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Around the PIA Western Alliance States

Posted By Administration, Tuesday, January 30, 2018

California — Jones Issues Show Cause: The California Department of Insurance issued two additional Orders to Show Cause against Access Insurance Company. The first alleges Access Insurance Company is conducting its business and affairs in a manner that threatens to render it insolvent or in a financially hazardous condition in violation of the California Insurance Code. The second alleges Access Insurance Company has failed to pay over $5 million in premium taxes, interest and penalties.

The first Order to Show Cause alleges that Access Insurance Company conducts its business in a hazardous manner that results in a risk of loss to the policyholders, creditors and the public. The order alleges the company has failed to properly account for its future obligations. The company's reserves are $22.5 million deficient and it has failed to pay premium taxes, penalties and interest in excess of $5 million dollars resulting in a total deficiency of nearly $27.2 million available to pay policyholders on their claims.

The department staff alleges that as a result of the deficiency noted above Access Insurance Company failed to maintain the capital required by law and the Insurance Commissioner is authorized to place Access Insurance Company under regulatory control. As a result, the Access Insurance Company may be subject to conservation or liquidation proceedings. Irreparable loss and injury to the property and business of the company may occur unless the Insurance Commissioner acts to correct, eliminate, and remedy such conduct and conditions.

The second Order to Show Cause charges Access Insurance Company with repeatedly failing to pay premium taxes to the State of California, and alleges that the company currently owes over $5.2 million in delinquent taxes, interest, and penalties. Pursuant to California Revenue and Taxation Code Section 12802, Access Insurance Company's Certificate of Authority shall be revoked unless the company can establish that the taxes, interest and penalties currently outstanding and due have been paid. The department staff alleges that this outstanding tax liability is in addition to the inadequate reserves identified in the first Order to Show Cause.

"As Insurance Commissioner, my first priority is protecting consumers," said Insurance Commissioner Dave Jones. "To do this I must ensure all insurance companies are following the law, acting with financial integrity, and delivering on their promises to consumers."

A public hearing will be held on February 14, 2018 at 10:00 a.m. at the Department of Insurance in San Francisco after which the Insurance Commissioner will determine whether to issue a cease desist order and or revoke Access Insurance's Certificate of Authority to transact insurance.

A separate Order to Show Cause, Accusation, and Notice of Non-Compliance were filed in July 2017 charging Access Insurance Company and some of its affiliates with engaging in improper claims handling and improper rating and underwriting practices in violation of the California Insurance Code and the Fair Claims Settlement Regulations. These actions are still pending.

 

Idaho — Ransome Ware Attack: Six weeks ago The Jerome, Idaho school district got hit by a massive ransomware attack. It happened on December 11th and much of its data base and the files contained was corrupted. To get the data back each form said a ransom must be paid in bitcoin.

The value of the ransom is something like $65,000.

While not done with the task, the district has not paid the ransom and will be able to rebuild all of the files from backed-up data.

Source link: Insurance Journal

 

Oregon — Data Breach Legislation: We’re all concerned about data breaches. Businesses and politicians agree that it’s a problem. However, a solution being offered in the Oregon Legislature is not all that popular with business. Retailers find both bills will raise the cost of doing business and is not going to make the date that much — if any — safer.

Sponsored by Eugene Democrats Rep. Paul Holvey and Sen. Floyd Prozanski the bills have business concerned in these areas:

  Changes to the definition of personal information would impose new requirements, such as the inclusion of geolocation and photographs in combination with other information, that are more stringent than in any other state. Including geolocation and photographs in personal information would increase businesses’ liability without a corresponding improvement in consumers’ financial protection.

  Requiring notification to affected consumers within 45 days of discovery of a breach would not provide adequate time for affected businesses to determine the size and scope of the problem, gather contact information and provide notice —especially in response to larger breaches.

  Requiring notification of the financial institution for each card that’s breached is duplicative and wastes resources that would be better directed to containing damage. Also, merchants do not have access to information about issuing financial institutions, as it is not collected at the time of sale.

  The mandates on businesses relating to training and monitoring security risks do not realistically account for the difficulty of training for a problem that is steadily changing because of technological advancements and the ingenuity of hackers.

  The addition of a private right of action provides an incentive for a person to pursue an action to final judgment. Retailers are already subject to a disproportionate share of data breach lawsuits: only 14.5% of publicly reported breaches relate to the retail industry, but nearly 80% of data security breach class actions are targeted at retailers.

To read the House bill, HB 4147, click here.

To read the Senate bill, SB 1551, click here.

Source link: The Oregon Prosperity Project

 

Oregon — Measure 101 Passes: New taxes will be levied on Oregon hospitals, health insurers and managed care companies to pay for the cost of Medicaid for hundreds of thousands of low-income people.

It means Oregon will continue to have the lowest rate of uninsured residents in the country at 5%. Also of note, about a million Oregonians — or 25% of the state population — receive health care coverage from Medicaid.

The bill was sponsored in part by the Oregon Association of Hospitals and Health Systems. Spokesman Andy Davidson said this is a short-term fix to generate between $210 and $320 million to pay for the services. “The vote is an affirmation of our belief that Oregon is better off with a robust Medicaid program for our most vulnerable citizens. We are proud to have been a partner in fighting for these patients and their families,” he said.

Source link: Insurance Business America

 

Oregon — New Product Standards posted: Limited-Wraparound Coverage:

A new product standards for limited-wraparound coverage have been posted.

http://dfr.oregon.gov/rates-forms/health/Pages/limited-wraparound.aspx

http://dfr.oregon.gov/rates-forms/Documents/5352.doc

http://dfr.oregon.gov/rates-forms/Documents/5352.pdf

The DRAFT timelines for 2019 Binders have been posted. Once timelines have been confirmed by CMS we will post updated documents: http://dfr.oregon.gov/business/insurance-industry/health-ins-regulation/Documents/2019-filing-timelines.pdf

Tags:  Around the PIA Western Alliance States  Insurance Content  Insurance Industry  Insurance News  Weekly Industry News 

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