MARIT’S READS
One of my favorite speakers and authors is Steve Anderson. This month IIAT featured Anderson during IIAT RISE Virtual Summit. In his recent book, The Bezos Letters, Anderson deconstructs Amazon CEO Jeff Bezos’s annual review letters to shareholders that show why, when, and how he takes risks and how that makes the shareholders successful. Steve has analyzed and distilled these letters to reveal the key 14 growth principles that unlock the lessons, mindset, and steps Bezos has used to make Amazon the massive success it is. Whether you’re an Amazon fan or not, there are lessons to learn. This book is designed to help business owners, leaders, CEOs, employees, and managers apply these same principles to grow their business to be more efficient, productive, and successful – fast.
-Marit Peters, IIAT president and executive director
TDI
The Texas Department of Insurance has issued the annual experience and workers’ compensation deductible plans data call. Insurance companies licensed to write private passenger automobile, commercial automobile, homeowners multiple peril, workers’ compensation, commercial fire and allied lines, residential fire and allied lines, commercial multiple peril, general liability, boiler and machinery, commercial crime, commercial glass, surety, inland marine, medical professional liability, or miscellaneous professional liability insurance in Texas are required to submit the required data by Feb, 12, 2021. The data will be used for a report on market conditions that must be provided to state leaders by March 31, 2021.
TDI approved the Texas Automobile Insurance Plan Association’s request for a 4.8 percent increase in commercial auto rates, effective March 1, 2021. TAIPA made the rate filing on Sept. 14, and the commissioner extended the approval period by 30 days until Nov. 13. Doug Slape, chief deputy commissioner, signed the order on the recommendation of Mark Worman, deputy commissioner, and Amy Wills, staff attorney. TDI did not receive any comments on the filing.
Under proposed rules affecting general administration (Chapter 1) and corporate and financial regulation (Chapter 7) published Nov. 6, TDI would assess maintenance taxes and other fees by order, not by rule. The department’s rationale in both proposals is, “This would allow the commissioner to maintain transparency on how the rates are calculated in the rule, but also help avoid delays that can result from the rulemaking process. The commissioner will be able to set the rates by order sooner than can be done by rule, which benefits stakeholders and preserves agency resources.” Maintenance taxes or fees, examination overhead assessments and premium finance examination assessments fund the operations of the insurance department, the division of workers’ compensation and the Workers Compensation Research and Evaluation Group. The proposed rule would remove the caps set for each line of business in the current regulation, but require that no rate exceed the statutory maximum. Fees are based on gross premium, including written and assumed premiums, as reported in annual statements of insurers, and payable on March 1 each year. James Person, general counsel for TDI, attested to the authority of the agency to adopt the rule. Comments are due by 5 p.m. on Dec. 7.
The Workers’ Compensation Research and Evaluation Group of TDI is required by law to publish its research agenda for the coming year. On Nov. 13 Cassie Brown, commissioner of workers’ compensation announced the group’s three-part agenda: (1) Complete and publish the 2021 Workers’ Compensation Health Care Network Report Card; (2) Analyze the initial impact of COVID-19 on the Texas workers’ compensation system, including claim frequency, claim costs, disputes and return-to-work outcomes, and (3) Study the use of telemedicine in the Texas workers’ compensation systems, including trends on the types and costs of services performed.
Disciplinary orders completed by TDI in October included penalties against four resident brokers and six nonresident brokers who failed to file surplus lines policies and related documents. Altogether, their fines totaled $95,700. These brokers were among the 129 agents referred by SLTX to TDI on March 23 for enforcement actions in its report for 2019 delinquent filers. One broker’s disciplinary order indicated that the broker failed to pay the administrative penalty that was levied shortly after the late filers report was transmitted to TDI.
The administrative penalty paid to Texas as part of a multi-state regulatory agreement completed on Aug. 5 was $8,483. The penalty was Texas’s share from a multi-state targeted market conduct examination of Principal Life Insurance Company, Principal National Life and Principal Life of Iowa. The total penalty allocated among participating states was $145,000, a sum the companies agreed without admitting liability. The joint team of regulators had concerns about the adequacy of the companies’ policies and procedures for handling claims and using of the Social Security Death Master File to identify owners and beneficiaries of unclaimed proceeds. States leading the examination were Florida, North Dakota, California, Pennsylvania and New Hampshire.
PEOPLE
W.R. Berkley Corp. announced Oct. 30 that it has named Thomas Joyce to succeed Thomas Kuzma as president of Nautilus Insurance Group, a Berkley company. Joyce will transition to his new role on Jan. 1, 2021. Kuzma has been named chairman. Joyce joined Nautilus as senior vice president of claims in 2015 and was named chief underwriting officer in 2018 and executive vice president in 2020. He has more than 35 years of experience in the insurance industry in various technical and leadership roles, with a focus in the excess and surplus lines market. Kuzma joined Nautilus as an underwriter in 1986, its inaugural year. As the company grew, he took on more responsibilities in underwriting management, becoming chief underwriting officer in 1994 and president in 1997. In September, W.R. Berkley named Timothy J. Nelligan as president of Continental Western Group, a Berkley company that offers commercial insurance products for businesses in 13 states.
MEETINGS/EDUCATION
The Dallas-Fort Worth Chapter of the National African-American Insurance Association held a lunchtime webinar on Oct. 22 on autonomous vehicles. Paul Jones, Liberty Mutual, moderated the virtual panel. Jillian Slyfield, managing director and digital economy practice leader for Aon, and Jim Lord, futurist consultant, were the panelists. Lord said the future of automated driving will eventually benefit fuel efficiency, as stop signs could be removed; interconnections of networks will allow vehicles to cross each other efficiently, “things that would scare a human driver.” Slyfield pointed out that insurance facilitates most new business models but is sometimes slowed by the regulatory process it must adhere to. Visit NAAIADFW.org to register for future webinars.
RECEIVERSHIP
A Travis County, Texas, judge on Oct. 21 approved an order placing a Houston-based nonstandard auto insurer into receivership. Travis County District Judge Tim Sulak signed the application by the Texas Department of Insurance to appoint a rehabilitator and place ACCC Insurance Company into rehabilitation. The order stipulates that the company has not been found to be insolvent nor is it an order of liquidation. Instead, the order warns that ACCC “is in a condition such that further transaction of its business would be hazardous financially to its policyholders, creditors, or the public.” Privately held ACCC offers its insurance products in Texas, as well as Alabama, Georgia, Mississippi, New Mexico, and South Carolina. ACCC agreed to the rehabilitation order, and the Texas insurance commissioner was named rehabilitator. Prime Tempus Inc. and Craig A. Koenig of Dripping Springs, Texas, were appointed as special deputy receivers.
COVID-19
According to an Oct. 21 report by Reuters, six insurers have dropped their appeal against a London High Court ruling that they were wrong to reject claims from holders of business interruption policies, but only with respect to three of the five insureds. A spokesperson for RSA Insurance Group, one of the largest of the six insurers, said it would work with broker Marsh to make interim payments where appropriate. This resolution was called a “huge win for large portions of the UK’s business community,” said attorney Sonia Campbell, whose firm Mishcon de Reye represents the Hospitality Insurance Group Action.
According to several published reports, a Durham County, North Carolina, judge handed down a ruling favoring policyholders in a COVID-19 business interruption lawsuit. The ruling that was made on Oct. 7 found the closure orders that restricted use of the plaintiffs’ restaurants in Raleigh-Durham constituted a “direct physical loss” that was covered by the policy. Judge Orlando F. Hudson said Cincinnati Insurance Company was improperly equating “physical loss” with “physical damage,” rendering invalid the company’s position that the coverage trigger required physical alteration of the property. Calling the language ambiguous, Hudson ruled for the plaintiff restaurants. The insurer plans to appeal the ruling.
Rep. Joseph Moody, D-El Paso, pre-filed House Bill 386 on Nov. 12 to create a presumption that nurses who acquired COVID-19 on or after Feb. 1, resulting in a disability or death, are presumed to have contracted the virus in the course and scope of their employment. Eligible nurses are those who treated COVID-19 patients or performed duties that required them to come into contact with infected patients. If passed into law, the measure becomes effective Sept. 1, 2021.
The Texas Workers’ Compensation Research and Evaluation Group released the results of its data call of 66 selected insurance carriers who write workers’ compensation coverage in the state. Among the key findings: Total number of claims reported to DWC from January to August 2020 was about 22 percent higher than the same period in 2019. As of Sept. 27, insurance carriers reported more than 25,000 COVID-19 claims and 200 fatalities. Most claims and fatalities involve first responders and correctional officers/prison workers. Most benefits paid were indemnity benefits. Despite denying 1,633 coronavirus claims, there were only five disputes filed as of Sept. 27. The full six-page report is available on TDI’s website.