NEW ORLEANS—The trustee for homebuilder WCI Communities L.L.C. has sued 14 insurance companies seeking indemnification for more than $200 million in losses related to claims from homes allegedly containing contaminated Chinese drywall.
The suit, filed Jan. 4 in U.S. District Court for the Eastern District of Louisiana, takes aim at several insurers that include Chartis Inc. subsidiary Lexington Insurance Co. The suit accuses the insurers of improperly denying coverage, reserving their rights, failing to reply to WCI or failing to acknowledge coverage of claims WCI made concerning the defective drywall.
Bonita Springs, Fla.-based WCI formed the WCI Drywall Trust in July 2009 after homebuilder WCI Communities and its subsidiaries entered bankruptcy to assume liability for claims alleging property damage or bodily injury from exposure to drywall made in China that was installed in homes built by WCI.
According to the lawsuit, WCI started receiving homeowner complaints in 2006 in areas of Florida including Fort Lauderdale, Fort Myers and Bradenton. Homeowner damage claims included corrosion of soft metal materials in air conditioners and appliances as well as health issues.
Nearly 700 homeowners may seek recovery through the WCI Trust.
In the New Orleans lawsuit, WCI is seeking declaratory judgment to cover the claims and damages for breach of contract.
“A prompt and thorough insurance recovery is vital to enabling homeowners suffering from the effects of defective wallboard to remediate their homes and recover their losses,” Robert M. Horkovich of New York-based Anderson Kill & Olick P.C. and lead counsel to Robert C. Pate, the trustee for the WCI Chinese Drywall Trust, said in a statement.
Aside from Lexington, other insurers named in the suit include American International Specialty Lines Insurance Co., another unit of American International Group Inc.; Old Republic Insurance Co.; Steadfast Insurance Co.; and Illinois Union Insurance Co., a unit of ACE Group of Cos.
Thursday, January 7, 2010
Prudential expands in Asia with UOB acquisition
Prudential is to acquire UOB Life Assurance in Singapore, for £192 million.
The move forms part of a long-term partnership agreement with United Overseas Bank Limited (UOB) to develop a major regional bancassurance business.
Under the terms of the 12-year agreement, Prudential’s investment, savings and protection products will be marketed through UOB’s 414 bank branches across Singapore, Thailand and Indonesia.
Furthermore, the acquisition of UOB Life Assurance will consolidate Prudential’s position in Singapore, where it already has tied agents and distribution partners.
Pru’s group chief executive, Tidjane Thiam, says: “This bancassurance partnership offers us significant new profitable growth opportunities in Singapore and Indonesia, and substantially increases our scale in Thailand, a key market in the region.”
He adds: “This transaction will allow us to continue to create significant shareholder value in some of the most dynamic and attractive Asian markets.”
Prudential currently has life insurance and asset management operations in 13 markets in Asia, with over 11 million life customers and retail funds under management of £16.4 billion (as at 30 June 2009).
The move forms part of a long-term partnership agreement with United Overseas Bank Limited (UOB) to develop a major regional bancassurance business.
Under the terms of the 12-year agreement, Prudential’s investment, savings and protection products will be marketed through UOB’s 414 bank branches across Singapore, Thailand and Indonesia.
Furthermore, the acquisition of UOB Life Assurance will consolidate Prudential’s position in Singapore, where it already has tied agents and distribution partners.
Pru’s group chief executive, Tidjane Thiam, says: “This bancassurance partnership offers us significant new profitable growth opportunities in Singapore and Indonesia, and substantially increases our scale in Thailand, a key market in the region.”
He adds: “This transaction will allow us to continue to create significant shareholder value in some of the most dynamic and attractive Asian markets.”
Prudential currently has life insurance and asset management operations in 13 markets in Asia, with over 11 million life customers and retail funds under management of £16.4 billion (as at 30 June 2009).
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WASHINGTON (Reuters)—House of Representatives Speaker Nancy Pelosi said on Wednesday congressional Democrats were close to agreement on merging their health care bills but still faced challenges in blending the two approaches.
For the second consecutive day, Rep. Pelosi, D-Calif., and other House Democratic leaders met with President Barack Obama at the White House to discuss ways to reconcile the House's health care overhaul with a version passed by the Senate.
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"We've had a very intense couple of days," Rep. Pelosi told reporters after the White House meeting. "I think we are very close to reconciliation, respectful of the challenges."
Democratic House-Senate negotiators must bridge differences on issues including the use of federal funds for abortion, new taxes to pay for the plans, a government-run insurance option and the level of subsidies and penalties for the uninsured.
The two bills must be melded into one and passed again by each chamber before President Obama can sign it.
But Democrats must keep each member of their fragile 60-vote Senate caucus together to muscle the bill through over unified Republican opposition, meaning the final version must hew closely to the Senate bill on several crucial points.
President Obama urged the House Democratic leaders to include a tax on high-priced health insurance policies that is in the Senate bill, The New York Times reported. President Obama has previously said he favors such a tax on so-called Cadillac plans.
"There's so much agreement in the bills but sometimes we approach the issue differently, so we have to figure out the best approach," Rep. Pelosi said after Wednesday's meeting.
The overhaul, President Obama's top legislative priority, would lead to the biggest changes in the $2.5 trillion U.S. health care system since the 1965 creation of the government-run Medicare health program for the elderly.
Both bills would extend insurance coverage to more than 30 million uninsured Americans and halt industry practices such as refusing insurance to people with pre-existing medical conditions.
House leaders have a list of about two-dozen issues to be resolved, a House aide said, with a goal of finishing work before President Obama’s State of the Union address to Congress sometime in early February.
To speed the process along, Congress plans to dispense with the traditional House-Senate conference committee—which could face procedural challenges from Senate Republicans—and let House and Senate leaders negotiate the merger.
Both bills would require most Americans to have insurance, give subsidies to help some pay for coverage and create exchanges where the uninsured could compare and shop for plans.
The need to keep all 60 Senate supporters on board probably means the government-run public insurance plan included in the House bill, but opposed by a handful of Senate moderates, must be jettisoned—an outcome Rep. Pelosi signaled on Tuesday she was willing to accept.
In return for dropping the public insurance option, House members hope to expand the subsidies available to low-income families to purchase insurance without dramatically increasing the bill's price tag, which was $871 billion over 10 years for the Senate but more than $1 trillion for the House.
So far, much of the discussion has focused on the tax differences in the two bills. The Senate's tax on high-cost "Cadillac" insurance plans—opposed by labor unions and many House Democrats—could be adjusted to ensure it does not hit middle-class workers.
The House's tax on the very wealthiest Americans—those individuals making more than $500,000 and families who make more than $1 million—also could be at risk.
For the second consecutive day, Rep. Pelosi, D-Calif., and other House Democratic leaders met with President Barack Obama at the White House to discuss ways to reconcile the House's health care overhaul with a version passed by the Senate.
Advertisement
"We've had a very intense couple of days," Rep. Pelosi told reporters after the White House meeting. "I think we are very close to reconciliation, respectful of the challenges."
Democratic House-Senate negotiators must bridge differences on issues including the use of federal funds for abortion, new taxes to pay for the plans, a government-run insurance option and the level of subsidies and penalties for the uninsured.
The two bills must be melded into one and passed again by each chamber before President Obama can sign it.
But Democrats must keep each member of their fragile 60-vote Senate caucus together to muscle the bill through over unified Republican opposition, meaning the final version must hew closely to the Senate bill on several crucial points.
President Obama urged the House Democratic leaders to include a tax on high-priced health insurance policies that is in the Senate bill, The New York Times reported. President Obama has previously said he favors such a tax on so-called Cadillac plans.
"There's so much agreement in the bills but sometimes we approach the issue differently, so we have to figure out the best approach," Rep. Pelosi said after Wednesday's meeting.
The overhaul, President Obama's top legislative priority, would lead to the biggest changes in the $2.5 trillion U.S. health care system since the 1965 creation of the government-run Medicare health program for the elderly.
Both bills would extend insurance coverage to more than 30 million uninsured Americans and halt industry practices such as refusing insurance to people with pre-existing medical conditions.
House leaders have a list of about two-dozen issues to be resolved, a House aide said, with a goal of finishing work before President Obama’s State of the Union address to Congress sometime in early February.
To speed the process along, Congress plans to dispense with the traditional House-Senate conference committee—which could face procedural challenges from Senate Republicans—and let House and Senate leaders negotiate the merger.
Both bills would require most Americans to have insurance, give subsidies to help some pay for coverage and create exchanges where the uninsured could compare and shop for plans.
The need to keep all 60 Senate supporters on board probably means the government-run public insurance plan included in the House bill, but opposed by a handful of Senate moderates, must be jettisoned—an outcome Rep. Pelosi signaled on Tuesday she was willing to accept.
In return for dropping the public insurance option, House members hope to expand the subsidies available to low-income families to purchase insurance without dramatically increasing the bill's price tag, which was $871 billion over 10 years for the Senate but more than $1 trillion for the House.
So far, much of the discussion has focused on the tax differences in the two bills. The Senate's tax on high-cost "Cadillac" insurance plans—opposed by labor unions and many House Democrats—could be adjusted to ensure it does not hit middle-class workers.
The House's tax on the very wealthiest Americans—those individuals making more than $500,000 and families who make more than $1 million—also could be at risk.
VAT shock for UK insurers with off shore operations
Compliance specialist TMF VAT & IPT Services is warning that changes to EU VAT rules represent a threat to European insurers that have off shored back office operations.
UK firms that have relocated functions such as administration, customer contact, claims processing and accounting to lower cost counties could be facing tax increases of upwards of 25%.
According to TMF, any potential losses are the “unintended consequence” of attempts by Brussels to simplify VAT and prevent fraud.
From 1st January 2010, EU regulations on determining which country’s VAT rules apply have changed; the term “place of supply” now means the place where a service is consumed, rather than where it is located.
For example, in the case of off shored UK insurance services provided from India, the VAT territory will become the UK, meaning the insurer has to account for the VAT bill.
Since insurance and other financial services are exempt for VAT in Europe, this could leave the insurer with an irrecoverable VAT cost of 17.5%.
Some UK firms have already created “VAT Grouping” structures, whereby related companies can offset this type of irrecoverable VAT liability.
However, this process is also under threat from the EU and TMF managing director, Richard Asquith, warns that a new challenge to the VAT Grouping rules could undermine the efforts of insurers using this strategy.
UK firms that have relocated functions such as administration, customer contact, claims processing and accounting to lower cost counties could be facing tax increases of upwards of 25%.
According to TMF, any potential losses are the “unintended consequence” of attempts by Brussels to simplify VAT and prevent fraud.
From 1st January 2010, EU regulations on determining which country’s VAT rules apply have changed; the term “place of supply” now means the place where a service is consumed, rather than where it is located.
For example, in the case of off shored UK insurance services provided from India, the VAT territory will become the UK, meaning the insurer has to account for the VAT bill.
Since insurance and other financial services are exempt for VAT in Europe, this could leave the insurer with an irrecoverable VAT cost of 17.5%.
Some UK firms have already created “VAT Grouping” structures, whereby related companies can offset this type of irrecoverable VAT liability.
However, this process is also under threat from the EU and TMF managing director, Richard Asquith, warns that a new challenge to the VAT Grouping rules could undermine the efforts of insurers using this strategy.
Higos treasures clients with emails
Higos Insurance Services is introducing improvements to its communications strategy by developing specialist teams throughout its 14-branch network.
The Somerset-based firm is aware that it may not communicate with clients between renewals, and staff will in future be emailing policyholders during the gap.
Marketing manager Neil Wyatt explains: “The aim is to improve communication between broker and client, talking to them in a timely way, providing useful updates and an invitation to get in contact through regular e-mails.”
According to Mr Wyatt, the key to an effective e-mail campaign is to ensure the content is pertinent and not too frequent.
He adds: “It is vital that the client doesn’t feel bombarded with overtly sales-like content on a regular basis, which is why we are planning on reaching out to our clients three times a year at the most and ensuring our content includes topical, relevant information.”
Apparently, summer updates on travel insurance and any issues facing travellers, such as the Swine Flu epidemic, will fit the bill.
In terms of cost effective communication, Higos calculates that each email will cost the firm around 1p.
Last month, the broker reported that the business had grown by 10% over the past year, despite the economic downturn.
The firm’s managing director, Ian Gosden, put the success down to an early decision “not to bury our heads in the sand” and instead focus on services, staff training and relationships with clients.
The Somerset-based firm is aware that it may not communicate with clients between renewals, and staff will in future be emailing policyholders during the gap.
Marketing manager Neil Wyatt explains: “The aim is to improve communication between broker and client, talking to them in a timely way, providing useful updates and an invitation to get in contact through regular e-mails.”
According to Mr Wyatt, the key to an effective e-mail campaign is to ensure the content is pertinent and not too frequent.
He adds: “It is vital that the client doesn’t feel bombarded with overtly sales-like content on a regular basis, which is why we are planning on reaching out to our clients three times a year at the most and ensuring our content includes topical, relevant information.”
Apparently, summer updates on travel insurance and any issues facing travellers, such as the Swine Flu epidemic, will fit the bill.
In terms of cost effective communication, Higos calculates that each email will cost the firm around 1p.
Last month, the broker reported that the business had grown by 10% over the past year, despite the economic downturn.
The firm’s managing director, Ian Gosden, put the success down to an early decision “not to bury our heads in the sand” and instead focus on services, staff training and relationships with clients.