AIG First, Now Fortis
Our federal government rescued AIG; now three European governments are infusing money into Fortis, a large and prestigious European retail banking and insurance operation. In both cases, it was not an insurance solvency issue; the insurance operations were strong. Other parts of the company dragged the insurance operation down with it. Will other insurer’s suffer a similar fate? No one yet knows. What will become of AIG? The federal government now owns 79% of it and the company will be disposed of sometime within the next 24 months. It could be purchased by another carrier, but that is not the only possibility. Hank Greenberg, former AIG Chairman and CEO who was ousted in 2005, may be on his way back. He recently appeared on the Charlie Rose show in Canada to reveal he is trying to put together the financing to buy back his company. If anyone could raise AIG from the ashes it would be Greenberg. We don’t know what will happen to AIG but the losers are those competitors who are bad-mouthing the company. It is highly unethical and considered to be unfair marketing practices by most insurance departments. Agents would do well to steer clear of such activities; who knows, next week it might happen to a company you represent. Insure Your Home with an Unrated Company
It has been a few years since Progressive tested their Homeowners product in a few states, got badly spanked, and withdrew. Now they are offering Homeowners insurance again, through a company called Homesite. A little investigation reveals this company is not rated by A.M. Best or any of the other major rating agencies. The company has been around long enough (formed in 1997) and is large enough to obtain a rating; the conclusion is that they have simply not applied to Best. Homesite is rated by Demotech, Inc. which has created its own “Financial Stability Rating”. The Demotech website includes the names of major carriers, but a closer review reveals these companies have not applied to Demotech for a rating; Demotech has simply listed them! But don’t worry, Philadelphia Contributionship Insurance and Genesee Patrons Coop enjoy a favorable Demotech rating, so we probably should not be too concerned about the financial strength of Homesite.
The consumer will assume, of course, that when they buy a policy from the Progressive websiste, the company will stand behind it. But in this case, Progressive appears to be acting as an “agent” for Homesite and the Progressive website contains a disclaimer: “Insurance policies purchased through the Progressive Home Advantage program are underwritten by Homesite Insurance Group. Homesite…is not affiliated with Progressive, and is solely responsible for claims under these insurance policies.” It appears that even if Homesite ends up being a dog, Progressive is not about to get bitten by any flees.
Turnaround Time Reduced on Last Minute CE
The Internet has been a godsend for those agents who wait to do their CE until the very end. Most states have approved on-line courses that can be taken instead of attending a class and finally we can file credits over the Internet in all of our key states. The reduction in turnaround time is astounding. Check out our online courses at insurancece.com. Here is the link for our key states: Wisconsin , Michigan , Ohio . If you still have questions, call Angela at 800-326-4741.
Quote of the Month
“Sometimes when I consider what tremendous consequences come from little things, I am tempted to think there are no little things.” Bruce Barton We Are:
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