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 on Wednesday, October 7, please email Michael Barry at michaelb@iii.org.
President Obama declares major disaster in American Samoa:
An 8.0-magnitude earthquake jolted the South Pacific on Tuesday, September 29, approximately 120 miles off the Samoan coast, generating a tsunami that swept across the islands in the area. Several villages were destroyed and dozens of people were killed in Samoa and American Samoa. Samoa is a nation of about 220,000 people; and American Samoa, a U.S. territory, has a population of approximately 65,000. President Obama declared a major disaster in American Samoa, an action which makes federal funding available to affected individuals.
President traveling to New Orleans in mid-October to assess region’s recovery from hurricanes Katrina, Rita:
The New Orleans Times-Picayune had some details, but not a specific date, on the president’s upcoming trip to New Orleans in its Tuesday, September 29, edition. The news came as President Obama signed an executive order this week extending the Office of the Federal Coordinator for Gulf Coast Recovery and Rebuilding for six months, through April 1, 2010.
P/C industry’s net income, overall profitability tumbled in 2009’s first half:
P/C insurers’ net income in the U.S. after taxes fell to $5.8 billion from $14.1 billion (59.3 percent) in first-half 2009 as compared to first-half 2008. Insurers’ overall profitability as measured by their annualized rate of return on average policyholders’ surplus (or statutory net worth) dropped to 2.5 percent in first-half 2009 from 5.5 percent in first-half 2008, according to a Monday, September 28, statement issued jointly by I.I.I., ISO and Property Casualty Insurers Association of America (PCI). I.I.I. President Bob Hartwig’s commentary is here.
New York Times chronicles report that said National Flood Insurance Program (NFIP) may be paying insurers too much money:
The Government Accountability Office (GAO) issued recently a report which identified many problems in the NFIP and concluded that government officials were unable to determine how much profit their private-sector insurance partners were receiving from the NFIP and whether the profit was appropriate, according to a Wednesday, September 30, New York Times story by Mary Williams Walsh. Premiums paid under the NFIP total about $2.3 billion annually and insurance companies receive approximately $1 billion of the total each year, the article noted.
I.I.I. meeting with New York Times insurance reporter on October 2:
The I.I.I.’s Bob Hartwig and Jeanne Salvatore are meeting with the NYT’s Mary Williams Walsh (email: maryw@nytimes.com) on Friday, October 2, at the Times’ midtown Manhattan offices. Walsh, who joined the Times in 2000, has been covering insurance extensively over the past year or so.
U.S. Department of Transportation hosting ‘Distracted Driver’ summit (September 30-October 1):
The two-day event is being held at Washington, D.C.’s Renaissance Hotel, 999 9th Street, N.W., and is being attended by the I.I.I.’s Carolyn Gorman. U.S. Secretary of Transportation Ray LaHood is delivering the opening and closing remarks. The I.I.I. issued a media advisory on Wednesday, September 30, calling attention to the I.I.I.’s editorial content on the insurance repercussions of distracted driving. In addition, the I.I.I.’s Claire Wilkinson wrote about the summit in her Tuesday, September 29, blog entry.
National Transportation Safety Board reports U.S. motor vehicle deaths dropped almost 10 percent in 2008:
The number of motor vehicle fatalities fell to 37,261 in 2008 from 41,259 in 2007, a 9.7 percent drop, and the lowest highway death toll since 1961. Motorcycle deaths rose to 5,290, the 11th consecutive year of increases, and now account for one in seven motor vehicle deaths. Factors that could explain the overall decline include record high gasoline prices, followed by the recession, which contributed to a cut in the number of miles traveled. Nevertheless, the rate of deaths per million miles fell by a significant 7 percent, suggesting there were improvements in safety. The New York Times published additional details on Wednesday, September 30.
Parental communication is key to safe teen driving, NBC Nightly News reports:
Teen car crashes and risky driving behaviors such as cellphone use, failure to wear seatbelts, and drinking and driving are strongly linked to the way teens and parents communicate and approach rules about safety, studies by The Children’s Hospital of Philadelphia and State Farm found. These findings were incorporated into a Monday, September 28, NBC Nightly News story.
Maryland ban on texting while driving takes effect on October 1:
A new Maryland state law makes typing or sending text messages while driving a misdemeanor punishable by a fine of up to $500. A Sunday, September 27, article from the Baltimore Sun’s hard-copy edition has more on the issue.
Michigan Supreme Court to hear arguments in credit-based insurance scoring case on Wednesday, October 7:
PCI briefed the group on Insurance Institute of Michigan et al v. Office of Financial and Insurance Services (OFIS); an appeal in the case will be heard next week in Michigan’s highest court. The PCI issued this statement on Friday, September 25, after a county circuit court judge granted an intervener motion to PCI and other trade groups.
Market research firm to assess consumer attitudes toward credit-based insurance scoring:
On behalf of the I.I.I.’s credit-based insurance scoring subcommittee, Bahler Communications is convening focus groups in Aurora, Colorado, on Tuesday, October 13; Brookfield, Wisconsin on Thursday, October 15; and Orlando, Florida on Saturday, October 17. If you would like to sit in on the proceedings in one of these cities, please contact Loretta Worters at lorettaw@iii.org.
Wisconsin bill calls for forbidding use of zip codes as an auto insurance rating criterion:
Some Democratic state legislators in Wisconsin have revived a plan to eliminate ZIP codes as a factor in setting auto insurance rates, even though Governor Jim Doyle vetoed a similar measure in the latest state budget, according to a front page story in the Thursday, September 24, Milwaukee Journal Sentinel. Supporters of the proposal say that with mandatory auto insurance in the state going into effect in 2010, insurance should be priced more evenly. But insurers oppose the bill, saying premiums would increase for drivers in less populated areas if the proposal becomes law. The Journal Sentinel plans to publish editorials reflecting the pros and cons of the issue in October 2009.
Former Gulfport mayor pleads guilty to defrauding FEMA after Hurricane Katrina:
Brent Warr pled guilty on Friday, September 25, to one felony charge in a 20-count federal indictment, acknowledging he filed a fraudulent disaster assistance application with FEMA and wrongfully received $9,558 from the agency for repairs to a home which was not his primary residence. Warr was sentenced to three years probation, must repay the $9,558 to FEMA and in the next six months must complete 100 hours of community service. The federal government agreed to dismiss all charges against Warr’s wife as part of the plea deal. The Associated Press and WLOX-TV, southern Mississippi’s ABC affiliate, covered the story.
Atlanta Journal-Constitution (AJC) finds FEMA maps offer limited guidance on flood risk:
Relying completely on federal flood maps to determine whether a property should be covered by flood insurance can cause homeowners major financial problems, as September 2009’s severe flooding in the metropolitan Atlanta area showed, according to a front page story in the Sunday, September 27, AJC. Many of the Georgia flood victims did not know their standard homeowners insurance policy would not cover flood damage and those who knew likely did not realize that property outside flood zones still faced a significant chance of being flooded, the article reports.
Chinese drywall makers may ignore U.S. lawsuits pending in New Orleans federal courts:
Chinese companies have ignored U.S. liability suits in the past, one Louisiana lawyer noted in an Associated Press story from the Monday, September 28, Baton Rouge Advocate, pointing to cases involving toxic edibles, toys and other products. Because of this possibility, plaintiffs’ lawyers are considering such tactics as filing suits against U.S. investment bankers who financed the Chinese companies and seizing ships that brought the drywall to the United States. There are about 300 suits in federal court in New Orleans involving Chinese drywall that came into the U.S. to repair property damage caused by hurricanes in 2004 and 2005.
West Virginia is U.S. state with highest likelihood of a deer-auto collision:
Based on claims data and motor vehicle registration counts from the Federal Highway Administration, drivers in West Virginia have a 1 in 39 chance of hitting a deer, according to a Parkersburg (West Virginia) News and Sentinel article published on Tuesday, September 29. Michigan (a 1 in 78 chance) and Pennsylvania (a 1 in 94 chance) were ranked second and third, respectively.
California State Compensation Insurance Fund’s (SCIF) president and CEO to step down:
Janet Frank is leaving California’s largest writer of workers compensation insurance effective Friday, October 23, according to a Thursday, September 24, press release. SCIF’s board of directors will appoint an interim president and CEO at its Wednesday, October 21, meeting. The Sacramento Bee covered the issue online.
New York state lawmaker hosting forum on Long Island non-renewals:
State Assemblywoman Michelle Schimel (D-Great Neck) is looking to generate media interest in her Thursday, October 8, public hearing, which will include a discussion about the issuance of homeowners insurance policy non-renewals on Long Island.
I.I.I. partnering with Michigan Association of Insurance Agents (MAIA):
At the MAIA’s behest, the I.I.I. is sending its high-definition, consumer-oriented videos (e.g., How to File a Claim) to a closed-circuit television network that services Michigan’s state governmental offices.
Best Day Video developing series on the tumultuous 2000s:
The I.I.I. pitched the idea for the series to A.M. Best’s John Weber, host of the daily Best Day Video (subscription required) and he was receptive. Taping begins in October 2009 and one video will be aired each week as the year comes to a close. Topics will include, but are not limited to: Y2K, 9/11, the tech bubble collapse, the hurricanes of 2004-2005 and the financial crisis. The I.I.I.’s Hartwig, Salvatore and chief economist Steve Weisbart will be interviewed along with many others. The Oldwick, New Jersey-based Weber (Phone: 908-439-2200, ext. 5127; email: john.weber@ambest.com) would like to interview high-level insurance executives about the industry’s experience in the soon-to-end decade, and the I.I.I. can facilitate an appearance for someone from your company.
The Regulator features tribute to the late Bill Bailey:
The September 2009 edition of The Regulator, the monthly newsletter of the Insurance Regulatory Examiners Society (IRES), included an excellent article on the I.I.I.’s late special counsel, Bill Bailey (see attached).
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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