Insurance Journal’s Most Noteworthy Topics of 2020: South Central Region

Insurance Journal’s Most Noteworthy Topics of 2020: South Central Region

2020-12-29 06:33:28

Hurricanes, hurricanes and tropical storms

It should come as no surprise that hurricanes and tropical storms topped the Insurance Journal's list of the most read topics in the South Central region. In a North Atlantic hurricane season, there were 30 named storms according to record books, 12 of which made landfall in the US, five of which were in Louisiana only.

While the total insurance price tag for the U.S. storms was $ 20 billion, the amount was moderate compared to the record seasons of 2005 and 2017, according to Swiss Re. Damage continued, as the residents of Louisiana still in recovery mode can attest to the seemingly endless wave of storms.

For Louisiana, the season started with Tropical Storm Cristobal in June and finally ended with Hurricane Zeta on October 28, with Laura, Marco and Delta in between.

Some of the stormheads that managed to capture the interest of IJ readers include:

COVID-19 lawsuits

As in the rest of the country and the world, the COVID-19 pandemic in 2020 had a major impact on the South Central region. Not only have huge numbers of people suffered and died from the disease, millions of people lost their jobs or were put on leave as a result of the company closures imposed by local and government officials in an effort to slow the spread of COVID-19.

Many companies tried unsuccessfully to access their commercial insurance policies to reclaim the revenue lost from the forced closures. As a result, numerous lawsuits have been filed over insurers' general denial of policyholder business interruption claims. Most of the lawsuits have been dismissed by judges who recognized that there is generally no coverage for pandemic-related business income losses under most commercial insurance policies. However, in mid-December, the first lawsuit to be taken to court began in New Orleans over insurers' denial of business interruption claims related to pandemic closures. The city's Oceana Grill had asked a state judge for a declaratory ruling that its business interruption policy covers the damages caused by forced closures by civil authorities due to the coronavirus. The lawsuit, filed in March 2020, was tried in mid-December. Judge Paulette R. Irons had previously ruled against a motion for interim relief filed by Lloyd & # 39; s of London to dismiss the lawsuit.

Other lawsuits have tried to accuse agents in addition to insurers for denying business interruption claims, and insurance experts on errors and omissions have warned agencies to be aware that creative litigation attorneys can target them.

Fires and explosions in the workplace

A fiery, explosive year in the South Central region began in January with a massive explosion at a Houston warehouse that killed two workers and injured 20 others. That event and others that resulted in workplace injuries, deaths, and closures caught the attention of readers in 2020.

The explosion called for a Grinding and making buildings damaged at least 450 structures, mostly houses. The company produces valves and thermal spray coatings for equipment in various industries. The Watson Grinding and Manufacturing later filed for bankruptcy, and CEO John Watson was forced to backtrack on a promise to repair all homes damaged in the explosion, at the insistence of the company's insurers.

Workers were also killed at other explosive workplace events in Texas and Louisiana this year, and while thankfully no one was injured in a pre-Thanksgiving fire and explosion at Greenberg Smoked Turkey Inc. in Tyler, Texas, the company was forced to close for the remainder of the year. Greenberg Smoked Turkey, which sells approximately 200,000 smoked turkeys each holiday season, shut down production after a fire and at least two explosions destroyed part of the plant in early November.

Non-standard car

Developments in non-standard auto insurance caught the attention of readers of the South Central region news in 2020.

State Farm's announcement in September that it would buy Texas-based GAINSCO attracted not only readers but commentators who wondered what was behind the company's choice of a non-standard auto insurer as its very first acquisition of another. insurance company. Of the $ 400 million transaction, Michael Tipsord, President, Chairman and CEO of State Farm, said in a press release that State Farm believes "this acquisition positions both our business and GAINSCO well for future growth." He added that the acquisition "will further help us achieve our goal of serving more customers in more ways."

Founded in 1978, GAINSCO specializes in minimum limits on personal car coverage and actively distributes its non-standard personal car products through independent retail agents in Arizona, Florida, Georgia, New Mexico, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, Ohio and Alabama. Its insurance business is conducted through its subsidiary, MGA Insurance Company Inc., a Texas corporation.

The demise of another Texas-based non-standard auto insurer was also of great concern to South Central readers. Houston-based ACCC Insurance was placed in receivership in late October at the request of the Texas Department of Insurance. In addition to Texas, the privately held company offered its insurance products in Alabama, Georgia, Mississippi, New Mexico and South Carolina, and was licensed in 20 states. Posting new business ceased when the company was placed in receivership. After it was determined that the company was in fact insolvent, a petition for liquidation was filed in late November by the TDI-appointed Special Deputy Receiver (SDR) for ACCC, Prime Tempus Inc. ., said the ACCC & # 39; s Alabama and Texas would hire nonstandard auto companies after court approval.

Commercial auto insurance fraud

As creative fraudsters continue to develop a seemingly endless variety of scams to unfairly pay auto insurers with sums of money to which they are not entitled, the staged auto accident scheme is one that remains eternally popular.

In the South Central region, at least 33 people have been charged so far in a federal investigation into the staging of motor vehicle and commercial vehicle accidents in the New Orleans metropolitan area. Eleven of the 33 accused defendants have pleaded guilty to federal court.

In November, Danny Patrick Keating, Jr. (51), a New Orleans personal injury attorney, charged with conspiring to defraud insurance companies, commercial carriers and transportation companies in the ongoing investigation into the mass-staged accident plan.

In Keatings' case, U.S. attorneys claim he paid others for 31 staged accidents, represented 77 plaintiffs involved in the 31 accidents, and settled 17 of them. The indictment charges that Keating and his 77 clients received approximately $ 1.5 million in settlements and that Keating held approximately $ 358,000 in attorney's fees.

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