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California’s Controversial Work Comp Coverage

Posted By Administration, Monday, May 25, 2020

 

California Governor Gavin Newsom issued an executive order saying that it is assumed that all essential workers who contract the COVID-19 did so at work. Newsoms decree covers 16 categories of essential workers. Employers can rebut the claim but the assumption and Newsom’s order are controversial.

And expensive.

California’s Workers Compensation Insurance Ratings Bureau (WCIRB) says the decree could end up costing the state $1 billion from the estimated 66 million compensable claims. An earlier outlook said the price tag could be $2 billion to $33 billion.

As it stands now the WCIRB says estimates for death benefits will be $210 million. Medical costs for severe cases could be $200 million. Critical cases might go as high as $120 million and fatal cases will rise to $140 million.

The WCIRB actuarial committee said things could get worse which takes us back to the $33 billion figure. It could get worse as stay-at-home orders are relaxed. Then there’s the issue of how Newsom interprets preexisting conditions and how the disease impacts them. 

Source link: Business Insurance — https://www.businessinsurance.com/article/20200520/NEWS08/912334662/California-workers-compensation-COVID-19-coronavirus-pandemic-presumption-could-#

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Willis Towers Watson — Market will Continue to Harden

Posted By Administration, Monday, May 25, 2020

 

The commercial insurance hard market is going to continue through this year and into 2021. That’s the conclusion of Willis Towers Watson and Joe Peiser who heads broking for the company.

He says there are currently two things pushing the hard market. They are the COVID-19 pandemic and the economic downturn that has accompanied the pandemic.

The pandemic and economic downturn will very likely extend the hard market through 2021, with market discipline continuing as insurerslosses materialize and their investment income deteriorates,” Peiser said. While we expect pressure on coverage to last for the foreseeable future, mainly due to significant policy language disparities brought into focus by the inconsistent language addressing pandemics, the good news is the insurance industry is solvent, well capitalized and positioned to deliver.”

Look for double-digit increases in several lines of insurance.

One example is directors and officers liability. It was already in hard mode when the pandemic came along. Since then Willis says it the pandemic made it worse and it could jump 50% in some cases and even more in others.

Underwriters are laser-focused on liquidity, industry and disclosures specific to COVID-19,” Willis Towers Watson said. Renewals are challenging with the environment heightened by underwriting scrutiny of D&O exposures, all in addition to the continuing firming of primary and excess rates.”

Other lines that will be hugely impacted?

            * Casualty umbrella — 40% or more

            * Casualty excess — 150% or more

            * Workers’ compensation will remain stable

            * Rates will go from negative 2% to positive 2%

Here’s what else the report showed for other lines:

Property:

            * Non-cat-exposed risks — 10% to 20%

            * Cat-exposed risks — 15% to 25% or higher

            * Cat-exposed risks with previous losses — 30% or higher

Casualty:

            * Auto rates will rise 6% to 12%

            * General liability could go up 2.5% to 7.5%

Cyber:

            * Rates will rise 10% to 15%

Political

            * Rates will go from flat to up 10%

Source links: Source: Carrier Management — https://www.carriermanagement.com/news/2020/05/08/206432.htm

Source: Business Insurance — https://www.businessinsurance.com/article/20200507/NEWS06/912334455/Rates-seen-rising-across-most-commercial-insurance-lines-Willis-Towers-Watson-C#

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The World’s Most Ethical Companies — Five are Insurers

Posted By Administration, Monday, May 25, 2020

 

Every year Ethisphere honors the world’s most honorable companies on a list called the World’s Most Ethical Companies. It is the 14th year and there are 14 first time honorees on the list and seven companies have been named to the list every year since it began.

Ethisphere’s mission is to improve the world through ethical behavior and corporate social responsibility which — in turn — enhances business performance.

This year the list has 132 companies in 51 categories from 21 countries. Five insurance companies are considered the most ethical in the insurance category.

Insurance companies and agencies — and this includes the independent agencies of the PIA Western Alliance — are quite generous. Or so says a study from McKinsey and Company and the Insurance Industry Charitable Foundation (IICF). Its report from last year called Charitable Giving in the Insurance Industry found insurers and agencies give about $560 to $600 million a year. Most of that goes to education, health, social services and the community.

Here are the five companies considered the most ethical in insurance in 2020:

Allianz

Allstate

USAA

The Hartford

Gallagher

Click here if you want to see what companies are considered the most ethical in the world.

https://www.worldsmostethicalcompanies.com/honorees/?fwp_industry=health-insurance&fwp_number_of_employees=20311.00%2C157000.00

 

 Source link: PropertyCasualty260.c0m - https://bit.ly/36sE8oI

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Special Report: Americans & Their Finances — We’re in Deep Trouble

Posted By Administration, Monday, May 25, 2020

First the pandemic. Since the stay-at-home orders were issued in mid-March, and since the layoffs began shortly after, and since millions of American worker have gone onto unemployment, the total employment income loss for the nation has hit $1.3 trillion.

The median cost has hit $9,000 per worker.

That information comes from the Society for Human Resource Management and Oxford Economics. It also says 20% of that loss — $260 billion — is from workers who have remained employed. Many have accepted fewer hours and reduced pay.

The number of unemployed — a week or so ago — was 33 million. That’s 15% of the U.S. workforce.

The 130 million stimulus checks from the $2.2 trillion CARES Act aren’t really helping the unemployed all that much. Those who have been laid off permanently or furloughed say the $1,200 isn’t close to enough to help them through the crisis.

The Lending Tree did a study of the 98 cities in the nation with the highest per capita income and found the coming economic troubles could lead the country into an economic crisis exceeding that of the Great Recession of late 2007 to 2009.

The two $1,200 stimulus checks and the $500 each for two dependents will cover 45% of one month’s $7,531 budget of a two-parent, two-child family.

Families in McAllen, Texas would see the stimulus figures covering 96% of their budget. In San Francisco, California the stimulus checks wouldn’t touch the average income of $158,000 to $189,000. Those incomes would only get a small amount of money from the stimulus checks.

The Internal Revenue Service has sent $1,200 to most individuals with annual adjusted gross income below $75,000. That figure hits $2,400 for married couples earning less than $150,000. Each qualifying child gets $500.

It’s not going to be enough and those figures led the Lending Tree report to reach a very disturbing conclusion.

In 8 of the top 10 cities, the economic impact payment only covers between 60% and 71% of the estimated monthly budget for a family of four,” the report said. “The stimulus payment will cover 50% or more of one months estimated expenses in just 34 of the top 98 metro areas.”

The big concern of economists is whether the American economy will ramp up fast enough to help those whose rents, mortgages and bills are likely to go unpaid.

Here’s another scary aspect of the Lending Tree study. The 100 most common occupations have workers that earn less than $75,000 a year.

For example, fast-food and counter workers need to work 107 hours — or two and a half weeks — to earn $1,200. Their average wage is $11.18 an hour. Other essential workers like those doing child care or home-health work, have to work the longest to earn $1,200.

People whose jobs are deemed important enough to risk coronavirus exposure at work are also bringing home less income in the process,” the Lending Tree Report said. “Workers in these occupations earn between about $11 and $16 per hour.”

By the way, the federal minimum wage is still $7.25 per hour and 44% — or 53 million — of us have what are considered low wage jobs.

This leads to part two of this story and the real American crisis. We — individuals and families — are woefully unprepared for a financial crisis. The Federal Reserve has statistics that say the average American doesn’t even have $400 set aside for an emergency. Just 39% have saved enough to pay a $1,000 emergency room visit or an emergency car repair.

Figures from BankRate says the people most at risk for emergencies and with the least money saved are those between age 53 and 62.

A whopping 25% of us have nothing saved for retirement.

Source: MSN Money — https://www.msn.com/en-us/money/personalfinance/americans-are-in-financial-trouble-why-dollar1200-stimulus-checks-are-only-a-band-aid/ar-BB14jJf8?li=BBnb7Kz&ocid=mailsignout

 

Source: MarketWatch: https://www.marketwatch.com/story/most-americans-are-one-medical-emergency-away-from-financial-disaster-2017-01-12

 

Source: CNBC — https://www.cnbc.com/2019/03/31/there-is-a-savings-crisis-and-many-americas-dont-know-how-to-fix-it.html

 

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Spring Cleaning — Ugh! Time to Toss Some Things

Posted By Administration, Monday, May 25, 2020

 

We all hate spring cleaning. Or most of us do. And even the smallest of living spaces are prone to clutter. Sometimes it seems like clutter has a mind of its own. Papers and boxes and stuff pack our closets, desks, pantries, living rooms, bedrooms, basements and storage areas. The areas of concern also includes our offices.

Clutter seems magnetic. Ubiquitous even.

Sometimes we feel like those hoarders you see on TV. Sometimes. Of course, that’s not true, but once in awhile we need to take a good look at what’s taking up space in our homes, condos or apartments and do something about it.

At least that’s the suggestion of Good Housekeeping. Even better, the magazine has offered a list of things we can think about sorting through and discarding. It ranges from old clothing to electronics to food items. The magazine says this kind of cleaning will only take you a couple of hours.

Another positive? Much of what you discard might help people whose needs are great and whose finances don’t match the need. Want to feel good? Get started. Here’s the list:

* Old cords — phones to cable connectors and electric cords

* Expired coupons and old calendars and old takeout menus

* Old receipts

* Glasses with outdated prescriptions — donate them

* Manuals for putting things together or for old electronics products and applications

* Last year's sunscreen — old stuff isn't as protective

* Cardboard boxes — unless you're moving, who needs them?

* Old board games — those you never use & those with missing pieces — donate them

* Unmatched socks

* Ladies and guys with ponytails — excessive numbers of hair ties

* Open bottles — alcohol does have a shelf life apparently. Once opened, two years before it changes and starts to evaporate

* Old condiment packets and old bottles of condiments in your refrigerator — you could have three bottles of ketchup or mustard or relish or pickles

* Old, expired spices

* Baby stuff — donate it

* DVDs — don't do away with all of your favorites but technology is changing and they're space hogs

* CDs — same thing

* VHS tapes — you'll probably never use them again, give them to an e-waste center

* Dull knives

* Old workout gear — sports bras and sneakers wear out in six to eight months

* Books and outdated reference books — donate them

* Old medication — toss it

* Unused craft supplies —donate them

* Old towels — use them for rags, donate to animal shelters

* Worn sheets — same thing

* Plastic grocery bags that are now packed in grocery bags — how many is enough?

* Reusable totes

* Promotional t-shirts — donate them

* Extra buttons

* Floral vases

* Containers without lids

* Old makeup and moisturizers and old nail polish

* Costume jewelry — donate it

* Wire hangers and plastic hangers — by the way, they stretch clothes

* Damaged dishes

* Office supplies — do you really need 20 post-it note pads?

* Old pens — they may already be out of ink or the ink has dried

* Clothes that are too big — donate

* Clothes that are too small — donate

* Shoes that don't fit — donate

* Outdated magazines

* Leftover paint

* Novelty appliances and baking pans that you never use — donate

* Excess coffee mugs — donate

* Forgotten candles that you'll never burn

* Do something with the change jar — like, oh, um, spend the money

* Empty journals and notebooks

* Old mattresses

* Old phones — e-cycle

* Old computers — e-cycle

* Old cards

Source link: MSN Lifestyle — https://www.msn.com/en-us/lifestyle/cleaning-and-organizing/65-things-in-your-home-to-get-rid-of/ss-BBMwCS8?li=BBnb7Kz&ocid=mailsignout#image=1

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Blindness Risk on the Rise

Posted By Administration, Monday, May 25, 2020

 

Between 2002 and 2017 the number of adults at risk for blindness rose dramatically. It went up from 65 million to 93 million. However, 40% of that 93 million said they had not been getting a yearly eye exam. Age and diabetes are the factors for the increases.

Sharon Saydah of the Centers for Disease Control and Prevention (CDC) said close to 10% of them said they can’t afford glasses even if they did see an optometrist of an ophthalmologist.

“We have a large number of adults at high risk for vision loss and at high risk for not receiving recommended eye care,” she said. “The solution is to really improve access, awareness and the affordability of eye care.”

This information comes from two different surveys. Adults over 65 with blindness risk rose from 51% to 53%. For those with diabetes, the figure went from 21% to 25%.

Vision problems rose from 9% in 2002 to 11% in 2017 because of:

            * Age-related macular degeneration

            * Glaucoma

            * Diabetic retinopathy

            * Eye injury

Those not being able to afford glasses rose from 8.3% in 2002 to 8.7% in 2017. But Saydah says not having glasses won’t lead to blindness but it can lead to serious injuries.

High blood sugar is another matter entirely. “But if diabetes is managed properly and blood sugar levels are controlled, that can help reduce vision loss,” she noted.

One of the problems senior have is Medicare not covering regular eye exams unless there is a high risk of glaucoma or if a patient has diabetes. Of those with a high risk of blindness in 2017, a bit over half — 57% — had an eye exam and 60% received a dilated eye exam.

Bonnielin Swenor works for the Wilmer Eye Institute and the Johns Hopkins Bloomberg School of Public Health in Baltimore said this shows the gap of good eye sight health in the U.S. and it’s often based on income.

“This study is not examining a question about improving eye conditions, but instead focuses on access and affordability of eyeglasses,” she said. “Currently most medical insurance and Medicare do not cover the costs of eyeglasses, which this data support as an important gap for the American population.”

Source link: MSN Lifestyle — https://www.msn.com/en-us/health/other/number-of-u-s-adults-at-risk-for-blindness-on-the-rise-study-says/ar-BB11a9VE?li=BBnb7Kz

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PG&E Bankruptcy Vote on Hold

Posted By Administration, Monday, May 25, 2020

 

The California Public Utility Commission (CPUC) has put the vote on Pacific Gas & Electric’s bankruptcy plan on hold. CPUC President Marybel Batjier said an improper email attacking the firm’s wildfire compensation proposal is the reason.

The email was sent by Will Abrams who is a survivor of a fire that ripped through Santa Rosa in 2017. Abrams went through objections to the plan by a committee representing fire victims. Theyre concerned PG&E wont be able to pay the $13.5 billion promised to victims impacted by the wildfires. His email was ruled improper because it was sent during a mandated “quiet period” from May 15th through this Thursday.

The vote will now be on May 28th which is the same day there will be a federal vote on the bankruptcy. The plan — as you know — must be approved by June 30th.

Abrams said he didn’t do anything wrong. His email didn’t include anything that hadn’t already been said and entered into the record. I tried my best to follow the rules,” Abrams pointed out.

PG&E said it appreciates the delay and the CPUC’s diligence.

Source link: ABC News — https://abcnews.go.com/Business/wireStory/improper-email-delays-key-vote-pges-bankruptcy-plan-70816419

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Special Report: COVID-19 by the Numbers — An Interesting Perspective

Posted By Administration, Tuesday, May 19, 2020


Last weekend CNN released a document outlining the number of COVID-19 cases found in each state and the number of deaths caused and the number per 100,000 in population.

The figures are fascinating.

This list places states in order of the number of cases detected in each. The numbers are for all states, the District of Columbia and U.S. territories.

State

Cases

Cases per 100,000 population

Deaths

Deaths per 100,000 population

1. New York

350,121

1,800

28,232

145

2. New Jersey

146,504

1,649

10,363

117

3. Illinois

94,191

743

4,177

33


Massachusetts at 84 deaths per 100,000 is fourth. Next on the list is the PIA Western Alliance state of California in fifth. But do note the low number of deaths per 100,000.

State

Cases

Cases per 100,000 population

Deaths

Deaths per 100,000 population

5. California

80,166

203

3,240

8


The rest of the PIA Western Alliance states by the numbers of cases detected.

State

Cases

Cases per 100,000 population

Deaths

Deaths per 100,000 population

19. Washington

18,433

242

1,001

13

23. Arizona

13,945

192

680

9

36. Nevada

6,952

226

350

11

37. New Mexico

5,938

283

265

13


State

Cases

Cases per 100,000 population

Deaths

Deaths per 100,000 population

41. Oregon

3,623

86

137

3

44. Idaho

2,419

135

135

135

51. Montana

468

44

16

1

52. Alaska

388

53

10

1

 

Many pandemic experts say the numbers in most states are low because of the enforced social distancing measures. The number of cases and deaths — they predict — would have been higher without them.

A new study by Health Affairs bears out that contention. It says without the lockdown measures we would have seen 35 million more cases.

The study was done on figures from March 1 to April 27. It implies that cases would have grown 10-times faster without the bans of large local gatherings, the closure of schools and businesses and without the shelter in place orders. The biggest impact — however — was the closure of entertainment-related businesses like movie theaters, restaurants, bars and gyms.

One of the authors of the study is Charles Courtemanche is a professor at the University of Kentucky’s Gatton College of Business and Economics. He said, “Our results suggest that light measures don’t work, and strong measures do, but they don’t really say anything about intermediate measures — like opening restaurants at reduced capacity or allowing socialization with masks. Since we don’t know what each intermediate step towards reopening will do, it makes sense to go one step at a time and look carefully for signs that the rate of spread is picking back up.”

Source links: CNN, Carrier Management


Tags:  000  COVID-19 cases  COVID-19 deaths per 100  Deaths COVID-19  Health Affairs  Social distancing 

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Update: Business Interruption — Treasury Defends Insurers

Posted By Administration, Tuesday, May 19, 2020


As you know there has been a push the last few weeks for insurers to pay business interruption claims even though a policy does not include coverage for a pandemic. The U.S. Treasury is worried about the ill-conceived idea and sent a letter to Congress on Monday of last week saying there are concerns that these proposals “fundamentally conflict with the contractual nature of insurance obligations.”

In other words, the U.S. Treasury does not believe there should be a retroactive rewriting of policies as some suggest. This is an effort to counter a statement by President Trump at a press conference in April. You have people that have never asked for business interruption insurance, and they’ve been paying a lot of money for a lot of years for the privilege of having it, and then when they finally need it the insurance company says ‘we’re not going to give it,’” the president said. “We can’t let that happen.”

That letter apparently has not deterred some members of Congress — pointing to the president’s comment — from saying insurers should pay those losses anyway.

Frederick Vaughan is the principal deputy assistant secretary in the U.S. Treasury’s Office of Legislative Affairs. He’s so worried about insurers and the devastation this might cause to the industry, that he sent a letter to Rep. Ted Budd who is on the House Financial Services Committee. Budd is opposed to such measures but others on his committee are not.

“While insurers should pay valid claims, we share your concerns that these proposals fundamentally conflict with the contractual nature of insurance obligations and could introduce stability risks to the industry,” the letter states.

Vaughn said the U.S. Treasury is looking forward to working with Congress and with states, and with the insurance industry to figure out “how best to move forward in addressing losses attributable to the current and potential future pandemics.”

Source: FOX Business — https://www.foxbusiness.com/features/insurers-coronavirus-related-business-interruption-claims-treasury

Source: Business Insurance — https://www.businessinsurance.com/article/20200511/NEWS06/912334504/US-Treasury-signals-concerns-over-COVID-19-coronavirus-pandemic-business-interru#Update: Business Interruption — Treasury Defends Insurers

As you know there has been a push the last few weeks for insurers to pay business interruption claims even though a policy does not include coverage for a pandemic. The U.S. Treasury is worried about the ill-conceived idea and sent a letter to Congress on Monday of last week saying there are concerns that these proposals “fundamentally conflict with the contractual nature of insurance obligations.”

In other words, the U.S. Treasury does not believe there should be a retroactive rewriting of policies as some suggest. This is an effort to counter a statement by President Trump at a press conference in April. You have people that have never asked for business interruption insurance, and they’ve been paying a lot of money for a lot of years for the privilege of having it, and then when they finally need it the insurance company says ‘we’re not going to give it,’” the president said. “We can’t let that happen.”

That letter apparently has not deterred some members of Congress — pointing to the president’s comment — from saying insurers should pay those losses anyway.

Frederick Vaughan is the principal deputy assistant secretary in the U.S. Treasury’s Office of Legislative Affairs. He’s so worried about insurers and the devastation this might cause to the industry, that he sent a letter to Rep. Ted Budd who is on the House Financial Services Committee. Budd is opposed to such measures but others on his committee are not.

“While insurers should pay valid claims, we share your concerns that these proposals fundamentally conflict with the contractual nature of insurance obligations and could introduce stability risks to the industry,” the letter states.

Vaughn said the U.S. Treasury is looking forward to working with Congress and with states, and with the insurance industry to figure out “how best to move forward in addressing losses attributable to the current and potential future pandemics.”

Source: FOX Business, Business Insurance

Tags:  business interruption Department of the Treasury  Business interruption insurance  U.S. Treasury & businss interruption insurance 

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Commercial & Other Insurance Rates — Rising

Posted By Administration, Tuesday, May 19, 2020


Marsh has a new report out. It says the average price of commercial insurance — globally — jumped 14% in the first quarter of 2020. That is the biggest increase ever seen in Marsh’s Global Insurance Market Index.

The index has been published every quarter since 2012.

Marsh says the commercial price uptick is being driven by hikes in property, financial and professional lines, and directors and officers rates. Prices rose in the U.S. by 14%. The United Kingdom saw a jump of 21% and the Pacific nations experienced rate jumps of 23%.

Dean Klisura, president of Marsh’s Global Placement and Advisory Services said the U.S. D&O market saw rate hikes of 44%.

“Pricing was trending higher in the first quarter, prior to any meaningful impact from losses associated with COVID-19,” Klisura said. “However, COVID-19 will likely have an impact on pricing for the balance of 2020.”

Here are other findings in the survey:

    * It is the 10th consecutive quarter of price increases
    * Globally pricing for property rose 15%
    * Globally financial and professional lines were up 26%
    * Globally casualty jumped 5%

Ivans Insurance Solutions — a division of Applied Systems — issued a report last week on April’s commercial rates. They rose significantly and workers’ compensation rates continued to plummet.

    * Commercial property rose highest with 5.51% renewal rates
    * Commercial property rates in March were 5.28%
    * BOP policies rose 5.22% in April compared to 4.85% in March
    * Commercial auto is up 4.8% from 4.75%
    * General liability rose 3.29% up from 3.18%
    * Umbrella rates are up 3.18% a bit lower than 3.22% in March

Workers’ compensation continues to falter. Rates fell 2.06% in April compared to a fall of only 1.96% in March.

Source links: Business Insurance, Business Insurance America

Tags:  BOP  business insurance  commercial insurance rates  commercial property insurance  Insurance rates  Marsh Global Insurance Market Index  property insurance  workers' compensation insurance 

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