It Figures

6

The owner of a Little Rock, Ark., insurance company was sentenced to six years in prison on a federal fraud conviction, the Associated Press reported. Frank Whitbeck, was ordered to pay $3.8 million restitution and was fined $12,000. He will be on three years’ supervision after serving his prison term. Whitbeck pleaded guilty May 8 to one count of mail fraud. He is to report to the federal Bureau of Prisons on Dec. 1. Prosecutors say Whitbeck defrauded the Arkansas Insurance Department and policyholders of his Signature Life Insurance Company of America Inc. They say he submitted false information to the department, misrepresenting the amount of required reserves the company had to pay potential claims. Whitbeck claimed his company had made secured loans, when actually he had diverted the money to other business interests and to himself, according to the U.S. attorney’s office. The company has been placed in receivership.

$13 Billion – $21 Billion

California-based Risk Management Solutions (RMS) updated its estimate for U.S. onshore and offshore insured losses from Hurricane Ike to $13 billion to $21 billion, of which $10 billion to $15 billion is estimated for wind and storm surge in Texas and Louisiana. The estimate also includes $2 billion to $3 billion from inland wind and flood losses and $1 billion to $3 billion in offshore losses. It does not include federally insured flood losses. The revised estimate is based on a new post-event modeling methodology; it includes an additional $2 billion to $3 billion of inland wind and flood losses not included in the previous RMS estimate. RMS noted the significant uncertainty that still remains in assessing insured losses. The updated range of insured losses makes Ike the third most costly U.S. hurricane after Katrina and Andrew, according to RMS.

$35 Million

Louisiana Citizens Property Insurance Corporation reached a $35 million agreement with policyholders to resolve claims that the insurer failed to offer settlements for hurricane claims in a timely fashion after Hurricanes Katrina and Rita in 2005, according to the Associated Press. It was reported that thousands of policyholders are eligible for payments of roughly $1,000 under the terms of the settlement, which doesn’t include an admission of wrongdoing by Citizens. It resolves two class action lawsuits that accuse the company of failing to provide a written settlement offer to policyholders within 30 days of being notified of storm damage.

Topics USA Hurricane