CHIROPRACTIC CLINIC MUST PAY:
A Dallas jury ruled recently that a Texas chiropractic chain, Accident and Injury Pain Center Inc., conspired to defraud Allstate Insurance Company and Encompass Insurance, an Allstate subsidiary, according to the insurers. Accident & Injury Pain Center Inc., its related entities and various chiropractors, osteopaths and medical doctors reportedly were found to have conspired to commit common law fraud by over-treatment and unnecessary referrals. The chiropractic chain was ordered to pay $2.8 million in actual damages and $3 million in punitive damages. Allstate took the chain to court almost three years ago on charges of common-law fraud; common-law conspiracy; unjust enrichment; and violating certain provisions of the Texas Occupation Code.
RATE HIKES IN LOUISIANA:
Some southern Louisiana residents will see average rate hikes of 27 percent for homeowners insurance and some may pay 50 percent more, as a result of the Louisiana Insurance Rating Commission's approval of a new price schedule for the Louisiana Citizens Property Insurance Corporation, the Associated Press reported. Louisiana Citizens is a nonprofit corporation and an insurer of last resort for homeowners in high-risk areas. State law requires Louisiana Citizens to charge at least 10 percent more than the most expensive of a parish's top 10 private insurers.
TMLT CUTS RATES AGAIN:
Texas Medical Liability Trust (TMLT) announced plans to reduce rates by an additional 5 percent for member physicians. The 5 percent reduction is in addition to a 12 percent rate cut the insurer implemented earlier this year. TMLT said together the rate cuts would translate into a $34 million savings for Texas physicians and are the result of the stabilizing medical liability market made possible by legislative reforms and passage of Proposition 12 last year. The new rate reduction are effective Jan. 1, 2005. TMLT, Texas' largest medical liability insurance provide, serves 48.2 percent of the available physician market in the state. Since announcing the 12 percent rate cut in January 2004 , the company has added more than 1,600 new physician policyholders.
ARK. REVAMPS NON-RES. SYSTEM:
Effective Sept. 30, 2004, the Arkansas Insurance Department no longer requires a non-resident individual to provide a current home state certification with a new license application or for a license renewal if the individual's home state participates with Producer Database (PDB). The department announced it has developed new software to perform an automatic lookup of the NIPR Producer, RIRS, and SAD databases, and therefore does not need home state license certifications on individuals. However, the automatic lookup program does not work for business entities. "Business Entities" include corporate or partnership insurance agencies, limited liability companies (LLCs) and limited liability partnerships (LLPs) acting as insurance agencies; but not sole proprietorships. For more information contact Fred Stiffler, director, License Division at (501) 371-2750 or fred.stiffler@arkansas.gov, or fax at (501) 683-2604.
TEXAS AG, INSURERS SETTLE:
Texas Attorney General Greg Abbott announced court-approved settlements with two major auto insurers that he says will result in refund more than $3.4 million to Texas policyholders who paid more out of pocket on claims for auto repairs in certain years than their policies required. Pro-gressive County Mutual Insurance Co. agreed to pay $2.35 million, including interest, in refunds to about 11,000 policyholders who had repair claims from January 1996 through May 1999, according to the AG's office. Old American County Mutual Fire Insurance Co. will pay refunds of $1.07 million to an estimated 4,500 policyholders. This refund period covers claims for vehicle repairs from January 1996 to September 2001. The companies, along with others in the industry, engaged in the unlawful practice known as "betterment," in which they claimed that the use of better or newer parts to repair the vehicle increased its value. Companies then charged the amount of this supposed "increased value" to the policyholders, thus reducing the amount the company paid for the repairs. Policyholders were then forced to make up the difference, in addition to their deductible, to the repair shop. Under the terms of the agreement, the companies, which have stopped the practice, agreed not to engage in this practice and will refund the total amount of overcharges, plus interest, to customers who had auto repair claims involving betterment deductions in the periods described. Since 2000, the Texas Attorney General's office has obtained betterment settlements with Home State County Mutual Insurance Co., Consumers County Mutual Insurance Co., Farmers, Texas Farm Bureau, Trinity, State Farm, Nationwide, USAA, Geico, Travelers, Safeco, Sentry, Liberty Mutual, Allstate and CNA for an estimated $16.4 million in total auto repair refunds to date. Two lawsuits, against State and County Mutual Insurance Co. and Maryland Casualty Insurance Co., are pending.
TWCC IMPOSES NEARLY $2M IN FINES:
The Texas Workers' Compensation Commission issued penalties totaling almost $2 million between Sept. 1, 2003 and Aug. 31, 2004, for administrative violations committed by system participants. A total of 2,195 Notices of Violation (NOVs) were issued during the 2004 Fiscal Year amounting to $1,981,686 in penalties. Out of the funds collected from these penalties, the initial $100,000 is appropriated to the Commission while the remainder goes to the state's general fund as required by the General Appropriations Act. Of the NOVs issued, 85 percent were sent to insurance carriers for administrative violations. These violations included late payment of income benefits to injured workers. Thirteen percent of the NOVs were issued to health care providers for violations such as late filing of required reports. The remaining 2 percent of the NOVs were issued to other system participants. Summaries of enforcement activities by the Commission's Compliance and Practices Division are posted on the Commission's Web site at: www.twcc.state.tx.us, under "Fraud and Enforcement."
