house insurance

Amendment to transfer insurance guaranty funds causes furor

2011-10-29T17:59:00.000-07:00

ST. THOMAS - Senators attached a handful of unrelated amendments to a bill to reprogram Community Development Block Grant funds this week.

The bill was the last on Thursday's session agenda, and Senate President Ronald Russell allowed each senator to offer up to two unrelated amendments.

One amendment, offered by Sen. Carlton Dowe, caused a commotion on the Senate floor, with senators yelling across the room at each other and everyone talking at once.

It was voted down.

Then it was reconsidered, altered and approved.

The amendment as it was first offered would have transferred $40 million from the Insurance Guaranty Fund to the General Fund for general governmental use.

The Insurance Guaranty Fund collects premium taxes assessed to insurance companies that operate in the territory, and the money is available after a natural disaster if an insurance company cannot pay its claims and becomes insolvent. The fund is required by law to have a $50 million balance.

In 2007, legislation was passed to use $45 million from the fund to make retroactive wage increases owed to government workers. The legislation required a letter of credit to secure a loan if the money is needed before the fund replenishes itself. Once the Insurance Guaranty Fund is restored to $50 million, the letter of credit is canceled. If the credit line established by the letter should be needed, the V.I. Public Finance Authority would loan the money to the government.

Last year, the Public Finance Authority chose Banco Popular de Puerto Rico to secure the letter of credit. The loan was scheduled to mature in three years, with an option to extend it for three years.

The amendment initially offered Thursday would have extended the agreement further, until the Insurance Guaranty Fund is fully restored after the new appropriation.

As part of the transfer, $3 million would have been given to the territory's hospitals to pay outstanding V.I. Water and Power Authority bills. In addition, the amendment would have freed up prior appropriations for specific purposes - restricted funds - and unrestricted them so the hospitals could use the money however they need.

"These are some serious and critical times for our medical facilities, and I think we must do all we can to assist them at this time," Dowe said Thursday.

Several senators strongly opposed taking money from the Insurance Guaranty Fund and dumping it into the General Fund with no restrictions.

Sen. Nereida Rivera-O'Reilly was particularly vocal about making a $300,000 appropriation to Luis Hospital for a mammography machine unrestricted. She said it would rob the women of St. Croix of a much-needed tool to fight breast cancer.

After the amendment failed, Sen. Usie Richards motioned to reconsider the amendment with two measures removed from it - the $40 million transfer from the Insurance Guaranty Fund and maintaining the restriction on the $300,000 appropriation for the mammography machine.

The revised amendment was approved by the Senate in a 10-4 vote.

Sen. Craig Barshinger, Sen. Alicia Hansen, Sen. Neville James, Sen. Shawn-Michael Malone, Sen. Terrence Nelson, O'Reilly, Richards, Russell, Sen. Sammuel Sanes and Sen. Patrick Simeon Sprauve voted in favor.

Sen. Louis Hill, Dowe, Sen. Celestino White Sr. and Sen. Janette Millin Young voted against the revised measure. Sen. Alvin Williams Jr. was absent.

The revised amendment would allow the government to forgive any outstanding financial obligations for Schneider Hospital and Luis Hospital. It also would eliminate the line item budgets for both hospitals, giving the facilities more flexibility.

In addition, the revised amendment frees up a number of other appropriations to be used for general operations by Luis Hospital, including: $250,000 for the Luis Hospital Nursing School; the balance of $16,512 from a $200,000 appropriation to purchase a dialysis machine; and the balance of $1,134,818.63 from a $1.5 million appropriation to develop plans for renovations to the Luis emergency room.

Other amendments passed Thursday include:

- Reprogramming a prior $160,000 appropriation to the V.I. Education Department for the purchase of four vans - two for each district. The change would leave the department with $123,000 for the vans and $37,000 to purchase sports equipment in both districts.

- Reprogramming a prior appropriation of $40,000 to Public Works to construct public restrooms and benches in downtown Christiansted. The amendment shifts the funds to the V.I. Tourism Department to purchase mobile public restroom trailers.

- Fixing a mistake in the recently passed Legislative Youth Advisory Council legislation. The bill was sent to Government House with a line missing. It was signed into law by the governor, so an amendment had to be made to the law to fix the legislation.

- Restoring the V.I. Code to allow departments and agencies to spend up to $5,000 without going out to bid. A recent law reduced the limit to $1,000.

- Allowing rental car companies that have a lease with the V.I. Port Authority to give courtesy rides to customers between the vehicle drop off lot and the airport terminal.

- Changing the V.I. Code to ensure that all construction, repair and maintenance of public highways use certified temporary traffic control technicians who have been certified by the U.S. Department of Transportation.

- Correcting the parcel number on a piece of government property so the V.I. Housing Finance Authority can use the property to build new homes.

Crop insurance supplants subsidies in farm-bill proposal

2011-10-29T17:58:00.000-07:00

WASHINGTON -- The nation's farm subsidy payments will give way to an expanded crop insurance program under a bi-partisan plan that is expected to be submitted next week to the Congressional deficit committee, Minnesota Rep. Collin Peterson told the Minneapolis Star Tribune.

The proposal is part of an ongoing effort among Senate and House agriculture leaders to rewrite the nation's farm bill. The group has committed to trim $23 billion in agricultural spending over 10 years.

Roughly $15 billion in cuts will come from the elimination of direct-payment subsidies, said Peterson, a Democrat who serves as the ranking minority member of the House Agriculture Committee. The new payment program would pay farmers only for planted acres when prices plummet below certain thresholds.

"We're trying to reform this system," Peterson said. "We don't want to pay people when they don't need it, and we don't want to pay people when they aren't growing a crop."

The U.S. Department of Agriculture projects that current farm subsidies would cost $52 billion from 2008 to 2017. The subsidies are paid based on past plantings, not on current acres in production. The subsidies are paid regardless of commodity prices.

The newly proposed protections would apply only to planted acres and current crop prices, Peterson said. The plan would ensure that farmers can collect up to 90 percent of a preset value on their crops.

About $8 billion in other spending cuts would be absorbed by various conservation and nutrition programs, including food stamps.

The rewrite of the farm bill by agriculture committee members has occurred at relatively high speed and behind closed doors, a process which has drawn criticism from several groups. Among the most vocal is the Environmental Working Group, which complained that the agriculture committees did not hold public hearings to listen to groups and individuals affected by the legislation.

"It's a welcome development that direct payments are finally being eliminated," said Craig Cox, the Environmental Working Group's vice president for agriculture and natural resources. Still, he added, the new proposal is "troubling" development because "it looks like they're turning a safety net into a guaranteed income program."

Meanwhile, the Minnesota Farm Bureau had not been told about the plan Peterson outlined and referred questions to its parent group, the American Farm Bureau. "Our farmers would have preferred to continue the existing program," said Mary Kay Thatcher, the American Farm Bureau's director of congressional relations.

Still, Thatcher conceded that keeping the existing no-strings-attached subsidy program is nearly impossible at this point because of the program's lack of political support as pressure builds to reduce the deficit. The Farm Bureau has pushed for an insurance program that differed from the one Peterson described.

The details of any farm program that will go to the super committee are not yet final, Thatcher insisted.

The speed of the process has been extraordinary, but that isn't necessarily a bad thing, said congressional expert Norman Ornstein of the American Enterprise Institute.

"It is not like these are people who haven't thought about and debated these issues for years," Ornstein said. "The perversity of paying people not to plant crops makes change long overdue. And if you can get a bipartisan package to do anything at this point, it should be applauded."

Peterson said the agriculture committees did not establish the timetable.

"What's usually done in six months, we're doing in four weeks," Peterson acknowledged. "When I ran the (House agriculture) committee, we started off in subcommittees. That's the way it should be done. We did not set up this process. I didn't think the super committee was a good idea."

The super committee, composed of six senators and six representatives, was assembled after Congress struggled over deficit reduction and raising the debt ceiling. The group is supposed to come up with $1.2 trillion in federal budget cuts over the next 10 years and present them to the House and Senate by Nov. 23. Congress must act on the plan by year's end.

If the super committee fails to develop a budget plan or Congress doesn't pass it, automatic cuts to defense spending and social programs take effect.

Policy committees in the House and Senate are supposed to give detailed budget-cutting proposals to the super committee by Nov. 1. The House and Senate agriculture committees are likely to be the only ones that will come close to that deadline, Peterson said - "We should get credit."

Cox of the Environmental Working Group has no praise for the process.

"This is no democratic process at all," Cox said, "They're making major changes to policy to reach a budget number. They've gone way beyond what they should have."

Don't be a Hallowe'en insurance victim

2011-10-29T17:57:00.000-07:00

Hallowe'en is meant to be a bit of harmless fun, yet, according to insurance claims, it is the worst day of the year for malicious damage to your home.

Ten years of data from Aviva show a rise of 150pc in home damage claims, with damage to cars and car thefts rising by 50pc and 20pc respectively in the week between Hallowe'en and Bonfire Night.

Figures also show a 28pc increase in burglary claims on Guy Fawkes Night, making it the worst night of the year for break-ins.

Research conducted by the insurer found that the period October 30 to November 5 last year saw the number of reported burglaries rise by 26pc when compared with the weekly average for the rest of the year.

The combination of darker nights and a mischievous occasion such as Hallowe'en, or a noisy one such as Bonfire Night, presents an opportunity that is too good for criminals to resist – leaving homes and vehicles more at risk than any other time in the year.

The steepest rise in burglaries were in Strathclyde and Northamptonshire, where police saw increases of 57pc and 53pc respectively.

Rob Townend, property claims director at Aviva, said: "Shorter days present more opportunities for criminals to work under cover of darkness. On Bonfire Night in particular, many people are out of the house at public displays or at parties and the noise of fireworks provides a distraction and means that suspicious sounds such as smashing glass aren't heard."

Mr Townend said that theft and malicious damage are covered as standard by your home insurance if the worst does happen, but it is best to take steps to avoid having the worry of being a victim of crime in the first place.

While it may seem obvious, households should ensure that they lock their doors and windows, figures suggest otherwise. The Metropolitan Police said that more than 5,000 people were burgled last year because they did not lock their front doors. They said that most burglars are opportunistic – they look for an easy way to get in that will not take long or arouse suspicion, so many try the front door first.

Never leave a spare key concealed anywhere near the front door as thieves know hiding places. Similarly, prevent letterbox burglaries by storing keys away from the front door.

A building that presents itself as unoccupied and insecure is far more likely to be targeted than one which is properly secured, so if you are going out after dark, draw the curtains and leave some lights on.

When it comes to fireworks on Bonfire Night, bear in mind that letting off explosives in the dark close to valuable property in an increasingly litigious society is a risky activity. So it makes sense to consider who will pick up the bill if something goes wrong. Few of us read every page of the small print in our household insurance policies, but it is well worth checking that your plan covers personal liability claims, as householders can be held legally responsible if any of their guests or a neighbour is injured, or their property is damaged by a firework or bonfire.

However, check your household policy for a "duty of care" clause. If you do need to make a claim, some insurers may raise this aspect of the contract, and policyholders will need to prove they took proper precautions.

Claims may be affected, for instance, if a bonfire was built too close to the home. All fires should be at least 60ft away from houses, trees, hedges, fences and sheds.

You should also make sure you know exactly what the cover limits are on your policy. For example, Direct Line has an automatic cover level of £1m on its buildings policies. Any damage to a neighbour's property would be initially covered by his or her insurance, but if the neighbour could show that you had been negligent in causing the damage, Direct Line's liability cover would protect you up to the value of £2m.

Esure's home insurance includes £2m of cover for personal liability in every contents policy. Its buildings insurance will cover damage to outbuildings – such as sheds and summer houses – if your bonfire gets out of control, for example. Contents are covered up to £2,500.

Esure's home contents policies cover all garden contents up to a maximum £1,000 – so, should your garden furniture go up in flames if a gust of wind causes you to lose control of your bonfire, you would be covered.

What was the Washington Building?

2011-10-29T17:56:00.000-07:00

In the 1970s, I worked in the Washington Building at 15th and New York NW. Not until years later did I notice its frieze more carefully. It depicts various graphics that have me curious about the building’s original purpose and tenants. Was it ever a federal building or that of a national trade association? When recently in the area, I was surprised at how difficult it is to even find an open-to-the-public entrance.

There are many Washington buildings, but there is only one Washington Building. It opened in 1927 at a place its owners liked to call “The World Corner.” Fifteenth Street and New York Avenue NW, they claimed in a large display ad in The Washington Post, was an intersection of global importance.

“Indeed,” the ad trumpeted, “a great national weekly magazine states that more prominent people pass this corner than any other in the world. Its strategic location is as permanent as the Treasury, as vital as the White House.”

The building was designed by the Boston firm of Coolidge Shepley Bulfinch and Abbott. The design is “stylized Classical Revival,” with large, three-story arches and fluted piers. It is ringed by what Answer Man considers a rather subtle frieze, given the expanse of limestone it decorates.

The frieze is made up of a repeating series of individual circular bas-reliefs. Some are easily recognizable. There is a telephone, the kind with a separate mouthpiece (old-fashioned now but cutting-edge then). There is a sheaf of wheat. There is the head of a bull and a piece of lab equipment known as a retort. Other details include an hourglass, a lever, a torch atop an open book, and what appears to be an urn or possibly a pharmacist’s vessel.

Answer Man is pretty sure these had no connection to specific Washington Building tenants. Rather, they are generic industry/business/agriculture symbols representative of the sort of tenants that the building’s owners, Washington Central Trust, wanted to have.

Actual tenants included the Washington Stock Exchange and smaller brokerages (the building is in the city’s 15th Street Financial Historic District). Other tenants were Travelers Insurance, Gestetner Duplicator, Shell Eastern Petroleum Products and International Mercantile Marine, which sold steamship tickets from its frontage on G Street. The Studebaker Corp. had four rooms on the fourth floor, and the Chicago Daily News had offices on the fifth.

There was a Peoples Drug store, too, “so magnificently equipped that we take pardonable pride in announcing its opening,” the drug store noted in an ad.

On Dec. 31, 1927, the Restaurant Madrillon opened with four separate theme areas: the Spanish Village, the Mayan Room, the Moorish Room and the Caliph’s Room. The New Year’s Eve attractions included Johnny O’Donnell’s Madrillon Band, S tafford Pemberton’s dancers and master of ceremonies Orville Rennie. The Moorish Room boasted silk-draped bazaars and cross-legged rug sellers, not to mention veiled maidens in “softly flowing pantalooned transparencies.”

Sure beats a Potbelly Sandwich Shop.

According to The Post, the most “radical” office was that of the Postal Telegraph Cable. “In the place of the customary counter,” the paper noted, “there are beautifully designed desks at which customers can sit in large upholstered chairs while transacting business with the telegraph clerk.”

While most telegraph offices were crisscrossed with unsightly exposed pneumatic tubes, the tubes at the Washington Building were inlaid in the desk pedestals. The room was paneled in unstained white maple and birch, while the floor was made of rubber tile and marble inlaid with the large image of a gladiator holding a sword in one hand and the Postal Telegraph shield in the other.

Unfortunately, it was hard filling the 10-story building. The Post reported in December 1928 that many floors were still empty and unfinished. The owners were increasingly in debt, and the building was eventually put up for sale.

Currently, the lobby is under renovation and tenants enter from a door on 14th Street. Nearly the entire Washington Building is rented by Skadden, Arps, the ginormous law firm. Answer Man isn’t sure what design would best symbolize a lawyer.

Putting some energy into underwriting

2011-10-29T17:55:00.000-07:00

WASHINGTON — When you apply for a mortgage to buy a house, how often does the lender ask detailed questions about monthly energy costs or tell the appraiser to factor in the house's energy-efficiency features when coming up with a value?

Hardly ever. That's because the big three mortgage players — Fannie Mae, Freddie Mac and the Federal Housing Administration, who together account for more than 90 percent of all loan volume — typically don't consider energy costs in underwriting.

Yet utility bills can be larger annual cash drains than property taxes or insurance — key items in standard underwriting — and can seriously affect a family's ability to afford a house.

A new, bipartisan effort on Capitol Hill could change all this dramatically and for the first time put energy costs and savings squarely into standard mortgage-underwriting equations.

A bill introduced Oct. 20 would force the big three mortgage agencies to take account of energy costs in every loan they insure, guarantee or buy. It would also require them to instruct appraisers to adjust their property valuations upward when accurate data on energy-efficiency savings are available.

The SAVE Act (Sensible Accounting to Value Energy) is jointly sponsored by Sens. Michael Bennet, a Democrat from Colorado, and Johnny Isakson, a Republican from Georgia. Along with the traditional principal, interest, taxes and insurance (PITI) calculations, estimated energy-consumption expenses for the house would be included as a mandatory new underwriting factor.

For most houses that have not undergone independent energy audits, loan officers would be required to pull data from either previous utility bills — in the case of refinancings — or from a Department of Energy survey database to arrive at an estimated cost.

This amount would then be factored into the debt-to-income ratios that lenders already use to determine whether a borrower can afford the monthly costs of the mortgage. Allowable ratios would likely be adjusted to account for the new energy/utilities component.

For houses with significant energy-efficiency improvements already built in and documented with a professional audit such as a home-energy rating study, lenders would instruct appraisers to calculate the net present value of monthly energy savings — i.e., what that stream of future savings is worth today in terms of market price — and adjust the final appraised value accordingly.

This higher valuation, in turn, could be used to justify a higher mortgage amount.

For example, Kateri Callahan, president of the Alliance to Save Energy, a nonprofit advocacy group and a major supporter of the new legislation, estimates a typical new home that is 30 percent more energy efficient than a similar-sized, average house will save about $20,000 in utility expenses over the life of a mortgage.

Under the Bennet-Isakson bill, appraisers would be required to add those savings to the current market valuation of the house. In this instance, Callahan says, the increase in value would be about $10,000.

Dozens of housing, energy and environmental groups have endorsed the new legislation, including appraisers, large homebuilders, the U.S. Chamber of Commerce, the U.S. Green Building Council, the Natural Resources Defense Council, green-designated real-estate brokers, the Institute for Market Transformation and the National Association of State Energy Officials, among others.

Business groups such as the Chamber of Commerce back the legislation because they see it as an employment generator that requires no federal budget outlays, and no new taxes or programs.

A joint study by the American Council for an Energy-Efficient Economy and the Institute for Market Transformation estimated that 83,000 new jobs in the construction, renovation and manufacturing industries could be stimulated by the legislation if the new underwriting rules were phased in over a period of years.

But you might ask: In a fractious, polarized Congress, could this bill actually make it through? The co-sponsors are optimistic, and supporting groups say there is substantial bipartisan support — a rarity — for the idea in both the House and Senate.

In the meantime, for homeowners who think their energy-efficiency and cost-saving improvements should be worth something, there is no rule barring you from asking a qualified appraiser or a lender to assess the added market value of those features. You can get your house rated and documented and pretty much insist they do precisely that.

Or you can invest in documented improvements that save on utility expenses — a worthy goal in its own right — and hope the federal agencies see the light and change their underwriting and valuation procedures before you go to sell. Sooner or later this is going to happen.

Term Life Insurance and Long-term Life Insurance

2011-10-27T03:22:00.001-07:00

What is a term life insurance policy or life insurance generally? A life insurance coverage offers financial safety to your family in the unfortunate occurrence of your death. At a standard level, it involves paying small sums every month (called premiums) to cover the risk of your unforeseen demise during the tenure of the policy. In such an occasion, your loved ones (or the beneficiaries you have named in the policy) will get a lump sum payment amount. In case you live till the maturity of the policy, depending on the type of life insurance coverage you have chosen, you will get returns the policy may have earned over the years. Today, there are lots of variations to this basic concept, and insurance plans focus on a wide array of needs.

Permanent insurance is a life insurance that delivers coverage throughout the insured’s lifetime and may include an element that builds cash value. Permanent life insurance offers lifelong protection. This kind of life insurance policy never stops as long as the premiums are paid. In addition, permanent life insurance coverage gives a cost savings element that accumulates a cash value over a long period of time. There are numerous kinds of permanent insurance. Below are the examples.

Traditional Whole Life stays in force during the insured’s entire lifetime, provided premiums are paid as specified by the plan. Life insurance coverage may also have an aspect for accumulating growth called cash value. Universal life insurance coverage is characterized by its flexible premiums, flexible face amounts, and unbundled pricing factors. Variable life insurance is a form of whole life insurance under which the death benefit and the cash value of the policy vary according to the investment performance of separate account investment options.

Term Insurance is a life insurance under which the death benefit is payable only if the insured dies during a specified period. Listed below are various types of term insurance. Term life insurance is the most affordable kind of life insurance available. It is designed to meet temporary life insurance needs; providing protection for a specified time period, the term which for example, is a term of 10, 20 or 30 years. This kind of life insurance makes sense if you have financial needs that will diminish as time passes, such as a home loan or a child’s tuition.

There are different types of term life insurance. One is level term which is a fixed amount of coverage with premiums that are set over a certain period of time, usually in 10-year increments. Second is increasing/decreasing term wherein the amount of coverage increases or decreases throughout the term, premiums typically remains level. Third is renewable term which includes a renewal provision that gives the policy owner the right to renew the insurance plan at the end of the specified term without submitting proof of insurability. Fourth is convertible term that gives the policyholder the right to convert the term policy to a permanent policy. Last one is group term insurance bought typically by an employer or professional organization that is intended to cover several people, usually leading to reduced premiums.

Term Life Insurance is the most preferred form of Life Insurance today which gives protection for a certain number of years. After all, that is what insurance is for: Protection for yourself and your family.

Study: Michigan health insurance options few

2011-10-27T03:21:00.007-07:00

Michigan has the fourth least competitive health insurance market in the country, meaning consumers and employers have fewer choices for health insurance than in most other states, according to a report by the American Medical Association.

Only Alabama, Alaska and Delaware had worse markets for health insurance competition, according to the report that used 2009 enrollment in health maintenance organizations and preferred provider organizations from 368 metropolitan areas and 48 states to come up with its findings.

In Michigan, the nonprofit Blue Cross Blue Shield of Michigan — the state's insurer of last resort — controls 71 percent of the state's commercial health insurance market, the association found.

The Blues control two-thirds or more of the commercial health insurance market in 13 of 15 metro areas surveyed across the state. In the Jackson area, the Blues had an 85 percent market share, marking the state's least competitive health insurance market, the report said.

In the Detroit-Livonia-Dearborn area, the Blues have a 55 percent market share, followed by Detroit-based Health Alliance Plan with 26 percent. The Blues have a 69 percent market share in the Warren-Farmington Hills-Troy area, while HAP has a 16 percent share there.

Blues spokeswoman Helen Stojic, however, cited two studies that point to a competitive insurance environment in Michigan.

A September 2009 report from the White House found Michigan's employer-sponsored insurance coverage for families had the lowest premium increases in the nation at 88 percent over a 10-year period.

A May 2010 report by Ken Ross, former Michigan Office of Financial and Insurance Regulation commissioner, found that while the Blues is the dominant carrier in the small employer market, there is a "reasonable degree of competition" in that market statewide and the Blues' size hasn't prevented other insurers from entering the market.

A June report from current OFIR Commissioner R. Kevin Clinton essentially came to the same conclusion.

But the Michigan Association of Health Plans, which represents 17 health plans with 2.1 million members, argues that the size of the Blues needs to be looked at during the review of the Blues' 31-year-old statute by the Snyder administration and Legislature.

Last month, Gov. Rick Snyder called for a "fresh look" at Blue Cross' unique legal and regulatory requirements to encourage competition, lower rates and provide access to high-quality care.

Nationally, the medical association found four of five metro areas have an anti-competitive commercial health insurance market.

"Our new report is intended to help regulators, lawmakers, researchers and policymakers identify markets where mergers among health insurers may cause competitive harm to patients, physicians and employers," Dr. Peter W. Carmel, American Medical Association president, said in a statement.

Selective Insurance Group (SIGI) Announces Quarterly Results, Beats Estimates By $0.11 EPS

2011-10-27T03:21:00.005-07:00

Selective Insurance Group (SIGI) announced its quarterly results on Wednesday. The company reported ($0.34) earnings per share for the quarter, beating the Thomson Reuters consensus estimate of ($0.45) by $0.11. The company’s quarterly revenue was up 1.1% on a year-over-year basis.

On a related note, analysts at Piper Jaffray (NYSE: PJC) cut their price target on shares of Selective Insurance Group to $16.00 in a research note to investors on Tuesday, October 11st. Analysts at Zacks Investment Research downgraded shares of Selective Insurance Group from a “neutral” rating to an “underperform” rating in a research note to investors on Tuesday, October 11st. Also, analysts at Bank of America Merrill Lynch upgraded shares of Selective Insurance Group from a “neutral” rating to a “buy” rating in a research note to investors on Friday, October 7th.

Shares of Selective Insurance Group (SIGI) traded up 3.15% during mid-day trading on Wednesday, hitting $15.74. Selective Insurance Group (SIGI) has a 52 week low of $12.34 and a 52 week high of $18.97. The stock’s 50-day moving average is $13.72 and its 200-day moving average is $15.58. The company has a market cap of $852.5 million and a price-to-earnings ratio of 12.97.

Selective Insurance Group, Inc. is a holding company of seven insurance subsidiaries. The Company, through its subsidiaries, offers property and casualty insurance products and services in the East and Midwest of the United States. The Company operates through two segments: Insurance Operations, which sells property and casualty insurance policies and products, and Investment Operations, which invests the premiums collected by the Insurance Operations. During the year ended December 31, 2009, the Company realigned its federal flood insurance administrative services (Flood) business into Insurance Operations. In addition, in 2009, the Company disposed of Selective HR, which comprised its HR Outsourcing segment

Kenyan herders reap dividends from livestock insurance

2011-10-27T03:21:00.003-07:00

Pastoralists whose herds have been decimated by drought receive first payments under innovative new scheme

About 650 herders in the vast arid area of Marsabit in northern Kenya last week received the first insurance payouts from an unusual project designed to cushion the impact of drought on pastoralists.

Payouts have averaged 3,000 Kenyan shillings (£18), with a maximum of 37,000 Ksh. Developed by the International Livestock Research Institute (ILRI) in Nairobi and US universities – and backed by USAid, the Department for International Development and the World Bank – the scheme was launched last year in Marsabit, where pastoralists keep 86,000 cattle and 2m goats and sheep. The livestock generate millions of dollars in milk and other products, and serve as the main source of sustenance and income. But ILRI estimates that up to one-third of all livestock in the region have perished during the current drought, which has left 12 million people in need of help.

In east Africa, an estimated 70 million people live in the drylands, many of them herders. In Kenya, the pastoral livestock sector is estimated to be worth $800m, while regional authorities estimate that more than 90% of the meat consumed in east Africa comes from pastoral herds.

Under the scheme, payouts are triggered when satellite images show that grazing lands in the region have deteriorated to the point where herders are expected to lose more than 15% of their herd (with the 15% threshold acting as a sort of deductible). Using satellites to track forage cover – rather than the number of dead animals – circumvents claims being made for animals that have died of disease or neglect rather than drought. Previously, insuring livestock for pastoralists has proved near impossible due to the difficulty of verifying the death of animals over a wide and remote area.

So far, the livestock mortality index at the heart of the programme appears to be working. The fatality rate predicted by the satellite assessments of forage loss chimes very closely with surveys of animal deaths on the ground.

To build the insurance model, ILRI researchers used the Normalised Difference Vegetation Index, a global database updated by Nasa, and the US National Oceanic and Atmospheric Administration to collect satellite images of plant growth in Marsabit since 1981. The information was combined with data on livestock deaths in Marsabit since 2000 to produce a programme that could reliably predict when a reduction in grazing will lead to animal deaths.

So, for example, a cattle herder in an area with a livestock mortality rate of 33% receives a payout covering 18% of his or her animals. With cattle valued at about 15,000 Ksh a head, an insurance policy covering 10 animals, or 150,000 Ksh in cattle, would pay out at about 27,000 Ksh. To date, the policies cover about 1,100 animals – mostly cattle, but also some goats and sheep, and a few camels.

There are two potential payouts each year. They are based on satellite images at the end of the long dry season in September and the short dry season in February. The payments last week – to farmers who had lost up to a third of their herds – were the first under the scheme.

Andrew Mude, the index based livestock insurance project leader at ILRI, said the 15% threshold for livestock losses was the result of discussions between ILRI researchers and two local firms, Equity Bank and UAP Insurance. A threshold below 15% would have made the premium too expensive for herders. On average, herders paid a premium of 1,150 Ksh, with a maximum of 12,000 Ksh and a minimum of 195 Ksh for the annual policy.

Mude acknowledges that insurance by itself is not sufficient, but must be accompanied by other measures such as better access to grazing lands and watering areas.

"Then the pastoralist approach, which some people dismiss as a backward lifestyle of the past, emerges as a very effective way to meet future food needs," he says.

Mude also calls the insurance scheme a work in progress; herders insisted on cash rather than livestock as payment, and the manner in which they spend it will be monitored.

"How will they use these funds?" asks Mude. "Spend on livestock, diversify or squander it?"

Mude said policy governments and donors will later have to decide whether to subsidise herders to buy insurance or stick to current schemes for helping pastoralists, which involve cash payments or food aid.

Jeremy Lind, a research fellow at the Institute of Development Studies in Sussex, says a two-track approach was needed to deal with shocks such as the drought: insurance for those with assets such as livestock, and social protection and livelihood-building programmes for the poorest groups, who lack assets.

"Where the two – social protection and insurance – might meet is in terms of more appropriate aid responses to problems of vulnerability and weakened livelihoods in pastoral areas," says Lind. "Rather than blanket food distributions following droughts [which tended to be the response to drought crises in the past], this two-track approach – providing direct support or public works payments (social protection) to the poorest, and insurance for those who have lost livestock during a drought – is a more appropriate way of responding to different types of vulnerability within pastoral societies."

Brit who 'faked his own death for £1.25 million insurance' found in Sydney

2011-10-27T03:21:00.001-07:00

A man who is wanted in Britain for allegedly faking his own death and collecting £1.25m in insurance payouts has been found living in Sydney with his four children.

Alfredo Sanchez was accused of massive fraud after police claimed to have found his own fingerprints on his death certificate after he was supposedly cremated.

Since his purported death, British police had been unable to find him, although they suspected that the Sanchez family was living somewhere in Australia.

His wife, Sophie Sanchez, who helped him plan the fraud to pay off the couple's huge credit card debts, was arrested last year at Heathrow when she visited the UK to attend her sister's wedding. She pleaded guilty to the scam and is now serving two years in jail.

But Mr Sanchez, who now goes by the name Hugo, has denied he is the wanted man and said he had "no knowledge" that police in Britain were looking for him.

Speaking to the Sydney Daily Telegraph, which tracked him down to a hair salon in the city's southern suburb of Hurstville, Mr Sanchez said he was "innocent until proven guilty."

He denied his wife was in jail, saying she was staying with relatives in Britain, and said his name was Hugo and "it's always been Hugo."

"I don't deny anything and I don't accept anything," he said.

"My wife is not in jail. It's all lies it's not true."

After speaking to the newspaper, Ecuadorean-born Mr Sanchez was spotted leaving his house with his children and a number of suitcases.

Mr Sanchez, 47, came to the attention of police after a staff card from music shop HMV, where he used to work, was used several times following his death.

When they started to investigate, Mrs Sanchez told authorities that her husband had died while on holiday in Ecuador in January 2005 and that his body was cremated two days later.

But while examining his death certificate, officers allegedly found Mr Sanchez's own fingerprints, leading them to believe he was still alive.

At the trial of Mrs Sanchez, a London court was told that the couple, from Surrey, got into serious financial difficulties after they opened seven credit accounts and took out several loans. At one point they moved to South America, taking out a loan for £65,000. But they were soon back in the UK.

Mr Sanchez also took out a £500,000 life insurance policy, which his wife claimed on as soon as she got his death certificate.

But far from being dead, it has been alleged that Mr Sanchez was in Australia, getting his Ecuadorean passport renewed and opening a tattoo parlour in Sydney.

Australian police would not comment on the case, saying it was a matter for UK authorities and that they would "act appropriately in response to any lawful process initiated by overseas law enforcement authorities."