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The World of Insurance
—Today’s Hot topics
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(l to r) Richard Ramsay (America’s Health Insurance Plans), John Mangan (American Council of Life Insurers) and Eric Goldberg (American Insurance Association) provide insight on the current issues facing the P&C and L&H insurance industries. |
Insurance professionals recognize AIA, ACLI, and AHIP as more than alphabet soup. They packed the panel discussion to hear from these professional associations. The speakers effectively covered all major product lines within the industry and made significant predictions for the future. Meet the panel:
- Eric Goldberg, associate general counsel and manager of state programs for the American Insurance Association (AIA),
- John Mangan, regional vice president of state relations for the American Council of Life Insurers (ACLI), and
- Rick Ramsay, vice president of state advocacy for American’s Health Insurance Plans (AHIP).
Here’s what the experts shared in terms of what’s hot, what’s merely warm and what’s about to boil…
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As associate general counsel & manager, state programs for the American Insurance Association, Eric Goldberg provides attendees with those issues on AIA’s radar screen. |
Hot topics from the American Insurance Association (AIA)
Eric Goldberg kicked things off with an impressive presentation reviewing the multiple topics with which the AIA is currently working, including:
- National Catastrophe Insurance—and the importance of advocating a coastal regulatory agenda while blocking efforts to socialize insurance products;
- Terrorism Insurance—and the advocacy for the enactment of a new federal terrorism insurance program (of special interest, Eric noted that terrorism is NOT an exclusion on many fire insurance policies);
- Regulatory reform—and the need to support optional federal chartering, while working against punitive legislation;
- Credit based insurance scoring—and the need to work to define insurance pricing;
- Legal reform—an ongoing issue in the insurance industry as work continues to block efforts to reverse tort reforms, while emphasizing the sanctity of the contract;
- Auto insurance—and the work of seeking auto insurance rating and market reforms in target states;
- Taxation—working to defeat federal and state revenue-raising proposals that target P & C insurers, and
- Worker’s compensation—as above, seeking meaningful reform in target states.
Click here to see Mr. Goldberg’s presentation.
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John Mangan, regional vice president, American Council of Life Insurers, discusses that the future isn’t what it used to be when it comes to life expectancy. |
Hot topics from the American Council of Life Insurers (ACLI)
John Mangan took the stage next to review the equally challenging life product line. He reviewed what the ACLI is working on, after framing his presentation with the notion that the future isn’t what it used to be. His framing remarks focused changing demographics and how they are shifting the way life insurance companies do business. He noted that today’s consumer has moved the life product focus away from protecting assets and loved ones against financial loss brought about by death (especially premature death) to addressing the current concern of many baby-boomers of outliving financial assets. Conversely, despite this expressed concern that’s causing a major shift in the industry from life insurance to annuities, Americans are spending money as fast as they can.
With his frame of reference in place, Mangan reviewed hot topics from the ACLI perspective that included:
- The critical importance of product suitability and the sister issue of improved consumer education;
- Issues involving seniors, especially concerns of predatory or unethical marketing tactics and stranger-initiated life insurance (STOLI), a scam that has the potential to bankrupt the industry;
- Regulatory issues that include modernization and the general notion of overall uniformity;
- The need to work with other organizations and state regulators on suitability of annuities;
- Supporting uniform-regulation initiatives;
- Advocating the concept of the optional federal charter, which worked well (conceptually) in the banking industry, and
- Working to address the issues surrounding risk classification, litigation reform, international accounting standards and terrorism risk reinsurance.
Click here to see Mr. Mangan’s presentation.
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Richard Ramsay, vice president, state advocacy for America’s Health Insurance Plans, explains that a major hurdle for our industry, and the nation, is to expand healthcare to the uninsured. |
Hot Topics from American’s Health Insurance Plans (AHIP)
Rick Ramsey focused on the health product line and was able to detail issues by state, to the amazement of participants. His office focuses exclusively on state issues—no small task—as he pointed out that approximately 13,000 pieces of health insurance legislation is being monitored in the 50 states. From that array, he was able to articulate these broad-based hot topics:
- Access—how to expand to the uninsured
Ramsey pointed out specific state-by-state variations of activity on this topic. Expanded access options range from Rhode Island’s plan that provides ways for employees to purchase health insurance to states who merely punted the topic to study and bring back in 2008.
- Market reform
Reviewing the market reform imitative, Ramsey again managed a state-by-state roll call of what’s hot where. In general, market reform initiatives are looking at rating practices, loss rations, high-risk pools, the concept of “groups of one,” group size, dependent coverage expansion, state health plans and tax credits. On a high note, he pointed out the expansion of bonuses for wellness programs.
- Industry conduct
Focusing on the industry for a moment, Ramsey discussed industry conduct as a hot topic focusing on state-oriented issues that included discount medical plans, coordination of benefits, Medicaid coordination, market conduct exams and bad faith claims.
- Provider Contracting & Network Issues
Again, in a state-specific overview, Ramsey reviewed provider contracting and network issues. What does he see as trending issues? Standardization of provider contracts, silent PPOs and network rental, retroactive payment issues and assignment of benefits.
Click here to see Mr. Ramsay’s presentation.
Just around the corner—2008
While no one can accurately predict the future, all panelists agreed that free market enterprise is the best regulator and that stakeholders in the industry all come together wanting to do their job and do what’s right for the consumer. The best bet for the future? 2008 may prove to be a year of change within the industry. How best to achieve those reforms? Get industry stakeholders together; come to the table to identify issues and propose winning solutions.
Hot topic wrap
Is the insurance industry burning? No, but it is heating up as these issues continue to occupy the minds of industry professionals, regulators and consumers. Every industry has issues to wrestle. However, the insurance industry, working in concert with national trade associations and state regulators, has a tradition of getting out in front of issues with education, communication, advocacy and best practices to ensure the protection of the consumer and the free-trade activity of the market.
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Marty Fisher, principal of Martha Fisher & Associates, moderates the state trades panel. |
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