Insurance Defense Blog

The case for banning contingent commissions

Daniel Schwarcz, a Fellow at Harvard Law School who is going to teach at the University of Minnesota, has written an article making The Case for Banning Contingent Commissions.

Coyotes in the suburbs

The Washington Post Magazine has an interesting article about the migration of coyotes into the East coast states, including into the big cities.  Key tip:  if you see a coyote, don't run, scare it off.  I'm still waiting for my first coyote-related case.  I suppose it is inevitable that at some point a child or infant is going to be attacked by a coyote, and then the family is going to be looking for someone to blame, someone who should have warned them of the hazard, or someone who should have put up an 8 foot fence somewhere.

CRS Report on Federal Response to Great Flood of 1927

Open CRS has a recent CRS report on the federal response to the Great Flood of 1927.

History of Flood Insurance

The history of flood insurance follows the history of flooding in the United States.  The basic incompatibility of floods with insurance became clear long ago.  This was alluded to in the recent AEI seminar on Katrina Insurance Liability, which I Tivo'd on CSPAN2, and I thought it would be useful to see what relevant resources are available on the web.

The USGS has a useful summary of significant flooding in the U.S. in the 20th Century.  (Be sure to scroll down and read about why it is a bad idea to drive a car into flood waters.)  Some historical perspective from the New Orleans Times Picayune blog.  NPR has a webpage on the history of Disaster and Response in the United States.  Here's a page on  Flooding in New England.  See also The Nation's Response to Flood Disasters - A Historical Account, by James Wright; the Wikipedia entry on the Great Flood of 1927; and the Wikipedia entry on the Great Flood of 1993.  Who is exposed to flooding?  Just about everybody.

There is a online course on the National Flood Insurance Program, which includes a historical summary:

National Capital Region Emergency Preparedness Campaign

Some ideas about making an emergency plan.

The Washington Times reports on the coverage disputes arising from Katrina.

Later:  an insurance agent's common sense view.

Coverage Disputes Brewing in Wake of Katrina

The Washington Post ran an article on potential coverage disputes brewing in the wake of Katrina.  This has also been commented upon by bloggers, here, here, and here.   Insurers need to get their adjusters down there to start photographing the evidence before it is all bulldozed away.

Later:  Sept. 10 Wash Post says that covered losses could be $60 billion.  Meanwhile, the latest interview of NO Mayor Ray Nagin.

Learning from Hurricane Katrina

A few thoughts about Hurricane Katrina.  In its own way, this has been as horrible as 9/11.

I haven't seen all that many links to the Salvation Army's website for Hurricane Katrina donations, so I am putting one here.  The Red Cross seems to be doing fine for now in terms of fund-raising.

I heard a press conference by Sen. Trent Lott of Miss. yesterday on CSPAN radio, as I was driving home.  He was asked about whether he had any criticisms of the FEMA response, and his answer was something to the effect of, 'my mama didn't raise no fools, and I am not about to be trying to bite the hand that's trying to save me.'  That's not an exact quote, but close enough. 

I got home, and there was President Bush on the news saying that he was going to head an investigation of the response himself, and by the way, he was going to ask for another $40 billion for disaster relief. 

Those two public statements were enough to convince me that the better course would be to defer any investigation until after the rebuilding is fully underway.  I doubt that the state and local officials involved are going to be willing to say everything that they know and think anyway, when their primary responsibility is going to be to get their constituents their fair share of the billions in aid that are going to be pouring forth.  New Orleans Mayor Ray Nagin has been remarkably candid so far in interviews, but I don't expect that to continue much longer.  Sorry to be cynical, but Senator Trent Lott was telling it like it is, and he should know.

So we are not going to have anyone in Congress asking or answering questions like, why was building a couple of bridges to nowhere in Alaska for over $400 million more important than the New Orleans levee system?  What were they thinking?

There's no point in asking those "why" questions anyway; it's just a question of who has political pull when the appropriations bill gets passed.  It's an ugly and disfunctional side of our government.

Meanwhile, September is National Preparedness month, and you have to ask yourself, are you ready?  You need at least three days of food and water to be ready, among other things.   Washington, D.C., in particular, has to shut down if there is more than 2 inches of snow, and the road systems struggle to handle normal rush hour traffic.   It will be chaos in the event of a major terrorist attack, particularly one that requires an evacuation.   Another terrorist attack is coming sometime, I think everyone takes that for granted .  We've already had three by my count.  (9/11, the anthrax incidents, and the D.C. sniper.)   I understand that if you don't live around here, you may not count the last two.

Today's Washington Post had a piece on the effect that the Katrina damages claims are going to have on the insurance industry.  The bottom line is that it is going to be big, but don't panic.  Hopefully there won't be any "significant" insolvencies, and besides, the public is going to pick up most of the tab.  Translation:  there is a financial hurricane forming for some in the insurance industry, and you'd better pay attention to it, and know which insurers are heavily at risk down there.

   

New Paper In D.C.

The Washington Examiner was launched today.

Coyotes in DC -- Can the First Coyote Liability Case Be Far Behind?

The Washington Times reports that coyotes have been spotted in Rock Creek Park.  If you consider what a coyote might do in an urban area, and what mistakes people might make in trying to shoot, poison or trap the urban coyote, there's bound to be trouble.

Later:  Tips for coexisting with urban coyotes.

Inequitable Tax to Pay for the Washington Nationals' Ballpark

The Legal Times Nov. 22, 2004 edition has an article entitled, "Smaller Firms Object to Baseball Tax Plan".  The article points out that the plan to pay for the new ballpark is to finance it with a new gross-receipts tax on businesses with revenues of more than $4 million.  However, the ballpark fee tax scale is capped at $48,000.  So a business or a law firm that grosses say, $300 million a year, will pay no more than a firm that grosses $30 million.  And firms in the $4 million to $30 million range pay only slightly less than the mega-firms or mega-businesses.