1Tornadoes Strike Midwest; Estimated Insured Losses $1B-$2B
Losses stemming from a series of deadly tornadoes that ravaged the midwest from Feb. 28 to march 3 are
expected to fall between $1 billion and
$2 billion, according to catastrophe
the destructive storm system wrought
tornadoes, hail and strong winds over an area
that covered 12 states from the Deep south
to as far north as ohio and illinois, according
to the national Weather service.
most of the more than 150 tornadoes,
a preliminary count, occurred in the states
of tennessee, Kentucky, indiana, illinois and
Alabama, says eQeCAt.
the cat modeler says an eF- 4 tornado, with
wind gusts of 166-200 mph, destroyed 200
homes and businesses in Harrisburg, ill.
2U.S. Government Responds to Greenberg’s AIG Lawsuit
4AIG Sells 14% of AIA Stock; Fed Sells MLII Securities
tHe U.s. government has asked a federal court to dismiss a lawsuit
filed against it by maurice greenberg and starr international on behalf
of the shareholders of Aig, stating that the company had asked and
agreed to be rescued. greenberg’s suit claims the rescue “amounted to
an attempt to ‘steal the business.’”
Aig tooK two steps toward repaying the government: selling the last
remaining securities held in the maiden Lane ii (mLii) facility; and selling
14 percent of the stock of its AiA group Ltd. for approximately $6 billion.
the sale of securities completes repayment of a $19.5 billion n. Y. Federal
reserve loan to mLii. the sale of AiA shares helps pay down a treasury loan.
6P&C M&A Expected to Remain Slow; Agent, Broker Activity Should Be Active
ProPertY & CAsUALtY mergers and acquisitions activity is
expected to be slow in 2012, according to a new report by Deloitte,
as low valuations, reserve adequacy and concerns over the soft
market impact deal-making. But activity among agents and brokers
is expected to remain strong, the professional-services firm says.
MBIA Reports $626M Q4 Loss
BonD-insUrer mBiA reports a fourth-quarter loss of $626
million, but the Armonk, n. Y.-based insurer’s top executives told financial
analysts during a conference call that despite the losses the company
was on track to relieving itself of risk in its structured-finance portfolio
and expects a return to profitability once outstanding litigation is resolved.
3Catastrophes Eat into State Farm Earnings
stAte FArm says net income for full-year 2011 was $800 million,
down $1 billion, or 56 percent, from 2010. the company took a $200
million pre-tax operating loss for its P&C companies due to significant
catastrophe activity. A spokesman says the company’s combined ratio for
2011 was 108.7 compared to 106.2 in 2010.
5Ariel Re Sells Parts of Operation to Goldman Sachs, Arch
ArieL reinsUrAnCe sold its Bermuda-based insurance and
reinsurance operations to goldman sachs and then sold its credit
and surety reinsurance operations—based in Zurich, switzerland—
to Hamilton, Bermuda-based Arch Capital group. terms of both
transactions were not disclosed.
7Court Reverses Travelers Payout of $500M for Asbestos Claims
A FeDerAL jUDge has reversed a Federal Bankruptcy Court decision
against travelers and has thrown out an order for the insurer to pay $500
million in asbestos claims. judge john g. Koeltl ruled that the conditions
of prior agreements were not satisfied, and “it was an error to require
travelers to make the settlement payments.”
9Crop Insurers, Agents Dismayed at New Proposed Cuts
CroP insUrers and agents are questioning President obama’s
Feds Indict 36 in
2013 budget proposals to make cuts to subsidies provided to the
industry. Under the obama administration’s proposal, subsidies would
be cut an additional $8 billion over 10 years.
NYC PIP Fraud Scheme
FeDerAL AUtHorities unsealed an indictment implicating 36
suspects for a scheme dating back to at least 2007. Authorities
apprehended the defendants—including 10 doctors and three lawyers—
who were allegedly involved in creating clinics in and around new York
City that habitually billed auto insurers for treatments that were either
medically unnecessary or never rendered.
Florida House Passes PIP Bill;
Will Senate Follow?
tHe FLoriDA HoUse of representatives passed HB 119, a bill
intended to quell the growing incidence of staged accidents and
medical fraud that deplete insurer profits and consumer wallets.
the House bill, which replaces the mandatory PiP no-fault insurance
coverage with “emergency care coverage,” will, among other things,
change the way accident reports are taken.