RICHARDSON: S.C. WENT THE 'RIGHT WAY' WITH HURRICANE LAW

The South Carolina House of Representatives and Senate recently agreed to changes to coastal omnibus hurricane legislation, which include extending the notice for homeowners whose insurance would be canceled to 90 days during hurricane season.

The measure also increases the notice to 60 days from 30 days during the rest of the year.

Gov. Mark Sanford has praised the bill, pushed by Scott Richardson, his insurance director, as a way to lower skyrocketing insurance premiums in a business-friendly way.

"This is the first legislation in a long time that is very pro-consumer and it should set the South Carolina market in a good position for 10 or 15 years to come," Richardson said. "It's also important on a national basis as South Carolina is the first to codify market philosophy -- not to mention the response we're getting from other states asking us how we did it. I think we went the right way."

The proposal would offer sales and income tax breaks to residents who make their homes more hurricane resistant with storm shutters and other mitigation materials. The breaks would not apply to vacation homes.

Other provisions include allowing homeowners to put money into tax-deductible hurricane savings accounts. Residents could use the accounts to offset large deductibles or forgo insurance altogether and self-insure. Insurers would get tax credits for writing full-coverage policies along the coast.

The law also put into formal effect Richardson's expansions of the wind pool, a state-run insurance program that helps provide coverage in areas where private insurers don't offer protection.

RASBERRY EXITS MISS. RACE

Jim Rasberry has withdrawn as a candidate for Mississippi insurance commissioner.

Rasberry, president of Rasberry Financial Services in Laurel, said that he was withdrawing from the Democratic Party primary because it was "difficult to obtain a firm footing in this race."

Rasberry, 24, said he had notified the Mississippi Democratic Party of his withdrawal.

Democratic Party officials said Rasberry's withdrawal leaves incumbent George Dale of Clinton and Gary Anderson of Jackson on the Aug. 7 primary ballot.

Republicans in the race for state insurance commissioner are state Sen. Mike Chaney of Vicksburg and Ronnie English of Vancleave.

RISING MEDICAL COSTS, SLOW INVESTMENT RETURNS CHALLENGE WORKERS' COMP

Skyrocketing medical costs are threatening to supersede gains in the workers' compensation line's latest calendar year statistics, according to an insider at NCCI Holdings Inc.

"Rising medical costs are an overriding theme -- they continue to increase at a rate above inflation," said Barry Lipton, a senior actuary and practice leader with NCCI.

Medical costs account for more than half of all losses for NCCI states in 2006, Lipton said. "That's the bad news."

NCCI reported that in recent years, workers' compensation medical claims severities have been increasing at a faster rate than would be expected based on medical inflation alone. There has been a shift to relatively more severe injuries, the report stated.

According to a January report titled "Measuring the Factors Driving Medical Severity: Price, Utilization, Mix" the key drivers -- accounting for approximately a 35 percent increase in medical severities -- include a markedly higher number of treatments within each diagnosis and a different mix of treatments across service categories. For example, there might be a shift from diagnostic radiology to complex diagnostic testing or from complex surgery to physical therapy.

Lipton also cited investment pitfalls as a concern for insurers.

"Returns are lower. Stock market gains are not what they used to be," he said. "No one is making 20 percent on their investments any more. This may cause reserve deficiencies for future payments on claims received."

While medical costs and investments remain concerns, the claims picture continues to improve.

"The good news is that frequency of claims is going down in all states," Lipton pointed out. "Frequency has declined in all but two of the past 16 years. We think it's due to safer workplaces -- not so much about safety programs."