Category(s): Connecticut - 10/01/2011

On September 23, 2011, the head of the Connecticut Insurance Department (the "CID"), Commissioner Thomas Leonardi, announced the signing of a memorandum of understanding ("MoU") with the Swiss Financial Market Supervisory Authority ("FINMA"), the governmental body responsible for financial regulation in Switzerland.  Under the MoU, the CID and FINMA may request assistance from one another, including obtaining information on regulated companies and individuals.

In announcing the MoU, Commissioner Leonardi stated, "The insurance industry is an international one and continues to expand its global reach.  Regulating it cannot stop at the border and must be looked at in its totality.  This commitment will allow Connecticut and Swiss regulators to work effectively together and ensure market stability for consumer protection."  To view the press release, click here.

Commissioner Leonardi indicated that the CID is party to a similar cooperation agreement with Dutch regulators, that it has a similar agreement pending with German regulators, and that it has applied to be a signatory to the International Association of Insurance Supervisors Multilateral Memorandum of Understanding on Cooperation and Information Exchange, which currently includes 17 non-U.S. jurisdictions.

Michael T. Griffin, Esq. - ACCEL LAW GROUP P.C., (860) 761-8550 , mgriffin@accelcompliance.com

Category(s): Florida - 10/01/2011

During a two-day meeting on August 17-18, 2011, the Florida Commission on Hurricane Loss Projection Methodology ("FCHLPM") approved a revised version of the Florida Public Hurricane Loss Model Version 4.1, agreeing that it met all of the FCHLPM's 2009 Standards to Determine Acceptability.  The Public Model’s initial submission had not been approved, inasmuch as it was riddled with typographical errors, including mislabeled tables, incorrect page numbers and miscalculations.  During the meeting, the FCHLPM also conducted a review of the six Standards, which include lengthy, technical and highly detailed requirements for evaluating hurricane models.  To view the complete meeting summary click here.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 10/01/2011

The Florida Workers' Compensation Joint Underwriting Association Board of Governors met on September 27, 2011, during which it unanimously approved a 9.7 percent overall average premium decrease for new and renewal business.  The decrease, which will be effective January 1, 2012, will be adjusted to reflect any approved voluntary market rate level and class relativity changes that may become effective January 1.

Fred E. Karlinsky, Esq. - GREENBERG TRAURIG, P.A., (954) 768-8278 , karlinskyf@gtlaw.com

Category(s): Florida - 10/01/2011

In State Farm Mutual Automobile Ins. Co. v. Gilda Menendez, SC10-116 (August 25, 2011), the Supreme Court of Florida held in favor of State Farm Insurance Company on the question of "whether the household exclusion barring coverage for 'any bodily injury to' 'any insured or any member of an insured's family residing in the insured's household' unambiguously eliminates coverage for bodily injuries suffered by the members of the household of a permissive-driver insured." The opinion is a victory for the insurance industry, inasmuch as it adds stability to the interpretation of clearly defined policy terms and maintains the bounds of coverage agreed to by insureds.

Richard J. Fidei, Esq. - GREENBERG TRAURIG LLP, (954) 592-5530

Category(s): Georgia - 10/01/2011

On September 12, 2011, Georgia’s Commissioner of Insurance issued Insurance Bulletin 11-EX-3 (the “Bulletin”) in order to outline nationwide regulatory changes affecting the placement of nonadmitted insurance in Georgia, which was occasioned by the passage of the Nonadmitted and Reinsurance Reform Act of 2010 (the “NRRA”), which became effective on July 21, 2011. One of the purposes of the Bulletin was to make clear that the NRRA did not have any impact on the scope of the types of insurance products that an insurer may write on a nonadmitted basis in Georgia, which remain unchanged. The Bulletin also explains how an insured’s “home state’ is determined for purposes of premium tax allocation, the allocation methodology when a surplus lines insurance policy covers risks or exposures located or to be performed inside and outside of the state, changes to the diligent search requirements of a surplus lines insurance broker before procuring insurance on a surplus lines basis and the preemptive nature of the NRRA’s restrictions on the ability of states to place eligibility requirements on nonadmitted insurers.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com
William M Osterbrock, Esq. - Locke, Lord, Bissell & Liddell, LLP, wosterbrock@lockelord.com

Category(s): Georgia - 10/01/2011

On September 13, 2011, the Georgia Court of Appeals affirmed the grant of summary judgment in favor of the defendant-insurance company in a lawsuit involving the classification of the plaintiff-insured’s injuries under a disability income insurance policy. In this case, the plaintiff sued the defendant when it refused to reclassify the plaintiff’s total disability from a “total disability due to illness” to “total due to accident,” which provided the plaintiff with a longer benefit period. In this case, the plaintiff, an orthopaedic and hand surgeon, filed a claim for total disability coverage after being diagnosed in 2003 with bilateral basal osteoarthritis of the thumbs and not being able to perform surgeries. While out on disability and recovering from multiple surgeries performed on his thumbs, the plaintiff slipped and fell in 2004, further damaging his right wrist and quashing his hopes to return to work. The plaintiff contacted the defendant, requesting that his disability be reclassified to total disability due on injury; however, after obtaining an independent medical exam which concluded that the plaintiff’s impairment was only 35% due to the wrist injury and 65% due to the prior thumb condition and subsequent surgical procedures, the defendant denied the plaintiff’s request. The Court of Appeals upheld the trial court’s decision to grant summary judgment to the insurance carrier, finding that the plain meaning of the policy which stated that “total disability caused or contributed to by sickness or disease will not be considered accident total disability” precluded the plaintiff’s claim that the defendant should have reclassified his injuries.

Brian T. Casey, Esq. - LOCKE LORD LLP, (404) 870-4638 , bcasey@lockelord.com
William M Osterbrock, Esq. - Locke, Lord, Bissell & Liddell, LLP, wosterbrock@lockelord.com

Category(s): Louisiana - 10/01/2011

A Baton Rouge Judge has refused to issue an injunction to stop the State of Louisiana from entering into contracts with three private insurance companies to provide healthcare management services for Medicaid recipients, but a different judge has ordered that the proposals submitted by the companies bidding on the project must be made public.

The state contracts farm out the management of healthcare services for approximately 800,000 Medicaid recipients to the private companies. Aetna Better Health, Inc., filed a lawsuit against the state, alleging that there were errors in the state procurement process by which the contracts were bid. Aetna sought an injunction to block the execution of the contracts with the private companies, arguing that it would be irreparably harmed by the action.

Aetna, Coventry Health Care of Louisiana, AmeriGroup Louisiana, Inc., AmeriHealth Mercy of Louisiana, Inc., and Louisiana Healthcare Connections all submitted proposals for the various state contracts in the bid process and were all awarded contracts. Aetna and Coventry, however, were not chosen to participate with the other three private companies in one certain contract dealing with coordinated-care networks.

After the decision, the Jindal administration has indicated it plans to move forward with the state contracts and intends to start the new program early next year.

Van R. Mayhall, III - Investar Bank, (225) 227-2309 , van.mayhall@investarbank.com

Category(s): Nevada - 10/01/2011

On September 13, 2011, the Third Judicial District Court of Salt Lake County, State of Utah, entered a liquidation order and declaration of insolvency against former Nevada domiciled insurer Western Insurance Company.  Western Insurance Company was formed and domiciled in Nevada in 1994 by former Nevada Insurance Commissioner Dick L. Rottman.  Former Nevada Insurance Commissioner Alice Molasky-Arman was an officer of the company but resigned just after the company was re-domiciled on December 1, 2010.

Vernon E. Leverty, Esq. - LEVERTY & ASSOCIATES LAW, (775) 322-6636 , Gene@levertylaw.com

Category(s): Nevada - 10/01/2011

On August 24, 2011, the Nevada Supreme Court amended its prior holding in Powell v. Liberty Mutual Fire Ins. Co., 252 P.3d 668; 2011 Nev. LEXIS 15; 125 Nev. Adv. Rep. 14.  The Court maintained its prior holding that insurers who wish to limit coverage as to earth movement must specifically identify those actions for which no coverage exists, or provide a list of the kinds of earth movements for which no coverage exists, including both natural and man-made movement.

Vernon E. Leverty, Esq. - LEVERTY & ASSOCIATES LAW, (775) 322-6636 , Gene@levertylaw.com

Category(s): Tennessee - 10/01/2011

Tennessee Commissioner of Commerce and Insurance Julie Mix McPeak has named former Morgan Keegan & Co. executive Michael Corbett as the Insurance Division's new Captive Director to coordinate with companies seeking to establish or redomesticate a captive under the recently enacted Revised Tennessee Captive Insurance Act.  Two new captives have already been licensed in Tennessee under the new law, which became fully effective on September 1.

T. Stephen C. Taylor, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-7758 , staylor@bassberry.com
Robins H. Ledyard, Esq. - BASS, BERRY & SIMS, PLC, (615) 742-6259