INSURANCE AUTO AUCTIONS EXPANDS
Insurance Auto Auctions Inc., a Schaumberg, Ill-based auto salvage and claims processing service provider, announced the opening of a new greenfield facility in Longview, Texas. The new facility, IAA's seventh in Texas, will serve eastern Texas and western Louisiana, including Shreveport, Bosier City, and Monroe. IAA has also recently acquired a facility in Austin. The Longview greenfield will minimize towing expenses, and enable IAA to expand market share in East Texas. CEO Tom O'Brien explained, "The expansion in Texas through our new Longview facility will allow us to service Eastern Texas vehicles more cost effectively while expanding existing client commitments to increase unit volume in that part of the state."
FITCH PREDICTS BAD YEAR FOR P/C
Fitch published a review of the nine-month 2001 reported GAAP results for the larger property/casualty insurers to assess operating performance thus far this year and to get an early indication of results for full-year 2001 and beyond. Based on its analysis, Fitch believes that the property/casualty industry is headed towards its worst underwriting year ever as the losses from the events of Sept. 11 accentuated what was already shaping up to be another disappointing year for the industry. Heavier than normal catastrophes through six-months combined with significant reserve strengthening at several companies had already dashed hopes that 2001 performance would show even a modest improvement over a lackluster 2000. However, such horrific results will likely set the stage for a sharp hardening of the property/casualty market in 2002, building on already favorable marketwide pricing trends.
IDI ADOPTS BEST PRACTICES
Looking to reduce nursing home medical professional liability rates by preventing accidents and injuries that lead to claims, Texas Insurance Commissioner Jose Montemayor adopted a "best practices" plan that would apply to both nonprofit and privately-run facilities. The best practices rules were adopted in response to the Long-Term Care Facility Improvement Act, passed by the 2001 state legislature. The bill allows insurers and the Texas Medical Liability Insurance Underwriting Association (JUA) to take into account a nursing home's adoption of the best practices when determining the home's rates for medical professional liability insurance. The practices proposed by Montemayor emphasize procedures to minimize insurance claims and improve quality of care by extension. They do not establish standards of care to potentially be used against nursing homes in civil suits.
SUBSIDIZED POLICIES FOR HOG FARMS
The government is making subsidized insurance available to livestock farms for the first time, in the form of policies that will give protection to hog producers from reductions in income. As reported by the Associated Press, the policies will be offered on an experimental basis in the nation's top hog producing state, Iowa, according to the Agriculture Department's Risk Management Agency. One form of coverage will protect against drops in hog prices, while a second will be tied to fluctuations in hog prices and feed costs. Currently, the government subsidizes the cost of insurance for grain, cotton and other crops. The insurance will be restricted to small and medium-size farms that sell no more than 32,000 hogs a year. Sales of the policies are set to begin in the spring.
HALLIBURTON INSURED
Halliburton Co., the Dallas-based oilfield services and engineering concern, is expecting insurers to carry the bulk of the costs of recent asbestos damages verdicts against the company if legal appeals fail following a Maryland jury's $30 million award against Halliburton subsidiary Dresser Industries. Haliburton claimed it would appeal in both the Maryland and Texas cases, and that the large sums of damages were more than it had previously been ordered to pay in asbestos litigation. The company said it would continue settling claims for reasonable amounts but insisted it would go to court if damages sought were too high. Halliburton said its subsidiaries would be involved in more asbestos claims trials throughout the country over the next few months.
ALLSTATE GETS RATE HIKE IN OKLA.
Allstate received a 30 percent homeowners insurance rate increase in Oklahoma, the largest premium increase in that state since the 1980s. According to BestWire, Allstate lost money in Oklahoma in five of the last six years. When Allstate made its rate request in August, it was paying out $1.48 in claims for every dollar it took in premium. The company covers about 70,000 homes in Oklahoma, and had initially requested more than a 48 percent increase. The rate increase takes effect Dec. 17 for new customers and Jan. 17 for existing customers. It will raise the average Allstate homeowners premium in Oklahoma from $590 to $767 a year, according to a report in the Daily Oklahoman. Additionally, State Farm won approval for a 15 percent rate increase in November, and will reportedly raise rates Jan. 15 for new business and March 15 for renewing business. Farmers is also trying to secure a proposed 20 percent increase that would take effect next year.
MOLD EXCLUSION FILINGS IN FLA.
Fifty commercial and residential property carriers filed for exclusions with Florida State regulators to protect themselves against toxic mold problems like those that have embroiled the Texas market. However, according to BestWire, some of them later withdrew their filings in order to work something out with regulators. Carriers have asked the Florida Department of Insurance to specify when they would and would not be required to cover mold claims. Most of the insurers' exclusions seek to clarify that a basic policy covers mold damage in certain circumstances. Some want to apply financial limits on existing coverage, even when mold is covered.
