Landslides and mud-slides: NOT covered by a standard homeowners policy

Landslides and mud-slides: NOT covered by a standard homeowners policy

The New York Times has an interesting story today about a significant hazard here in the rainy Pacific Northwest: mudslides.

Mudslides and landslides, the article notes, are "a topographical drama less spectacular but far more common than the potentially deadly earthquakes, avalanches and tsunamis that loom in anxious minds across the Pacific Northwest."

And here's what many homeowners don't know: mudslides and landslides aren't covered by a standard homeowners policy. So it can be very difficult to collect for losses caused by any form of land movement unless you bought specific additional riders or policies, like these:

Landslide coverage: You may be able to buy a special rider for your homeowners policy that includes coverage for contents for all perils, including earth movement. But this type of rider only covers contents, not the structure, and some insurers don't offer this option at all. For the structure, you may be able to buy separate earth-movement coverage from what's known as the "surplus lines" market, meaning insurers who specialize in risks that the traditional insurance industry doesn't cover. But if your home is on a hillside, it may be difficult to get this kind of coverage.

Flood insurance: Flood insurance may apply to some kinds of earth movement, such as water-related erosion, mudflows or flash floods. Most homeowners seeking flood coverage start with the National Flood Insurance Program, which is federally run but sold by local agents and brokers.

Earthquakes: Quake damage is another category of risk not covered in a standard homeowners policy, but you can buy this coverage to protect against losses from an earthquake -- or quake-triggered landslides.

Minimum Maintenance Standards Ruled Inapplicable

Minimum Maintenance Standards Ruled Inapplicable

Giuliani v. Halton (Municipality), 2011 ONCA 812 (C.A.)

The Giuliani decision was released by the Court of Appeal on December 21, 2011. The plaintiff lost control of her vehicle when the road she was travelling on was covered with snow and ice. Approximately two centimetres of snow had fallen on the road which impacted and turned to ice.

The weather forecasts beginning the afternoon prior to the date of the accident indicated that snow would fall beginning the next morning. The trial judge found that the Town had ample time to schedule a person or crew to monitor the weather and road conditions and to place a maintenance crew on standby.

Salting operations did not begin until fifteen minutes after the accident occurred. It was not clear when the icy road conditions were first discovered. It was held that the Town “failed to inspect the roads when it ought to have known that an inspection was necessary to trigger the remedial steps necessary to maintain [the road in question]”.

The trial judge held that the defendants had complied with the Minimum Maintenance Standards (MMS) with respect to treating the icy roadway within the required time after becoming aware of its icy condition. However, the trial judge held that this was not a defence.

The Court of Appeal upheld the decision and held that sections 4 and 5 of the MMS do not establish minimum standards to address the accumulation of 2 centimetres of snow on a Class 2 roadway (they apply when there is a 5 cm accumulation), nor do they establish a minimum standard for the treatment of a highway before ice is formed and becomes an icy roadway. The Town was liable for failure to monitor the weather and the failure to deploy resources to prevent the road from becoming icy. Therefore, the analysis did not centre on the MMS as the MMS does not establish a minimum standard for the treatment of a highway before ice is formed and becomes icy.

The analysis turned to section 44(1) of the Municipal Act, 2001 requiring municipalities to take reasonable steps. The Court of Appeal agreed with the trial judge that reasonable steps were not taken with respect to monitoring the weather and lining crews up in advance.

This case raises the bar significantly with respect to what the courts require of municipalities to meet the reasonableness standard. It also takes away much of the certainty that was provided to municipalities by way of the MMS. An increased proactive approach to maintenance of roadways will be required.

̶ Kristen Dearlove, Student-at-Law

Job opening: Actuary

Job opening: Actuary

We have a job opening for a full-time, permanent actuary at our main office in Tumwater.

The person will be reviewing health and disablity insurance rate filings, as well as helping our company supervision divisions financial analysis work. For a full description of the job, salary range, benefits, etc., please see the job listing.

45 Amazing Health Tips Ever !

taking the time to read this tops the list.

1. Copy your kitty: Learn to do stretching exercises when you wake up. It boosts circulation and digestion, and eases back pain.

2. Don’t skip breakfast. Studies show that eating a proper breakfast is one of the most positive things you can do if you are trying to lose weight. Breakfast skippers tend to gain weight. A balanced breakfast includes fresh fruit or fruit juice, a high-fibre breakfast cereal, low-fat milk or yoghurt, wholewheat toast, and a boiled egg.

3. Brush up on hygiene. Many people don't know how to brush their teeth properly. Improper brushing can cause as much damage to the teeth and gums as not brushing at all. Lots of people don’t brush for long enough, don’t floss and don’t see a dentist regularly. Hold your toothbrush in the same way that would hold a pencil, and brush for at least two minutes. This includes brushing the teeth, the junction of the teeth and gums, the tongue and the roof of the mouth. And you don't need a fancy, angled toothbrush – just a sturdy, soft-bristled one that you replace each month.

4. Neurobics for your mind. Get your brain fizzing with energy. American researchers coined the term ‘neurobics’ for tasks which activate the brain's own biochemical pathways and to bring new pathways online that can help to strengthen or preserve brain circuits. Brush your teeth with your ‘other’ hand, take a new route to work or choose your clothes based on sense of touch rather than sight. People with mental agility tend to have lower rates of Alzheimer's disease and age-related mental decline.

5. Get what you give! Always giving and never taking? This is the short road to compassion fatigue. Give to yourself and receive from others, otherwise you’ll get to a point where you have nothing left to give. And hey, if you can’t receive from others, how can you expect them to receive from you?

6. Get spiritual. A study conducted by the formidably sober and scientific Harvard University found that patients who were prayed for recovered quicker than those who weren’t, even if they weren’t aware of the prayer.

7. Get smelly. Garlic, onions, spring onions and leeks all contain stuff that’s good for you. A study at the Child’s Health Institute in Cape Town found that eating raw garlic helped fight serious childhood infections. Heat destroys these properties, so eat yours raw, wash it down with fruit juice or, if you’re a sissy, have it in tablet form.

8. Knock one back. A glass of red wine a day is good for you. A number of studies have found this, but a recent one found that the polyphenols (a type of antioxidant) in green tea, red wine and olives may also help protect you against breast cancer. It’s thought that the antioxidants help protect you from environmental carcinogens such as passive tobacco smoke.

9. Bone up daily. Get your daily calcium by popping a tab, chugging milk or eating yoghurt. It’ll keep your bones strong. Remember that your bone density declines after the age of 30. You need at least 200 milligrams daily, which you should combine with magnesium, or it simply won’t be absorbed.

10. Berries for your belly. Blueberries, strawberries and raspberries contain plant nutrients known as anthocyanidins, which are powerful antioxidants. Blueberries rival grapes in concentrations of resveratrol – the antioxidant compound found in red wine that has assumed near mythological proportions. Resveratrol is believed to help protect against heart disease and cancer.

11. Curry favour. Hot, spicy foods containing chillies or cayenne pepper trigger endorphins, the feel-good hormones. Endorphins have a powerful, almost narcotic, effect and make you feel good after exercising. But go easy on the lamb, pork and mutton and the high-fat, creamy dishes served in many Indian restaurants.

12. Cut out herbs before ops. Some herbal supplements – from the popular St John's Wort and ginkgo biloba to garlic, ginger, ginseng and feverfew – can cause increased bleeding during surgery, warn surgeons. It may be wise to stop taking all medication, including herbal supplements, at least two weeks before surgery, and inform your surgeon about your herbal use.

13. I say tomato. Tomato is a superstar in the fruit and veggie pantheon. Tomatoes contain lycopene, a powerful cancer fighter. They’re also rich in vitamin C. The good news is that cooked tomatoes are also nutritious, so use them in pasta, soups and casseroles, as well as in salads. The British Thoracic Society says that tomatoes and apples can reduce your risk of asthma and chronic lung diseases. Both contain the antioxidant quercetin. To enjoy the benefits, eat five apples a week or a tomato every other day.

14. Eat your stress away. Prevent low blood sugar as it stresses you out. Eat regular and small healthy meals and keep fruit and veggies handy. Herbal teas will also soothe your frazzled nerves. Eating unrefined carbohydrates, nuts and bananas boosts the formation of serotonin, another feel-good drug. Small amounts of protein containing the amino acid tryptamine can give you a boost when stress tires you out.

15. Load up on vitamin C.We need at least 90 mg of vitamin C per day and the best way to get this is by eating at least five servings of fresh fruit and vegetables every day. So hit the oranges and guavas!

16. No folly in folic acid. Folic acid should be taken regularly by all pregnant mums and people with a low immunity to disease. Folic acid prevents spina bifida in unborn babies and can play a role in cancer prevention. It is found in green leafy vegetables, liver, fruit and bran.

17. A for Away. This vitamin, and beta carotene, help to boost immunity against disease. It also assists in the healing process of diseases such as measles and is recommended by the WHO. Good natural sources of vitamin A are kidneys, liver, dairy products, green and yellow vegetables, pawpaw, mangoes, chilli pepper, red sorrel and red palm oil.

18. Pure water. Don’t have soft drinks or energy drinks while you're exercising. Stay properly hydrated by drinking enough water during your workout (just don't overdo things, as drinking too much water can also be dangerous). While you might need energy drinks for long-distance running, in shorter exercise sessions in the gym, your body will burn the glucose from the soft drink first, before starting to burn body fat. Same goes for eating sweets.

19. GI, Jane. Carbohydrates with a high glycaemic index, such as bread, sugar, honey and grain-based food will give instant energy and accelerate your metabolism. If you’re trying to burn fat, stick to beans, rice, pasta, lentils, peas, soya beans and oat bran, all of which have a low GI count.

20. Mindful living. You've probably heard the old adage that life's too short to stuff a mushroom. But perhaps you should consider the opposite: that life's simply too short NOT to focus on the simple tasks. By slowing down and concentrating on basic things, you'll clear your mind of everything that worries you. Really concentrate on sensations and experiences again: observe the rough texture of a strawberry's skin as you touch it, and taste the sweet-sour juice as you bite into the fruit; when your partner strokes your hand, pay careful attention to the sensation on your skin; and learn to really focus on simple tasks while doing them, whether it's flowering plants or ironing your clothes.

21. The secret of stretching. When you stretch, ease your body into position until you feel the stretch and hold it for about 25 seconds. Breathe deeply to help your body move oxygen-rich blood to those sore muscles. Don't bounce or force yourself into an uncomfortable position.

22. Do your weights workout first. Experts say weight training should be done first, because it's a higher intensity exercise compared to cardio. Your body is better able to handle weight training early in the workout because you're fresh and you have the energy you need to work it. Conversely, cardiovascular exercise should be the last thing you do at the gym, because it helps your body recover by increasing blood flow to the muscles, and flushing out lactic acid, which builds up in the muscles while you're weight training. It’s the lactic acid that makes your muscles feel stiff and sore.

23. Burn fat during intervals. To improve your fitness quickly and lose weight, harness the joys of interval training. Set the treadmill or step machine on the interval programme, where your speed and workload varies from minute to minute. Build up gradually, every minute and return to the starting speed. Repeat this routine. Not only will it be less monotonous, but you can train for a shorter time and achieve greater results.

24. Your dirtiest foot forward. If your ankles, knees, and hips ache from running on pavement, head for the dirt. Soft trails or graded roads are a lot easier on your joints than the hard stuff. Also, dirt surfaces tend to be uneven, forcing you to slow down a bit and focus on where to put your feet – great for agility and concentration.

25. Burn the boredom, blast the lard. Rev up your metabolism by alternating your speed and intensity during aerobic workouts. Not only should you alternate your routine to prevent burnout or boredom, but to give your body a jolt. If you normally walk at 6.5km/h on the treadmill or take 15 minutes to walk a km, up the pace by going at 8km/h for a minute or so during your workout. Do this every five minutes or so. Each time you work out, increase your bouts of speed in small increments.

26. Cool off without a beer. Don’t eat carbohydrates for at least an hour after exercise. This will force your body to break down body fat, rather than using the food you ingest. Stick to fruit and fluids during that hour, but avoid beer.

27. ‘Okay, now do 100 of those’. Instead of flailing away at gym, enlist the help – even temporarily – of a personal trainer. Make sure you learn to breathe properly and to do the exercises the right way. You’ll get more of a workout while spending less time at the gym.

28. Stop fuming. Don’t smoke and if you smoke already, do everything in your power to quit. Don’t buy into that my-granny-smoked-and-lived-to-be-90 crud – not even the tobacco giants believe it. Apart from the well-known risks of heart disease and cancer, orthopaedic surgeons have found that smoking accelerates bone density loss and constricts blood flow. So you could live to be a 90-year-old amputee who smells of stale tobacco smoke. Unsexy.

29. Ask about Mad Aunt Edith. Find out your family history. You need to know if there are any inherited diseases prowling your gene pool. According to the Mayo Clinic, USA, finding out what your grandparents died of can provide useful – even lifesaving – information about what’s in store for you. And be candid, not coy: 25 percent of the children of alcoholics become alcoholics themselves.

30. Do self-checks. Do regular self-examinations of your breasts. Most partners are more than happy to help, not just because breast cancer is the most common cancer among SA women. The best time to examine your breasts is in the week after your period.

31. My smear campaign. Have a pap smear once a year. Not on our list of favourite things, but it’s vital. Cervical cancer kills 200 000 women a year and it’s the most prevalent form of cancer among black women, affecting more than 30 percent. But the chances of survival are nearly 100 percent if it’s detected early. Be particularly careful if you became sexually active at an early age, have had multiple sex partners or smoke.

32. Understand hormones. Recent research suggests that short-term (less than five years) use of HRT is not associated with an increase in the risk of breast cancer, but that using it for more than ten years might be. Breast cancer is detected earlier in women using HRT, as they are more alert to the disease than other women.

32. Beat the sneezes. There are more than 240 allergens, some rare and others very common. If you’re a sneezer due to pollen: close your car’s windows while driving, rather switch on the internal fan (drawing in air from the outside), and avoid being outdoors between 5am and 10 am when pollen counts are at their highest; stick to holidays in areas with low pollen counts, such as the seaside and stay away from freshly cut grass.

33. Doggone. If you’re allergic to your cat, dog, budgie or pet piglet, stop suffering the ravages of animal dander: Install an air filter in your home. Keep your pet outside as much as possible and brush him outside of the home to remove loose hair and other allergens. Better yet, ask someone else to do so.

34. Asthma-friendly sports. Swimming is the most asthma-friendly sport of all, but cycling, canoeing, fishing, sailing and walking are also good, according to the experts. Asthma need not hinder peak performance in sport. 11 percent of the US Olympic team were asthmatics – and between them they won 41 medals.

35. Deep heat. Sun rays can burn even through thick glass, and under water. Up to 35 percent of UVB rays and 85 percent of UVA rays penetrate thick glass, while 50 percent of UVB rays and 77 percent of UVA rays penetrate a meter of water and wet cotton clothing. Which means you’ll need sunscreen while driving your car on holiday, and water resistant block if you’re swimming.

36. Fragrant ageing. Stay away from perfumed or flavoured suntan lotions which smell of coconut oil or orange if you want your skin to stay young. These lotions contain psoralen, which speeds up the ageing process. Rather use a fake-tan lotion. Avoid sun beds, which are as bad as the sun itself.

37. Sunscreen can be a smokescreen. Sunscreen is unlikely to stop you from being sunburned, or to reduce your risk of developing skin cancer. That’s because most people don’t apply it properly, and stay in the sun too long. The solution? Slather on sunscreen daily and reapply it often, especially if you’ve been in the water. How much? At least enough to fill a shot glass.

38. Laugh and cry. Having a good sob is reputed to be good for you. So is laughter, which has been shown to help heal bodies, as well as broken hearts. Studies in Japan indicate that laughter boosts the immune system and helps the body shake off allergic reactions.

39. It ain’t over till it’s over. End relationships that no longer work for you, as you could be spending time in a dead end. Rather head for more meaningful things. You could be missing opportunities while you’re stuck in a meaningless rut, trying to breathe life into something that is long gone.

40. Strong people go for help. Ask for assistance. Gnashing your teeth in the dark will not get you extra brownie points. It is a sign of strength to ask for assistance and people will respect you for it. If there is a relationship problem, the one who refuses to go for help is usually the one with whom the problem lies to begin with.

41. Save steamy scenes for the bedroom. Showering or bathing in water that’s too hot will dry out your skin and cause it to age prematurely. Warm water is much better. Apply moisturiser while your skin is still damp – it’ll be absorbed more easily. Adding a little olive oil to your bath with help keep your skin moisturised too.

42. Here’s the rub. Improve your circulation and help your lymph glands to drain by the way you towel off. Helping your lymph glands function can help prevent them becoming infected. When drying off your limbs and torso, brush towards the groin on your legs and towards the armpits on your upper body. You can do the same during gentle massage with your partner.

43. Sugar-coated. More than three million South Africans suffer from type 2 diabetes, and the incidence is increasing – with new patients getting younger. New studies show this type of diabetes is often part of a metabolic syndrome (X Syndrome), which includes high blood pressure and other risk factors for heart disease. More than 80 percent of type 2 diabetics die of heart disease, so make sure you control your glucose levels, and watch your blood pressure and cholesterol counts.

44. Relax, it’s only sex. Stress and sex make bad bedfellows, it seems. A US survey showed that stress, kids and work are main factors to dampen libido. With the advent of technology that allows us to work from home, the lines between our jobs and our personal lives have become blurred. People work longer hours, commutes are longer and work pervades all aspects of our lives, including our sexual relationships. Put nooky and intimacy on the agenda, just like everything else.

45. Good night, sweetheart. Rest heals the body and has been shown to lessen the risk of heart trouble and psychological problems.

Susan Erasmus, William Smook, Ilse Pauw, Health24, updated FAB 2012. Originally published in Fairlady magazine.)
Insurance companies and agents fined

Insurance companies and agents fined

We'll be posting a news release on this shortly, but we've issued the following fines and other enforcement actions:
  • Fidelity National Title Insurance Co. and Chicago Title Insurance Co.: Fined $100,000 for wrongfully offering discount club memberships to people who were in a position to send title business to the companies.
  • Aetna Life Insurance Co.: Fined $20,000 for failing to promptly handle appeals from consumers.
  • Charter Warranty Services, Inc., Mechanical Breakdown Protection, Inc., and Paul Pawlusiak, of Detroit, Mich.: Ordered to stop selling unauthorized motor vehicle service contacts.
  • Scott L. Stevens and RV, of Mill Creek: Ordered to stop acting as an agent for a service contract provider not authorized to do business in Washington state.
  • Cynthia L. Rushing, of Spokane: License revoked for misappropriating funds.
  • Trevor D’Jon Losse, of Cle Elum: Fined $1,000 for multiple violations, including failing to disclose other state disciplinary actions against him.
  • Robert Tychsen, of El Cajon, Calif.: Fined $1,750 for selling insurance in Washington without a license.
  • Douglas D. Wellsandt, of Hayden, Idaho: Fined $5,000 for violations including falsely stating that Washington policies had been sold in Idaho.
  • Ross S. Wolf, of Sammamish: Fined $2,000 for violations including acting as an insurance company’s agent without having been appointed by the company.
Orders and details about these cases are posted online at

The fines collected do not go to the agency. They are deposited in the state's general fund to pay for other state services.
Washington consumers with questions, problems or complaints can call us at 1-800-562-6900 or e-mail (Not in Washington? Here's how to reach your state's insurance regulator.)
A company that insured the Titanic goes under, leaving behind maritime relics

A company that insured the Titanic goes under, leaving behind maritime relics

The Wall Street Journal's Leslie Scism has a story today about Atlantic Mutual, the company that insurered the Titanic and many other ships for more than a century, before the company was ordered into liquidation two years ago.

The story details the maritime artifacts and records amassed by the company. Many of the items -- model ships, paintings, old maps, gold coins, barometers, etc. -- may be sold soon.
Tacoma man sentenced to prison for insurance fraud, forgery

Tacoma man sentenced to prison for insurance fraud, forgery

A Tacoma man has been sentenced to more than two years in prison for insurance fraud and forgery after filing a false auto insurance claim.

Cash B. Knott, 46, was sentenced Friday in Pierce County Superior Court to 29 months in prison and must pay $1,200 in costs and assessments. He pleaded guilty in January to two counts of forgery and one count of felony insurance fraud.

On Nov. 6th, less than a month after getting coverage from Progressive Direct Insurance Co. for his 1992 Ford Ranger pickup, Knott filed a $5,674 insurance claim with Progressive. He said someone had scratched the paint, stolen his chrome wheels and tires, and stolen his navigation and entertainment system, 1,000 watt amplifier and other electronic components.

He provided Progressive with a Sept. 2 stereo shop invoice for $4,547.84 worth of stereo equipment, a copy of his check, and a bank statement showing the withdrawal from his checking account.

The problem: When contacted by an insurance adjuster, the stereo shop said it had no record of such a purchase. All they could find was that Knott had bought an amplifier -- for $109 -- on Sept. 2.

Insurance Commissioner Mike Kreidler's Special Investigations Unit obtained a search warrant for Knott's bank records. The bank found no checks written to the stereo shop, and none whatsoever for $4,547.84.
Homeowners insurance: What's NOT covered

Homeowners insurance: What's NOT covered

People often assume that homeowners insurance is a catch-all, covering virtually any event.

Not true, unfortunately. There are many things that a typical homeowners policy does NOT cover. Among them:
  • floods
  • earthquakes
  • breaks in a water line leading to your home
  • termites
  • stolen pets
  • damaged or stolen cars, boats and motorcycles (these would typically be covered, however, by your car/boat/etc. insurance)
Also, here's a list of what IS covered by a typical homeowners policy, as well as add-ons you might want to consider.
Separating Self-Insurance Facts From Fiction

Separating Self-Insurance Facts From Fiction

Note: The following commentary appears in the February 20, 2012 edition of Business Insurance Magazine as part of its special spotlight report on self-insurance for the middle market.

Small and midsize companies are looking at self-insurance as a cost-effective health care benefits solution as Patient Protection and Affordable Care Act deadlines approach. Michael W. Ferguson serves as chief operating officer for the Self-Insurance Institute of America Inc., looks at facts and myths surrounding the decision to self-insure.

As more smaller and midsize companies look to self-insurance solutions to control escalating group health care costs in the wake of passage of the Patient Protection and Affordable Care Act, this proactive risk management approach has attracted increased negative attention from traditional health insurance industry and state regulators who warn of various calamities.

Of course, this criticism is largely predictable, as health insurance carriers are worried about market-share erosion, and state regulators don’t like the fact they cannot directly regulate self-insured group health plans because of Employee Retirement Income Security Act (ERISA) pre-emption. Nonetheless, it’s worth pointing out some of the more frequently repeated canards in order to help clear up any confusion this may cause for employers considering self-insurance.

But first the disclaimer: Self-insurance is not the best option for every employer, regardless of size. In fact, it could be a very bad option based on a variety of considerations. In this regard, it is highly recommended that employers engage in the same type of thorough due diligence they would rely on for any other major financial decision.

That said, let’s jump in and separate some important myths from realities.

Perhaps the most unfortunate allegation is that a primary motive for many employers to self-insure is that they can escape regulation, raising consumer protection concerns. While it is true that self-insured plans are not subject to state benefit mandates, there is no evidence to suggest that self-insured employers scrimp on covered benefits. In fact, it is widely acknowledged that self-insured plans incorporate more robust coverage terms for key health services because they have the ability to customize their plans to meet the specific needs of their employees.

And for employers switching to self-insurance since the passage of PPACA, they don’t evade any new substantive federal regulations—except those specifically geared for commercial health insurance carriers—because, by definition, they would establish “non-grandfathered” plans.

The reality is that self-insured employers actually subject themselves to more regulatory requirements because they are governed by ERISA, which prescribes strict federal rules for plan fiduciaries, among other requirements designed to protect the interests of plan participants.

Some critics also claim that self-insured health plans are more cost-effective because they deny claims at a higher rate than fully insured plans. But in a report issued by the U.S. Department of Health & Human Services last year, HHS-contracted researchers from RAND Corp. concluded that there is no evidence of such disparity.

Then there’s the belief that self-insured plan participants pay higher premiums than their fully insured counterparts. The available data does not support this conclusion, either.

As part of a U.S. Department of Labor report on self-insured health plans released last year, Deloitte Financial Advisory Services L.L.P. and Advanced Analytical Consulting Group, Inc. found that from 2009 to 2010 for employers with more than 200 covered lives, the average per employee premium contribution to be covered by fully-insured plans increased by $808 compared to average increase of $248 for self-insured premiums.

Most recently, influential academics and public policymakers predicted that such self-insured plans would contribute to adverse selection when insurance market reforms are fully implemented, suggesting that employers would switch back and forth between self-insured and exchange-offered plans based on their claims experience on a yearly basis.

That’s a nice conspiracy theory for sure, but it does not match up with marketplace realities. The fact is that due to ongoing administrative and compliance requirements, employers cannot simply switch their self-insured plans on and off.

Moreover, once an employer transitions to a fully insured health plan, it loses possession of claims data, which makes it more difficult to re-establish a self-insured plan in the future regardless of other considerations.

Claims data is arguably the most important health plan asset, as it can help employers control future health plan costs and can be used to customized plan design details. Giving up this asset over one bad claim year is not a decision to be taken lightly by plan sponsors.

The health care marketplace is certainly evolving, creating shifting roles for self-insurers, commercial health insurance companies and public sector payers. All three industry segments contribute in different ways to ensure that coverage is as available and affordable for the widest population possible.

Those who disseminate misleading information about any of these segments do a disservice to the ongoing public dialogue on how to improve the country’s health care system.
Court of Appeal - Striking a Jury Notice

Court of Appeal - Striking a Jury Notice

There is an interesting recent Court of Appeal decision in which the court discusses the appropriateness of a jury notice where there is a significant pre-accident medical condition. In Placzek v Green, (January 26, 2012, Ontario Court of Appeal) the plaintiff was injured in a rear end collision. The plaintiff had suffered from "severe fibromyalgia" for many years before the accident. The defendant argued that, to the extent that the plaintiff's physical problems interfered with her life after the accident, both problems were attributable in whole or in the main to the serious pre-existing condition and not to the relatively minor accident involving the vehicle driven by the defendant.

The trial judge struck the jury at the outset of the trial and held that, with respect to damages, despite the plaintiff's prior physical problems, the injuries suffered as a result of the car accident had caused significant problems for the plaintiff. The trial judge awarded damages in the amount of $919,237.

The defendant appealed on the basis that the trial judge should not have discharged the jury and that she did not quantify the damages on the basis of a rational analysis of the evidence.

With respect to discharging the jury, the Court of Appeal pointed out that the decision to discharge a jury is a discretionary one and that the court will defer to the exercise of that discretion unless it is shown that it was exercised on a wrong principle or that the exercise in the circumstances can be properly characterized as arbitrary, capricious or unreasonable.

In this case, the trial judge dismissed the jury on the basis of the anticipated complexity of the evidence to come relevant to the damage assessment. The complexity arose out of the plaintiff's pre-existing medical condition and the need to determine the impact of that condition on the plaintiff's post accident medical condition. In addition, there was competing expert evidence relating to the plaintiff's lost income and loss of future income claims. The plaintiff was a self-employed realtor and there were several factual variables relevant to her lost income claims. Finally there was competing and somewhat complex medical, engineering and biomedical evidence.

The Court of Appeal acknowledged that the defendant had made a powerful argument in support of his position that this was not really a complicated case at all, but found that they were unable to describe the trial judge's characterization of the evidentiary complexity as arbitrary, capricious or unreasonable. The Court of Appeal acknowledged that other judges might have reached a different assessment of the complexity of the evidence and declined to strike the jury, but that is not a basis upon which the trial judge's exercise of her discretion can be interfered with.

Of interest, the Court of Appeal went on to discuss other factors which the trial judge thought supported the exercise of her discretion in favor of striking the jury. For example, the Court of Appeal was of the view that the manner in which some of the evidence might be put before the jury and the advantages or disadvantages that one side or the other might have as a consequence, is irrelevant to the decision as to whether the jury should be struck before the trial started. Also, concerns about the position taken by the defendant with respect to liability could not provide any basis for striking a jury.

However, because the trial judge made it clear in her reasons that she struck the jury because of the anticipated evidentiary complexity on matters relating to damages, errors in respect of other matters considered did not taint the exercise of the trial judge's discretion.

With respect to the second ground of appeal, the defendant argued that the trial judge did not attempt to quantify the damages based on a critical assessment of the evidence, but instead simply picked a point somewhere in the middle between the various scenarios advanced by the parties. The Court of Appeal gave short shrift to that argument which apparently did not have much basis in evidence.

This case should be of some concern to defendants who believe that their cases are best determined by a jury. In most injury cases, certainly most cases which proceed to trial, there are issues relating to pre-existing medical conditions and there are issues relating to the calculation of future lost income. We certainly hope that Courts will not develop the habit of striking juries on those types of cases.

- Colin Osterberg
Cease and desist order issued for "Prolong Plus" auto warranties

Cease and desist order issued for "Prolong Plus" auto warranties

A New Jersey-based company selling vehicle warranties paired with engine additives has been ordered to stop selling unauthorized vehicle warranties in Washington state. The order takes effect immediately.
The Choice Manufacturing Company, Inc., also known as The Choice Warranty, Inc., is not authorized to sell vehicle service contracts in Washington. Their application was denied in 2008 because they didn't meet several requirements of the state's insurance law.

Despite that denial, however, the company continued to sell its "Prolong Plus" vehicle warranty in Washington. When state officials investigated, the company and principal Peter Masi refused to provide information or cooperate.

Our office has received several complaints from people who bought the warranties. Each said that the company had wrongly denied claims.

The Prolong Plus warranty requires consumers to put additives in their car radiators, engine oil, air conditioning or batteries. The additives are manufactured by Choice Manufacturing.

What if you live in Washington and bought one of these warranties? Even though the warranty was not legally sold here, the company is still required to honor the terms of the contract.

Update: On Aug. 6, 2012, the company agreed to pay a $10,000 fine.

Blood Test May Help Diagnose Depression

A blood test may eventually help diagnose depression, according to a new study published in the journal Molecular Psychiatry.

In the study, which was funded by Ridge Diagnostics, the firm that developed the blood test, researchers at Massachusetts General Hospital in Boston analyzed the levels of nine biomarkers that could distinguish patients who had a major depressive disorder from those who did not.

The biomarkers analyzed were associated with inflammation, neuron development and stress response in brain structures. The blood test results were then scored on a scale that researchers created for the study.

“Traditionally, diagnoses of major depression and other mental disorders had been made based on patients’ reported symptoms, but the accuracy of that process varies a great deal, often depending on the experience and resources of the clinician conducting the assessment,” Dr. George Papakostas, lead author of the study, said in a statement.” Adding an objective biological test could improve diagnostic accuracy and may also help us track individual patients’ response to treatment.”

The pilot study included 36 adults who had been diagnosed with major depression, and 43 healthy control study subjects. The test accurately pinpointed depression in 90 percent of previously diagnosed depressed patients.

Many patients deny they are depressed because of the stigma associated with depression, said Dr. Harold Koenig, a professor of psychiatry and behavioral sciences at Duke University Medical Center, so the test could be useful in taking away the shame of the disease and getting more people treated, he said.

But a blood test diagnosis can come with a big downside.

“[Some] patients might truly have depression and have a negative test, and then their symptoms might be discounted by family members and by health professionals, since depressive symptoms or emotional feelings are entirely subjective and there is no way to verify these symptoms,” said Koenig. “This could place a huge burden on patients who are already suffering, and be told that they really don’t have depression because they had a low score on a less than perfect test.”

The biomarkers could also be influenced by other disease patterns, said Cynthia Kuhn, a professor of pharmacology at Duke University Medical Center.

“It will be important to see if [the blood test] can discriminate depression from related disorders,” said Kuhn. “It is unlikely that the blood test alone would be appropriate.”

It is important that physicians focus on patients’ symptoms, along with biologic and genetic factors, said Dr. Carol Bernstein, associate professor of psychiatry at the New York University School of Medicine.

“Patient-centered care should be exactly that and outside of specific diseases that have clear genetics … medicine cannot be reduced to simple tests,” said Bernstein. “Disease states are complex and depression is no exception.”

SHOWS: Good Morning America
Most and least expensive cars to insure

Most and least expensive cars to insure is out with its annual list of the most- and least-expensive cars to insure. (Scroll down after clicking that link to reach the table listing the cars.)

Among the cheapest to insure: minivans, small SUVs, and some large pickup trucks. The lowest-cost vehicle to insure is the Toyota Sienna.

The most expensive will come as no surprise. The list, topped by the Audi R8 Spyder Quattro convertible, is dominated by expensive European sports cars.

The folks at, an industry news site, put together a short slideshow with the top cars in each category.

Give us your feedback

We're tuning up our agency website (not this blog; we've already done that part) and would love to get your feedback.

Our survey takes less than a minute. Please take a quick look at the site and give us your thoughts.

Thank you!
Surpluses of nonprofit health insurers in WA at $2.4 billion

Surpluses of nonprofit health insurers in WA at $2.4 billion

The Seattle Times had a story today about a change in the law we've proposed.

The background: Washington's three major health insurers -- all of whom are non-profit companies -- have amassed surpluses totalling more than $2.4 billion.

Commissioner Kreidler is asking lawmakers to let him consider those surpluses when the companies propose increases in health insurance premiums. The That, hopefully, could ease future premium hikes. In the individual and small group markets, insurance premiums, on average, have more than doubled since 2005.

The bill is SB 5247. It has cleared a key committee and is currently in the Senate's Rules Committee.

How to look up the number of complaints against an insurance company

We've created an easy online tool to look up the number of complaints against insurance companies.

We're the insurance regulator in Washington state, so the data's only for our state. But it can provide some insight into who we hear a lot of complaints about, and who we don't.

Since the market share of these companies varies widely, we also calculate what we call the "complaint index." That's simply the ratio of complaints divided by market share, to make the results easy to compare.
Loss Transfer - Costs of Assessments

Loss Transfer - Costs of Assessments

In Wawanesa v. Axa (2012), 107 O.R. (3d) 395 (S.C.J.), the issue was whether the cost of s. 42 assessments are recoverable in loss transfer, particularly in light of the legislative changes that came into effect March 1, 2006 (when DACs were eliminated). The underlying accidents occurred on August 21, 2006 and October 6, 2005.

The arbitrator held that the cost of s. 42 assessments are not recoverable under loss transfer. Justice Greer upheld the decision. The legislative changes had no impact on the principle that assessment expenses are not recoverable in loss transfer.
Survey: 57 percent of people in low-income families have no health insurance

Survey: 57 percent of people in low-income families have no health insurance

The Commonwealth Fund today released the results of a new survey on the uninsured. Among the group's findings:
  • 57 percent of people in low-income families (those earning less than about $30,000 for a family of 4) had no health insurance at some point last year.
  • 35 percent have been uninsured for two years or more.
  • Among moderate-income adults (about $30,000 to $56,000 for a family of 4), some 36 percent of adults in those families were uninsured during the past year.
None of this should come as a surprise. We do our own report on the uninsured in Washington state, and income is by far the largest factor correlated to being uninsured. The less you make, the more likely it is that you don't have health insurance.

We've also found that in most income brackets, the younger you are, the more likely that you're uninsured. See the report link above for more data and details.
Car sharing and usage-based insurance bills move forward

Car sharing and usage-based insurance bills move forward

Everyone in Washington state is required to have basic liability insurance if you own a car. Well, here's two bills that could impact how you get insurance and how much you pay for coverage.

The first, House Bill 2384, creates an insurance framework for peer-to-peer car sharing programs. Several other western states (OR, CA) have passed similar bills. Here's how it would work: You sign-up with a program to share your car when you're not using it. Your financial liability for the car transfers to the program during the time it's in use. Of course you still need insurance coverage for when you're driving your car, but the program is responsible for having insurance coverage for any car in its use. The bill report has all of the details if you want to know more.

Next is an issue we've seen before: Usage-based insurance (House Bill 2361). Nothing prevents an insurance company from creating a usage-based insurance product today, but under our state law, all auto insurance products and why they cost what they do is public once the premiums are approved by our office.

Certain information is considered confidential (ie. those pesky credit scoring models) but only if they've been carved out in state law. This bill would allow insurers who want to offer a usage-base product the ability to keep their products confidential. Also, there would be limits on how the insurance company could use your information and they couldn't sell it to anyone.

So why should you care? Well, you could get your rates reduced depending on how you drive. This means: the amount of miles, where you drive, the time of the day you drive, your speed, etc. Of course it goes both ways - if you have a lead foot or tend to brake hard, you could see your rates go up. Here's the full details.

Both bills must pass a February 14 deadline to stay alive.
Job openings: Actuary, investigator, HR consultant, etc.

Job openings: Actuary, investigator, HR consultant, etc.

We have four job openings, although some of the application deadlines are coming up soon. (Check each listing for the deadline, some may have closed by the time you're reading this.) We're looking for:
We're a small agency, but we do have job openings periodically. Most are due to retirements or resignations, rather than new positions. When we have job openings, we post them on our jobs page, as well as on the state's site.
Insurers and agents fined more than $1.3 million in 2011

Insurers and agents fined more than $1.3 million in 2011

Insurance Commissioner Mike Kreidler fined insurance companies, agents and brokers more than $1.3 million in 2011.

Violations included wrongly denying medical claims, overcharging customers, misappropriating clients’ money, charging unapproved rates and submitting false documents.

“These cases are the exception, not the rule,” said Kreidler, who’s been the state’s insurance regulator since 2001. “The vast majority of insurers, agents and brokers comply with the law.”

The largest fine, issued in January 2011, was against six Chubb & Son subsidiaries, which were ordered to pay $534,000 for violations including a long-running pattern of failing to properly document why the companies were charging higher or lower rates for certain policyholders.

Other major fines included $100,000 from American Bankers Insurance Co. of Florida (June 2011) and $100,000 from Regence BlueShield (August 2011).

Over the past 11 years, Kreidler has issued more than $13 million in fines against insurers, agents and brokers who violated the law. The agency’s disciplinary orders are posted online at

Fines collected by the insurance commissioner’s office do not go to the agency. The money is deposited in the state’s general fund to pay for other state services.
Interpretation of the Insurance Contract – Back to the Basics

Interpretation of the Insurance Contract – Back to the Basics

In Sam’s Auto Wrecking Co. (c.o.b. Wentworth Metal) v. Lombard General Insurance Co. of Canada (S.C.J.), the Operations Manager of Sam’s Auto, Mr. Farber, was injured on the job when he was run over by a crane being operated by an employee, resulting in the severance of his right leg between the ankle and knee and a serious cut to his left heel.

Mr. Farber was not an owner but was considered to be a part of the management team at Sam’s Auto. Prior to the incident, the owners had decided to opt out of WSIB insurance for themselves and Mr. Farber, for economic reasons. They purchased alternative disability insurance. However, they were left with a gap in coverage for which they were unaware.

When they approached the broker for Lombard to acquire a comprehensive business policy, they did not advise him that not everyone at their company had WSIB coverage. They obtained a comprehensive business insurance policy through Lombard which included commercial general liability. Because no one was aware of the gap in coverage, an employer’s liability endorsement was not requested.

Following the incident, Mr. Farber sued Sam’s Auto. Lombard took an off coverage position and consequently would not provide a
defence. As a result, this action was commenced.

The issue before the court was whether the personal injury experienced by Mr. Farber, due to the actions of an employee at Sam’s Auto, operating within the scope of his employment, was or should have been covered by the insurance policy Sam’s Auto had through Lombard.

Justice Whitten used basic contract interpretation principles in his interpretation of the insurance policy:
1) The contra proferentem rule;
2) The principle that coverage provisions should be construed broadly and exclusion clauses narrowly; and
3) The desirability, at least where the policy is ambiguous, of giving effect to the reasonable expectation of the parties.

Justice Whitten cited the principle from Bathurst Ltd. V. Mutual Boiler and Machinery Insurance Company [1980] 1SCR 888 that the “objective is to search for an interpretation which from the whole of the contract would appear to promote or advance the true intent of the parties at the time of entry into the contract.”

Justice Whitten listed factors to consider, in an insurance context, to determine the intent of the parties at the time of entry into the contract:
1) What was the nature of the business operated by the potential insured?
2) Was there an independent insurance contractor involved? Or was the insurance solicited direct from the insurance company?
3) If a broker was involved, what was requested or communicated to the broker?
4) What was the broker’s understanding of what was communicated to him or her that guided the request for coverage from the insurer?
5) What was the broker’s understanding or knowledge as to the appropriate insurance coverage?

The policy stated: "We will pay those sums that the insured becomes legally obligated to pay as compensatory damages because of “bodily injury” to which this insurance applies...This insurance does not apply to … (d) “Bodily Injury” to an employee of the insured arising out of and in the course of employment by the insured".

Justice Whitten held that there was no ambiguity with respect to these sections and it was clear that personal injury to the public was covered but personal injury to an employee working in the course of his or her employment was exempt. Given the nature and size of the business, the broker was reasonable in assuming that all employees were covered by WSIB, and was not told any different. Therefore, the broker would not have been aware of the gap in coverage.

There were arguments advanced with respect to whether Mr. Farber would be considered an “employee” because of the management position he held. Justice Whitten held that the distinction between the terms “employee” and “executive officer” is purely “academic”, and had no bearing in this context.

It was held that there was a clear lack of coverage and therefore no duty to defend existed.

- Kristen Dearlove, Student-at-Law