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Around the PIA Western Alliance States

Posted By Administration, Tuesday, May 15, 2018

California — PG&E and Wildfire Detection: PG&E has opened a center to keep an eye on wildfires. It’s located at the company’s headquarters in San Francisco and has a bank of computer screens that follow weather forecasts, wind speeds and satellite images of 70,000 square miles of northern and central California.

The idea behind the center is to give the company a heads up in A) anticipating fire and B) having crews ready to respond when fire erupts. The purpose of the crews is to protect people and company assets.

One benefit of the center is an ability to shut off power lines during days — which these days are most days — when fire danger is high and winds are blowing at high speeds. That way downed lines will not spark a fire.

PG&E’s Pat Hogan said, “As we monitor fire risks throughout our service territory, this is where key decisions are going to be made.”

Currently, PG&E is facing over 100 lawsuits that blame downed power lines for fires that killed 44 people and destroyed 6,400 homes in six California counties. The price tag for insurers is $10 billion.

Source link: The Press Democrat

 

California — Pharmaceutical Settlement: Insurance Commissioner Dave Jones reached a $1.875 million settlement with Valeant Pharmaceuticals, Inc. relating to its former relationship with Philidor Rx Services LLC and claims for reimbursement or payment for Valeant products submitted by Philidor to California insurers.

"I am pleased that our fraud investigation of Valeant Pharmaceuticals has come to a successful conclusion," said Insurance Commissioner Dave Jones. "Pharmaceutical companies have a legal duty to make sure that they or their contractors are not submitting fraudulent claims for reimbursements."

Valeant's former relationship with Philidor, which has been widely reported on, was terminated by Valeant in late 2015, following allegations that, among other things, Philidor submitted fraudulent claims for reimbursement to insurance companies. Since terminating its relationship with Philidor, Valeant has replaced many members of its senior management.

The submission of fraudulent claims for reimbursement is illegal under the California Insurance Frauds Prevention Act (CIFPA).

 

California — Climate-Risk Stress Test: Despite litigation threats from 12 state attorneys general and one governor,Insurance Commissioner Dave Jones has taken another unprecedented step to address climate risk faced by insurers, as the first U.S. financial regulator to conduct a climate-related financial risk stress test and analysis of insurance companies' investments in fossil-fuels.

"The climate-related financial risk to insurers' investments in thermal coal, other fossil fuels and fossil fuel enterprises should not be ignored," said Commissioner Jones. "As a financial regulator, I want insurers to consider climate-related financial risks, including risks to their investments. In order to make sure they are considering these risks, we have undertaken an analysis of the climate-related risk to insurers' investments."

The department has engaged 2° Investing Initiative, an established partner of European financial regulators on the topic, to conduct this analysis for insurers in California's insurance market with over $100 million in annual premiums. It is arguably the most comprehensive financial stress test analysis ever conducted for the insurance sector. Insurers analyzed have over $500 billion in fossil fuel-related securities, issued by power and energy companies, $10.5 billion of which consists of investments in thermal coal enterprises.

The department has published key figures from the forward-looking scenario analysis on its website. The results of the scenario analysis by 2° Investing is consistent with Commissioner Jones' Climate Risk Carbon Initiative determination that thermal coal presents long-term financial risks for investors, despite any short-term fluctuations in market price and policy signals. Due to market forces, financial analysts expect more coal-fired capacity retirement in 2018 than under the first three years of the previous U.S. Administration.

"Ceres applauds the leadership and foresight of California Insurance Commissioner Dave Jones, and encourages all insurers to incorporate 2° scenario analysis into their business strategy," said Cynthia McHale, Director of insurance at the sustainability nonprofit organization Ceres. "2° scenario planning strengthens an insurer's assessment of climate risks and opportunities, and positions the insurer to adapt and prosper in a carbon-constrained future."

Individual insurer reports will be made available to all 672 insurance companies with more than $100 million in annual premiums and sent for response to the top 100 insurance companies (by size of their investment portfolio) operating in California, representing over 80 percent of the assets that were analyzed. These reports will explain how investment plans align with different climate scenarios, where the individual insurer ranks among its peers, and which securities are driving the climate risk exposure of their investment portfolios. These results will help insurance companies apply the recommendations of the Financial Stability Board's task force on climate-related financial risks (FSB TCFD) chaired by Michael Bloomberg.

"California was one of the first jurisdictions in the world that recognized the importance of insurers managing and disclosing their climate risk. To advance climate leadership and action, the California Department of Insurance (CDI) became one of the first insurance supervisors to join UN Environment's Principles for Sustainable Insurance Initiative (PSI), and then became the founding Chair of UN Environment's Sustainable Insurance Forum for Supervisors (SIF)," said Butch Bacani of the United Nations, who leads the PSI, the largest collaborative initiative between the UN and the insurance industry, and who co-led the creation of the SIF. "This pioneering work by CDI on scenario analysis to assess transition risk in insurers' investments is yet another testament to California's commitment to promote climate risk transparency and sustainable insurance markets, in line with the aims of the Financial Stability Board's climate risk disclosure recommendations, the Paris Agreement on Climate Change, and the Global Climate Action Summit in California this year. This is leadership in action."

As regulator of the largest insurance market in the nation, Commissioner Jones launched early in 2016 the Climate Risk Carbon Initiative because of the potential for investments in coal, oil, gas and utilities burning carbon to become stranded assets on the books of insurers with little or no value as governments, private companies and markets may slowly or dramatically reduce the demand for carbon-based fuels and their value drops. Jones is the first financial regulator to ask that a financial sector-in this case insurance companies-divest from thermal coal and to publicly disclose their holdings in oil, gas, coal and utilities, due to potential climate-related risks.

In June 2017, 12 state attorneys general and one governor threatened to sue Commissioner Jones for calling on insurance companies to evaluate and address potential climate-related risks to their investment portfolio, to ensure they are investing in assets that retain value and are subsequently available to pay future claims. Despite these threats, Commissioner Jones is continuing the Climate Risk Carbon Initiative, the most recent component of which is the climate-related financial risk stress testing announced today, to make sure insurers are addressing climate change related risks and to protect California consumers. In April 2018, a group of financial supervisors and central banks including the central banks of England, France, Germany, the Netherlands, Sweden, Singapore, China and Mexico announced their cooperation to conduct similar climate stress testing on insurance companies and other regulated financial institutions.

 

Idaho — Medicare Workshop offered in Coeur d’Alene: Senior Health Insurance Benefits Advisors (SHIBA), a unit of the Idaho Department of Insurance, is offering a Medicare Workshop, on Tuesday, May 22nd at the Kroc Center, 1765 Golf Course Rd, Coeur d’Alene ID 83815 from 1:00 pm to 3:00 pm.

This workshop is especially designed for:

  People who are turning 65

  Disabled individuals under 65 or others approaching Medicare eligibility

  Caregivers

  Anyone who would like to learn more about how Medicare works

 

Presenters will explain some of the vocabulary that is associated with Medicare and introduce the various parts of Medicare. Attendees will learn about:

  Important timeframes for enrolling in Medicare

  Enrollment periods for Medigap, Medicare Advantage and Medicare Prescription Drug Plans

  How the different parts of Medicare work together – and when they don’t

 

Anyone interested in attending this workshop is encouraged to call the SHIBA Helpline at 1-800-247-4422 to RSVP.  You can also find more information on the SHIBA website: www.shiba.idaho.gov

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

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