SYNOPSIS ALL INDUSTRY CONFERENCE CALL June 8, 2011

To recap the issues raised during Wednesday’s conference call, here are some of the key media stories, and the messages we’re conveying.

 

If there is a subject you would like to see addressed, please email Mike Barry at michaelb@iii.org.

 

I.I.I. offers analysis of April 2011 insurance industry employment trends:  Property/casualty carriers employed 1,800 fewer people (-0.4 percent) in April 2011 than they did in March 2011, and April 2011 life insurance carrier employment was down 500 people (-0.1 percent) compared with March 2011, according to a U.S. Bureau of Labor Statistics (BLS) report. The number of agents and brokers rose by 400 in April 2011, as compared with March 2011, the highest level so far this year. But the April 2011 agent/broker combined number is still lower than the average for 2010, according to the Insurance Information Institute’s analysis of the insurance job market.

 

For the first time, a majority of new buyers of auto insurance initiated their policy purchase by applying for a rate quote online:  This was the key finding in the fifth annual J.D. Power and Associates U.S. Insurance Shopping Study, which included responses from more than 15,500 people who requested an auto insurance price quote from at least one competitive insurer in the past year. The firm issued this Thursday, June 2, news release.

 

USA Today says La Niña may be causing frequency and severity of natural disasters in the U.S. this year:  Powerful tornadoes, floods, wildfires and widespread drought have caused widespread destruction across the U.S. this spring because of La Niña, some experts believe, according to this front page story in the Wednesday, June 8, edition of USA Today.

Insurance Institute for Highway Safety (IIHS) says improvements in electronic stability control have made sports utility vehicles (SUVs) much safer to drive:  The IIHS’s Thursday, June 9, findings generated national media coverage, most of it favorable to the engineers who design the current SUV models.

 

I.I.I. quoted in New York Times article on homeowners insurance policies, and coverage against defamation: Jeanne Salvatore told New York Times columnist Paul Sullivan for a Saturday, June 11, article that many people may not know whether their homeowners policies cover them if they are sued for defaming someone, and that an umbrella policy provides coverage above and beyond existing policies. Insurers Chubb and Chartis offer personal injury coverage that protects against the policyholder against such lawsuits, the article states.

Wall Street Journal, Smart Money, Kiplinger’s, Money, and Boston Herald have stories in the works:  Erik Holm is readying a piece for The Wall Street Journal on whether other property insurers are going to follow Alfa Mutual’s lead and issue homeowners insurance policy non-renewals in states like Alabama and Missouri because of this year’s tornadoes…David Montalvo of Smart Money (email: david.montalvo@dowjones.com) is doing a broad story on auto insurance market trends and circled back to the I.I.I.’s Loretta Worters for additional information about uninsured motorists…Patricia Essewin, a real estate writer with Kiplingers (PEsswein@kiplinger.com) wanted to know whether, if you are renting to a tenant and the tenant steals jewelry from you it would be covered under your homeowners policy. The I.I.I.’s Worters briefed her on the need to get jewelry appraised and secure separate endorsements, as homeowners insurance policies generally only covers up to about $1,000 – $2,000 for all jewelry…Kathleen Lewis (Katherine@KatherineRLewis.com) of Money magazine is doing a big story on disaster preparedness and insurance. Worters briefed her on all aspects of disaster preparedness and insurance including coverage, taking a home inventory, evacuation and fortifying homes. In addition, she provided Money with information from IBHS…Greg Turner of the Boston Herald (gturner@bostonherald.com) consulted the I.I.I. for a story he is writing on the insurance repercussions of the recent Springfield, Massachusetts, tornado.

FEMA administrator Craig Fugate and U.S. Senator Roger Wicker address the U.S. Senate Banking, Housing and Urban Affairs committee:  Their Thursday, June 9, testimony on the reauthorization of the National Flood Insurance Program can be found at this summary of the hearing. The Biloxi Sun Herald’s next-day story reported that FEMA’s Fugate wants private-sector insurers to enter the flood insurance market.

Alfa’s decision was front-page news in the Mobile Press-Register:  Jeff Amy’s first story on the matter appeared on Saturday, June 4, and was followed by this Wednesday, June 8, article about how other carriers have reaffirmed their commitment to writing property insurance coverage in Alabama.

Louisiana insurance agent killed two investigators, and then himself, authorities report:  Police believe John Melvin Lavergne killed veteran insurance fraud investigators Rhett Jeansonne and Kim Sledge on Tuesday afternoon, June 7, and then committed suicide, after they had come to collect information from Lavergne, the Associated Press reported on that same day.  It was not clear exactly what the investigators were looking for. Lavergne barricaded himself in his office and a SWAT team and negotiators spent hours outside before bursting in to find Lavergne dead. 

 

State Farm Florida and Universal P&C portrayed unfavorably in agency’s assessment of their financial strength:  The South Florida Sun-Sentinel’s Julie Patel developed a lengthy piece on the Weiss Ratings findings in her blog on Tuesday, June 7, and received pushback from the companies Weiss Ratings criticized.

 

Austin American Statesman says the bill would require audits of TWIA claims-handling practices, and mandate TWIA reinsurance purchases unless it has a plan to pay losses of $2.5 billion or more:  The measure also calls for changing the name of TWIA to the Texas Coastal Insurance Plan Association, according to this Wednesday, June 8, Statesman article.

 

Known as the Wallow Fire, it has impacted more than 300,000 acres in Arizona:  The fire was, prior to the Wednesday, June 8, I.I.I. media call, encroaching on residential areas along the New Mexico line, and law enforcement officers had been going door to door in the mountain hamlets that ring the Apache and Sitgreaves National Forests, urging residents to evacuate.  Not everyone was taking their advice, The New York Times reported, in a Tuesday, June 7, article.

 

Therese Goldsmith’s first day on the job is Monday, June 13:  Commissioner Goldsmith served previously as a commissioner of the Maryland Public Service Commission and was once a partner at Hogan & Hartson, LLP.

Verus Financial of Waterbury, Connecticut, given broad powers in California Department of Insurance (CDI) inquiry into the fate of unclaimed life insurance policies:  National Underwriter (subscription required) obtained a letter CDI sent to Verus, outlining their compensation schedule and other terms of Verus’s employment with the CDI.  The NU article on the arrangement between California’s state government and the Connecticut-based vendor appeared online at NU’s life/health website on Tuesday, June 7.

 

St. Louis Post-Dispatch elaborates on Missouri attorney general’s decision to stop paying any new permanent total disability awards from the state’s Second Injury Fund:  AG Chris Koster’s decision was made in March 2011; the fund covers certain workplace injuries that aggravate pre-existing disabilities, the Monday, June 6, Post-Dispatch article stated. The solvency of the fund has been in question since 2005 when lawmakers capped its revenue source—a 3 percent surcharge on businesses’ workers compensation insurance premiums to fund the payouts to injured workers covered under the Second Injury Fund. The 2005 law was intended, in part, to lower workers compensation rates for businesses, which it has done, but because of the 3 percent cap, funding for the Second Injury Fund has not kept pace with claims made against it. 

–Julie Patel of the South Florida Sun Sentinel had a tweet that read: “Florida’s two largest private home insurers deemed weak at start of hurricane season.” According to Weiss Ratings, a company that rates the financial health of companies, State Farm Florida and Universal Property & Casualty are in poor financial shape despite the fact that their parent companies are considered highly profitable. 

 

–Ben Berkowitz of Reuters had a tweet today (Wednesday, June 8) that read: “44% of insurance execs at S&P event in NY say they are most concerned about life/annuity business, more so than reinsurance or other lines.”  This statistic was based on a survey taken at the event, the Reuters reporter writes.    

 

–Matthew Sturdevant of The Hartford Courant has two stories in his feed, both of which were linked to recent I.I.I. press releases. The first was about bicycle insurance and theft—one of the trending insurance topics this week—and the article quoted the I.I.I.’s Salvatore from a release the I.I.I. issued on May 23^rd.  The second tweet from Sturdevant was about tornado damage and what is covered under a standard homeowners policy. The article explains the basics of a homeowners policy and encourages people to make sure they are properly covered—an item that was popular in last week’s social media report, as well. 

 

The I.I.I. is cited regularly in the media as an authoritative source of insurance information. To access the current I.I.I. press clips, click here

 

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