We Were Thrilled With Your Response

In our last edition, we were overwhelmed with the response to our thoughts on David Brooks’ teachings from his bestselling book, “The Road to Character.”  One of our devoted readers, Frank Kowalski, shared, “Recently, as a reward for excellent performance I sent one of my CSRs to the YAC event in Tampa. I had no idea you were a presenter there yourself. So unexpectedly the young lady was moved by your newsletter today that she took an excerpt of your comments on Gratitude and sent it to everyone on staff, giving LMA credit for it of course. I thought you’d appreciate that you touched someone enough for them to pass it along, pay it forward if you will.”

Another said, “Lisa, I’m in Europe with my family and I read your entire discussion about dispositional gratitude to them over breakfast. Gratitude happens when some kindness exceeds expectations, when it is undeserved. Thank you for always providing us a foundation for what we do.”

Many of our younger readers asked us for more pearls of wisdom and after some reflection about how stressful our industry can be with deadlines, coverage debates, claims disputes, litigation, etc., that are the engine of our industry… I was reminded of Daniel Koepke’s advice to “just breathe.”

“Breathe. You’re going to be okay. Breathe and remember that you’ve been in this place before. You’ve been this uncomfortable and anxious and scared and you’ve survived. Breathe and know that you can survive this too. These feelings can’t break you. They’re painful and debilitating, but you can sit with them and eventually, they will pass. Maybe not immediately, but sometime soon, they are going to fade and when they do, you’ll look back at this moment and laugh for having doubted your resilience. I know it feels unbearable right now, but keep breathing, again and again. This will pass. I promise it will pass.”  ~Daniel Koepke

A Message from Club 25

Some of our readers will recall that I was thrilled in 2013 to be selected as a member of the Club 25, which is made up of honorees of the Tallahassee Democrat’s “25 Women You Need To Know” and the five “Young Women To Watch”.   These women are business owners, educators, attorneys, philanthropists, volunteers, former elected officials, community leaders and so much more, but more importantly, they’re women who make a difference in the Tallahassee community. In the past, the group has planted trees throughout the city, provided scholarships to local students and taken on community projects regularly.  One of the projects for this year and one we are asking you to support is the Tallahassee Police Department Victims Unit Collection Project.   For this project we are asking that folks contribute the following:

Comfort Kits – filled with women’s toiletry items in travel sizes, hotel size or any size. Items include shampoo, conditioner, body wash, hair brush, tooth brush and tooth paste, mouth wash, wipes, Kotex and tampons, deodorant, lotions.

Clothing – Any donations of new or gently used, freshly washed clothes because many victims arrive with nothing but the clothes they are wearing.

Hotel Vouchers – Hotel vouchers or gift cards for a night in a hotel would be welcomed as an emergency shelter option for victims.

We have a collection box in our LMA office at 331 North Monroe Street and hope you will drop by with whatever you can contribute.  Three other collection locations are:

Big Bend Hospice, 1723 Mahan Center Blvd (ask for Betty Morales), United Church of Tallahassee, 1834 Mahan Drive, and Sentry Self Services Storage, 3116 West Tharpe Street.  We appreciate anything you can do.

Office Solidifying Holding Company Model Act Rules and Related Forms

On Wednesday, August 12, 2015, the Office of Insurance Regulation (OIR) held a workshop to discuss the proposed rules and forms that are to comply with the NAIC Model Holding Company Act and the Florida law that implemented this NAIC model act, Senate Bill 1308 that passed in 2014.  The model act and the Senate bill are designed to give greater transparency to insurer affiliates. On June 13, 2014, Commissioner Kevin McCarty, who, while NAIC president helped design the NAIC model law, applauded the Legislature and Governor Scott upon Senate Bill 1308 becoming law saying this bill brings solvency regulatory standards into compliance with the NAIC model law.

During the rule workshop on August 12, several regulatory lawyers and consultants including Lisa Miller & Associates asked OIR for clarification about the rules.  For example, one of the rules cited that filings by companies as required by these rules should be marked as proprietary information.  One of the attendees pointed out that the statutes are clear that these filings are proprietary so what happens if a company doesn’t mark their submission accordingly? Another concern centered on whether affiliates had to produce separate financial documents when much of this information was contained in consolidated financial statements and creating separate financial documents for affiliates will be time consuming and costly.  Terms in the rule and form documents like “relationships” and “general financial condition”, and “material distribution patterns” were cited as being ambiguous and OIR agreed to study and determine how to make the rules more clear to avoid misunderstanding on the part of the filers. A copy of the proposed form documents that are to accompany OIR’s proposed new rules may be obtained by clicking HERE.

Comments on these rules will be accepted until August 24 and on or about September 24, the Financial Services Commission will hear OIR’s request to have these rules published which will start the formal clock for rule adoption. There will be another opportunity to comment most likely in October.  Please please call me and I will walk you through these rules as they will have far reaching effects on insurer filing requirements.

DFS Formalizes Revised Rules for Neutral Evaluation of Disputed Sinkhole Claims

On 7-27-15, the Department of Financial Services’ Division of Consumer Services officially put in place a host of revisions to its administrative rules guiding  policyholders, insurers and neutral evaluators in the process of resolving disputed sinkhole claims. The more important changes to the sinkhole claim dispute rules include:

  • Repealing the Neutral Evaluator standards because the standards are now set forth in Florida statute.
  • Imposing a five business day requirement on insurers to contact claimants after notice of a request for neutral evaluation.
  • Imposing a three business day requirement on neutral evaluators to disclose conflicts of interest.
  • Requiring professionals used by a neutral evaluator to disclose conflicts of interest.
  • Allowing insurance companies to contact policyholder representatives and not just the policyholder.
  • The revised rules also start the neutral evaluation request process as of the date insurers receive notification from DFS, instead of the date DFS was first notified of the dispute.

A neutral evaluator is defined by DFS as a professional engineer or geologist who has completed a course of study in alternative dispute resolution designed or approved by DFS for use in the neutral evaluation process and who is determined by DFS to be fair and impartial to the process. A copy of the revised rules that utilizes underlining and strikethrough to assist the reader in understanding each rule change can be read or downloaded by clicking HERE. Please call our office if you have any questions or need assistance in interpreting changes made to these important rules.

LMA Congratulates Caitlin Murray, OIR’s new Legislative Affairs Director

We are so excited to be working again with Ms. Caitlin Murray; OIR’s newly appointed legislative affairs director. A graduate of Florida State University, Murray has built a solid political resume through working with Fowler White Boggs, the Republican Party of Florida, the Dorothy Hukill for State Senate campaign, and the Florida Legislature. While working in the Legislature, Caitlin was senior legislative staff to former Senator JD Alexander from Polk County and most recently to current Senator Jeff Brandes, a leading senator who has championed flood insurance legislation. Caitlin is organized, has great attention to detail and a pleasure to work with. Her balanced and measured approach will be appreciated. Congrats Caitlin!

Connecticut Supreme Court Rules on Data Loss

We are drowning in issues regarding data thievery and cyber liability in today’s news events; however, a recent court case in Connecticut gave yet another scenario of how liability policies may respond in this data/cyber liability world in which we live. A May 18, 2015 ruling by the Connecticut Supreme Court held that insurers are not obligated to defend or indemnify the loss of data under general liability and umbrella insurance. The case involves a Chicago-based recall information management firm that had contracted with Armonk, New York-based IBM Corporation, to transport and store computer tapes. In the case, Recall Total Information Management Inc. et al. v. Federal Insurance Co. et al., Recall Total subcontracted the work to another firm.  Recall Total and the subcontractor had coverage under a commercial general liability policy issued by Federal Insurance Company, an insurer within the Chubb Group, and an umbrella liability policy issued by Scottsdale Insurance Company, an insurer within the Nationwide Group. The case stemmed from the loss of 130 computer tapes containing information on 500,000 current and former IBM employees, when the tapes fell out of a truck in February 2007. An unknown individual retrieved the information, but the data apparently never were accessed. A settlement for notification and other costs was eventually reached with IBM, and the firms then sought $6.4 million in coverage under their policies, which the insurers denied. The Connecticut Supreme Court agreed with an appellate court that the loss of the computer tapes did not constitute a personal injury as defined by the policies, because there had been no publication of the information that violated privacy rights. Joseph F. Bermudez, an attorney with Wilson, Elser, Moskowitz, Edelman & Dicker L.L.P., said the ruling “just confirms (general liability) polices were not intended to, and do not, cover data breach crisis events. As a result of this ruling, you’re going to see a lot of people understand the need for cyber coverage a little bit more,” said Todd M. Rowe, a partner at Tressler L.L.P. in Chicago.

Internet Domain .insurance to Be Available by

End of 2015

The top-level Internet domain “.insurance” should be available to the industry late this year, according to a financial services-backed organization that operates generic domains including “.bank.” The group, fTLD, submitted an application to the domain-approval organization, the Internet Corporation for Assigned Names and Numbers (ICANN), in May 2012, seeking to operate the .insurance generic top-level domain. fTLD was created in 2011 by a group of banks, insurance companies and financial services trade associations after ICANN said it would accept applications for financial top-level domains. The organization promises that .insurance will have enhanced security and all applicants will be “verified as legitimate member of the insurance community.” Backers hope the new domain will help prevent users from being redirected to fake insurance websites and limit the ability of spammers to send emails from a fake .insurance domain. “This major milestone will allow us to move forward with our initiative to enhance consumer confidence in the online financial system by creating a trusted, protected, more secure and easily identifiable space on the Internet for the insurance community,” said Craig Schwartz, managing director of fTLD, in a statement. “The new domain will be operated in a highly restrictive manner with strict eligibility requirements designed to ensure that the space is used by verified insurance industry members.” The group already has a similar contract with ICANN to operate the .bank domain, which it said it expects to make available by mid-2015, several months before .insurance will go public. “We see a tremendous opportunity for ‘.insurance’ to serve as a platform for innovation in insurance services, and securing the right to operate this top-level domain is the first step necessary to translate the community’s interests and hard work into the reality,” Schwartz said.

In the World of Workers’ Compensation

It’s that time of year again when we travel to Orlando for the 70th Annual Workers’ Compensation Educational Conference at the Orlando World Center Marriott.  If you’ve ever attended this event, you will agree that it is an amazing conference, addressing state, national and international issues in the workers’ compensation world. We are looking forward to the keynote speaker this year, Herschel Walker and as is always the case, folks from the Division of Workers’ Compensation will be there to share the latest from Florida regulators.  We’ll share the highlights of what we learn in a future edition. In other workers’ compensation news, the Florida Department of Financial Services, Division of Workers’ Compensation has adopted the Florida Workers’ Compensation Health Care Provider Reimbursement Manual, 2015 Edition (Rule Chapter 69L-7.020, Florida Administrative Code). However, the policies and reimbursement allowances identified in the Health Care Provider Reimbursement Manual will not go into effect until the manual has been ratified by the legislature. The purpose and effect of the rule is to update the schedule of maximum reimbursement allowances to 2014 Medicare reimbursement rates as adopted by the Three Member Panel on 01/22/2015. When the manual becomes effective, we will let you know.

With Change Comes Opportunity

LMA has undergone some exciting changes of late, like our beautiful new conference center that is proving to be a great addition to our services.  We are also undergoing a few other changes that we will be sharing with you in an upcoming newsletter publication.  It’s our way of life to participate in new adventures, and we are certainly an adventurous crew here at LMA. With change comes opportunity, so stay tuned and we’ll clue you in very soon. Until then, stay in touch and come by and see us when you can.  Lisa and the Team