A View From The Press Box

Whose fault is it when properties are underinsured? The policyholder? The agent? The insurance carrier? That's the question we posed to NU readers following last year's California wildfires, for which many homeowners reportedly lacked adequate coverage to rebuild. NU's ethics columnist, Peter R. Kensicki, compiled the responses (many of them from readers of my blog) and came up with the following trends.

Yesterday, we closed out the RIMS conference in San Diego with a bang, drawing 240 attendees on getaway day to hear the winners of the 2007 “NU Award For Excellence In Workers’ Compensation Risk Management” from Belk Department Stores and Rolls Royce North America share the secrets of their success in cutting the frequency and severity of claims, getting people back to work faster, and reducing the overall cost of risk, thus boosting productivity and improving the bottom line, which gets the attention of those in the C-suite. Will you be a role model for your risk manager peers next year, talking about your loss control, safety and back-to-work programs? You have until June 9 to enter the 2008 award program. Click on for details.

You are asked by an attorney friend to review a claims coverage opinion received from an insurance representative. When you read the opinion, you believe that parts of it are seriously flawed and incorrect. You know the person who wrote the opinion and believe that he is, at least in part, opining outside his area of expertise. What are your ethical obligations to both the attorney and the person who wrote the report? Feel free to weigh in right here, and while there is no need to give your name, please include your role in the insurance business—agent, adjuster, risk manager?

Should insurers be required to serve, in effect, as "environmental traffic cops," forced to cough up substantially more data about how climate change might impact their clients' exposures, and thus, their own operations? Chuck Chamness, president and CEO of NAMIC, argued forcefully against such mandates in the "Final Say" column of this week's edition of NU. Click on to read Chuck's take and feel free to offer your own opinion.

Ready or not, I'm turning 50 this afternoon! I've tried not to dwell on this earthshaking event, but circumstances haven't made it easy. Indeed, it seems as if the world has been conspiring to remind me about the consequences of aging as my mega-birthday approached!

Just a few months ago, Sen. Barack Obama seemed invincible, propelled by the catchy campaign slogan, "Yes, We Can." Now, as he struggles to fend off his relentless opponent, Sen. Hillary Clinton, the chants are starting to sound more like, "No, She Can't." Could the Democrats have devised a more self-defeating scenario? Even if Obama does manage to hold onto the nomination, can he beat Sen. John McCain this fall? Would having Clinton as his running mate make any sense, or any difference?

Keeping with the theme I cited in an earlier blog--it ain't easy being green--check out the tale of Assistant Managing Editor Caroline McDonald after the RIMS conference. Feel free to weigh in with any of your own war stories about how society doesn't facilitate those eager to preserve the environment.

Bill Berkley is the Simon Cowell of insurance. He always speaks his mind, with no sugarcoating, and lets the chips fall where they may. He was back on his soapbox last week in Orlando at the National Council on Compensation Insurance annual symposium, where he lobbed more verbal grenades at rating agencies.

Janice Ochenkowski, president of the Risk and Insurance Management Society, works hand-in-hand with her CFO. While this should be the rule rather than the exception, too many risk managers still find themselves on the outside looking in at upper management, known as the C-Suite.

Independent agencies and their insurance carriers that fail to embrace real-time data processing will soon start losing marketshare and could find themselves out of business over the long haul, a trio of cutting-edge agents warn.

Remember the old saying, "children should be seen and not heard at the dinner table"? The insurance industry has expanded that concept, because they often act as if customers should be seen but not heard, period. To invite feedback and establish more trust with consumers, perhaps it's time for carriers to launch social media sites.

Maybe there is some justice in this world after all. "The Insurance Hoax"--a pure hatchet job in the September 2007 issue of "Bloomberg Markets" that indicted the entire insurance industry for its claims-handling practices--did not win the prestigious Daniel Pearl Award for Investigative Reporting, given out by the New York City Deadline Club--an affiliate of The Society Of Professional Journalists.

Now that it's clear Congress won't be adding wind exposures to the National Flood Insurance Program anytime soon, should private carriers be forced to write coverage for both risks in one policy, and then have the government reimburse them for flood-related claims? That's the trial balloon being floated by one academic.

One of my big complaints about property-casualty insurers is that with the industry split on several critical issues, it's difficult to get some badly needed reforms passed in Washington or the individual states. However, PCI President and CEO David Sampson says the industry is united on far more issues than the few dividing the various segments and associations, while predicting an even closer working relationship among the key players in the face of the "real existential threats" ahead.

Our May 5 cover story--headlined "Should Illegal Aliens Get Workers' Comp?"--generated quite a stir, and not because of the content. It was the image with the article--depicting an Hispanic man in a wheelchair with crutches, holding both an American and Mexican flag--that drew reader complaints.

We asked NU readers to share some of their weirdest and whackiest claims, and you folks came through big time! Check out this week's cover story (featuring cola-drinking cows), have a few laughs, and feel free to chime in with some of your own war stories about your most challenging and unusual claims. Click here for the full story.

Rather than be dismissed as part of the problem, the National Association of Insurance Commissioners appears poised to be part of the solution when it comes to regulatory reform, if what we hear from the grapevine is correct. However, did the group make a mistake leaving out a key constituency--consumers--in its recent pow-wow with industry leaders?

Joel Wood should be a blogger. The senior vice president of government affairs for the Council of Insurance Agents and Brokers is a colorful writer with a lot to say, providing valuable insights on a host of controversies inside and beyond the Beltway in his regular column to members. The latest example is his post about last week's extraordinary pow wow with the National Association of Insurance Commissioners to talk about federal regulation, which he opens with the keen political maxim that "the foot you step on today is connected to the ass that you have to kiss tomorrow."

Continuing our discussion about regulation, the National Association of Insurance Commissioners stepped on a hornet's nest this week with its proposal to collect market conduct data as part of the annual statement process--then keep it in a central data base. Consumer groups are all for it, but insurers fear more class-action suits and tipping off competitors to proprietary information. No matter what happens, this is one battle the industry can't win. All they can do is limit the fallout.

There was a fabulous article in the May 19 edition of "The New Yorker," headlined: "The Bribe: How the Mississippi Lawyer Who Brought Down Big Tobacco Overstepped." Yes, it's the incredible tale of Dickie Scruggs, who pled guilty a few months ago for trying to bribe a judge in a lawsuit over the division of contingency fees in a Hurricane Katrina suit. It was a disgraceful end to an audacious and amazingly successful legal career, in which Scruggs brought down corporate titans in asbestos, tobacco and insurance. The problem is that while the greedy, arrogant Scruggs went too far, what is the alternative for those with valid claims seeking top legal talent to make their case?