Claims

Bethesda, Md. - Suitability standards for annuity products and long-term care insurance that will apply nationally are the centerpiece of new standards just issued by the Insurance Marketplace Standards Association (IMSA), a Bethesda, Md.-based standards-setting organization for the life insurance marketplace. The new IMSA suitability standards incorporate the essential elements of the NAIC model regulations for annuities and long-term care. Inclusion of these provisions means widespread, national application of these consumer protection standards by IMSA companies. They will cover the 60% of the life insurance marketplace represented by IMSA-qualified companies. "These standards exemplify the best in the marketplace," said Leon Roday, chairman of IMSA chairman and senior vice president and general counsel at Genworth Financial, Richmond, Va. "The national application of the suitability standards among IMSA-qualified companies will benefit consumers with more consistent protections. These uniform standards will also be good for IMSA companies as they will be implementing one set of high standards rather than many different state standards." In addition to suitability provisions, the new IMSA standards adopt a streamlined methodology to more closely track the compliance approach of companies and regulators. The new IMSA standards are effective immediately with a compliance date of January 1, 2008. "This latest revision of IMSA's standards is the result of 18 months of work from a wide cross section of our companies including all sizes and product lines," said Brian Atchinson, IMSA president and CEO. For the first time, the group received input from a Standards Advisory Committee made up of representatives from NASD, AARP, NAIC, Standard and Poor's, A.M. Best, and the National Association of Insurance and Financial Advisors (NAIFA), added Atchinson. To qualify for IMSA membership, a company must successfully complete an internal assessment of its policies and procedures, and then an assessment by an independent examiner to confirm that it meets IMSA's rigorous Principles of Ethical Market Conduct. To maintain IMSA qualification, a company must demonstrate that ongoing business operations abide by IMSA's strict code of ethical market conduct with a new independent assessment every three years. Companies that qualify for membership in IMSA commit to maintaining high ethical standards and to being fair, honest, and open in the way they advertise, sell and service life insurance, annuity products, and long-term care insurance in the individual market. For more information about IMSA and a list of IMSA-qualified companies, visit www.IMSAethics.org. Source: IMSA

New York and Saint Paul, Minn. – Metropolitan Life Insurance Co. (MetLife) and Travelers Insurance Group Holdings Inc. renewed their agreement to offer Synchrony absence management services.Synchrony combines group disability insurance and the Family Medical Leave Act (FMLA) administration from MetLife with workers compensation insurance and claim administration services from Travelers to deliver one, integrated approach that can help companies better manage employee absences whether due to occupational or non-occupational events and assist employees in returning to work as soon as medically appropriate. First offered by the two companies in 1998, Synchrony programs currently cover more than 180,000 employees.

Needham, Mass. - The insurance industry is rapidly embracing service-oriented architecture (SOA), as well as related Web services and standards, according to TowerGroup research conducted in partnership with ACORD. TowerGroup interviewed senior leadership executives at more than 12 carriers and conducted more than 150 hours of data gathering and analysis across the industry (covering property/casualty, life and annuity, and reinsurance).Key findings of the study, according to Needham, Mass.-based TowerGroup, include:

Media, Pa. - A network of insurance and financial Web sites is creating an online national directory of business insurance agents, a move that observers are calling another ripple in a movement to expand insurance distribution on the Internet.

Hamilton, Bermuda - Big European insurance companies are embracing industrial operating models to cut costs and improve customer service, according to an Accenture survey of senior executives at 30 carriers based in Europe.The survey revealed that 92% of respondents are assigning high priority to "industrialization"--the use of standardized operating and production platforms similar to those used by manufacturers. The rest of the respondents--the other 8%--say they expect industrialization to become a priority in the next three years.

Houston - The insurance industry, where companies face an average of 1,696 lawsuits, spanning product liability and environmental class actions to directors and officers claims, and even coverage fights over hurricanes and terrorist attacks, faces the most litigation when compared to other industries, according to a survey from international law firm Fulbright & Jaworski LLP, headquartered in Houston. Retailers and energy firms reported average caseloads north of 330 per company, which doesn't even come close to the insurance industry.In its third annual survey of corporate litigation trends—pulling data from 422 in-house law departments worldwide—Fulbright found that U.S. companies face an average of 305 pending lawsuits internationally. For large U.S. companies—those with $1 billion or more in annual gross revenue—the number of lawsuits soared to 556 cases, with an average of 50 new disputes emerging each year for close to half of them.

Darien, Ill.-based Insure.com Inc.'s Web site has been named a "best site" for life insurance quotes by Kiplinger's Personal Finance magazine.The citation came in a special report called "The Best List" that appears in the November 2006 issue.

Two celebrated anti-aging experts are joining Humana Inc. in what the company calls a multi-media campaign to turn passive healthcare users into active healthcare consumers.

Jersey City, N.J. - ISO, a Jersey City, N.J., provider of data, analytics and decision-support solutions, is extending its product set and focus to the healthcare industry with its plans to acquire the assets of Urix, a Cheshire, Conn., provider of healthcare analytics and employer reporting solutions. Terms were not disclosed. The Urix product set includes Web-based business solutions that enable health insurers, national brokerage firms and large employers to derive strategies to improve the quality of health care while lowering the cost of delivery. Urix is a developer of Web-based healthcare analytic solutions that are scalable and cost-effective, the companies report. ISO entered the healthcare sector in 2004 with the purchase of Boston-based DxCG, a company widely recognized as a world leader in predictive modeling software solutions. ISO will form a single company containing the Urix and DxCG assets doing business under the Urix brand name. Urix CEO John Farrell will serve as president of the combined entity; Michael Coyne will serve as COO. "With so many synergies between the Urix business intelligence solutions and DxCG predictive modeling capabilities, it makes sense to combine our assets and approach the market with a unified set of solutions," said Michael Coyne, head of DxCG. "Our teams will create new and, in many cases, unique solutions by working together closely," continued Coyne. ISO's chairman, president and chief executive officer, Frank Coyne, cited ISO's plans to combine Urix and ISO's DxCG unit as "an excellent opportunity for ISO to expand its presence in the healthcare business intelligence market by leveraging complementary strengths in both companies' product lines. We expect the new entity to lead the market with a host of solutions designed to improve the quality and efficiency of our nation's healthcare system," said ISO's CEO. Source: ISO

Washington, D.C. - The U. S. Department of Labor's Employee Benefits Security Administration (EBSA) today announced a new interactive resource Web site for employers in complying with the various federal health benefit laws. The Health Benefits Advisor is designed to help employers and other plan officials understand their responsibilities in operating group health plans. Private-sector employers can obtain guidance about operating their group health plans. The site provides benefit professionals with an overview of certain federal laws, such as COBRA, HIPAA, the Newborns' and Mothers' Health Protection Act, the Mental Health Parity Act and the Women's Health and Cancer Rights Act, all of which affect health insurance. Employees can also visit the site to learn more about their rights and options pertaining to health coverage provided by a private-sector employer. The online resource also offers general advice to workers undergoing life changes, such as marriage, childbirth, job loss and retirement. The site does not offer information, however, on an employee's specific plan or health plans provided by federal, state or local governments and churches. Source: U.S. Newswire, Employee Benefits News

Washington, D.C. – From stepping up with renewable energy projects to incorporating futuristic underwriting models, the insurance industry must do more to address the growing impact of climate change-induced damages, according to a new report by World Wildlife Fund (WWF) and Munich-based global insurer Allianz Group.

Mountain View, Calif. - eHealth Inc., the parent company of eHealthInsurance Services Inc., spent $50 million developing an electronic platform to sell health insurance through the Internet. The company’s business model? Serve the growing market of uninsured and underinsured consumers with online tools and ultimate health insurance products. The Mountain View, Calif., company, plans to raise $47.1 million in an initial public offering next week. In its prospectus the market for private health insurance brokering is a mess, stating that except for large companies buying insurance in bulk, finding medical coverage is time-consuming, paper-wasting, complicated and expensive. Most individuals, families and small businesses who buy their own medical coverage find insurers using local agents who serve a single community, offering insurance from a small handful or even a single insurance carrier. Through its Web site, eHealth has sold health insurance electronically to 325,000 consumers, and points to this statistic: More than 40% of those customers were uninsured before finding the site. That means the company thinks its site, which offers 5,000 health insurance products through 150 insurers, including Aetna and UnitedHealth, can tap into an underserved and fragmented corner of the estimated $658 billion market for private medical insurance. About 17 million Americans, including self-employed people, buy their own medical insurance (as opposed to electing coverage through an employer's plan), and the company said that number is growing. A rising number of small businesses have stopped offering medical benefits to employees, forcing these people to buy their own coverage or risk life without insurance, the company said. The U.S. Census estimates 46 million Americans are uninsured, and the company said many of these people have jobs, make decent salaries and would buy their own coverage if only they could find an affordable plan. That's where eHealth's business model comes in. eHealth's site offers online rate quoting and information, health plan comparisons, and online applications linking consumers with insurers. The variety of policy offerings and efficient brokering process in theory would help consumers find cheaper coverage. As a broker, eHealth offers insurers new market opportunities, access to electronic data about consumers and simplified policy processing, which reduces costs. The company takes a percentage off the insurers' premiums. In 2005, eHealth booked $41.8 million in revenue, almost all from brokerage commissions, compared with $9.3 million in 2001. For the six months ending June 30, 2006, eHealth reported net income of $2.7 million, compared with a net loss of $209,000 for the same period a year ago. The company, led by Chief Executive Gary L. Lauer, has lost money most quarters since its 1997 founding as it sinks money into technology and marketing through direct mail, television and radio. But it hopes that by harnessing the Internet, it can grab a large share of a huge and largely untapped market. The company plans to sell 5 million shares at $10 to $12 apiece, giving the deal a proposed market cap of $271 million, and is reportedly using joint-lead managing underwriters such as Morgan Stanley and Merrill Lynch. The stock will trade on the Nasdaq under the symbol "EHTH." Source: Associated Press, MSN Money, Red Herring

Worcester, Mass. - The Hanover Insurance Group Inc., reports that it has enhanced its homeowners quoting and issuance process, making it easier for its agent partners to do business. The 150-year old Worcester, Mass., company, which sells property and casualty products and services to individuals, families and businesses through a network of independent agents, reports that it has implemented distinct and separate quote and issuance processes and introduced screens that are easier to read and navigate. The simplified homeowners screens were recently piloted with in Connecticut and Virginia, and include homes, condominiums and tenants policies. Other improvements include helpful links for cross selling allow agents to easily offer additional policies such as second home, auto or umbrella and improved navigation and "help" icon efficiently answers agent questions. Hanover also provides a link to the Marshall & Swift/Boeckh Replacement Cost Estimator, to help foster agent/customer discussions about the adequacy of their coverage. The enhancements, which were made based on direct feedback from agent partners, should cut the time it takes to quote a policy by 30% and reduce the number of accounts referred to an underwriter, reports the company. "We believe these enhancements, as well as planned future enhancements, will deliver additional growth opportunities for independent agents," says Marita Zuraitis, president of The Hanover's property and casualty companies. The improvements in agent services comes on the heels of last year's launch of Connections Auto product, which has driven private passenger automobile new business growth of more than 150%, reports the company. Source: PRNewswire

Washington, D.C. - Subsequent to a June 2006 report by the Surgeon General that confirmed secondhand smoke causes lung cancer and heart disease, the American Academy of Actuaries (AAA) has released a dollar figure to go along with it. The effects of secondhand smoke on nonsmokers in the United States cost nearly $6 billion in medical and economic costs in 2004, according to an actuarial study entitled "Economic Effects of Tobacco Smoke." Cori Uccello, senior health fellow of the Washington-based AAA, analyzed the implications of the study, which estimated costs related to diseases caused by secondhand smoke. Medical costs to care for nonsmokers suffering from coronary heart disease and lung cancer as a result of secondhand-smoke exposure is estimated to have reached $2.6 billion in 2004," Uccello said. "This includes the medical care of nearly half a million people suffering from coronary heart disease, and an estimated 2,500 patients newly diagnosed with lung cancer -- an extremely deadly form of cancer -- as a result of exposure to secondhand smoke." Using U.S. Bureau of Economic Analysis data, the Americans for Nonsmokers Rights report that employees who smoke cost businesses in Marion County, Indiana, $260.1 million in increased health insurance premiums, lost productivity, and absenteeism, as well as additional recruitment and training costs resulting from premature retirement and deaths due to smoking. In addition, economic losses due to lost wages and benefits from disability or premature death of nonsmokers caused by exposure to secondhand smoke are estimated at $3.2 billion for 2004, giving a low-bound cost total of nearly $6 billion. In an effort to mitigate risk, many healthcare providers, such as Aetna, Cigna and Blue Cross Blue Shield, have implemented online campaigns to educate their policyholders on the dangers of second-hand smoke, and most carrier offer premium discounts to members who stop smoking. "It is important for policymakers, who must contemplate public smoking restrictions, to understand both how many people suffer ailments due to secondhand smoke as well as the costs involved," Uccello said. Uccello said actual costs could be even higher, because they do not include costs from other diseases and conditions that the Surgeon General identifies as being caused by secondhand smoke, such as low birth weight and sudden infant death syndrome. In addition, the Surgeon General finds evidence to suggest, but not prove, that secondhand smoke causes other conditions, such as asthma and an increased risk for chronic pulmonary disease. An estimated 50,000 people die annually due to illnesses caused by exposure to second-hand smoke. Sources: PRNewswire, American Academy of Actuaries

Arlington, Va. - As insurers scramble to minimize risk and make the most of business opportunities related to climate change and other severe weather-related losses, the National Science Board, Arlington, Va., is asking for $300 million in additional funds to help fund a multi-agency effort to improve hurricane science and engineering research. In a draft report released yesterday, "Hurricane Warning: The Critical Need for a National Hurricane Research Initiative (NHRI)'' the report calls for "a determined effort to maximize our understanding of hurricanes and ensure the effective application of science and engineering outcomes for the protection of life and property,'' the report states." And while no individual weather event can be attributed to global warming, a growing body of new scientific data show that rising temperatures are likely increasing the intensity of hurricanes, and other extreme weather events in the U.S. and globally. Hurricane-related losses in the U.S. totaled $168 billion in the last two hurricane seasons, and 1,450 storm-related deaths were reported, according to the report. Analysis performed by the science board found that most hurricane-related funding is focused on short-term forecasting efforts, with less than 2% aimed at improving structural design and engineering for buildings. Annual funding for the government's "focal point'' for storm analysis, the National Oceanic and Atmospheric Administration's Hurricane Research Division, has never exceeded $5.1 million, states the report, and its staff has declined by 30% in the past decade. "Billions of tax dollars have been provided for rescue, recovery, and rebuilding after hurricanes strike," notes the board. "Also important is national investment in the creation of new knowledge, and more effective application of existing knowledge to reduce these enormous public outlays, loss of life, and the associated societal disruption caused by hurricanes." The National Science Board, the governing board of the National Science Foundation (NSF), was established in 1950 to promote the progress of science, advance the national health, prosperity, and welfare, and secure the national defense. One lawmaker, referencing the report, has introduced bipartisan legislation to implement a national research initiative designed to better research, predict and prepare for hurricanes. U.S. Senator Mel Martinez, R-Fla., crafted the proposal working from recommendations presented by the National Science Foundation's new draft report. The bill's original cosponsors include Senators Mary Landrieu, D-La., David Vitter, R-La., and Bill Nelson, D-Fla. "Hurricanes, by far, cause more economic damage to a more widespread area than any other natural disaster. This bill takes sound, scientific recommendations and builds from them a foundation for better, more coordinated research," said Martinez. "Given the enormous cost associated with hurricanes, we ought to better coordinate research and information about hurricane prediction, observation, the vulnerability of structures and how we might develop better evacuation plans." The legislation would place responsibility for implementing and overseeing the NHRI on the National Oceanic and Atmospheric Administration (NOAA) and the National Science Foundation (NSF). The bill sets out specific goals for NHRI research, including predicting hurricane intensification, storm surge, rainfall, and inland flooding, improved observations, assessment of vulnerable infrastructure, interaction of hurricanes with engineered structures, improved computational ability, improved disaster response and recovery, and evacuation planning. The proposal also would establish a National Infrastructure Data Base in order to provide a baseline for developing standards, measuring modification and loss, and establishing public policy to better understand hurricanes and tropical storms. A Science Board task force has studied the issue of nationwide investments in hurricane science and engineering since December 2005. Its report warns that relative to the tremendous damage and suffering caused by hurricanes, the federal investment in hurricane science and engineering is insufficient, and as the board document exclaims, "Time is not on our side." Sources: Sen. Mel Martinez, The National Science Board, and Insurance Networking News Archives

Hartford, Conn. - Aetna announced today the results of its broadest study to date of consumer-directed plans - a review of four years of data to determine the impact of consumer-directed health plans on 1.6 million Aetna members. Aetna is one of many insurers targeting members with improved tools and plans to improve overall performance and management of their members’ health. Included in the latest study were members in an Aetna HealthFund consumer-directed plan, as well as employees within the same employer groups who have chosen other benefits options. Five years after the launch of Aetna HealthFund, consumer-directed plans consistently result in lower medical costs, maintained or improved levels of chronic and preventive care, and increased usage of generic medications and consumer tools and information, the study results noted. The 1.6 million members studied include 134,000 HRA members from 99 employers, 18,000 HSA members from 27 employers, and 1.45 million Aetna members from those same employer groups who have chosen other benefits offerings. These members were compared to a population of 1.4 million Aetna PPO members comprised of all large employer groups. Four years of data was studied for HRA members, two years of data was studied for HSA members, and three years of data was studied for the comparison population. Among the study’s results, Aetna reports that it is receiving favorable reviews on its online tools: its HealthFund members accessed online tools more than twice as often as members of other plans, based on the experiences of five large employer groups. As consumer-driven products shift decision-making responsibility to consumers, other insurers are providing more information to help members make health care decisions. Highmark, Pittsburgh, Pa. contracted with Subimo LLC, a provider of Web-based health care decision support tools. Currently, 75% of Blue Cross Blue Shield plans in the United States use Subimo tools, and nearly 75 million Americans have access through their insurance company or employer. Using Subimo's Healthcare Advisor and Hospital Advisor, members can access health care information in both English and Spanish on hospitals, medical conditions and treatment options. Healthcare Advisor enables consumers to research treatment options, know what to expect prior to surgery and find the appropriate hospital for a certain health need. And Mount Laurel, N.J.-based AmeriHealth New Jersey plans to offer online capabilities through its Web site, www.amerihealthexpress.com, to its group customers and members, starting in 2007. Through a contract with Mount Pleasant, S.C.-based Benefitfocus.com Inc., AmeriHealth New Jersey will improve its self-service Web site by providing new Web tools to create an online resource for health benefit management. Other key findings from the Aetna study point to the ability of Aetna’s members to experience savings and improve their overall health focus: Employers who offered Aetna HealthFund as an option are seeing savings across all products offered. Those who offered an HRA option plan effective in January of 2003 experienced an average medical cost trend of 6.7 percent over a three-year period. Both Aetna HealthFund HRA and Health Savings Account (HSA) members with chronic conditions maintained or improved the level of care they received prior to joining the plan, including a 6% higher usage of inhaled steroids among asthmatics when compared to a similar population. Preventive care was also maintained or improved. For example, first-year HSA members received cervical cancer screenings at a 13.8 percent higher rate than PPO members. Sources: Aetna, Business Wire, Insurance Networking News

"You cannot discover new oceans unless you have the courage to lose sight of the shore."

The stats have arrived- survey results from insurers and researchers have one thing in common: Baby boomers are not prepared for retirement, and therefore insurers could be missing out on business. Some companies are stepping up, using technology to capture this pending market.Allstate's 2006 Retirement Reality Check survey reveals that 40% of Americans admit they are not saving seriously for retirement. One unexpected finding, according to the survey, is that Generation X respondents (those born from 1965 to 1978) are more likely than their elders to describe themselves as financially independent-73% of gen-Xers compared with 67% of baby boomers.

YOUNG INDEPENDENT AGENTS WANT MORE TECHNOLOGYYoung independent insurance agents identify technology to help them more easily write business and service customers as the second most important thing-after competitive rates-carriers can offer an independent insurance agency. Drive Insurance Group of Mayfield Village, Ohio-based Progressive Casualty Insurance Co. discovered this while conducting a survey of more than 750 young (40 years of age or younger or those who have been in the industry less than 10 years) independent agents. The majority of young independent insurance agents (79%) say technology has been significant in helping them grow their business. Other results from the survey showed 11% have an interactive Web site where customers can quote, buy and contact them. Thirty-four percent have a static Web site where people can learn more about their agency and the services they provide, and 40% don't have a Web site at all.

VOICE SELF-SERVICE AND CUSTOMER INTERACTION MANAGEMENTThe customer interaction management software suite from Genesys Telecommunications Laboratories Inc., headquartered in Daly City, Calif., enables SAP solutions to integrate with voice self-service functionality from Genesys' Voice Platform. The integration of voice self-service with the back and mid-office is designed to simplify access to SAP solutions and make them available to a larger set of users across the organization.