Company in negotiations to buy Shenandoah Life

Transcription

Cuccinelli’s
challenge
6
Commonwealth
Virginia Attorney General
Ken Cuccinelli gets his day
in court to battle
health care reform.
of Virginia
Required reading for successful insurance and financial service professionals
Volume 12, Issue 6 |
Accusations
Warm weather seems to
have drawn out controversy.
Risk mismanagement?
Washington, D.C.,
risk manager
accused of failing
to pay claims to
insurance contractors. Page 3
1
County, schools battle
Insurance policy
fine print leads
Sullivan County
leaders, school
officials to argue.
Page 5
2
Claims settled
Health insurer pays
$30,000 to resolve
regulators concerns
over use of unfiled,
unapproved forms. Page 7
3
Company in negotiations
to buy Shenandoah Life
Small-business owners
getting lost without
brokers’ translations
Prosperity Life has window to broker deal for
insurer in receivership since February 2009
Employers fighting ‘general confusion’
about effects of health reform, executive says
By Bob Graham
State regulators are working with a life insurance company interested in buying
Shenandoah Life Insurance Co,
which has been in receivership
in Virginia since February 2009.
Prosperity Life Insurance
Group has a 90-day exclusive
Al Gross
negotiating period, which can
be extended, to negotiate a deal to buy the troubled life insurance company, according to the
Virginia State Corporation Commission Bureau
of Insurance. At press time, no deal had been
reached.
Any deal for Roanoke, Va.-based Shenandoah
would require the approval of Virginia insurance regulators.
The deputy receiver, Virginia Insurance Commissioner Alfred W. Gross, has been leading efforts to rehabilitate the company and making
decisions regarding its day-to-day operations
since being placed into receivership.
Gross said the purchase of Shenandoah would
not just “best serve the interests of all its insureds
and creditors,” but also “affords an opportunity
for the company to remain an important presence in the regions it serves and to preserve jobs
in Roanoke.”
See “Insurer” on p 16
In Congress :: Page 5
Five-year extension
for NFIP demanded
Everywhere.
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Under $1,500 a year paid for LTC insurance
by half of seniors, a third of all purchasers
Analysis bucks ‘misconception’ that most
buyers pay ‘thousands a year,’ expert says
By Bob Graham
Subscription information
available online at:
IFAwebnews.com/
subscribe
August 2010
About one-in-three long-term care insurance buyers pays less than $1,499 per year for
coverage, and among people under age 61
nearly half pay less than $1,500, according to a
new analysis.
Exactly 35.4% of all recent long-term care in-
surance buyers paid less than
$1,499, according to a report
analyzing 93,500 sales, prepared by the American Association for Long-Term Care Insurance, a national trade
organization.
Among buyers under age 61,
Jesse Slome
43.5% pay less than $1,499 annually, whereas 73.6% of buyers
See “LTC” on p 14
By Bob Graham
A silver lining exists for insurance brokers as small businesses are struggling with the
nuances of health care reform,
according to a health insurance
brokerage executive.
“We are finding that current
business really doesn’t underRobert P. Poli
stand health reform and that
leaves a great opportunity for brokers,” said
Robert P. Poli, executive vice president and chief
operating officer of Insurance See “Reform” on p 12
Summer isn’t
season for change
My agency makes the following
changes* for summer:
2% Close for a week
or two straight
23% Close early one
or more days a week
14% Hire students
or interns for summer
61% No changes
for summer
*More than one choice can be selected.
IFAwebnews.com poll, June 21-30, 2010
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2 | Virginia
|
IFAwebnews.com
August 2010
D.C. risk manager,
on leave, accused of
delaying payments
Claims management, workers’ comp.
firms fighting District for money owed
Several insurance contractors are
struggling for payment from the District of Columbia’s Office of Risk Management.
Meanwhile, the director of that office, Kelly Valentine, was placed on administrative leave after questions were
raised about the handling of insurance
and other government contracts, according to the Washington Examiner.
Sedgwick CMS and Risk Management, a claims management firm, is
struggling to obtain $1.3 million in payments, which Valentine has delayed
over allegations of overbilling, according to the newspaper.
Modern Medical, a workers’ compensation company, is owed “hundreds of thousands of dollars,” its
lawyer, Michael Ruggio, told the newspaper in June.
City could face $6 million bill
Also in June, whistleblowers informed the FBI that Valentine gave contracts for health insurance coverage
and private investigations to companies with whom she had ties.
Neither Mayor Adrian Fenty nor his
staff explained the reason for the sudden removal of Valentine, who is paid
$147,848 a year.
Recently, Fenty and
his attorney general,
Peter Nickles, announced that the District could be forced to
Adrian Fenty
pay $6 million to cover
life insurance premiums that were
never advanced to insurance companies. The premiums had been collected
from hundreds of disabled city employees, according to the Washington
Examiner.
Now, several investigations, including ones led by the FBI, the city inspector general, city auditor and finance office’s integrity team, are
underway, according to the report. IFA
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IFAwebnews.com/Career
Virginia
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IFAwebnews.com
August 2010
|
3
IFAInsights
// Publisher’sNote
EXCLUSIVE INSIGHTS
ONLY AVAILABLE ONLINE
Carriers have best chance for rebound
//AgentSuccess
CLAIMS-MADE POLICIES
Agents, clients must have
understanding of retro dates
There are a number of risks that, because of the nature of their business, are placed into a
claims-made policy instead of a traditional occurrence policy, and retro dates are an important consideration for when the policy is written.
IFAwebnews.com/link/143
AGENCY MANAGEMENT
Being selfish is sometimes the best thing for everyone
OWNERSHIP
Negotiating a personal guarantee in a tight credit market
ACQUISITIONS
Acquiring an agency with no out-of-pocket expense
// Top online stories
|
1 AMA says Medicare cuts put
health of seniors ‘at grave risk’
|
2 The Hartford to settle case over
annuity payments for $72.5M
|
3 Report: Insurance will stem
financial impact of oil spill for BP
“While the controversy over Chinese
drywall has actually been around for a
few years, it just now seems to be in the
sights of the trial bar, and as with any
litigation feeding frenzy, this one will
result in headaches for everyone in the
supply chain and their insurance
companies for some time to come.”
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4 | Virginia
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by states and the federal government.
Yes, their investment portfolios have
been hurt, but the fact
remains that their deTony Ondrusek
mand will not de- Publisher
crease. Car sales will
decline; homes remain unsold; iPhones sell nicely but are
made overseas. But protecting one's assets through property-casualty insurance,
life insurance, or even health insurance
will continue to be a fixed need for most.
While no one can accurately predict the
role of agents and brokers when we eventually move into recovery and new laws
are implemented, the fact remains that
carriers can for the most part rebound,
and that's not all bad.
The government’s taking over one-sixth
of our economy and we expect the
government’s going to do a better job
than the private sector?”
- John Lobert,
blog post on court case involving
Chinese drywall
Blogs
Tony Ondrusek
The domestic auto industry - save Ford
Motor Co. - was almost driven to the brink
of collapse, and has survived only with
government intervention.
The home sales industry is mired in a
near-criminal mortgage crisis and an unending recession that makes its revival all
but impossible.
Manufacturing, once our economy's
backbone, has been shipped overseas.
The tech industry had its run, and while
many firms are profitable, some are laying
off workers, contributing to an unemployment rate that in some states is nearly one
in five.
And yes, the insurance industry has
been slammed by the recession, mismanagement by some and an overzealous Congress and president. But the insurance industry might also be the most likely to
rebound.
Insurance carriers have lots of cash flow,
and for most that hasn't ceased. They also
have lots of reserves, which are mandated
Sarah Palin
Former Alaska governor and VP candidate
addressing health reform law at fundraiser
for developmentally disabled children
“We didn’t have the resources.”
Clarence Lee
former official at U.S. Office of Thrift Supervision
defending the agency’s oversight
of AIG between 2006-2008
This is yet another short term fix, as
Congress has once again kicked the can
down the road to September 30, 2010.…
The real estate market has again suffered
due to this needless lapse in coverage.”
Brian Marino
PIA National President-elect
voicing concern about the National
Flood Insurance Program’s funding
|
IFAwebnews.com
August 2010
President signs another
short-term NFIP extension
Trade groups criticize leaders for not
approving long-term solution
By Bob Graham
ment. “Between now and September, Congress must pass a long-term extension. For
the many homeowners and businesses that
rely on this program, I’m sure news of the
extension is welcomed especially during this
time of year when floods are prevalent.”
Measures to extend the program for five
years, including one before Congress now,
have failed in the past two years, and with
President Barack Obama signed an extension to the National Flood Insurance
Program, extending the lifeline to owners of
properties in flood-prone areas to Sept. 30.
The extension allows people with properties in flood areas and
those seeking to close
// New NFIP designation exam unveiled
on properties in floodA new credential exam for the National Flood Insurance Proprone areas to transact
gram, ANFI 205—National Flood Insurance: Fundamentals,
sales on those properis now available at on-site and Prometric testing centers.
ties. No claims could be
Battle ensues after county learns
of insurance reimbursement policy
Jurisdiction, schools expected full
coverage of $150,000 in settlement
The Sullivan County (Va.) commissioners are criticizing school officials because
their decision to settle a discrimination
suit forced it to pony up $150,000 that it
thought insurance would cover.
The unnamed insurance company will
reimburse the town, but officials were not
aware that the decision to settle the federal
Equal Employment Opportunity Commission complaint filed by Brookside Elementary School Principal Deborah Morelock would result in the upfront outlay,
according to the Bristol Herald Courier.
filed against NFIP poliTopics covered on the exam include an introduction to the
cies and no new NFIP
National Flood Insurance Program; available flood maps and
policies could be writzone determinations products; policy provisions; general
ten since the program’s
rules and eligibility rating; claims handling process and
expiration May 31.
requirements of the Flood Insurance Reform Act of 2004
The program, which
The Malvern, Pa.-based American Institute For CPCU and
serves about 5.5 million
FEMA created the new Associate in National Flood Insurproperty owners in the
ance (ANFI) designation.
U.S., received a retroacTo register for the ANFI 205 credential exam, contact customer
tive extension, meaning
service at 800-644-2101 or [email protected]. Visit
any claims filed after
www.aicpcu.org/anfi
for more information.
May 31 for flood damage will be honored.
During the lapse, some property buyers Republicans increasingly fighting the
in flood areas who had locked in interest Obama Administration over spending into
rates or were taking advantage of federal the federal deficit, a long-term extension
closing cost rebates found themselves un- could be unlikely. IFA
able to close, meaning they may have lost
the locked-in interest rate and the rebate // LOCAL LINES
opportunity.
Spotsylvania Co. supervisors
The lapse, one of several in the last year,
came as the hurricane season began in the urge residents to call Anthem
U.S. That season runs from June 1 to Nov. 30. The Spotsylvania County supervisors
“We are pleased that Congress reautho- asked residents to call Anthem and urged
rized the flood insurance program,” said the health insurance company to settle
David Sampson, presiits dispute with the new HCA hospital in
dent and CEO of Propthe county.
erty Casualty Insurers AsAt press time, Anthem, the largest
sociation of America, in a
health insurance provider in the state, prostatement. “But this
viding coverage to more than 3,000 Spotthree-month extension
sylvania County’s government and school
threatens to leave comemployees, and the Spotsylvania Regional
munities
vulnerable
Medical Center, had not reached an acLeigh Ann Pusey
again in September, at
cord on hospital fees, according to the
the height of hurricane season.”
Fredericksburg Free-Lance Star.
Sampson’s frustration at a short-term
In June, the Spotsylvania Board of Suextension was shared by others in the in- pervisors posted a message on the county
surance industry.
website telling residents to call Anthem
“We’re pleased this program has been ex- “to express their support for a fair and eqtended, even if it’s for a short time, said Leigh uitable resolution, which will not discourAnn Pusey, president and CEO of the Amer- age Anthem-insured citizens from choosican Insurance Association, in a state- ing to visit the county’s new hospital.” IFA
Virginia
The complaint was filed in conjunction
with a series of personnel changes former
Director of Schools Jack Barnes made
when he took office July 1, 2008, including
the shifting of Morelock to principal. Morelock, who had been the school system’s elementary education supervisor, alleged
that she lost out on several central office
jobs that went to men and younger applicants, according to the report.
The school system settled the claim in
February, anticipating the insurance company would foot the entire bill. When it
had to pay the money first, the school
board and county commissioners began to
battle over its handling. IFA
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IFAwebnews.com
August 2010
|
5
Health Care Reform
Cuccinelli says reform law ‘radical,’ ‘unprecedented’
Obama: Insurers should not raise rates in response to changes
Obama Administration refutes AG’s claim, saying national crisis requires action
President warns health executives not to
use law ‘as excuse to simply drive up costs’
The first court hearing over federal
health reform began in Richmond, Va., July
1, where the Virginia Attorney General’s Office
argued the law exceeds
the limits on federal government described in
the U.S. Constitution.
Virginia Solicitor General E. Duncan Getchell
Ken Cuccinelli
Jr. told U.S.. District
Court Judge Henry E. Hudson that the government’s requirement that individuals
buy private health insurance would be
“unprecedented,” according to the Washington Post. Getchell also called the law
“ahistorical” and “radical.”
The Obama Administration’s lawyers argued that the law is appropriate and legal,
given the national health care crisis, the
newspaper reported.
Hudson must now decide if the federal government’s request to dismiss the suit should be
granted. At press time, Hudson was expected to
give his ruling by early August.
The suit, filed by Virginia Attorney Gen-
President Barack Obama recently met
with chief executives from more than a
dozen insurance companies, warning
them against raising rates in response to
new requirements placed on them.
“There are genuine cost drivers that are
not caused by insurance companies,” the
president said after the meeting, according
to the Washington Post. “But what is also
true is that we’ve got to make sure this new
law is not being used as an excuse to simply drive up costs.”
“The CEOs here today need to know that
they’re going to be required to justify unreasonable premium increases,” he added.
Obama called new requirements imposed on insurance companies “what
amounts to a true Patient’s Bill of Rights,”
ending what he called “some of the worst
practices in the insurance industry.”
“It’s not punitive,” he continued. “As I
said when I met with the insurance executives, it’s not meant to punish insurance
companies. They provide a critical serv-
eral Ken Cuccinelli, a Republican, despite
opposition from the state’s Democrats, is
one of a handful arguing the illegality of
the law. A second one, filed in Florida, pits
attorneys general in 20 states against the
government, arguing that states will lose
their constitutional freedom if forced to
expand Medicaid programs required under the law.
The hearing in Virginia came the same
day a new law took effect in the state, prohibiting an individual insurance mandate.
Cuccinelli said the Virginia law, one of 38
state attempts to avoid the mandate, required his legal action in federal court.
The health reform, approved by Congress and President Barack Obama in
March, requires every American to buy
health insurance in 2014 or pay a penalty
of up to 2.5% of annual income.
Critics of the mandate argue that the
federal government has never before told
Americans to purchase any product or
service, while proponents of the mandate
argue that without it, some people might
only enroll in health plans when sick. IFA
Insurance regulators miss
HHS deadline for MLR plan
NAIC’s delay in sending methodology
based on ‘complexity’ of situation
Jim Van Eperen, General Agent, and
The Washington Group Staff are Proud to Announce
Significant Additions to Our Management Team:
Howard Liebowitz,
Phil Cho,
Brokerage Director
Sales Manager
Jim Hegel,
Michelle Hughes,
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Sales Manager
Kenneth Van Valkenburgh,
Michael Hincewicz,
Sales Manager
Sales Manager
www.financialstrength.com
(301) 581-7200
Contact The Washington Group to learn how our team
can help take your practice to the next level.
The Washington Group is a general agency of Massachusetts Mutual Life Insurance Company (MassMutual)
with offices located throughout the Mid-Atlantic region. The Washington Group is headquartered at
6500 Rock Spring Drive, Suite 400, Bethesda, MD 20817.
6 | Virginia
The National Association of Insurance
Commissioners (NAIC)
submitted a letter June
1 to the U.S. Department of Health and Human Services (HHS)
saying it was delaying Jane L. Cline
its report on how health
insurers should calculate their medical
loss ratios.
HHS asked the NAIC to guide it on how
to ensure insurers meeting new health
care reform requirements for medical loss
ratios. The NAIC originally had until Dec.
31 to complete its work, but then was told
to complete it by June 1.
“The NAIC has received tremendous input from dozens of consumer groups, regulators, health care organizations and industry trade groups,” said Jane L. Cline,
NAIC president and West Virginia insurance commissioner, in a statement.
“This complex issue will have a profound impact on the future of health
care,” she said. IFA
|
IFAwebnews.com
President Barack Obama leads a meeting with
health insurers and state insurance commissioners in the White House’s Roosevelt Room.
(White House photo)
ice. They employ a large number of Americans. And in fact, once this reform is fully
implemented a few years from now, America’s private insurance companies have the
opportunity to prosper for the opportunity to compete for tens of millions of new
customers. We want them to take advantage of that competition.”
Among the carriers represented were
Blue Cross Blue Shield affiliates, Aetna,
Wellpoint, Tufts Health Plan, Kaiser Permanente, CIGNA Corp. and Humana. IFA
Report: Short-term buyers
leading to most of Mass.
health plan cost increases
State analysis says active plan members
subsidizing those who terminate in a year
People are paying more for health insurance in Massachusetts because they
are subsidizing residents who bought
coverage only when they were sick, according to a new state report.
The number of people who dropped
their health coverage within six months
quadrupled in the first three years of the
state insurance program. Short-term buyers increased from 3,508 in 2006, the year
the state’s health reform law took effect, to
17,177 in 2008, the latest year for which
data is available, the Boston Globe reported, citing a Massachusetts Division of
Insurance report.
“The active members subsidize some
of the costs tied to those individuals who
terminate within one year,’’ the report
states.
The conclusion raises new questions
about the Massachusetts Health Connector, a health insurance delivery system touted as the model for federal
health reform passed in March. IFA
August 2010
NewProducts
Md. regulators impose $30,000 fine
for Optimum Choice form infractions
For more go to IFAwebnews.com/Products
Firm offers new illustration to
boost employee contributions
Securian recently rolled out
its Personal Savings Illustration, customized specifically for employees
who are eligible but not participating in their
retirement plans.
Life
Insurance
The Minnesota-based company said the
product uses data unique to each individual
to show the results he or she might experience under different savings scenarios. The
personalized tool complements Securian’s
personalized Annual Checkup, a gap analysis
that shows the difference between the
employee’s savings goals and the actual
amount saved, according to the company.
Now in its fourth year, Annual Checkup is
provided through employees’ quarterly
statements.
New app allows business
insurance access anywhere
Travelers introduced the
mobile version of its eCARMA risk management information
system (RMIS) application to help business
insurance customers access vital information anywhere and at any time.
PropertyCasualty
The Connecticut-based insurer has developed the platform to be accessible on any
mobile device with a web-browser, including
the iPhone and BlackBerry smartphones.
The e-CARMA system is the visual front-end
to the Travelers’ suite of RMIS products,
allowing customers to report claims
instantly, access documentation anywhere
in the claim process and review key information such as adjuster’s case notes. The
system offers a robust set of tools to
enhance the users’ analytic capabilities,
according to the company.
Insurer opens up access to its
specialty programs website
Zurich, is offering commercial property and casualty
agents free access to its website –
www.ZProgramsMatch.com — with access
to more than 50 specialty insurance
programs.
PropertyCasualty
include roofing contractors, staffing services
workers’ compensation, gas stations and
convenience stores, golf courses and country clubs.
Agents must register for accessible on the
home page of the site.
Universal life product with
term-life premiums debuts
Protective Life Insurance Co.
and West Coast Life Insurance Co. released two new universal life
insurance products, Protective Secure-T and
WCL Secure-T, that offer term-like, guaranteed premiums for periods of 10, 15, 20, 25
and 30 years.
Life
Insurance
Secure-T is designed to provide low-cost coverage for a specified duration, according to
the companies. The product offers a built-in
lapse protection, with the ability to extend
coverage beyond the initial level premium
period. At the 25- and 30-year guarantee periods, premiums are 13% to 16% lower,
depending on payment mode, than their previous traditional term product counterparts,
officials said. Unlike traditional term products
with a 30-day grace period, Secure-T features
a 61-day grace period.
By Bob Graham
Optimum Choice Inc. paid a $30,000
fine to the Maryland Insurance Administration after applying benefits to members’
covered claims using unfiled and unapproved forms.
The health insurer identified the group
to whom improper benefits were applied as
Lockheed Martin, the defense contractor,
MIA records show.
Although the insurer corrected claims for
group members who filed complaints with
state regulators, the MIA feared others might
require corrective actions so Optimum
Choice conducted a self-audit. It found
3,369 group members had erroneously applied co-payments, records show.
The insurer also reprocessed 23,486
claims using correctly applied benefits,
adding a total of $684,926, plus $198,541 in
interest, to their benefits paid, records show.
Optimum Choice also provided members with new ID cards that were rolled
back to the last approved plan, dating to
2006/2007, for the remainder of 2009.
The insurer first submitted one of the
endorsement forms for amendments to
the group benefit plan contract Feb. 1,
2008. Optimum Choice responded to two
MIA letters about the changes, but failed to
respond, as required within 90 days, to a
third letter, so the MIA withdrew the
changes in November 2008.
The company submitted a subsequent
endorsement form with benefit plan
changes Feb. 19, 2009. Company officials
did not respond to an MIA letter regarding the changes, and that form was
deemed withdrawn July 2, 2009, records
indicate.
After submitting the 2009 filing, Optimum Choice discovered that its 2008 filing was not approved. It resubmitted the
form July 6, 2009, and failed to respond to
the MIA’s letter regarding the changes, so
it was withdrawn Nov. 12, 2009.
Because the 2009 form expired Dec. 31,
2009, and because the company took remediation measures, the MIA did not require it to refile the 2008 or 2009 form filings, according to MIA records. IFA
License status updates
available on Blackberry
Insurance agents and brokers can access licensing
and compliance information remotely with a
new, one-of-a-kind Blackberry app that
shows real-time license status
information. This Blackberry app is a follow
up to the March launch of the License Status App for the iPhone.
Agent
Licensing
THE
MIGHT OF MANY
INSURANCE AGENCIES
BECOMES
Developed by Groesbeck, Texas-based Insurance Licensing Services of America, the new
app can be downloaded for a one-time fee of
$5.99. The application checks licenses
against the National Producer Database.
THE POWER OF ONE.
Current assumption universal
life product launched
The website, first launched in January 2009,
previously was only offered to Zurichappointed agents.
The U.S. division of Sun Life
Financial launched a current
assumption universal life product designed
to provide lifetime protection and competitive cash value growth through a guaranteed
minimum interest crediting rate.
Zurich’s programs are industry-specific
books of commercial lines business administered through program administrators and
general agents, and through more than 50
participating programs. Risks covered
Sun AccumULator offers tax-advantaged
cash accumulation potential, income tax-free
withdrawals and loans to help meet supplemental retirement income needs, college
expenses, or other needs, officials said.
Virginia
Health insurer improperly applied benefits
to members of Lockheed Martin plan
www.siaa4u.com
Life
Insurance
Complete Independence • Top Tier Profit Sharing • Stable Markets
Call Dan Kerns
in Western VA
888-371-6879 • www.blueridgeagents.com
Call Jon Pappas
in Northern VA/ DC area
443-692-4000 • www.pinsiaa.com
Call Lee Mills
Call Beth Roe
in Central & Southeast VA
in North Central VA
910-455-7576 • www.siaofnc.com
|
Potomac Insurance
Network
IFAwebnews.com
423-612-0683 • www.meaa4u.com
August 2010
|
7
LEGALBRIEFS
News from the federal and state courts.
Va. jury sides with truck owner, not State Farm, on theft
PropertyCasualty
Pictured (from left) are CNA leaders: Peter Wilson, president and chief operating officer, CNA Specialty; Tom
Motamed, chairman and chief executive officer; George Agyen, mid-Atlantic zone leader; Bob Lindemman,
president and chief operating officer, CNA Commercial; and Tim Szerlong, president, Worldwide Field Operations.
CNA Financial opens branch in nation’s capitol
CNA Financial Corp. opened a branch in
Washington, D.C., an expansion the company says extends its geographic footprint
and puts it closer to its agents, brokers and
customers.
The new office for the Chicago-based
multi-line business and personal insurance
agency is part of a strategy announced last
year, company officials said in a statement.
“We are fortunate to be among the few
businesses that are meeting the challenge
of this economic environment by opening
new doors and expanding employment
opportunities within our industry,” Tom
Motamed, chairman and chief executive
officer of CNA, said in a statement.
“Our new D.C. branch will enable CNA
to penetrate the capital’s robust market
and diverse industries,” he said.
Motamed said key areas of concentration
for the office include technology, education,
real estate, manufacturing and distribution,
and business/professional services.
George Agyen, mid-Atlantic zone officer, will lead the D.C. branch office, located at 2020 K Street, NW. IFA
The jury awarded the man, Peter L. Norlund, 26, and his father, Lewis L. Norlund, whose
name was also on the truck’s title and insurance policy, the money in connection with the
June 7, 2008, theft, according to The Virginian-Pilot. The jury, after a one-day trial, awarded
the sum equal to the value of the truck, interest he paid on the loan and personal property he
lost with the theft.
State Farm had accused the younger Norlund, who filed a police report and insurance claim
shortly after the incident, of fraud, saying the vehicle’s sophisticated anti-theft system would
prohibit anyone except the keyholder to take the vehicle, according to the report. The vehicle
was found a few days after he filed the police report in South Carolina, where it appeared to
have been intentionally burned.
Marsh’s Mercer unit settles $2.8 billion suit in Alaska
A unit of insurance conglomerate Marsh & McLennan Cos. settled a $2.8
billion lawsuit with the state of Alaska for a $500 million payment, alleviating a
concern for investors and further clearing up the picture for Marsh.
Pension
Case
Mercer Inc., an investment-services and consulting group of Marsh’s, said it will pay $500
million to Alaska over claims brought by the state’s pension funds for the handling of the
funds’ investments from 1992 to 2004. Mercer, which expressly denies liability in the settlement, said $100 million of the cost will be covered by insurance.
Calif. sheriff’s deputy charged with disability benefit fraud
Disability
Insurance
Annuities
Oster suffered an injury in 2007 and was not able to return to work, according to the TV
report. While receiving benefits, investigators say, he lied about his employment status, the
TV station reported. Oster, whose bond was set at $10,000, was put on administrative leave.
Life
Term, UL, WL,
Second to Die,
Final Expens,
LTD, WDI
Term, UL, WL,
Second to Die, Final Expense
Health
Disability
Group, Dental,
Medical, PPO,
LTD, WDI, Major
Blue Collar
Cancer, Indemnity
Senior
Medicare,
LTC, HHC
A Solano County, Calif., sheriff’s deputy was arrested for allegedly collecting
nearly $90,000 in disability benefits for which he was allegedly not entitled.
Deputy Michael Oster, 49, an eight-year veteran who lives in Elk Grove, Calif., faces two
counts of insurance fraud, according to KOVR-TV.
SPIA (Ratable),
FPDA, SPDA
Life/D.I.
A Virginia jury recently awarded $23,864 to a man whose insurance claim for
a stolen 2007 Chevrolet Silverado was denied by State Farm.
Senior
Medicare, LTC, HHC
N.Y. brokerage owner pleads guilty in $7M scheme
The owner of a pair of Suffolk County, N.Y., insurance brokerages pleaded
guilty to mail fraud in what prosecutors say was a $7 million scheme to use
client premiums for personal use rather than forwarding the funds to carriers.
PropertyCasualty
Arthur Bielli, 42, of West Islip, N.Y., made the plea in U.S. District Court in Central Islip, N.Y.,
according to Newsday. Bielli is the former owner of Global Insurance Brokerage and Cross
Country Insurance Brokerage, both in Ronkonkoma, N.Y. Officials say Bielli’s victims included
more than 20 companies between 2001 and 2004 that required costly vehicle insurance premiums, including tow truck operators and trucking companies. He faces up to 20 years in
prison.
In May 2006, the New York State Insurance Department revoked Bielli’s license, as well as
the licenses of his two agencies, after a 2001 conviction of third-degree grand larceny for
misappropriating premium money received from a client, according to records.
First National Brokerage is a full service agency, catering to YOU, the agent.
The Hartford settles accident victim claims for $72.5M
We assist each agent from beginning to end, whether it's product
training/development, quoting, underwriting, enrollment and continued
service once the policy is placed.
Connecticut-based The Hartford has received preliminary approval on a settlement to pay $72.5 million to resolve a class-action suit accusing the firm of
keeping millions in fees that should have been distributed to 21,000 accident victims.
First National Brokerage Corporation
5311 Patterson Avenue, Richmond, VA 23226
800-234-5667 | www.fnbc.cc
8 | Virginia
PropertyCasualty
A federal judge in Bridgeport, Conn., granted the initial approval to settle the national suit,
filed in 2005, involving plaintiffs injured and eligible for personal injury or workers’ compensation claims from The Hartford Financial Services Group, according to the Hartford Courant.
For the latest Legal news go to IFAwebnews.com/Record
|
IFAwebnews.com
August 2010
UniCare bows to
Anthem, CareFirst
with exit from Va.
Health insurer cedes market to its
competitors in northern part of state
By Bob Graham
UniCare is exiting the Virginia market, eliminating individual health insurance coverage for about 3,000 people,
mostly in Northern Virginia, company
officials said.
The exodus from the commercial
health insurance market in Virginia Dec.
31 is part of a company strategy agreed to
late last year, Tony Felts, a company
spokesman, told Insurance & Financial
Advisor. The company pulled out of its
two biggest markets, Illinois and Texas,
dropping coverage to about 400,000 people, in the fall, he said.
No additional market eliminations
have been announced, Felts said. The
company provides coverage in Maryland
and Washington, D.C., to about the same
numbers as in Virginia, he said.
The departure is not tied to federal
health reform, but rather acceptance of
the competitive market within Virginia,
Felts said.
The market share for UniCare is far
dwarfed in the state by two Blue Cross Blue
Shield licensees: Anthem Blue Cross,
which like UniCare is a subsidiary of WellPoint, and CareFirst, an Owings Mills, Md.based carrier covering Northern Virginia.
About one third of the people covered
by UniCare will receive a guaranteed issue for comparable coverage from Anthem, he said. The others, because they
are in Northern Virginia where Anthem is
not licensed, will not receive an offer of a
guaranteed issue, Felts said. IFA
Success
SSuc
uccceesss
// LOCAL LINES
State Farm agents help
Charlottesville group
Two State Farm insurance agents helped
put the Building a Bridge, a long-term
residential community for adult survivors of traumatic brain injuries, back
on the road, the Charlottesville Daily
Progress reported.
State Farm agents Hunter Wyant and
Chris Grimm found a Toyota minivan,
which had been in a rear-end accident
and needed work.
Jeff Cotton’s staff at Master’s Auto Body
in Charlottesville, Va., made it operable. IFA
Virginia
|
IFAwebnews.com
August 2010
|
9
// HEALTH INSURANCE
// FOLLOWUP
Coventry to pay $262 million
to end class-action suit
Money headed to PCA peanut
butter salmonella victims
Coventry Health Care is taking a $262
million charge to end a class-action suit
filed in Louisiana over workers’ compensation claims.
The Bethesda, Md.-based health insurer said the Third Circuit Court of Appeals in Louisiana affirmed a trial court’s
decision granting summary judgment
against First Health Group Corp., a
wholly owned subsidiary of the insurer.
The suit involves claims of alleged violations of notice provisions of
Louisiana’s Any Willing Provider Act in
connection with providers providing
services to injured workers with workers’
compensation claims. IFA
The 123 people who filed personal injury
claims in connection with a salmonella
outbreak that was traced to Lynchburg,
Va.-based Peanut Corp. of America in 2009
could start seeing some money this month.
In Roanoke, a U.S. District Court judge
recently agreed to accelerate the resolution of the personal injury claims received through PCA’s bankruptcy action,
according to the Lynchburg News Advance newspaper. A $12 million fund,
drawn from Peanut Corp.’s insurance
policies, were set aside to pay claims of
people sickened by the salmonella.
The outbreak of salmonella was linked
to PCA’s peanut butter. IFA
Have you met our
weekly edition?
eNews Updates bring you desktop access to local and
national industry news to give you an edge.
Each update includes more than 20 headlines linking to stories on
IFAwebnews.com, including important local news stories, along
with coverage of national property-casualty, health insurance, life
insurance/financial service and new product announcements.
Required reading for successful insurance and financial service professionals.
10 | Virginia
PeopleNews
Matthew Brotherton,
president of 1752 Financial Solutions in
Richmond, Va., was
named a recipient of the
American Association for
Long-Term Care
Insurance’s 2010 Achieve- Matthew
Brotherton
ment Award, honoring
leading long-term care insurance professionals in each state.
Brian Propst was selected
as Capitol Financial Solutions’ vice president of
business development.
Jason G. Pruden, a resident of Richmond and
financial representative for
Capitol Financial Solutions, Brian Propst
recently earned his Chartered Financial Consultant (ChFC) designation
from The American College. The firm, based in
Raleigh, N.C., and Richmond, Va., is a member of
John Hancock Financial
Network, a national network of independent
career firms. John Hancock
Jason G. Pruden
Financial Network also said
Hayley Wood consecutively ranked within
the top 10 across the nation in her first-year
with the company.
Eric D. Hirsch and Benjamin T. Jolly, both
residents of Washington, D.C., recently
earned their Certified Financial Planner (CFP)
certifications from the Certified Financial
Planner Board of Standards Inc. Both are
financial representatives with Signature
Financial Partners, a Vienna, Va.-based
financial guidance firm serving the Virginia,
Maryland and Washington, D.C.
Tiffany Jennings was promoted to a commercial underwriter assistant at Atlantic
Specialty Lines of VA.
Rebecca Holland of Nansemond Insurance
Agency in Suffolk, Va., earned the Certified
Insurance Service Representative designation
through Professional Insurance Agents Association of VA and the District of Columbia.
Timothy Herr was named Richmond, Va.based Genworth Financial’s senior vice
president of brokerage general agency distribution. He was president and founder of
Preferred Strategic Partners.
|
IFAwebnews.com
Dan O’Leary, formerly
vice president of sales at
USI, was named commercial lines account
executive at Preferred
Insurance in Fairfax, Va.,
focusing on real estate,
technology and construc- Dan O’Leary
tion insurance.
New officers for the Insurance Women of
Richmond, Va., include Maria A. Swanson of
Selective Insurance, president; Teresa
Yocom of Realcorp & Associates, second
vice president; Melanie A. Morris of Colony
Insurance Co., treasurer; and Laura E.
Vaughan of Colony Insurance Co., secretary.
Maryl Cosman of Armfield Harrison
Thomas in Leesburg, Va.; Teresa Evans
with Grayson Carroll Wythe Insurance
Co. in Galax, Va.; Deborah Isbell of
BB&T/DeJarnette & Paul in Richmond,
Va.; Tuyet Le with Wells Fargo Insurance
Services in Richmond, Va.; and Sara Vandegriff of BB&T/Chaney Thomas in
Roanoke, Va., all recently earned the Accredited Customer Service Representative
(ACSR) designation through the Independent Insurance Agents of Virginia.
Aaron Milligan, formerly with Maxim Healthcare Services, joined Washington, D.C.-area
firm Wellness Corporate Solutions as
national director of flu shot programs.
Send Your News!
The easiest way to submit news is online:
IFAwebnews.com/submit-news/
// ASSOCIATION NEWS
Virginia/DC PIA group selects
online CE course partner
The Professional Insurance Agents of
Virginia and the District of Columbia selected CEAuthority as its preferred online
insurance continuing education provider.
Members of the insurance trade group
have unlimited access to CEAuthority’s insurance CE course catalog at preferred
subscription pricing. The unlimited access
subscription is available at PIA of VA and
DC’s website. CEAuthority, powered by
RegEd, Inc., offers online insurance continuing education courses in life, health,
property and casualty, and other areas. IFA
August 2010
Virginia
|
IFAwebnews.com
August 2010
|
11
Va. firm eyes state health exchange role
MAXIMUS hopes to help states to meet
federal regulatory requirements of reform
A Virginia-based company that provides
government services worldwide said it has
launched its Health Insurance Exchange
offerings, designed to help states meet federal regulatory requirements included in
federal health reform legislation.
MAXIMUS, a Reston, Va., health and human relations consulting company, said its
exchange will help states assess, design, implement and operate a cost-effective and efficient exchange that meets all federal and
state requirements, according to a statement.
“State leaders must make critical decisions regarding how they extend health insurance coverage through an exchange,”
said Bruce Caswell, president and general
manager of MAXIMUS Health Services, in
a statement.
“Our exchange solutions utilize our extensive government health
insurance program experience to apply best
practices that address
each state’s unique challenges of expanding cov- Bruce Caswell
erage and meeting the
federal requirements,” he added.
MAXIMUS intends to use its experience
with Medicaid, the Children’s Health Insurance Program and other state-designed
insurance programs to help state leaders,
the statement said. IFA
Focused.
…on helping our agents grow.
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Business • Auto • Home • Surety
12 | Virginia
Reform: Employers struggling with effects
From page 1
midst of a host of health care reform challenges, employers remain confident that
they will continue to offer health care benefits to their active employees,” she said.
Further complicating matters is the fact
that the individual mandate, a cornerstone
Marketing Center, a regional brokerage
based in Rockville, Md.
The health reform law, passed by Congress and President Barack Obama in
March, sets new minimum standards for
// Early employer actions
coverage for small
A new survey on patterns of Health Savings Account research
businesses and, in
and purchasing by Information Strategies Inc., based on 1,700
2014,
establishes
purchasers and more than 34,000 searches, indicates:
health
exchanges
• 87% of employers agree that their organizations will conwhere individuals and
tinue to offer health care benefits because they are critical to
small business ownemployee recruitment, retention and remaining competitive.
ers can compare cov•
One in five employers (21%) is planning to add or
erage options and buy
increase emphasis on high-deductible health plans in the
policies.
next 12 months.
The rhetoric sur•
Close
to 70% of these employers are likely to focus on
rounding the passage
account-based plans linked to health savings accounts.
of the legislation indi• 66% of employers will take advantage of the new legal procated that insurance
vision that will offer increased levels of financial incentives
would cost less. But
available to employees who participate in employer-provided
health
insurance
wellness programs; 9% disagree and 25% are not sure.
rates are rising by as
Source: International Foundation of Employee Benefit Plans survey
much as 30%, in part
because of the new
mandates included in the coverage.
of the health reform legislation, is being
“Some owners believe that rates should challenged in several federal courts, creatbe going down and they don’t understand ing some uncertainty in what form, if any,
that none of the real changes go into effect health reform ultimately will take.
until 2014,” Poli said.
Poli, quoting Charles Dickens, said the
Employers are attempting to assess the situation is the best of times because busiimpact and determine how they will re- nesses “need the agent now more than
spond to health reform, according to a new ever.” At the same time, he said, now is the
survey, published by the International worst of times “because everyone includFoundation of Employee Benefit Plans, of ing the agents are scared and don’t know
more than 1,000 employers.
what is going to happen. Many think they
“Both large and small employers are will be out of business in four years.
carefully scrutinizing their options,” said
“That is not true,” Poli added. IFA
Sally Natchek, senior director of research at
the International Foundation, in a state- // ASSOCIATION NEWS
ment. “Employers at this point are reacting
VAHU to explore health reform
to the first wave of requirements, knowing
they need to make some initial immediate at Sept. 14-15 conference
decisions.”
The Virginia Association of Health UnFrank X. Kelly III, president and CEO of
derwriters will hold its annual conference
Kelly & Associates Insurance Group, a reat the Kingsmill Resort & Spa in Williamsgional brokerage based in Hunt Valley, Md.,
burg, Va., Sept. 14-15.
said his staff is combating “general confuThe event will provide agents from all
sion” among employers by using emails,
over the state with the tools and informabulletins, monthly and quarterly publication necessary to understand and respond
tions to explain upcoming changes.
to the federal health reform legislation,
“We’re trying to let people see the inforpassed in March. Continuing education,
mation and calming them down,” he said.
networking and a trade show are planned.
Kelly added that because the rules imFor more information or to register,
plementing the reform law are now being
contact VAHU at www.vahu.org. IFA
written, “We are still waiting for some clarification on a lot of regulation.”
Online CE.
Natchek said that despite the complexity,
the study shows employers remain comIFAwebnews.com/Career
mitted to providing health benefits. “In the
|
IFAwebnews.com
August 2010
DoneDeals
Calendar of Events
has gone digital.
mergers • acquisitions • partnerships
Pacific Life, PIMCO deal
marks move to ‘cutting edge’
Pacific Life Insurance Co.
awarded PIMCO a contract
to manage a portion of its general account
assets, a move it says puts the company on
the “cutting edge” of insurer investing.
Life
Insurance
The Newport Beach, Calif.-based insurer
said the contract began July 1. Terms of the
deal were not disclosed.
PIMCO was selected from six firms to
invest for Pacific Life among a wide range of
fixed income securities, according to a statement from the companies.
“Pacific Life is among the first of large life
insurance companies to employ this new
investment structure,” said Mark Holmlund,
Pacific Life’s chief investment officer. He
added that the company manages more
than $10 billion of Pacific Life policyholder
funds within its separate account offerings.
“We are excited to be on the cutting edge
of this new investment trend,” he added.
New Jersey’s MSO affiliates
with executive search firm
Glen Rock, N.J.-based MSO,
a property-casualty ratings
service bureau, is affiliating with Abbott
Smith Associates Worldwide, an executive
search and talent management firm.
PropertyCasualty
Services in the areas of employee recruiting
and talent management will be provided to
MSO member firms on a discounted basis.
Symetra Life partnering with
CANNEX Exchange
Symetra Life Insurance Co.
Wealth
Mgmt.
said two of its income annuity products are now available on the
CANNEX Exchange.
CANNEX. which distributes annuity surveys,
quotations and illustrations for U.S. insurers,
will offer the Advantage Income and Freedom Income annuities on its platform.
Wells Fargo Advisors teaming
up with Saybrus Partners
Saybrus Partners, the distribution company of The
Phoenix Cos., is going to provide life insurance consulting services to the financial
advisors of Wells Fargo Advisors.
Financial
Services
Under the agreement, Saybrus Partners’
wealth management consultants will work
with Wells Fargo Advisors’ financial advisors
in branches across the U.S., helping them
match insurance products to meet their
clients’ needs, according to a statement. Saybrus Partners will separately secure selling
agreements with several carriers it will represent in the Wells Fargo Advisors system.
To provide the latest, most accurate
Calendar of Events information, the
calendar is now online at
IFAwebnews.com/calendar. A print
calendar will no longer appear each month.
Associations and other groups are encouraged to post
events, seminars and other activities on the calendar
at no charge. It’s quick, easy and always up-to-date.
Phoenix formed Saybrus Partners late last
year to provide consultation services to partner companies, as well as support for
Phoenix’s product line within its own distribution channels. Saybrus Partners offers both
wholesaling and “assisted sale” services.
American College, MetLife
team up on college facilities
Agent
Education
The American College signed
an agreement with MetLife
to sponsor the new ‘MetLife Learning Center,’ located on the college’s campus in the
suburbs of Philadelphia.
The center is a state-of-the-art meeting and
classroom facility that will serve as the primary location for the institution’s academic
programs, according to the college.
The MetLife Learning Center will be the
home of the college’s master’s degree residency courses each year, as well as other
learning opportunities.
LPL parent company prepares
for its $600 million IPO
The parent company of one
of the largest brokerage
companies in the U.S. filed for an initial public stock offering worth up to $600 million.
Financial
Services
LPL Investment Holdings is the parent of
LPL Financial, the fifth largest broker dealer
based on the number of registered financial
advisors, More than 12,000 independent
financial advisors work with LPL, which also
offers clearing and technology for 4,000
other advisors.
Last year, company officials indicated that an
IPO was likely.
www.kaig.com
www
w..kaig.com
The filing does not indicate the number of
shares to be sold; however, it did indicate
that the money raised would be used to
repay debt.
LPL, previously known as Linsco/Private
Ledger, had on March 31 advisory and brokerage assets totaling $285 billion. The
company earned $25.6 million in the first
quarter, according to company filings, which
showed $743 million of net revenue.
www.ktbspayroll.com
w
www
w..ktbspay
yroll.com
For the latest deals go to IFAwebnews.com
Virginia
|
IFAwebnews.com
August 2010
|
13
// LOCAL LINES
Culpeper dentist in prison in Oxycodone prescription case
A Culpeper, Va., dentist is serving his 28month federal prison term, six months after being sentenced for his role in a conspiracy to illegally distribute Oxycodone,
which in one case involved a false insurance claim.
Dr. William J. King, 62, who operated a
general dentistry practice in the 1000 block
of Oaklawn Drive in Culpeper, is serving the
sentence at the Federal Correctional Institution in Fort Dix, N.J., a low-security facility,
according to the Culpeper Star-Exponent.
At his sentencing in December 2009,
King, who pleaded guilty Sept. 29, 2009, to
one felony count of conspiracy to distribute the painkiller, also was ordered to three
years of supervised release, fined $20,000
and ordered to forfeit $150,000, the newspaper reported.
King wrote prescriptions for OxyContin and other narcotics in 2006 and 2007
for a woman with whom he had a romantic relationship, according to court records,
cited by the newspaper. IFA
LTC: Real policy costs less than perceived
From page 1
between ages 61 and 75 pay $1,500 or more.
“Individuals mistakenly have been led
to believe that long-term care insurance
costs thousands of dollars,” said Jesse
Slome, AALTCI’s executive director, in a
statement.
He added that a “significant number”
of buyers spend between $10 and $20 a
week for up to $250,000 of future care.
Among buyers under age 61, exactly
28.1% paid less than $999-per-year. Fewer
than one in 10 (9.3%) pay $3,500 or more
annually.
The report confirmed that age is an important factor. While 41.5% of buyers under age 61 pay between $500 and $1,499per-year, only 20.8% of buyers who are
ages 61-to-75 pay within this range.
Nearly one in 10 (9.5%) of all buyers
paid $4,000 or more yearly for their insurance protection, the AALTCI report found.
Just 6% of buyers under age 61 pay the
amount, while 28.2% of buyers age 76 or
older did, Slome said. IFA
NewProducts
For more go to IFAwebnews.com/Products
Partnership enables vision
plan offering from insurer
Assurant Employee Benefits
is offering a fully-insured
vision plan through a partnership with VSP
Vision Care, a eye-care provider.
Vision
Benefits
“Introducing a vision plan means that Assurant Employee Benefits now offers all
ancillary benefits, making it easier than ever
for brokers and customers to do business
with us,” said Paul Walker, product development marketing specialist, in a statement.
The fully-insured eye-care plan includes benefits such as contacts and glasses as well as
yearly eye exams, the company said.
With the introduction of the fully-insured
vision plan, Assurant Employee Benefits now
offers vision, dental, long and short-term disability and worksite benefits including cancer,
critical illness, accident and gap, making them
a one-stop shop for ancillary benefits.
‘Ann’ answering the virtual
call for national health insurer
Aetna has unveiled an online
assistant to help members
who have questions about how to navigate
Aetna’s member website.
Health
Insurance
“Ann,” Aetna’s personalized, virtual assistant, offers 24-hour support for members
who are new to the website or need help
logging in. More than half of health plan
members who register on the website for
the first time interact with Ann, company
officials said, adding that calls to the company’s customer service technical help desk
declined 29% in one month because of
Ann’s interactions.
Our conference is poised and ready to offer attendees
the tools and information to sort through the regulations of the new Health Reform Law.
Customize your Conference experience. There will be
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courses along with personal development classes and many
networking opportunities.
We have plans to present a panel discussion with
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information to share with your clients.
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and register to attend.
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board with VAHU and learn what opportunities
lie ahead in these challenging times.
Register to attend at: www.vahu.org.
14 | Virginia
Members receive the same responsive service
from Ann that they receive when calling customer service, but without leaving the website,
the Hartford, Conn.-based company said in a
statement. Ann is interactive and easily interprets members’ questions, helping them with
the registration process or with recovering forgotten user names or passwords.
Developed by Next IT, the technology
behind Ann emulates the look and voice of a
human, according to the company.
themselves and their employees, the company said.
MetLife collaborated with Benz Communications, a benefits communication firm, to
create several new resources on the Open
Enrollment Toolbox. These include guides
for employers and brokers on how to simplify benefits, easy ways to make
enrollment more effective, trends to watch
and how to get started with social media,
the insurer said.
Middle-market coverages for
industry segments doubled
The Hanover Insurance
Group, a property-casualty
insurance provider, launched more than a
dozen new and enhanced middle-market
capabilities for various industry segments.
PropertyCasualty
The company said the move is a response
to the growing number of its agent partners
who are becoming more specialized in their
marketing and sales efforts and the result of
its recently acquisition of OneBeacon Insurance Group, which operates in specialized
and niche markets.
The enhanced industry solutions include a
core commercial package policy, property,
general liability, commercial auto and commercial umbrella coverage, combined with
customized products and services for each
unique industry segment. These areas
include brewers, cultural institutions, food
industries, hospitality,
Media, metalworkers, plastic manufacturers,
printers, professional services, real estate,
retail and wholesalers.
Financial advisors have new
coach in their 401(k) corner
Financial
Planning
John Hancock Retirement
Plan Services introduced
Coach's Corner, an online tool designed to
help financial representatives identify the
needs of prospective clients in a more effective manner.
Carrier adds punch to its
online open enrollment tools
Coach's Corner is the latest addition to John
Hancock RPS's PRIME Elements program -a suite of tools to help financial representatives quickly identify and address the critical
elements plan sponsors require in a 401(k)
retirement plan.
MetLife has enhanced its
online Open Enrollment Toolbox to help employers engage their
workforce during open enrollment, implement new strategies and optimize the value
of their group benefits programs for both
The Coach’s Corner tool provides financial
representatives with support throughout the
entire sales cycle -- from preliminary discussions with a prospect all the way to
presenting them with a retirement plan solution, company officials said.
Life
Insurance
|
IFAwebnews.com
August 2010
// TECHNOLOGY
RCM&D inks contract for
redesign of its website
MGH, an Owings Mills, Md.-based integrated marketing communications
agency, has been contracted to redesign
the website of RCM&D, a regional insurance brokerage.
Terms of the deal between MGH and
RCM&D, a 125-year-old privately held insurance brokerage and consulting firm
based in Baltimore, Md., were not disclosed.
The updated site, whose completion is
expected by the end of the year, will provide additional information for brokers
and the public and provide online access
to policy information, according to the
Baltimore Business Journal.
RCM&D has offices in Baltimore and
Bethesda, Md.; Richmond and Virginia
Beach, Va.; and Harrisburg, Pa. IFA
// PROPERTY-CASUALTY
Unitrin buys ‘Kemper’ name
from Lumbermens Mutual
Unitrin bought the “Kemper” name
from Lumbermens Mutual Casualty Co.,
finally putting the name with the company that operates under the name.
“We are pleased to have acquired such
a venerable name in financial services as
Kemper and plan to increase the profile
of the name in our insurance operations
over time," said Unitrin's chief executive
officer, Donald Southwell, in a statement.
Lumbermens has owned the intellectual property rights to the Kemper name
and operated various insurance businesses as “Kemper Insurance Cos.”
In 2002, Unitrin bought the personal
lines and casualty business from Lumbermens, and it acquired a license to use
the Kemper name only with its personal
lines business. IFA
In Memoriam
■
Michael J. Long, originally from WilkesBarre and recently Ashburn, Va.; former
Nationwide Insurance employee.
■
Walter Carroll Plunkett Jr., 87, of
Ruckersville, Va.; worked in insurance industry,
then tax advisor at Amvest.
■
Samuel Lewiston Brown, 88, of Reva, Va.;
worked as an insurance agent for Home
Beneficial Insurance.
companynews
Dominion Dental helps
Alexandria children’s fund
Dominion Dental Services supported The Fund for Alexandria’s
Child’s annual “Fostering the Future Cruise” for the fifth-consecutive year, which benefits the children’s recreation, therapeutic
casework enhancement, emergency food, clothing and transportation, holiday giving and community outreach efforts.
Pictured are Suzanne Kratzok, community resources coordinator for the City of Alexandria Department of Human Services,
and Mitch McGlynn, president of Dominion Dental Services.
Send photos of your company events and happenings:
[email protected]
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Virginia
|
IFAwebnews.com
August 2010
|
15
Insurer: Company looking at Shenandoah
From page 1
“We are pleased to have the opportunity
to further develop and refine our plan to recapitalize Shenandoah,” said Prosperity
Life’s president, Jose Montemayor, in a statement. “The recapitalization aims to restore
Shenandoah’s financial strength to allow it
to continue to serve policyholders as it has
been doing since its founding in 1916.”
Shenandoah is a Virginia-domiciled life
and health insurer that, at the time it was
placed in receivership, wrote primarily life,
annuities and dental insurance in 31
states, and Washington, D.C.
A moratorium placed on the payment of
claims and benefits, except for accident
and health claims, death claims, and peri-
odic annuity payments, at the time of receivership will remain in place during the
parties’ negotiations. And, Shenandoah
will not resume the issuance of new insurance policies until a plan of rehabilitation
is approved by the SCC. IFA
For the Record
Virginia Agent & Carrier Actions
The following summaries are based on information obtained from the Virginia State
Corporation Commission Bureau of Insurance.
■
OneBeacon completes
shedding of personal lines
OneBeacon Insurance Group completed
the sale of its traditional personal lines
business to Tower Group as the company
focuses its attention on specialty lines, the
company announced.
The deal was announced Feb. 2. IFA
Michael E. Cahill
ministrative action taken against him by North Carolina.
Mechanicsville, Va.
Action: Paid a $7,500 fine, agreed to completed four
hours of continuing education work in ethics within 12
months and agreed to five years of probation
Synopsis: Cahill was found to have made false or fraudulent statements or representations regarding an application or document; knowingly helped to secure a life
insurance policy on a person who is not in an insurable
condition by means of misrepresentations, or false or
fraudulent statements; used fraudulent, coercive or dishonest practices; and forged another’s name ot an application or document related to an insurance transaction.
Case No. INS-201-00096
■
Case No. INS-2010-00060
■
Case No. INS-2010-00034
■
Case No. INS-2010-00061
■
Case No. INS-2010-00085
■
New eyes.
New reach.
New exposure.
Case No. INS-2010-00045
■
Zachuriah D. Collar
Virginia Beach, Va.
Action: License revoked
Synopsis: Collar failed to report within 30 days an ad-
Freedom Settlement Group LLC
Winchester, Va.
Action: Paid a $5,000 fine
Synopsis: The company was found to have acted as a
settlement agent without being properly registered
with the Virginia State Bar.
NTSWV Inc.
Chester, W.Va.
Action: Paid a $500 fine
Synopsis: The company failed to provide a copy of its
analysis or audit report of its escrow account in a
timely manner.
Queen E. Robinson
Chicago, Ill.
Synopsis: Robinson failed to report to the commission
within 30 days an administrative action taken against
her by Alabama, and provided materially incorrect, misleading, incomplete or untrue information on its license
application.
James A. Connors Assoc. Inc.
Morristown, N.J.
Synopsis: The company failed to report to the commission within 30 days an administrative action taken
against it by Florida, and provided materially incorrect,
misleading, incomplete or untrue information on its license application.
Leikicha L. Phillips
Philadelphia, Pa.
Synopsis: Phillips failed to report to the commission
within 30 days an administrative action taken against
her by Wisconsin, and provided materially incorrect,
misleading, incomplete or untrue information on its license application.
Case No. INS-2010-00082
■
Orlando A. Ramirez
Falls Church, Va.
Synopsis: Ramirez was found to have acted as an
agent of an insurer without first obtaining a license.
Case No. INS-2010-00051
// REGULATION
FINRA fines, bars Va. man for his outside business activities
Reach even more insurance agencies
and retail financial service offices
throughout the mid-Atlantic region.
• Expansion throughout all of Pennsylvania
• Increasing circulation in Maryland and Virginia
• Relaunched website with more news and features
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16 | Virginia
A Chesterfield, Va., man was fined
$22,500 for failing to inform his member
firm of his outside business activities, according to the Financial Industry Regulatory Authority.
Walter Allen Ellis, a registered principal,
also was barred from any association with
FINRA members for one year, ending April
4, 2011, FINRA records show. The fine must
be paid when Ellis returns to the industry.
FINRA investigators found that Ellis
managed customers’ accounts and effected trades in commodity futures contracts and commodity futures options
through commodity trading firms and
earned commissions from those firms,
records show.
Ellis, who neither admitted nor denied
the allegations, completed quarterly compliance questionnaires for his firm, where
he false reported that he was not participating in the activities, records show. IFA
// ASSOCIATION NEWS
Cooper, others chosen to lead Roanoke Claims Association
Derek Cooper of EarthNet in Roanoke,
Va., will lead the Roanoke Claims Association for its 2010-2011 year.
Other leaders include Rick Wheeler of
CRDN of the Shenandoah in Waynesboro,
Va., vice president; Randy Layman of Chas.
Lunsford Sons & Associates in Roanoke,
treasurer and state director; and Caroline
Gearhart of ServPro of Roanoke, Mont-
|
IFAwebnews.com
gomery & Pulaski Counties in Salem, Va.,
secretary.
Members of the board of directors area
Ken Frederick of Blue Ridge Investigative
Services in Lynchburg, Va.; Mike Goodman
of Kidd’s Restoration Services in Roanoke;
Pete Lassen of Crittenden Adjustment Co. in
Fincastle, Va.; and Bob Ostrom of Air-Lee
Cleaners/Peacock-Salem in Roanoke. IFA
August 2010
// RETIREMENT PLANNING
Keystone Insurers Group adds
17th partner in Kentucky
Employers: Workers lacking retirement investment know-how
Insurance group
opposes Va. speed
limit increase
Virginia transportation authorities
considering 70 mph on some interstates
An insurance industry organization
voiced opposition to Virginia’s consideration of a plan to increase the speed limit
on more than 700 miles of interstate
roads from 65 mph to 70 mph.
At press time, the Virginia Department
of Transportation had not made a final
decision on all roads. But it did raise the
speed limit on a segment of I-295, between I-64 east of Richmond, from 65
mph to 70 mph, according to the
Progress Index newspaper in Richmond.
The last time VDOT raised speed limits was in 2006, when it upped the speed
limit on sections of Interstate 85 near
North Carolina.
“There is a direct correlation between
higher speed limits and more deaths on
the highway,‘’ said Russ Rader, a
spokesman for the Insurance Institute
For Highway Safety, a research organization funded by the auto insurance industry, according to a report in the
Culpeper Star-Exponent. “There is a
tradeoff. If we want to get people to destinations faster, it means accepting more
deaths on the highway.”
Advocates for the increase, including
the Virginia General Assembly, which
voted for the increases, say most drivers
already go 70 mph, and that it could improve traffic safety, according to the StarExponent. Opponents say reducing the
speed limit would save lives, reduce fuel
use and trim pollution.
The state has seen a reduction in highway fatalities over the last four years. In
2007, a total of 1,026 highway deaths
were reported, while in 2008 it dropped
to 821 and in 2009, to 756.
Rader told the newspaper that if the
speed limit is increased, most drivers will
go at between 5 mph and 10 mph above
that speed limit. IFA
Virginia
Most employers say their employees don’t
know as much as they should about retirement investing, according to a new survey.
Nearly four-in-five employers say their
workers lack knowledge about their retirement investments, while fewer than half of
those participating in a recent survey said
their employees are very involved in monitoring and managing their retirement savings, according to the 11th Annual
Transamerica Retirement Survey.
Employers said they fear their workers financial preparedness for retirement. Threequarters of employers said believe their employees could work until age 65 and still not
have enough saved to meet their needs in
retirement, while only 53% are confident
in their employees’ ability to achieve a comfortable lifestyle in retirement.
“Most employers understand that these
plans are important to their employees
and are key retention tools,” said Catherine
Collinson, president of the Transamerica
Center for Retirement Studies. “By adding
a retirement plan – or enhancing existing
retirement benefits with automatic features, investment advice, and retirement
income options – employers can increase
their impact in helping their employees
prepare for a secure retirement.” IFA
A Henderson, Ky., insurance agency has
become the 17th franchise partner in that
state for Keystone Insurers Group.
Latta Insurance Services, led by President Williams S. Latta, serves western
Kentucky with commercial coverages.
Latta said the deal enables his company
to offer additional products and services.
Keystone President David Boedker
called William Latta “legendary” in a statement, saying the owner “commands the
respect of carriers and his fellow agents.”
Keystone Insurers Group is owned by
its employees and franchise partners in
Pennsylvania, North Carolina, Virginia,
Indiana, Ohio and Kentucky. IFA
Online CE.
“Optima Health
values our business
and employees.”
Count on Optima Health
Thousands of small businesses in
Virginia count on Optima Health
–Johns Brothers Security
for excellent health coverage.1
We offer a variety of affordable
plans — including innovative
High Deductible Health Plans that
cost 20–50% less than most other
traditional health plans.2 We can
even modify coverage levels so
you buy only what you need. Plus,
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with our plans.
For more information,
contact your broker or visit
OptimaHealth.com/business.
Optima Health is the trade name of Optima Health Insurance
Company and Optima Health Plan. For costs and complete details
of coverage call your broker or go to www.optimahealth.com.
1
2
|
IFAwebnews.com
Optima Health Membership Change Report, March 2010.
Optima Vantage 20/40 compared to Optima Plus 20/80.
August 2010
|
17
LEGALBRIEFS
EAIG ratings upgraded, outlook ‘stable’
Strong operating results, capitalization
lead A.M. Best to raise firm’s evaluation
Eastern Alliance Insurance Group
(EAIG) and its members had their ratings
upgraded in recognition of its strong operating results and capitalization, as well as
its conservative practices and financial
flexibility, according to A.M. Best Co.
“The upgrade in our A.M. Best Company financial strength rating is evident of
our top performing workers’ compensation insurance operational and financial
results and validates the successful execution of our strategic business plans, the foundations of which are based
on strong relationships
with our partner agents
and their customers,”
said Bruce Eckert, chief
executive of Eastern In- Bruce Eckert
surance Holdings, the
holding company of EAIG and its members, in a statement. “I was particularly
pleased with this achievement considering
the challenging market conditions and
economic uncertainties that face the insurance industry today.”
The ratings service upgraded the financial strength rating (FSR) to A (Excellent)
from A- (Excellent) and issuer credit ratings (ICR) to “a” from “a-” for EAIG, which
consists of Eastern Alliance Insurance Co.
(EAIC), Allied Eastern Indemnity Co., Eastern Advantage Assurance Co. and Employers Security Insurance Co. With the
exception of Employers Security, which is
based in Indianapolis, all of the companies are based in Lancaster, Pa.
A.M. Best also upgraded the ICR to
“bbb” from “bbb-” of the holding company, Eastern Insurance Holdings. The
outlook for all ratings has been revised to
“stable” from “positive.”
The ratings service said the cultivation
of a loyal agency base within preferred territories has produced profitable growth,
as evidenced by the group’s five-year average combined ratio, which outperforms
the workers’ compensation composite by
a wide margin.
The strong underwriting performance
reflects management’s commitment to
maintain sound pricing, a proactive return
to work program and utilization of “compromise and release” agreements, the service said. IFA
News from the federal and state courts.
Buffalo Bills’ McGee settles financial advisor case
A National Football League player settled a civil suit in which he alleged that a
financial advisor he was introduced to by his agent put his money into unauthorized investments.
Financial
Planning
Buffalo Bills’ cornerback Terrence McGee and his former agent Terry Bolar reached a settlement in the case, where McGee says he lost more than $1 million, according to an
Associated Press report. Terms of the settlement were not disclosed.
The news service reported that Bolar says he did nothing wrong and that he is prohibited
from commenting on the settlement because of a confidentiality agreement.
McGee, in court papers, alleged that Bolar and Jerry Gray, now a secondary coach with the
Seattle Seahawks, knowingly introduced McGee to the financial advisor, who allegedly put
McGee’s money into investments McGee says were unauthorized and possibly nonexistent,
according to the AP. The report said it was unclear if Gray also participated in the settlement.
Federal jury issues $19.3M verdict for Cascade National
A federal jury in Washington state has issued a $19.3 million verdict against
three individuals and their company for pocketing millions of dollars owed to
a financially troubled insurance company.
PropertyCasualty
The jury rendered a verdict against Danny Pixler, Anthony and Sheri Huff and Midwest
Merger Management, a limited-liability company domiciled in Kentucky, according to the
Washington State Office of the Insurance Commissioner.
Money recovered as a result of the suit will be used to reimburse the insurance guaranty
fund that has paid the company’s workers’ compensation claims.
Cascade National focused principally on auto and commercial trucking coverage in Washington, Oregon, Alaska, California, Mississippi and Louisiana, serving nearly 5,000 policyholders.
Mich. tax preparer faces IRS, insurance fraud charges
A Saginaw, Mich., tax preparer facing charges of filing tax returns with fictitious Schedule A deductions is now charged with trying to defraud
Progressive Michigan Insurance Co. for in-home health services.
Health
Insurance
Carolyn R. Moore is accused of conspiring with three other women to obtain insurance payments for the services in 2007 and 2008, which authorities say never occurred, according to
the Bay City Times newspaper.
We Work For Your Benefit.
Moore was the alleged claimant to Progressive Michigan for in-home services allegedly filed
for fraudulently by Leana B. McGee, Tawhona L. Hunt and Tiara M. Baskin, the newspaper
reported, citing federal court records.
Top-5 Reasons to Offer Voluntary
Dental and Vision1 Plans
1.
2.
3.
4.
5.
Moore also faces 65 counts of willfully aiding and assisting in preparing false tax returns, 60
counts of wire fraud and one count of attempted wire fraud for allegedly preparing tax
returns between 2004 and 2006 that claims fictitious Schedule A itemized deductions, leading to an estimated tax loss of more than $250,000, according to the report.
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Man allegedly reported silk tie collection stolen thrice
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1
Vision plans are underwritten by Security Life Insurance Company of America,
and are marketed and administered by Dominion Dental Services USA, Inc.
This communication is not intended for presentation, distribution,
or dissemination to the public, and is for internal use by sales
agents/brokers ONLY.
18 | Virginia
A Lynnwood, Wash., man faces charges of insurance fraud for allegedly
claiming car thieves stole the same $33,000 collection of silk ties — not
once, not twice, but three times in nine years, according to state insurance regulators.
PropertyCasualty
Carlton H. Wopperer, 49, faces two counts of insurance fraud, according to the Washington
State authorities. Within a nine-year period, he reported that thieves had stolen his collection
of 212 silk ties, carried in four plastic containers, from his vehicle three times, even though
authorities allege that he typically returned the ties within minutes of buying them.
After an alleged January 2009 theft, Wopperer purchased replacement ties from Nordstrom,
Butch Blum, Barneys New York and Mario’s of Seattle, submitting the receipts to his insurer,
PEMCO Insurance. The insurer paid him $33,370 under the terms of a provision allowing for
replacement cost of stolen items, authorities said.
Investigators found two other instances, including one in 2000 and the other in June 2009,
where he allegedly reported the ties stolen.
|
IFAwebnews.com
August 2010
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All Zones - including A&V
CBRA risks considered
Flood Deductible buy downs available
For a SIMPLE QUOTE call
Greg Provenzo * Dave Adcock
800-368-2095
ATLANTIC SPECIALTY LINES, INC
Dedicated to helping you and your clients!
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Bill Desko - Safeco Region Manager
804-320-0405 - [email protected]
© 2010 Safeco Insurance Company of America, Member of Liberty
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is a registered trademark of Safeco Corporation. The Safeco logo is a
trademark of Liberty Mutual Insurance Company.
With predictions of an active hurricane season around
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Laurie Bruinooge Gray
Wholesale
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(804) 767-0218
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[email protected]
www.sadlerinsurance.com
FLOOD INSURANCE
We are agent focused and offer the following:
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Call Tom Shaughnessy
at 800-423-4403 dial 1 and then 656
or email [email protected]
American Bankers Insurance Company
Sales Representative needed!
Growing General Agency is seeking an outside marketing representative. Opportunity involves recruiting
and developing a network of brokers throughout
Virginia to distribute our products. Duties include
training, educating and product support for new and
existing agents. Potential to be home based along
with a competitive compensation/benefits package.
Please e-mail resume in confidence to
Mark Glandon at
[email protected]
Virginia
|
IFAwebnews.com
August 2010
|
19
Rope in
more profits!
Business owners continue to seek solutions
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In addition, we never sell direct, so unlike other
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Learn how EBCA can help you increase sales,
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Call our Broker Service Hotline to
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Employee Benefit Corporation of America
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EBCA maintains close ties with 17 major carriers,
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10451 Mill Run Circle, Suite 400,
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Company in negotiations to buy Shenandoah Life

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