Wednesday, June 29, 2011

Child Booster Seats

The institute for Highway Safety has provided a method to take much of the guesswork out of selecting the proper booster seat for your child. Seat belts are designed with adults in mind- so a child booster seat is an absolute necessity, and extra care needs to be taken when securing young children.



Children usually resist wearing a seatbelt because it is uncomfortable. Boosters elevate children so that the safety belts installed in the vehicles by manufacturers will fit the child better. The booster seat allows the lap belt to fit properly over the child’s thighs and not their abdomen. The shoulder belt should fit across the middle of the child’s shoulder. Not only will the belt be more comfortable, it will provide maximum protection in a crash.



The institute’s researchers used a specially designed test dummy configured as a 6 year old child. The researchers determined the effectiveness of how a 3-point lap and shoulder belt fit the dummy under a range of configurations representing many different automobile models. Based on a range of scores, a booster seat rating was assigned to each seat.

Saturday, June 18, 2011

Life Line for New York SIGs Falling Short While National Attention on Funds Sharpens

It appears my recent story “A New Life Line for Group Workers’ Comp Funds in New York” was overly optimistic and the obituary for SIGs in that state may indeed be published in the not too distant future.

According to knowledgeable sources, preliminary discussions about finding a reasonable compromise to allow well run New York SIGs to continue to operate have not panned out. At issue has been the posting of security to satisfy regulator concerns about solvency going forward.

The state’s workers’ compensation board pushed back against formulas proposed by industry that would allow funds sufficient access to cash to pay claims and other operating expenses. As a result, a new law has been passed requiring funds to post security equal to 160% of expected claims. With such a high bar, it is likely that the baby will be thrown out with the bath water.

There is some uncertainty, however, as the regulations to implement the new law has yet to be written and industry continues to press its case to the Governor and the Legislature that this law will have significant negative ramifications for the state’s workers’ compensation system. So stay tuned as there may additional twists to this story in months ahead.

But while New York has been the epicenter of actual legislative/regulatory activity affecting SIGs, it’s worth noting that the New York experience has spurred discussions in national forums.

Just last month at the National Council of Self-Insurers (NCSI) Annual Meeting, representatives from the California Self-Insurers Security Fund presented a session on SIGs. Although some good objective data was provided, there was an obvious bias evidenced by the fact that they were quick to point out the isolated problems within the SIG industry without acknowledging that the overwhelming number of SIGs are well run and provide smaller employers an important risk financing option.

It should not be surprising that the presentation concluded with comments suggesting that national standards for SIG regulation should be considered.

This discussion promises to pick up again next month Southeastern Association of Workers’ Compensation Administrators (SAWCA) Annual Meeting as one of the featured sessions will discuss “warning signs for a SIG default.” This meeting typically attracts a large number of regulators so the meeting room is likely to be filled with those who may be inclined to make it more difficult for SIGs to operate.

While a serious regulatory push with national reach may not be right around the corner, those who have an interest in maintaining sensible SIG regulation should nonetheless pay attention to the discussions that are going on because developments can accelerate with little warning.

Not only do you have regulators encouraging each other to conform to group think about how to deal with SIGs, but the traditional insurance industry never misses an opportunity to stir the pot by trying to make funds look bad. The confluence of these dynamics should keep SIG industry stakeholders on their toes.

So we’ll watch to see how things continue to play out in New York while keeping an eye on other states who may not be able to resist on messing with a good thing.

Wednesday, June 15, 2011

Kidproof

The temptations and dangers to today’s children are unfortunately ever growing. The news will attest to this with stories of abductions, kidnapping, facebook driven depressions, internet bullying, etc. It is important that kids and parents today be proactive against such dangers. Being in the business of risk management we are always looking for ways to mitigate and avoid risk. One way to do this when it comes to kid’s safety is through courses put on by Kidproof. Kidproof is an organization that puts on safety courses for children. The courses are geared toward kids ages 5 to mid teens.



Some examples of their courses are:



Cybersafe which teaches kids how to safely use the internet. They teach them how to see warning signs and unsafe situations online.



Another course is all about avoiding being bullied or how to deal appropriately with a bully. The course is called Bully Proofing.



Their most popular class is the Babysitter Training course. This course helps kids develop the skills needed to take care of other children.



Knowledge and education are always a good defense against certain dangers. Kidproof’s classes are a great way for parents to help make children aware and educated on today’s dangers. Visit www.kidproofsaftey.com today.



Kidproof is always looking to expand to help get the word out to parents in different communities in North America. If anyone wishes to start their own Kidproof franchise then contact Darian Richardson of RMC Franchise. Visit his website at www.rmcfranchiseconnect.com.

Monday, June 13, 2011

Obsessed With Adverse Selection

In case you haven’t heard, self-insurance is the gateway to adverse selection in the health insurance marketplace. Federal and state regulators have been sending up warning flares on this subject, but not surprisingly, their aim misses the mark.

This discussion has heated up as policy-makers look ahead to 2014 when state insurance exchanges are slated to come on-line and they try to predict market conditions and that time. For PPACA supporters, there’s a lot riding on making sure the exchanges work as promised so they are taking aim at any real or perceived obstacles. Adverse selection drivers are at the top of the list.

We saw this first in the HHS Report on the Large Group Market, which was published in March. In the report HHS commented that if low attachment point policies in the reinsurance (read stop-loss) market become more widely available by 2014, a significant number of fully-insured employers with “low risk” employees will switch to self-insurance, therefore creating adverse selection in the marketplace.

This section of the report concludes that “these results highlight the importance of closely monitoring the availability and pricing of reinsurance (stop-loss insurance) and closely monitoring decisions made by small employers to self-insure.”

A working draft of a recent NAIC white paper on the subject of adverse selection also points the finger at self-insurance as contributing to adverse selection. The NAIC writes: “Employers with favorable risk demographics have an incentive to self-fund while those with less desirable risks would tend to opt for fully-insured plans either through the exchange or in the outside market.”

Neither HHS nor the NAIC acknowledges one very important fact as part of their analysis, which is that most companies with fewer than 100 employees simply do not know if their group is a good risk because claims data is generally not available to them. In this regard, their “premeditation” argument is compromised.

Now it’s true that employers that switch to self-insurance can often improve the aggregate risk profile of their groups over time, regardless of the baseline at the time of transition, through wellness programs and other innovative plan design strategies, but shouldn’t that be the objective of all group health plans?

Let’s also recognize the importance of the HHS comment about “closely monitoring” the stop-loss market as way to guard against adverse selection. As described in my previous blog posting, Treasury Department Gets Schooled on stop-Loss Insurance, federal regulators now have a keen interest in stop-loss insurance for a variety of reasons.

This new federal attention combined with the ongoing desire by state legislators to expand their authority over self-insured health plans creates a very uncertain environment for future legislative/regulatory activity that could affect the ability of small and even mid-sized companies to self-insure.

There’s one last development on this subject worth mentioning. Some key House Republican staffers have indicated a renewed interest in introducing association health plan (AHP) legislation, but are holding back because of anticipated criticism that self-insured AHPs would contribute to adverse selection. So the education process continues on multiple fronts.

Thursday, June 9, 2011

Pools and Insurance

A few weekends ago we all celebrated Memorial Day. Traditionally this is the weekend where many pool owners open up the family pool for the summer. Pools are cleaned, chlorine is checked and pool toys are brought out of storage. There is, however, one other step pool owners should take when opening the pool. That step is to make sure their homeowner insurance is up to date to best protect them if something happens to the pool and or to a summer guest.


The pool itself has coverage on your homeowner policy under Section I, Other Structures. Normally this coverage is 10% to 20% of the amount of insurance you have on your home. Let’s say you have your house insured for $200,000; under a typical homeowner policy you will have $20,000 in coverage for Other Structures. As a pool owner you need to ask yourself, is that enough to cover my pool if it was damaged? If not you may need to increase your Other Structures coverage.


Liability is always a big concern when a pool is involved. It is important for pool owners to know that many insurance companies require pools to be fenced. If they are not the pool owner may find their homeowner carrier canceling their insurance. So if you are someone that currently doesn’t have a pool but plan to add one, make sure to include a fence in your planning process.


Umbrella insurance policies are something we at Fey Insurance Services always recommend but if you are a pool owner we strongly recommend them. Unfortunately drowning is a real risk when you own a pool. Heaven forbid this ever happened at your pool but if tragedy did strike you would want to have all the liability coverage you can to help protect you.


So before you pull the winter cover off your pool, be sure to consult with your insurance agent and do a review of your homeowner insurance. Enjoy the summer!

Thursday, June 2, 2011

Homeowner Insurance in a Disaster

With all the devastation that is occurring in the country from tornados, home insurance has become a hot topic. More specifically, having the correct amount of insurance on your home has become a hot topic. A few weeks back we posted a blog article about a house's "Market Value" vs. "Construction Replacement Cost". Just a few days ago USA Today journalist Sandra Block posted a wonderful article in the Money section of USA Today on the same topic. Here is a link to this article:



Will Your Homeowners Insurance Cover You if Disaster Hits? by Sandra Block (June 1, 2011) USA Today