A View From The Press Box

Writing ain't easy--not even for professionals, like me, who craft stories for a living. So it's no surprise that relative "amateurs" in the insurance industry called upon to compose press releases, claim letters, proposals, reports or simple e-mail correspondence are often undermined by a lack of fundamental skills. My old friend and former colleague, Jack Appleman, offers invaluable help with his new book on the basics of business writing.

One of the dirty little secrets about the uninsured that went unmentioned in Michael Moore's documentary, "Sicko," is that a significant percentage of those going bare appear to be making enough money to afford health insurance, but for some reason choose not to buy it. The question for those backing universal coverage is whether these "free riders" should be forced to pay premiums or penalized if they show up for care without a policy.

It was a disappointing night for Obama-backers, but I have to hand it to Sen. Hillary Clinton for refusing to be written off by the pundits and for rebounding so strongly in Ohio, while holding on for a tight win in Texas. Now what?

When I order a meal in a restaurant, I expect to be handed a bill. I'll even give a generous tip for good service. But I don't expect to have to pick up the check when a cop shows up at the scene of an accident, or a fire fighter drops by to put out a blaze. Yet such fees are becoming more prevalent as municipal governments struggle to balance their budgets without raising taxes. Insurers are fighting to discourage what they call "double-taxation," but it might be a losing battle as the economy tanks.

I don't think I have ever been more shocked than I was to hear today that New York Gov. Eliot Spitzer--the former crusading attorney general who brought insurance giants Marsh and AIG to their knees, and toppled titans such as Maurice Greenberg--had been linked as a client to a prostitution ring. Where does the sullied white knight go from here?

Often in this space I scold the insurance industry for short-sighted actions or outright misbehavior that undermines an already tarnished reputation. But what is equally unfortunate is that insurers are not adept enough in spreading the news about the good they do for society--such as their efforts to help combat global warming, or at least mitigate the effects of recent climate change trends.

No doubt many in the insurance industry are dancing with glee over the demise of New York's wayward governor, Eliot Spitzer, who announced his resignation today in the wake of a prostitution scandal. But no matter how far he has fallen from grace, it doesn't change the fact that as attorney general Mr. Spitzer exposed a seamy side of the business, putting carriers and brokers on notice that misleading clients or investors won't be tolerated. That will be his legacy.

Given the fact that getting an optional federal charter approved anytime soon is little more than a pipe dream, I hope the industry rallies around the latest proposal to use Uncle Sam not as the industry's ultimate regulator, but more as a facilitator to make multi-state licensing of agents and brokers more efficient. I also can't help but wonder why the same concept could not be applied to national insurance company licensing as well.

It was quite a week for the insurance industry. First, New York's Eliot Spitzer had to step down as governor in the wake of a prostitution scandal, and then high-profile trial lawyer Richard "Dickie" Scruggs pled guilty to bribing a judge--and in a Hurricane Katrina lawsuit, no less!!! With the shortage of high-profile nemeses, the loss of these two powerful crusaders against insurer wrongdoing is a huge blow to industry reformers.

A recent article in the New York Times carried the alarming headline that "More Americans Are Giving Up Golf," mainly because people just don't have the time anymore to lollygag around the course when there is real WORK to be done--most often over the Web. But what about the insurance industry, which historically has conducted so much business with clubs in their hands? Is this trend not alarming?

The courts have not been supportive of insurers when it comes to one of the most heated hot-bottom issues in politics today--the implications of illegal immigration--ruling that undocumented employees are entitled to workers' comp benefits if hurt on the job, even if they forged their identification papers. Even for someone like me who is against mass deportations and in favor of reasonable immigration reform, this seems to go too far.

Insurers hit the trifecta this week! First Eliot Spitzer had to step down as New York's crusading governor after a prostitution scandal, then trial attorney extraordinaire Dickie Scruggs pled guilty to bribing a judge in a Hurricane Katrina suit. Now the king of class-actions, Melvyn I. Weiss, copped a plea for his role in a scam to drum up plaintiffs. Why isn't Congress investigating this parade of misconduct by officers of the court?

Did Robert DeNiro pull off one of his greatest acting jobs with the insurer covering production delays for a film he was to shoot, only to be diagnosed with prostate cancer soon after? Or did he merely comply faithfully with the letter of his policy contract, as a court has ruled? Listen to the facts and decide.

In response to my March 10 blog entry, "What Goes Around, Comes Around," Gary Wolcott, director of communications at the Professional Insurance Agents Western Alliance, lamented about how much damage Eliot Spitzer did to innocent independent agents with his crusade against big broker abuse of legitimate contingent compensation deals. I invited him to elaborate, and his musings follow. While he may be preaching to the choir, his commentary on Mr. Spitzer's legacy are worth repeating. Read on, and please share your own take.

They say politics makes for strange bedfellows, but I thought April Fools Day had come early when a news release hit my e-mail this morning announcing that the Reinsurance Association of America was on the same side as the industry's chief critic, Bob Hunter of the Consumer Federation of America, in opposing expansion of the National Flood Insurance Program to include wind damage.

The insurance industry has one thing in common with major league baseball--both enjoy a cherished exemption from federal antitrust law. Still, baseball gets away with a lot more than insurers and brokers could ever hope to in managing their business. Indeed, imagine for a moment what insurance would be like if baseball's standard operating procedure prevailed!