SYNOPSIS ALL INDUSTRY CONFERENCE CALL May 18, 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 later today, please email Mike Barry at michaelb@iii.org

 

 

Bloomberg’s taped interview with the I.I.I.’s Steven Weisbart aired in the 8 a.m. news block on Tuesday, May 17.  The reporter questioned whether the NFIP ever be in a position to repay the nearly $18 billion the FEMA program owes the U.S. Treasury Department. The I.I.I. also briefed Bloomberg TV on the U.S. House bill being considered (HR 1309) that would extend the NFIP for another five years.

U.S. House Financial Services committee unanimously approves HR 1309:

Reuters filed a report on Friday, May 13, the day the committee voted, 54-0, to move the legislation to a vote of the full House.

USA Today says Army Corps of Engineers opened the Morganza spillway to allow water from the Mississippi River to flood the Cajun region of Louisiana:

Local law enforcement officers went door to door to urge residents to evacuate low lying areas, according to this Tuesday, May 17, USA Today article. Corps spokesman Bob Anderson said that opening the spillway lowered the level of the river and reduced the pressure on levees. The river at Baton Rouge and New Orleans dropped by 2.5 feet on Monday, May 16, after the Corps opened 11 of the 125 bays at the spillway north of Baton Rouge. The opening flooded 8,000 acres, mostly farmland, in the Atchafalaya Basin, and Corps officials plan to continue slowly opening the flood control system, which could inundate some small Cajun villages, the article states.

Wall Street Journal’s editorial page says U.S. will likely compensate the owners of land flooded by Army Corps of Engineers as they struggle to control the great flood of 2011:

The Corps opened floodways that have been closed for decades to protect large population centers, particularly New Orleans, according to a WSJ Tuesday, May 17, editorial. The government’s decision to compensate people whose lands were flooded by the Corps is expected to prompt others damaged by the flooding to file claims, they write. The ports of Baton Rouge and New Orleans serve an enormous volume of global trade in oil, gas and other commodities, and many years ago the federal government constructed barriers to contain the Mississippi River to foster commerce along its course. Many now question the feasibility of using engineering to prevent the Mississippi river from pursuing its natural course, which may no longer direct the river toward New Orleans.

 

Premium rates for homeowners coverage have been relatively stable over the last five years but some of the largest insurers in the U.S. say they are planning to raise their rates, according to this Tuesday, May 17, Wall Street Journal (subscription required) article. Many homeowners are asking why they have to pay more to cover a house that may have significantly declined in value, the WSJ writes, while insurers explain that premiums are based in part on the cost of rebuilding rather than market value. I.I.I. and National Association of Insurance Commissioners (NAIC) figures were cited.

HomeInsurance.com releases study saying the national average homeowners insurance premium per annum was $710, as of February 2011:

This was a cumulative average of policies sold by HomeInsurance.com in the 44 states they currently write in. Their average premium for February 2010 was approximately $679, illustrating a slight upward trend of 4.5 percent, their Tuesday, May 17, news release states.

 

Commissioner Hamm’s election to be the successor to McRaith, who is joining the Obama administration as the first FIO director, puts Hamm on track to be the NAIC’s president in 2014. The NAIC’s Monday, May 16, news release, has details.

 

The Insurance Research Council (IRC) found that 68 percent of adults do not want governments to charge accident response fees to individuals involved in traffic accidents:  The IRC’s findings are in this Wednesday, May 18, Insurance Journal article.

 

Baltimore Sun readying editorial on court decision affirming an insurer’s right to issue non-renewals in coastal communities:  The I.I.I.’s Mike Barry spoke on background with Sun editorial writer Rob Kasper about insurers’ need to balance their interest in expanding their book of business with the need to hedge their risks in hurricane-prone parts of the U.S. Kasper’s interest in the issue came about after a Maryland appeals court upheld Allstate’s business practices in the eastern part of the state.

New York City’s CBS affiliate interviews the I.I.I. on blood test technologies that could prove indicative of life expectancy:

WCBS-TV producer Stephanie Cassell (212-975-8656; scassell@cbs.com) has, since the I.I.I.’s media call, taped an interview with the I.I.I.’s Weisbart about the life insurance rate-setting implications, if any, of the type of product Life Length is marketing. Life Length says its new blood test can determine a person’s biological age. Critics quoted in a Thursday, May 19, New York Times print article warn such blood tests could prompt life insurers to boost premiums without cause. The I.I.I. will receive advance notice of the air date of the segment, and relay that information to the group.

Governor Scott says he believes Senate Bill 408 will strengthen the state’s property insurance market:  The governor’s office issued this Wednesday, May 18, news release on the matter.

I.I.I. has updated its Florida edition of A Firm Foundation: How Insurance Supports the Economy: 

The document focuses on the insurance industry’s pivotal role as an employer, investor and taxpayer in the state of Florida.

United Automobile Insurance Company’s CEO says Florida lawmakers failed to act on combating no-fault auto insurance fraud:

Richard Parrillo criticized a number of groups who he believes blocked legislation during the recently concluded session to reform the state’s no-fault system, according to his Monday, May 16, op-ed in the South Florida Sun-Sentinel.

Risk Management Solutions issued statement with that number:  The RMS estimate generated stories in The Wall Street Journal and other media outlets, such as The Birmingham News. Thesingle tornado that struck Tuscaloosa and Birmingham, two Alabama cities, accounted for almost 40 percent of the total estimate.

 

Tuesday, June 14 concert to benefit Alabama storm victims:

The Country Music Television channel has details on the Birmingham, Alabama, event.

 

TWIA’s newly-appointed general manager, John Polak, speaking to Southwestern Insurance Information Service early next month:  SIIS’s website has additional information.

Commissioner Doak supports bill saying uninsured accident victims can recover auto repair costs, medical expenses and income loss resulting from an accident caused by others: But current Oklahoma law also allows motorists—including uninsured ones—to recover pain and suffering awards, a practice that the legislation would stop, if enacted. In a Wednesday, May 18, news release Commissioner Doak said that SB 272 would help temper the state’s uninsured-motorist problem (an estimated one-quarter of Oklahomans on the road lacked coverage in 2009) and increase the availability of affordable car insurance in the state.

Governor Cuomo taps Benjamin Lawsky to the first head of the  Department of Financial Services:  The governor’s office issued this Monday, May 16, news release on the appointment. Lawsky will oversee the integration of the state Banking and Insurance Departments.

 

Long Island Newsday covers Nassau County executive’s press conference in support of NY state Senate no-fault auto insurance fraud proposal:

The Newsday story appeared in its Wednesday, May 18, print edition.

Insurance Commissioner Mila Kofman has held the post since 2008:  The Bangor Daily News reported on her upcoming departure in its Monday, May 16, edition.

 

The Coalition says that the data and security information of all the state’s vehicles would be compromised if H102/S104 were enacted:  The Massachusetts Auto Coalition issued a news release arguing that the legislation would make key codes and other security information widely available. The Massachusetts Police Association, the National Insurance Crime Bureau, and the Highway Loss Data Institute all opposed comparable bills during the 2010 legislative session, the Coalition says.

 

HBO pushing heavily its Monday, May 23, debut of Too Big To Fail:  The film is based on the book of the same name by New York Times reporter, Andrew Ross Sorkin.

 

 

— Julie Patel of the Sun Sentinel tweeted about Governor Rick Scott signing into law a wide-ranging bill that could allow home insurers to raise premiums up to 15 percent a year for reinsurance, on top of regular rate hikes. This happened on Tuesday, May 17, and concludes the saga of SB 408. The new law makes more than 20 different changes to existing state law and you can see those details online in the Sun Sentinel story by Patel.  

 

–A tweet from Insurance Journal reports that the U.S. property/casualty industry took a beating from record first quarter 2011 catastrophe losses. Insured losses from winter storms and severe thunderstorm and tornado events through April—including one outbreak that could represent the industry’s costliest ever—already are pressuring operating results just before what has been forecast to be an active Atlantic hurricane season. How insurers manage catastrophe programs for the remainder of the year will be influenced by pricing and availability of property catastrophe coverage, as well as emerging views of loss exposure and whether the rising frequency and severity of storms seen in recent years is now the norm.

 

–Another popular social media subject was dog bites. As National Dog Bite Prevention Week (May 15-21,  2011) continues, dog bite liability facts and statistics are still popular on Facebook and Twitter with the I.I.I. press release being shared around by insurance companies. Statistics from that release have also been used on various blogs talking about which states have the most dog bite incidents and how much liability cases cost insurers every year. All of this information is being used to encourage dog owners to be responsible for their pets. 

 

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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