My prediction: AIG bailout #4…or is it #5 now? I lost track. Either way it will be followed by more finger pointing, more stupid hearings and more people getting thrown under the bus.
And all the “good ole boys” with their golden parachutes, retention bonuses, and severance pay will make huge champaign donations to select politicians and then retire in luxury with tax shelters in the Virgin Islands and money stashed in the Swiss banks. Roll up your sleeves suckers. We will be the ones bailing everyone out with 50 to 60% tax rates in the near future. Change we can believe in, right!
I’m disgusted to think that our government would “bail out” (subsidize) life insurors. Insurance companies are supposed to reserve enough dollars to pay any potential claims – not live on investment income when investments pay big bucks and then whine when they must make a profit on underwriting and reserve properly. Same goes for P&C companies.
If AIG had been allowed to sink or swim the rest of us who conduct business prudently and properly would be much better off, as would our country. As for global issues, let other countries handle their own messes.
Unfortunaltely this plays right into the hands of what several life companies have wanted for years Federal Regulation instead of State Regulation. Now with the Federal Government doling out Federal funds it gives them another reason for the life companies to espouse being regulatd by the Federal Govenment instead of the States. The States have done a far superior job in regulating insurance companies than the federal government will ever do (please anyone tell me a successful federal program. The Property and Casualty companies are not in this predicament (in spite of the cat losses last year)and actully made money last year.By the Federal Government giving money to the Life Companies it will give the Life Companies not only funds, but Federal Regulation instead of State Regulation which is exactly what they have fought for in the last several years.Barney Franks will lead the charge. We may be and probably smelling a rat with a hidden agenda. The Federal Government will use this as an excuse to have Federal Regulation instead of State Regualation.
Anyone who continues to maintain that the patchwork state by state insurance regulatory system is superior to a new uniform federal regulatory system with a federal regulatory head, is unfortunately not thinking in the 21st century. Let me see — failures of the state regulatory system allowed the following (to name just a few): Billion Dollar bankruptcy of Reliance, Embezzlement of hundreds of millions by Martin Frankel; bid-rigging investigations convictions Of Marsh McLennan, AIG, and other executives; rampant denial of billions of dollars of Katrina homeowner claims many based on a “gotcha” clause (if it’s wind we’ll pay, wind and water we won’t pay); AIG’s credit default swaps (unregulated insurance by any other name, without reserves) leading to a banking collapse and government bailout; numerous stories of failing to protect the consumer; and hundreds of thousands of formal complaints filed with the state regulators each year.
Does the state by state regulatory system still look good? We should start focusing on how to make a federal system work fairly for insurer and insured alike. We can adopt the best of the state system, and the best of the state insurance personnel, into a cost-effective uniform federal system with national and international standards. We can allow the states to add more specific statutes or regulations to cover specific state or regional issues. There are many examples of Federal agency success stories. Why can’t Insurance be one of those stories?
That was a long disertation without one example of a successful Federal Program. The examples that were cited with poor regulation were the exact reason why the Federal Government should not regulate the insurance industry. I agree there has to be a system that allows agents who write in several states to have a better system of coordination, but the Federal Government is not the answer. The Federal Government has done a terrible job of regulating the banks, and now you are suggesting they regulate the insurance industry. The SEC is also an example of Federal System. Does the name Bernie Madeoff ring a bell. Great oversight by the Federal Government right? AIG did not fail because of lack of oversight by the State Department of Insurance. There insurance part of the business was doing very well. It was the their dirivatives. We can also thank Chris Dodd and Barney Frannks for Freddie Mac and and fannie Mae. do you think the Federal Goivernment should now regulate our industry. This 21st Century way of thinking we can do without. Yes the Life Insurance Industry wants to be rfegulated by teh Federal Government the same sector of the industry that isasking for our tax dollars.
EDGE, my dear sir when have any of seen a Federal Program work? We are in this mess because of a mandated program to put every American in a home via Barney Frank.
What we need is have the Gov out of our lives. The Only reason the Federal Government exists is to protect our interests and that is only reason. Look it up!, you might learn something.
For anyone who continues to rail about federal government overseeing the insurance industry, and stating that there are no federal agency success stories, let me suggest a few federal agency success stories in this area:
Federal Reserve established in 1913 — stabilized the banking system;
FDIC established in 1933, created federally insured bank accounts (now up to $250,000 for most accounts);
National flood insurance program — the federal program to cover a flood catastrophe, where no private insurers wanted to venture;
Terrorism risk insurance act — federal government backstopping the insurance industry, allowing high-rise construction and other construction to continue, where insurers were reluctant to venture;
Children’s health insurance program — federal program insuring millions of children without health insurance;
Federal crop insurance program — insuring farmers against crop failure
We have to question whether the current state-by-state regulatory system could have effectively and uniformly provided these programs, and many of the other ones that are going to be needed in this global insurance community of the 21st century.
An example of a new federal program: We should consider establishment Of a Federal Insurance Guarantee Corp.(FIGC), which could protect policyholders, claimants and creditors against bankruptcies and failures of insurance carriers, with a reasonable cap for each policy, uniformly administered across the country. This would be similar to the FDIC program which protected bank accounts and restored the trust in the banking system in the 30s, and has continued to work well today.
The FIGC, coupled Congress’s creation of a uniform federal insurance law, with a federal regulator at the head, adopting national standards, would certainly go a long way to restore the trust in the insurance industry.
You can’t really consider a program $18 billion in debt (NFIP) to be a success, can you?
How many terrorism claims have we seen?
The Federal Crop program is in concert with private availability.
The FDIC, insures a business/speculative risk – not pure risk.
Federal government is not equipped to take care of the ultimate consumer as well as the states. I’d rather have my auto rates based on my state’s experience rather than lumped in with every state.
Why can’t a Federal system be successful, it can be, for the national insurance carriers; but not for the consumer.
My prediction: AIG bailout #4…or is it #5 now? I lost track. Either way it will be followed by more finger pointing, more stupid hearings and more people getting thrown under the bus.
And all the “good ole boys” with their golden parachutes, retention bonuses, and severance pay will make huge champaign donations to select politicians and then retire in luxury with tax shelters in the Virgin Islands and money stashed in the Swiss banks. Roll up your sleeves suckers. We will be the ones bailing everyone out with 50 to 60% tax rates in the near future. Change we can believe in, right!
campaign donations
I’m disgusted to think that our government would “bail out” (subsidize) life insurors. Insurance companies are supposed to reserve enough dollars to pay any potential claims – not live on investment income when investments pay big bucks and then whine when they must make a profit on underwriting and reserve properly. Same goes for P&C companies.
If AIG had been allowed to sink or swim the rest of us who conduct business prudently and properly would be much better off, as would our country. As for global issues, let other countries handle their own messes.
What’s to worry about? I mean WTF: We’ll let Obama merely print us out some mo’ money and ‘spread da wealth’, right? Easy.
Unfortunaltely this plays right into the hands of what several life companies have wanted for years Federal Regulation instead of State Regulation. Now with the Federal Government doling out Federal funds it gives them another reason for the life companies to espouse being regulatd by the Federal Govenment instead of the States. The States have done a far superior job in regulating insurance companies than the federal government will ever do (please anyone tell me a successful federal program. The Property and Casualty companies are not in this predicament (in spite of the cat losses last year)and actully made money last year.By the Federal Government giving money to the Life Companies it will give the Life Companies not only funds, but Federal Regulation instead of State Regulation which is exactly what they have fought for in the last several years.Barney Franks will lead the charge. We may be and probably smelling a rat with a hidden agenda. The Federal Government will use this as an excuse to have Federal Regulation instead of State Regualation.
Anyone who continues to maintain that the patchwork state by state insurance regulatory system is superior to a new uniform federal regulatory system with a federal regulatory head, is unfortunately not thinking in the 21st century. Let me see — failures of the state regulatory system allowed the following (to name just a few): Billion Dollar bankruptcy of Reliance, Embezzlement of hundreds of millions by Martin Frankel; bid-rigging investigations convictions Of Marsh McLennan, AIG, and other executives; rampant denial of billions of dollars of Katrina homeowner claims many based on a “gotcha” clause (if it’s wind we’ll pay, wind and water we won’t pay); AIG’s credit default swaps (unregulated insurance by any other name, without reserves) leading to a banking collapse and government bailout; numerous stories of failing to protect the consumer; and hundreds of thousands of formal complaints filed with the state regulators each year.
Does the state by state regulatory system still look good? We should start focusing on how to make a federal system work fairly for insurer and insured alike. We can adopt the best of the state system, and the best of the state insurance personnel, into a cost-effective uniform federal system with national and international standards. We can allow the states to add more specific statutes or regulations to cover specific state or regional issues. There are many examples of Federal agency success stories. Why can’t Insurance be one of those stories?
That was a long disertation without one example of a successful Federal Program. The examples that were cited with poor regulation were the exact reason why the Federal Government should not regulate the insurance industry. I agree there has to be a system that allows agents who write in several states to have a better system of coordination, but the Federal Government is not the answer. The Federal Government has done a terrible job of regulating the banks, and now you are suggesting they regulate the insurance industry. The SEC is also an example of Federal System. Does the name Bernie Madeoff ring a bell. Great oversight by the Federal Government right? AIG did not fail because of lack of oversight by the State Department of Insurance. There insurance part of the business was doing very well. It was the their dirivatives. We can also thank Chris Dodd and Barney Frannks for Freddie Mac and and fannie Mae. do you think the Federal Goivernment should now regulate our industry. This 21st Century way of thinking we can do without. Yes the Life Insurance Industry wants to be rfegulated by teh Federal Government the same sector of the industry that isasking for our tax dollars.
EDGE, my dear sir when have any of seen a Federal Program work? We are in this mess because of a mandated program to put every American in a home via Barney Frank.
What we need is have the Gov out of our lives. The Only reason the Federal Government exists is to protect our interests and that is only reason. Look it up!, you might learn something.
For anyone who continues to rail about federal government overseeing the insurance industry, and stating that there are no federal agency success stories, let me suggest a few federal agency success stories in this area:
Federal Reserve established in 1913 — stabilized the banking system;
FDIC established in 1933, created federally insured bank accounts (now up to $250,000 for most accounts);
National flood insurance program — the federal program to cover a flood catastrophe, where no private insurers wanted to venture;
Terrorism risk insurance act — federal government backstopping the insurance industry, allowing high-rise construction and other construction to continue, where insurers were reluctant to venture;
Children’s health insurance program — federal program insuring millions of children without health insurance;
Federal crop insurance program — insuring farmers against crop failure
We have to question whether the current state-by-state regulatory system could have effectively and uniformly provided these programs, and many of the other ones that are going to be needed in this global insurance community of the 21st century.
An example of a new federal program: We should consider establishment Of a Federal Insurance Guarantee Corp.(FIGC), which could protect policyholders, claimants and creditors against bankruptcies and failures of insurance carriers, with a reasonable cap for each policy, uniformly administered across the country. This would be similar to the FDIC program which protected bank accounts and restored the trust in the banking system in the 30s, and has continued to work well today.
The FIGC, coupled Congress’s creation of a uniform federal insurance law, with a federal regulator at the head, adopting national standards, would certainly go a long way to restore the trust in the insurance industry.
Why couldn’t it be a federal success story?
You can’t really consider a program $18 billion in debt (NFIP) to be a success, can you?
How many terrorism claims have we seen?
The Federal Crop program is in concert with private availability.
The FDIC, insures a business/speculative risk – not pure risk.
Federal government is not equipped to take care of the ultimate consumer as well as the states. I’d rather have my auto rates based on my state’s experience rather than lumped in with every state.
Why can’t a Federal system be successful, it can be, for the national insurance carriers; but not for the consumer.