Insurance Law Hawaii

Hawaii to Benefit from Settlement Against Travelers in Florida Suit

     The Associated Press reports that Hawaii will receive a portion of a $6 million settlement against Travelers Co., Inc, to settle a suit filed in Florida, alleging Travelers conspired with brokers to submit fake bids for coverage even though the brokers had already determined which insurer would provide coverage for a policyholder.  Travelers allegedly paid contingent commissions to the brokers in exchange for funneling business to Travelers, never disclosing the commissions to the policyholders.  The suit alleged that the contingent commissions amounted to kickbacks that resulted in higher prices charged to policyholders.  Hawaii was one of ten states involved in the litigation.

Insurance Fraud

While not exactly an insurance coverage case per se, the Intermediate Court of Appeals just came out with a new decision on jury instructions in a criminal insurance fraud case.  See State v. Watanabe, No. 26777 (December 31, 2007).  In short, an individual damaged his own car and attempted to file a vandalism claim against AIG.  AIG representatives became suspicious when they noted the systematic nature of the damage and the fact that some of the damaged areas appeared to be rusted (indicating the damaged had occurred previously). 

This case is a good reminder that insurance fraud is theft and will be treated accordingly.

Insurance Fraud

     While not exactly an insurance coverage case per se, the Intermediate Court of Appeals just came out with a new decision on jury instructions in a criminal insurance fraud case.  See State v. Watanabe, No. 26777 (December 31, 2007).  In short, an individual damaged his own car and attempted to file a vandalism claim against AIG.  AIG representatives became suspicious when they noted the systematic nature of the damage and the fact that some of the damaged areas appeared to be rusted (indicating the damaged had occurred previously). 

     This case is a good reminder that insurance fraud is theft and will be treated accordingly.

Reinsurance Rates Fall

     Reuters reports today that the cost of reinsurance has fallen due to another relatively disaster-free year.  Rates for property catastrophe reinsurance, which typically cover hurricanes and earthquakes, are down 9 percent.  The U.S. subprime mortgage market crises has not impacted reinsurers.

     The lack of natural disasters have allowed reinsurers to obtain large profits for the second year in a row, and the pressure to cut prices has intensified.

     The Reinsurance rates are important to consumers because they have a major influence on the cost of insurance at the local level. 

Top Ten Insurance Stories of 2007

     The Insurance Journal has identified the top ten insurance stories of 2007.  We addressed some of the topics in this Blog, including climate change, hurricane coverage, and the recent passage of Terrorist Risk Insurance Program Reauthorization Act of 2007.