WellPoint merger.(Anthem Inc.)(WellPoint Health Networks Inc.)(Brief Article)
December 1, 2004... The long-delayed merger of Anthem Inc. with WellPoint Health Networks Inc. appears to have cleared its last major hurdle, as California Insurance Commissioner John Garamendi has conditionally removed his objection to Anthem gaining control of...

HCC insurance holdings to acquire United States Surety.(HCC Insurance Holdings Inc. to acquire United States Surety Co.)(Brief Article)
December 1, 2004... International insurance holding company and specialty insurer HCC Insurance Holdings Inc. said it would acquire United States Surety Co. for an undisclosed amount payable in HCC shares. The purchase is subject to a definitive agreement and...

Old is new again: baby boomers are buying boats reminiscent of their childhoods, opening opportunities for marine specialty writers.
December 1, 2004... Wooden runabouts, utilities, cruisers--even steam-powered launches--are becoming major attractions for boating enthusiasts. Baby boomers are buying boats they remember from their childhoods in record numbers, and in many cases, the investment...