Best's Review articles from February 2005

Best's Review archives from February 2005

Watch out for ringers.(Editor's Prologue)
February 1, 2005... Adding dazzling new players to a lineup can be exhilarating, especially when the game is shifting in favor of their strengths. Lately, some life insurers appear to be looking around for new players in the form of different types of products, a...

Selling insurance to soldiers.(Comment)(Letter to the Editor)
February 1, 2005... We believe that your article "Selling to Soldiers" (December 2004) was a fair attempt to portray concerns related to sales of insurance products to the military. We would, however, like to add some details about our Horizon Life Product...

Quote/unquote *.(Comment)
February 1, 2005... "On a catastrophe-adjusted basis, 2004 represented the peak in the current cycle in terms of earnings and underwriting performance." Robert P. Hartwig Senior Vice President and Chief Economist Insurance Information Institute ...

Correction.(Comment)(Correction Notice)
February 1, 2005... A photo identification in the December issue of Best's Review was incorrect. In the photo at right, taken at A.M. Best's E-Fusion Conference, are Fred Myatt, Zurich NA, left, and Ken Winer, SeaPass Solutions, right.

Regions Financial Corp.(People in Insurance)(appointment of David L. Bowlin)
February 1, 2005... Regions Financial Corp. has Bowling president and chief executive officer of its newly created Regions Insurance Group Inc., the corporate parent structure for all of the company's insurance operating subsidiaries. In his new role, Bowlin will...

Citizens and Hanover Insurance Cos.(People in Insurance)(appointment of Robin Nicks )(Brief Article)
February 1, 2005... Citizens and Hanover Insurance Cos. named Robin Nicks regional president of Hanover Insurance Co.'s Southern region. In this capacity, she will be responsible for all aspects of commercial personal lines distribution, marketing and in the...

Axa Distributors LLC.(People in Insurance)(appointment of Christine Long-Vazquez )(Brief Article)
February 1, 2005... Christine Long-Vazquez has joined Axa Distributors LLC, a wholly owned subsidiary of Axa Financial, as vice president of strategic relationship marketing. Long Vasquez is responsible for developing marketing programs designed specifically for...

Marsh & McLennan Cos.(People in Insurance)(appointment of E. Scott Gilbert )(Brief Article)
February 1, 2005... Marsh & McLennan Cos. has named E. Scott Gilbert to the newly created position of senior vice president and chief compliance officer. Gilbert will be responsible for supervising and implementing the company's compliance policies and...

Tsunami devastation slows claims-adjusting process.(Highlights From BestWeek)
February 1, 2005... Insurers don't expect to take big financial hits from the massive Dec. 26, 2004, earthquake and tsunami, but the event is proving quite a challenge for claims adjusters and catastrophe modelers. As of mid-January, the death toll had reached...

MetLife Inc.(People in Insurance)(appointment of Steven L. Sheinheit and Carl E. Morales )
February 1, 2005... MetLife Inc. has named Steven L. Sheinheit chief information officer. Previously, Sheinheit was the company's chief technology officer. In connection with Sheinheit's appointment, Carl E. Morales becomes chief technology officer.

Willis Group Holdings Ltd.(People in Insurance)(Appointment of William E. Yocke)(Brief Article)
February 1, 2005... Willis Group Holdings Ltd. has named William E. (Ric) Yocke senior vice president of Willis Risk Solutions. As a member of the Willis Risk Solutions Group, Yocke will focus on serving the needs of Fortune 1000 companies and companies with...

Harleysville Group Inc.(People in Insurance)(appointment of Akhil Tripathi)(Brief Article)
February 1, 2005... Harleysville Group Inc. has named Akhil Tripathi senior vice president and chief information officer. He will be responsible for directing the company's ongoing information technology strategy, integration and development efforts and will...

A.M. Best study: life/health impairments relatively rare from 1976 to 2002.(By the Numbers)(Insurance companies)(Brief Article)
February 1, 2005... Best's Insolvency Study, U.S. Life/Health Insurers, 1976-2002 reports that overall life/health insurer impairments remained relatively rare for the 27 years of the study, ranging from about 1-in-250 companies in more stable times to 1-in-35...

Insolvency company characteristics (1976-2002).(Brief Article)(Illustration)
February 1, 2005... Insolvency Company Characteristics (1976-2002) OWNERSHIP: 97% were stock vs. 3% for mutual companies. SIZE: 93% had less than $20 million in capital and surplus (2002 dollars). GROWTH:...

Primary causes of L/H impairments.(Brief Article)(Illustration)
February 1, 2005... Primary Causes of L/H Impairments 1976 to 2002 Miscellaneous, 10% Reinsurance Failure, 3% Significant Change in Business, 5% Affiliate Problems, 20%...

Meetings.(Insurance industry)(Brief Article)(Calendar)
February 1, 2005... Feb. 27-March 1 LIMRA International: 2005 Distribution Conference, Sheraton New Orleans, New Orleans. Phone: (860) 285-7862. Fax: (860) 285-7792. Web site: www.limra.com. March 6-8 Captive Insurance Companies...

Ga. regulator orders refunds to soldiers.(Georgia)(Brief Article)
February 1, 2005... A Texas-based insurance company was ordered by Georgia Insurance Commissioner John W. Oxendine to refund $1.3 million in life insurance premiums paid by some active-duty soldiers trained at Fort Benning. The commissioner said his office is...

Vermont licensed 43 captives in 2004.(licensing of captive insurance companies)(Brief Article)
February 1, 2005... Vermont licensed 43 new captive insurers in 2004, continuing a long-running trend of growth the state's regulators expect to continue into 2005. The largest captive domicile in the United States said it has 717 licensed captives. The...

State Farm settles O.T. suit; more adjuster cases in line?(overtime)(Los Angeles County, California. Superior Court)(Brief Article)
February 1, 2005... State Farm has agreed to pay $135 million to resolve a class-action lawsuit brought by more than 2,600 adjusters in California who alleged the company violated state wage and hour laws by failing to pay them overtime compensation. The...

Ace to boost reserves, sell A&E runoff.(ACE Ltd.)
February 1, 2005... Seeking to finally kill off the asbestos reserving issue that has dogged it for the past eight years, Bermuda-based insurer Ace Ltd. said it would boost reserves at its asbestos and environmental runoff units and sell those units to a...

Best's rating changes.(Ratings)
February 1, 2005... 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...

Covering the bases: universal life policies with guaranteed death benefits are driving the market, but the bigger trend may be that life writers are broadening their product lineups.(new products)(Cover Story)
February 1, 2005... Watch out. The status quo is being shaken and stirred. Hartford Life Insurance Co., long known as a powerhouse in variable annuities and variable life, has become an active player in universal life and whole life products. Jackson National Life...

Funding the inevitable: the California Earthquake Authority appears ready for the big one.(Catastrophes)
February 1, 2005... Florida had never seen anything like it--four hurricanes in six weeks that killed 32 people and damaged thousands of homes and businesses. While insured losses for the four storms reached more than $21 billion in Florida, no single one of these...

The quantitative imperative: new analytical techniques require new talent. Companies can choose to leapfrog the competition or be left behind.(property and casualty insurance industry)
February 1, 2005... In the 1970s, property/casualty insurers embraced mainframe computing, generating mountains of management information. Actuaries and CFOs couldn't get enough, and the foundations of modern analytical management were laid. Since then,...

A clearer understanding: the underserved market for breakdown coverage is small, nonmanufacturing businesses.(Selling Insight)
February 1, 2005... As the Industrial Revolution was transforming America throughout the mid-to-late 19th century, steam was the top energy source. Steam powered the boilers for industrial machinery, locomotives and steamboats. As uses for steam power became...

Taking leave: California's new paid family medical leave act could be copied in other states, opening the door for insurers to expand their leave administration services and develop new income replacement products.(Family Medical Leave Act)
February 1, 2005... Keeping track of the hours employees worked used to be as simple as making sure the time clock was accurate when they punched in and out. That's not the case anymore, and employers who fail to follow state and federal guidelines could find...

A silver lining: Sarbanes-Oxley compliance may reveal hidden dividends for insurers.(Sarbanes-Oxley Act of 2002)
February 1, 2005... Passage of the Sarbanes-Oxley Act of 2002 has generated an almost unprecedented level of activity within the insurance industry related to corporate governance, financial reporting and regulatory compliance, along with a new search for best...

A profound change: the SMART bill's most far-reaching change may be preemption of state approval of rates.(Legal Insight)
February 1, 2005... For decades, federal regulation of insurance has been either sought or fought, with equivalent passion, by and among the industry and state regulators. With release of a discussion draft of the "State Modernization and Regulatory Transparency...

Identity crisis: independent agents must make their brands known to grow their businesses.(Branding)
February 1, 2005... The big guns of the insurance world have branding down to an art. Consider Allstate's Good Hands logo, State Farm's Good Neighbor slogan and the icons of Prudential's Rock of Gibraltar and Hartford Financial's majestic stag. Independent...

Finding the good life: life reinsurers enjoy the prospect of fresh business opportunities in the United States and elsewhere as more life insurance is sold to older policyholders.(Life)
February 1, 2005... The U.S. life reinsurance market is being reshaped by a hardening market, consolidation and expansion opportunities in foreign markets. About $2 trillion of new life insurance is written annually in the United States. And about 60% of new...

Retooling auto: the science of automobile insurance ratemaking is benefiting from modeling advancements.(Auto)
February 1, 2005... The mechanics, science and art of automobile insurance ratemaking have undergone major changes over the past three decades, particularly in recent years. * The hardware: from calculators to time-sharing computers, to in-house mainframes,...

Glimpsing the future: emerging technologies bring insurers a competitive advantage.(technology insight)
February 1, 2005... The combination of equity exposures, catastrophic losses and the need for reserve strengthening--on top of underlying infrastructural challenges--are causing a turbulent ride into an uncertain future for many carriers. Yet, despite this...

Increased technology spend helps with competitive edge.(y )
February 1, 2005... Insurers now see information technology investment as being driven by the need for efficiency gains rather than simply for reduction of operational costs, according to a recent survey by independent market analyst Datamonitor. "North...

AIG Specialty Workers' Compensation.(www.aigswc.com)(Brief Article)
February 1, 2005... AIG Specialty Workers' Compensation expanded its "Partners in Productivity" Web site (www.aigswc.com) to enable its small-business policyholders and their brokers to report claims online and to request and receive loss runs electronically.

BlueCross BlueShield of Tennessee.(online Marketing Assistance Program)(Brief Article)
February 1, 2005... BlueCross BlueShield of Tennessee launched an online Marketing Assistance Program for brokers called MAR The service enables brokers to purchase pre-approved BlueCross-branded advertising and marketing materials directly from the Web. More than...

Empire Blue Cross Blue Shield.(Brief Article)
February 1, 2005... Empire Blue Cross Blue Shield recently expanded its Broker Online Services Web portal to allow brokers to renew groups sized 2 to 50 online and generate multiregion quotes round the clock with the click of a mouse. Brokers can view and submit...

Fiserv Insurance Solutions.(Fiserv Advanced Billing's 1.2 version)(Brief Article)
February 1, 2005... Fiserv Insurance Solutions announced the availability of the 1.2 version of Fiserv Advanced Billing, a Web-based system using the Java 2 Enterprise Edition platform. The system supports premium billing, cash-to-application management,...

Pay the piper: as the Superfund Trust fund runs out of money, will the U.S. Environmental Protection Agency become more aggressive in pursuing the insurers of bankrupt polluters to pay the hefty expense of cleaning up toxic waste sites?(Environmental Liability)
February 1, 2005... Peter J. Mintzer, a Seattle-based attorney with Cozen O'Connor, expects to stay busy in 2005. Mintzer, who specializes in resolving environmental insurance claims, foresees an increase of lawsuits on the horizon, especially now as the U.S....

Expert: 4 principles at heart of effective advertising.(Marketplace)
February 1, 2005... Insurers have to avoid the impulse to oversaturate consumers with advertising and instead concentrate on responding to their needs, said J. Walker Smith, president of marketing consultants Yankelovich Partners. Recent studies of TiVo users...

Nationwide, Volkswagen team up for program.(Marketplace)(Nationwide Mutual Insurance Co.)
February 1, 2005... Certain Midwestern car buyers who purchase or lease certain Volkswagen models over the next few months will be entitled to a free private-passenger automobile insurance policy underwritten by Nationwide Mutual Insurance Co. under a new pilot...

Resolving insolvencies: reinsurers are thrust into a difficult position when a cedent becomes insolvent.(Insolvency)
February 1, 2005... Property/casualty insurer financial impairments hit a decade high of 43 in 2002, then dropped by nearly half that in 2003, according to the 2004 Best's Insolvency Study, Property/Casualty, U.S. Insurers, 1965-2002. Throughout most of 2004,...

The place to be: insurers are beginning to participate in the merging of marketing and entertainment--product placement.(Marketing)
February 1, 2005... Once the marketing tool to sell soft drinks and potato chips, product placement is being recognized by insurers as a valuable way to promote their brands. As Reese's Pieces candy gained popularity from its placement in the blockbuster movie ET,...

Life insurance in 2005: Sternberg criticizes no-lapse pricing and assesses the political landscape.(Policy Guarantees)(New York Life Insurance Co.)(Sy Sternberg)
February 1, 2005... NewYork Life Insurance Co. is refraining from offering much in the way of no-lapse guarantees on its cash-value universal life insurance products. That decision will impact 2004 sales, but Sy Sternberg, chairman and chief executive officer,...

Annuity payout tax relief has limited backing in Congress.(Marketplace)
February 1, 2005... Several members of Congress have sponsored legislation to exempt from tax half of lifetime payouts from annuities funded with after-tax dollars, the kind of tax relief the insurance industry has sought for several years. Most of the...

Seniors more likely to seek advice after their retirement.(survey)(Brief Article)
February 1, 2005... Retirees are more likely to seek professional financial advice than they were before they retired, according to the first Lincoln Long Life Survey. The survey interviewed 500 people from 70 to 79 years old with annual household incomes of...

Two insurers have announced new ways to protect retirement.(new products and services)(Brief Article)
February 1, 2005... Two insurers have announced new ways to protect retirement savings in qualified plans during a worker's disability. Chattanooga, Tenn.-based UnumProvident enhanced its Retirement Income Protection provision available with group long-term...

Bankers Life and Casualty Co.(marketing agreement)(National Peace Corps Association)(Brief Article)
February 1, 2005... Bankers Life and Casualty Co. has reached a marketing agreement with the National Peace Corps Association to offer Medicare supplement, long-term-care insurance and possibly disability insurance to seniors who are current and former volunteers...

The five P's of underwriting: those who would underwrite life applicants need to keep learning, work with partners, and maintain their integrity.(Underwriting Insight)
February 1, 2005... The P's stand alone... that is, as benchmarks of fulfilling the mission of the 21st century home office underwriter. What, then, are these demarcations that set pros apart from the herd? Actually, there are just five. And each packs a wallop....

Battle of the Blues: round 2: three years after their separation, Highmark and Capital BlueCross are holding their own in a healthy--but spirited--competition.(market competition)
February 1, 2005... Three years ago, the tug-of-war between Pennsylvania-based health insurers Highmark Inc. and Capital BlueCross ended in a split that ceased a 36-year-old joint operation. Today, as the two Blues plans venture out on different paths, they say...

The need to know: insurance companies face a challenge to meet the demands for greater transparency at the point of sale.(Selling Insight)
February 1, 2005... Inquiries into the practices of certain large brokers and insurance carriers have prompted considerable discussion of insurance industry distribution approaches. The ensuing debate has included most insurance products and markets, and ranged...

Prognostication elevated: models based on numerical weather prediction are being used to generate potential losses from winter storms.(Catastrophe Modeling)
February 1, 2005... After having experienced one of the costliest hurricane seasons in U.S. history, many insurers anticipated to the relatively quiet winter months with a sense of relief. For some, however, it may be a false sense of security. According to...

End of an era: after beginning his career 34 years ago in Farmers Insurance Group's claims department, CEO Martin D. Feinstein is retiring.(chief executive officer)(Interview)
February 1, 2005... Tort reform is one of the most important issues that needs to be addressed in Congress, and significant, fundamental changes are likely to result from the current investigations into insurance industry practices, according to retiring Chief...

Directors & officers premiums fall in first slide since '99, study shows.(Loss/Risk Management Notes)
February 1, 2005... Directors & officers premium rates fell 10% in 2004 despite increasing severity and claims costs. Not since before the Y2K scare, Sept. 11 and the collapse of Enron have insurance buyers seen such a decline. Tillinghast's directors &...

St. Paul Travelers unveils imported-products cover.(Brief Article)
February 1, 2005... St. Paul Travelers introduced a new Imported Products Program designed to provide coverage for the special exposures faced by U.S.-based companies that import foreign products. The program is tailored for manufacturers, wholesalers and other...

Wausau streamlines coverage for restaurants.(Brief Article)
February 1, 2005... Wausau Insurance has rolled out a new package policy designed to streamline coverage and costs for restaurant and hospitality businesses. The Wausau Express package policy combines many tailored coverages into a single property and general...

Chubb Group launches travel protection for rich.(Brief Article)
February 1, 2005... Chubb Group has launched a travel accident program designed for its most affluent customers who travel frequently. Signature Passport is available in Illinois, Texas and California, with expansion planned this year. It costs $365 per year,...

Hartford Steam Boiler sells identity recovery to insurers.(Hartford Steam Boiler Inspection and Insurance Co.)(Brief Article)
February 1, 2005... Hartford Steam Boiler Inspection & Insurance Co. is offering to insurers identity recovery coverage that combines identity theft insurance with services that help victims restore their credit history and identity records. HSB's identity...

A higher policy: a recent Pennsylvania Supreme Court ruling protects insurers from covering the illegal deeds of their homeowners policyholders.(court ruling)(Minnesota Fire and Casualty Co. vs. Greenfield)
February 1, 2005... The "public policy argument" is rarely a lawyer's first line of defense. In fact, it's often viewed by the bar as a "catch all" tactic--if all else fails, argue public policy. The Pennsylvania Supreme Court's Aug. 19, 2004, decision in...

Opening the door to a lawsuit: employment practices risks also apply to homeowners who hire domestic help.(Loss/Risk Management Insight)
February 1, 2005... Accusations of harassment and discrimination have worried office employees for years, but now employment practices risks have entered the home. More homeowners today are exposed to wrongful employment allegations. Nannies, housekeepers, cooks...

Kentucky's AIK Comp stopped writing policies as of Jan. 1.(Companies)
February 1, 2005... Nearly five months after entering state-monitored rehabilitation, Louisville-based workers' compensation group AIK Comp ceased writing both new and renewal business Jan. 1, the state rehabilitator said. Current policyholders have been...

Commerce sues regulator over assigned risk.(Brief Article)
February 1, 2005... The Massachusetts insurance commissioner has revised her order approving rules for the state's newly created assigned-risk plan. Commerce Insurance Co., the state's largest private-passenger automobile insurer, responded by suing the...

Affirmative Holdings buys nonstandard auto assets.(acquisitions)(Affirmative Insurance Holdings Inc.)(Brief Article)
February 1, 2005... Affirmative Insurance Holdings Inc. finalized its acquisitions of the assets of two nonstandard automobile agencies in separate cash purchases worth a total of $11 million. Affirmative paid 21st Century Holding Co. $7 million in cash for 24...

RLI Transportation launches commercial auto business.(Brief Article)
February 1, 2005... RLI Transportation, a division of RLI Insurance Co., has launched a commercial automobile insurance unit that, according to RLI President David Dunn, will write monoline commercial auto business with its existing retail independent agents while...

Ending the global disconnect: over-the-phone interpreters help insurers bridge language barriers.(The Last Word)
February 1, 2005... Insurance knows no boundaries, but the more than 6,800 languages and dialects that span the globe can sometimes make it difficult for insurers and adjusters to communicate with their clients. Many insurers have found a solution to help...