Jimbo the Clown never got the memo that Louisiana Citizens Insurance is insolvent. A Captured Regulator Update.

Louisiana Insurance Commish Jim Donelon

A dimmer bulb has never flickered in the Louisiana DOI folks.

Donelon said he took off another 2.3 percent because it was excessive and served to build the company’s capital and reserves.

“They don’t need to be building reserves” with rates, Donelon said. He said other fees help Citizens remain solvent.

Reserves????  Didn’t you mean the almost billion dollar deficit Jimbo? A common clown may well be able to fool the big business lackey/buffoons over at the Wall Street Journal editorial board but the numbers don’t lie and convey the ugly truth about Louisiana’s corrupt, special interest ridden insurer of last resort.

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Bad Faith Insurers Safeco (Liberty Mutual) and Republic coming to scam coast residents.

Courtesy of Mr Liberty Mutual: http://mrlibertymutual.com/

Yesterday Mississippi Insurance Commissioner Mike Chaney was on cloud 9 floating over lala land as exhibited by his WLOX interview which covered the subjects of mitigation grants and Safeco.  From the interview it is clear he is sticking to his meme that he can foster competition in a small market in an industry with an anti trust exemption (the kool-aid the state republican leadership drinks must be powerful stuff). Our long time readers will no doubt remember Mr Chaney as the man whose State Farm Market Conduct examiner found massive evidence of wind claims dumping and bad faith claims practices in the sample results  while Mr Chaney ignored all that and attacked the two courageous women that exposed the practices (The analysis of the MID Market Conduct study by retired World Bank analyst turned law student James Barbieri is found beginning on page 10 of his thesis). Long suffering coast residents are not buying in as evidenced by the comments to Anita Lee’s coverage of Mr Chaney’s announcement and it is there we begin:

Safeco Insurance plans to offer wind coverage again, Mississippi Insurance Commissioner Mike Chaney said Monday morning.

The company will offer 500 to 1,000 homeowner policies with wind coverage, he said, beginning in mid-March.

“They’re going to be selective about who they write, but I’m assuming as long as there’s not a credit risk involved, they’re not going to have any real restrictions,” Chaney said. Some companies have restricted wind coverage to the northern three Coast counties, but stopped offering it to new customers or nonrenewed policyholders who live near shore.

In doing some basic googling I found where the insurance bastards at Liberty Mutual bought Safeco in 2008. As a Liberty Mutual insured found out the hard way after Katrina’s winds severely damaged his house those thugs will have you arrested for simply filing a claim! Here at Continue reading “Bad Faith Insurers Safeco (Liberty Mutual) and Republic coming to scam coast residents.”

BREAKING: The Farm sells Mississippi again. Well not quite all of Mississippi….

James Edwards Bates / The Sun Herald
James Edwards Bates / The Sun Herald. Mike Chaney pals around with State Farm claims employees

I see the coast is still being punished by the Farm and their boy Mike Chaney. I don’t think I’ll ever insure another home with a company that employs exclusive agents and highly recommend Chip Merlin’s post that Nowdy highlighted today on getting exactly what you pay for. Anita Lee has the story for the Sun Herald:

State Farm Fire and Casualty Co. will begin writing new business again in Mississippi, spokesman David Majors said Tuesday, but not in the lower three Coast counties.

State Farm has continued to serve existing policyholders, but stopped writing new business in the state because of the fractious legal and political climate after Hurricane Katrina. Continue reading “BREAKING: The Farm sells Mississippi again. Well not quite all of Mississippi….”

Familar Problems in Alabama’s X-Wind Homeowners Insurance Market

The first week of April, Jeff Amy at the Mobile Press Register authored an excellent story on the coastal X-wind HO market in Alabama. His story, unlike our coverage of it, is very timely. However, unlike justice delayed, Mr Amy’s piece has gotten better with time. The reason for that also explains my detour back to November 29, 2006 and the deposition of State Farm Senior Vice President Mr Robert Trippel, an otherwise useless character who still managed to provide some enlightening commentary when he was deposed in Watkins v State Farm about several Katrina related matters. While the meat of Mr Trippel’s depo is dedicated post on its own he had a few things to say about X-Wind policies in his zone, which includes Mississippi and Alabama so it is on page 103 of his deposition that we begin as the Watkins lawyer Jeff Marr questions Mr Trippel:

Q All right, Mr. Trippel, after you identified — what are these called, initiatives, is that what we’d call them — in these different states these things that are being conducted, what are they called?

A I would say it’s the new underwriting guidelines.

Q Okay. And you covered Mississippi and Georgia. Which state is next? What’s another state in this zone that’s been affected by the change of underwriting guidelines following Katrina?

A Alabama.

Q How has Alabama’s underwriting guidelines been changed following Katrina?

A Very similar with a mile setback off the coast and hurricane deductibles for new business.

Q Okay. So similar to Mississippi in that new business is only a mile off the coast, correct? Is that correct?

A Correct.

Q And then the wind hurricane — excuse me, hurricane deductible is now 2 percent to 5 percent?

A Correct.

Q Any others?

A No.

Mr Marr, like Nowdy and I must have been scratching his head wondering what skills besides the ability to recite the company line Mr Trippel brought to his very senior position on the Farm. He certainly does not know the basics of insurance finance as we continue on the bottom of page 104: Continue reading “Familar Problems in Alabama’s X-Wind Homeowners Insurance Market”

The End Result of Regulatory Capture: Madoff and Another Bailout

I’ve been too busy too keep up with the news but the spectacular implosion of the Madoff hedge fund caught my attention if only because it serves up another great example of regulators being asleep at the switch at the US Securities and Exchange Commission instead of protecting the investing public from fraudsters such as Bernard Madoff.  From what I’ve read and heard Madoff’s so called investment bank was nothing more than ye ole Ponzi Scheme.  Even better the toothless watchdogs at the SEC looked at Madoff multiple times and found nothing wrong.

threewisemonkey

I’ve written about the problems with regulatory capture many times here on slabbed, from our own Mississippi Insurance Commissioner Mike Chaney to big problems at the SEC involving John Mack, CEO of Morgan Stanley.  The end result is never good for the public though Mr Mack’s $40 million dollar bonus must have been nice for him.

As for the group of very distinguished bagholders that resulted from Mr Madoff’s get rich quick Ponzi Scheme, they may just get a bailout according to this AP story carried by the Sun Herald.

A federal judge on Monday threw a lifesaver to investors who may have been duped in one of Wall Street’s biggest alleged frauds, saying they need the protection of a special government reserve fund set up to help investors at failed brokerage firms.

U.S. District Judge Louis L. Stanton ordered that clients of Bernard Madoff’s private investment business seek relief under a federal statute created to rescue cheated investors. Stanton also ordered that business be liquidated under the jurisdiction of a bankruptcy court and named attorney Irvin H. Picard as trustee to oversee that process. Continue reading “The End Result of Regulatory Capture: Madoff and Another Bailout”

Speaking of Socialism and Mississippi Republicans. An Open Letter to our Favorite Captured Regulator the Commish

Anita Lee is always good but today she is also heaven sent. It seems the Consumer Federation of America and United Policyholders have taken Mr Chaney to task for not doing a good job looking out for consumers. Duh! I guess we should be grateful he has finally gotten around to the fortified bunker program.

I guarantee Kevin Buckel and Amy Bach aren’t the only two people that our Commish feels free to ignore. IMHO Chaney and his staff were too busy leaking David Rossmiller info about the Market Conduct Study to bother with such trivialities.

In any event (and while we wait to hear what Mr Matthews and Company think of Mr Chaney and his Market Conduct Study) here is Anita Lee’s story about how consumers/voters need not apply for access to the Commish -he is simply too busy.

Mississippi Insurance Commissioner Mike Chaney needs to do a better job for consumers, two national organizations have concluded, but Chaney said Wednesday night that he he has “a full platter.” Continue reading “Speaking of Socialism and Mississippi Republicans. An Open Letter to our Favorite Captured Regulator the Commish”