In Parker and Parker v National Farmers Union Mutual Insurance Society Ltd [2012] EWHC 2156 (Comm), the High Court held that the Defendant insurers, National Farmers Union (NFU), could not avoid the claim of the First Claimant, Mrs. Parker, for the non-disclosure of the Second Claimant, Mr. Parker. The claim related to damage caused to a property and its contents by fire. …
Read More UK: Breach of a Condition Precedent Sufficient for Defendant Insurer to Avoid a Claim and Successfully Counterclaim

PHYSICIAN GROUPS PROPOSE PERMANENT “DOC FIX”
In an October 15 letter, the American Medical Association (AMA) and more than 100 other medical societies and physicians’ organizations urged Congress to consider a permanent replacement for the Medicare physician payment system. Under the Sustainable Growth Rate (SGR) formula used for Medicare Fee Schedule payments, doctors’ reimbursements for services are scheduled to be cut by 27% as of January 1, 2013. …
Read More Healthcare Update: Physician Groups Propose Permanent “Doc Fix”; HIPAA/HITECH Enforcement Expected to Increase in 2013

On October 17, the SEC filed a lawsuit in the Southern District of New York against hedge fund Yorkville Advisors LLC, as well as its President Mark Angelo and CFO Edward Schinik.  The action, brought by the SEC’s Asset Management Unit, is the latest alleged fraud brought to light by its “Aberrational Performance Inquiry,” which uses risk analytics to identify returns from hedge funds that appear to be too good to be true. …
Read More SEC’s Asset Management Unit Continues to Probe Valuation Methods of Hedge Funds with Latest Case Against Yorkville

Richard McCarthy and Eric Hermanson, attorneys in Edwards Wildman’s Insurance and Reinsurance Department, discussed the ramifications of the Stringfellow ruling in Law360. In the article, “Insurers See Ways Around Calif.’s Landmark Stacking Ruling,” Hermanson commented that the Stringfellow ruling was based on a fairly close reading by the California Supreme Court of the language in the 1966 [standard policy] form and that the Stringfellow holding will not apply automatically to alternate policy language, such as was in effect after 1986. …
Read More Edwards Wildman’s Richard McCarthy and Eric Hermanson Discuss Impact of Stringfellow Ruling in Law360

We previously reported on AB 999. This bill revises the premium rate development process for long-term care insurance in order to address the dissatisfaction of policyholders with rate increases on in-force coverage.
Read More California Insurance Commissioner Dave Jones Has Sponsored Seven Bills That Have Been Enacted and Will Become Effective on January 1, 2013

Financial lines insurers may want to take a closer look at revenue-sharing agreements between pension plan administrators and the mutual funds they offer plan participants as investment options, in the wake of a Connecticut federal court’s decision to certify a class action against ING Life Insurance & Annuity Company. …
Read More Alleged Mutual Fund Kickback Case Allowed to Proceed as Class Action

As the Financial Stability Oversight Council continues its process for designating systemically important financial institutions (SIFIs) (see our previous blog on this topic here), the International Association of Insurance Supervisors (IAIS) has released its policy measures for global systemically important insurers, or G-SIIs. …
Read More IAIS Seeks Public Comment on G-SII Proposed Policies

A New York State trial court recently dismissed claims by the holders of variable life insurance policies, some of whose excess cash value was invested with Bernard Madoff’s securities firm, against various investment advisors and hedge fund managers.  The decision is SSR II, LLC v. John Hancock Life Insurance Company, et al., No. 652793/2011 (N.Y. Sup. Ct. – N.Y. Co. – Sept. 28, 2012). …
Read More New York Court Dismisses Madoff Claim Against Investment Advisors & Fund Managers

On Thursday, October 18, 2012, the Financial Stability Oversight Council (FSOC) will meet in a closed session. At this meeting FSOC will continue its consideration of nonbank firms that might be designated as systemically important financial institutions (nonbank SIFIs).  For the posting on the Treasury Department’s website about Thursday’s meeting click here. …
Read More FSOC To Hold Another Closed-Session Meeting; Appears Close to Designating First Set of Non-Bank SIFIs

D&O and E&O carriers alike will want to keep a close eye on the US Supreme Court this term.  On September 25, the court accepted the matter of Gabelli v. SEC, No. 11-1274.  Another market-timing case against investment advisors, at issue in Gabelli is when a claim accrues under the 5-year statute of limitations for SEC enforcement actions. …
Read More Market Timing Case Goes to U.S. Supreme Court