The issues of contingent commissions and producer compensation disclosure has reached the forefront of New York regulatory law, as the Supreme Court of New York, Appellate Division, First Department recently ruled in favor of the insurance industry in the matter of People v. Liberty Mut. Ins. Co.
Insurers Questioned On Use Of Rate Model Assuming Increase in Weather Related Catastrophes
By Troutman Pepper Locke on
According to the Insurance Information Institute, the cost of homeowners insurance along the East and Gulf coasts has increased by as much as 100% since 2004. The Wall Street Journal (WSJ) recently reported that regulators and other critics contend that this increase in premiums is due in part to insurers’ use of a “computerized catastrophe model” that assumes climate change resulting in more frequent and more severe hurricanes.
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SEC Proposes a New Rule to Regulate Indexed Annuities
By Troutman Pepper Locke on
On June 26, 2008, the Securities and Exchange Commission (“SEC”) published proposed Rules 151A and 12h-7 (“Proposed Rules”). The Proposed Rules, if adopted, would clarify the status of indexed annuities (i.e. annuities for which payments to the purchaser are dependent on performance of a securities index) under the federal securities laws, and would provide insurance companies an exemption from reporting requirements under the Securities Exchange Act of 1934 (“Exchange Act”) with respect to such annuities and certain other securities issued by insurance companies that are registered under the Securities Act of 1933 (“Securities Act”) and regulated as insurance under state law.
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New York State Considering Resurrection of the Insurance Exchange
By Troutman Pepper Locke on
Twenty one years after the New York Insurance Exchange Commission (the “Exchange”) closed its doors for trading, New York State officials have begun to consider reviving this unique market. The Exchange was created in 1979 with the enactment of Regulations 89, 89-A and 89-B. …
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Update on New York’s Proposed Change in Collateral Requirements on Foreign and Alien Reinsurers
By Troutman Pepper Locke on
In October, www.insurereinsure.com reported on a regulation being proposed by New York Superintendent of Insurance Eric Dinallo that would eliminate the existing collateral requirements imposed on foreign and alien reinsurers operating in New York (click here to view prior post).
Bermuda: The Association of Bermuda Insurers and Reinsurers (ABIR) and the Bermuda Insurance and Reinsurance Brokers Association (BIRBA) Announce the Adoption of a Contract Certainty Code (the Code)
By Troutman Pepper Locke on
The Code requires ABIR’s and BIRBA’s members to provide certainty in coverage terms and conditions to both policyholders and ceding insurers.
UK: FSA Update on Firms’ Progress Towards Achieving the Outcomes of Treating Customers Fairly
By Troutman Pepper Locke on
Posted in Regulatory, United Kingdom
The FSA has published an update on firms’ progress toward meeting the December 2008 deadline of the Treating Customers Fairly initiative (TCF). The initiative is part of the FSA’s move towards principles based regulation and seeks to encourage firms to change their behaviour toward customers. …
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Second Circuit: Dismissal of Claims Against Individual Defendants for Failure to Plead Scienter Does Not Preclude Claims Against Corporate Defendants
By Troutman Pepper Locke on
Posted in D&O Liability, United States
The United States Court of Appeals for the Second Circuit recently dismissed a securities class action against Dynex Capital Inc. (“Dynex”) and its subsidiary, Merit Securities Corp. (“Merit”), because the plaintiff had failed to allege the requisite scienter. …
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UK Insurance Contract Law Reform: Lloyd’s/Institute of International Shipping & Trade Law Symposium
By Troutman Pepper Locke on
Posted in Regulatory, United Kingdom
On 3 July 2008 Helen Clark attended the Institute of International Shipping & Trade Law Symposium on the prospective reform of marine and commercial insurance held at Lloyd’s. The Symposium provided an opportunity for further debate of the Law Commission’s proposals (contained in Consultation Paper 1) for the reform of English law on misrepresentation and non-disclosure, breach of warranty and the role of intermediaries pre-contract, with an emphasis upon business rather than consumer insurance.
California State Court of Appeal Holds That Demand Letter Was A “Claim” That The Insured Was Required To Report Under Its Insurance Policy
By Troutman Pepper Locke on
A California state court of appeals recently held that an insurer properly denied coverage after its insured failed to timely report a “claim” after receiving a demand letter.