Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!usa-post Newsgroups: usa-today.insur From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: insur Wed, Feb 19 1992 Date: Wed, 19 Feb 92 06:39:08 EST Message-ID: DECISIONLINE: Insurance USA TODAY Update Feb. 19, 1992 Source: USA TODAY:Gannett National Information Network INSURERS MUST BE MONITORED: Congressional investigators looking into four 1991 insurance company collapses urged a Senate panel Tuesday to write national standards to get insurers to account more closely for their financial circumstances. The General Accounting Office probers also said federal rules might force state regulatory bodies to keep a more exacting eye on insurers. (For more, see special GAO package below.) EUROPEAN VENTURE FORMED: Three insurance groups, Royal Insurance of Great Britain, Aachener and Munchener of Germany and Fondiaria of Italy, have agreed to a three-way joint venture to attack the European insurance market outside their home countries. European Partners for Insurance Co-operation, a Luxembourg-based holding company, will start by buying the Dutch operations of Royal Insurance. CALIF. POLICYHOLDERS GET REBATE: A fourth insurance company has agreed to pay its policyholders the Proposition 103 rebates approved by voters over three years ago, California Insurance Commissioner John Garamendi said Tuesday. The Doctors' Co. follows two other medical malpractice insurance groups and the Automobile Club of Southern California in agreeing to voluntarily comply with the rollback provisions. DOCTORS TO RETURN $18.5M: The agreement with The Doctors' Co. calls for the return of $18.5 million to the company's 9,500 California physician members, a 19.24% rebate. The insurer will offer credit to current members on their next four quarterly statements beginning April 1, 1992, and will send refund checks to all 1989 policyholders who are no longer with the company by April 8, 1992. BUSH READY FOR CHANGE: President Bush's point man on the health care crisis promised Congress Tuesday the administration is ready to "roll up its sleeves" to fix the nation's ailing health care system. "We're not talking about business as usual," said Health and Human Services Secretary Louis Sullivan, promoting the president's health care package of tax credits to help the uninsured get coverage. MANY NOT PASSING ON SAVINGS: Making health insurance more affordable for small employers won't do much to help the uninsured, says a study in Wednesday's Journal of the American Medical Association. In a two-year program, 40,000 small firms in New York state had a chance to insure employees at half price. Few did. The study says a 50% cut in small-firm insurance rates would cut the uninsured ranks by 5% at best. PBGC REPORTS LOSS: In its 17th Annual Report released Tuesday, the Pension Benefit Guaranty Corporation reported losses totaling more than $1 billion from underfunded pension plans in fiscal year 1991. With these losses, the deficit of PBGC's single-employer plan insurance program rose to $2.5 billion, based on assets of $5.7 billion and liabilities of $8.2 billion. NWNL TO DIVEST CHARTWELL UNIT: NWNL Companies, Minneapolis, has agreed to sell Chartwell Re Corp. to an investor group including Wand Partners Inc. and Michigan Mutual Insurance Co., Detroit. Chartwell Re Corp. is the parent of Chartwell Reinsurance Co., Stamford, Conn. GREAT-WEST BUYS LINCOLN UNIT: Great-West Life & Annuity Insurance Co., Englewood, Colo., has agreed to acquire the $1.2 billion group life and health indemity insurance portfolio of Lincoln National Corp., Fort Wayne, Ind. The book of business includes some 2,200 group life and indemnity health clients covering approximately 800,000 individuals, with the majority of plans covering between 50 and 2,000 individuals. SPECIAL PACKAGE ON GAO: REGULATORS DID NOT ACT: A preliminary GAO study found that state regulators knew as early as 1983 that Executive Life of California was in deep financial trouble - and did nothing. Executive Life was taken over by California regulators last April. "Only after the insurers hemorrhaged from policyholder runs did state regulators move to take them over," said Richard Fogel of the GAO. BAD INVESTMENTS COST CONSUMERS: Fogel testified at a Senate Banking Committee hearing that the GAO examined last year's collapses of Executive Life of California and New York, First Capital of California and Fidelity Bankers of Virginia. Those failures and that of Mutual Benefit of New Jersey heightened awareness about the $1.4 trillion industry's problems, accrued through unwise investments and sales of high-risk policies. SYSTEM NOT ADEQUATE: Sen. Donald Riegle, D-Mich., chairman of the Banking Committee, suggested that Congress might want to take another look at instituting a federal regulatory responsibility for the insurance industry. There is no federal oversight of the industry; only states can watch over carriers. Riegle says regulators' examining insurance companies once every three to five years isn't adequate. STATES MISLEADING CONSUMERS: State insurance commissions also must provide more and better information to consumers, said Martin Weiss of Weiss Research. Weiss reported that 24 state commissions "made positive statements about Presidential Life." Fifteen states gave out the company's B-plus rating from A.M. Best Co. and said the grade meant "very good" when, in fact, a B-plus from Best is a negative signal. (End of package.) Insurance Editor: Michele Coleman. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. 08:0002190000D0219 INTE- R D Irish-to-discuss-abortion............. A D0219 This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM