RiskProf

At War with the Weather

2009-06-11T16:57:05-04:00

	Four years in the making…. I just received my copy in the mail today from MIT Press. It is available on Amazon for $ 37.12. What a bargain. In the fine print on the cover you can see while I am not a primary author I do get the “with” treatment. Other notables are Neil Doherty, bob Klein and Mark Pauly.
What is nice about the Amazon listing is that there are a ton of blurbs. However, there is no Kindle edition yet. Nor are there any free peeks. You’ll just have to wait.

Non OFC Federal Regulation

2009-06-10T08:16:09-04:00

I heard rumors of this last week. Details so far:

Big insurers are regulated by feds

“Deregulation” (whatever that means) will not occur.

The Fed will be the systemic risk regulator

There will be a financial consumer protection agency

FDIC will resolve big insurance company failures.

via National Underwriter

Florida Chamber of Commerce Poll Results

2009-06-10T08:10:18-04:00

via IJ

• 62 percent believe consumers should be allowed to choose their property insurance provider "even if the prices are not fully regulated by the state" rather than to be limited to purchasing insurance from a provider whose prices are fully regulated.

• 60 percent of Florida voters are either "very" or "somewhat" worried that their insurance company may not be able to pay their claim if the state is hit with more hurricanes this summer, like in 2004 and 2005.

A Little Friday Levity

2009-06-05T11:43:14-04:00

Not to be confused with the new little Leverty. Riskprof’s Ty Leverty had a little boy earlier this spring. I won’t disclose his name out of respect to his privacy, but it is a real strong Irish name. I am particularly fond of Finbarr as a name, but my wife (who was probably thinking of the then wee one’s future) repulsed with significant gusto my attempts to name any of my little sigmas Finbarr. Just so you know -- I did stop moping about this years ago.

Here is the real Friday levity. Evidently, someone sued Pepsi (the owners of Cap’n Crunch) for false advertising for $5 billion because there were no crunchberries in the cereal. I realize $5 billion is much anymore, but I think the fact that the word “crunchberry” is not in a real dictionary or even MS Word’s might have been a clue.

boingboing has a short story, but the comments are hilarious.. some of my favorites so far..

#7. I heard that Crunch [had] to stop using his formal title when it was exposed that he never actually served in the military.
#3. What!? Next thing you'll be telling me is that Froot Loops aren't made from real fruit, and that there's no nuts in Grape Nuts!
#37. Don't be silly. Froot Loops are made from froot.
#9. I love that she's suing on behalf of, not just herself, but the "other people" who have been similarly misled. […]Don't kid yourself, lady, you are an island in this belief system.
#33 Follow up suit: Lucky Charms are not "magically delicious." They are merely "delicious."
#48. So... that bowl I just had of Rice Chex didn't really have any Czecks (sic) in it, right?

Quote of the day....

2009-06-04T14:43:35-04:00

"We're one large hurricane away from a major threat to the economy of this state [Florida]," said Proctor, R-St. Augustine.

via www2.tbo.com.

Nice Biliography on The Future of Insurance Regulation

2009-06-04T10:46:00-04:00

Martha Henn McCormik at the Networks Financial Institute has produced a nice biography of regulatory reform.

My Congressional Testimony Part I (The Back Story)

2009-06-03T19:31:00-04:00

I have been teaching a special three week term. Each class meets about 3 hours per day and I am teaching two. (I just finished yesterday.) At the beginning of the term I was asked to testify before Congress regarding my opinion about the future of insurance regulation. I was teaching intensively six hours a day and I was getting a little brain fried, so I said yes. That is when the trouble started.

I received the official invitation from the subcommittee at 5:00pm on Friday. I didn’t read the fine print until Sunday. I had to have 100 copies of my testimony to the subcommittee 48 hours prior to the hearing on Wednesday. That was not a big deal—it just meant I had to finish writing up my testimony by Sunday night and then I would overnight a package to DC. Well, thanks to the anthrax scare of late 2001 --

mail (of any kind) does not get to Congress quickly. In fact, they will not accept overnight packages. Monday I talked to the subcommittee counsel and she suggested that I use a friend or the university's Washington counsel to walk it over to the subcommittee offices. I laughed and said I wouldn’t tax a friend with this and that we didn’t have DC counsel. This brought a concise “Sure you do. All universities have local counsel.” I called our university attorney’s office and asked who our DC counsel is, and I got a big chuckle from him. I called back to DC and told them the bad news and the subcommittee graciously agreed to copy the document for me. (Remember, all the phone calling back and forth was taking out time from writing the testimony-plus I had to teach six hours that day. The stress was slowly, but surely building.)

About 4:00pm my pc died taking a great deal of unsaved work with it. The work was supposed to being saved every 20 minutes or so, but either because of user error (likely) or hardware problems I lost about four hours of work. It was a good four hours too. I never wrote so eloquently in my entire life. So after a little dance around my office with a few choice, and some relatively common, expletives, I got back to work. But after an hour I had to go teach again.

I got home from class about 10:30 and worked until 1:30 and wrote something that was semi-coherent, but not nearly as eloquent as my earlier missive. I got up about 6:30 and reread and edited the testimony, corrected a number of glaring typos and then sent it off to the e-mail address in the invitation letter about 7:30 am. About an hour later I looked to see if I received an acknowledgement and I noticed that I did not attached the danged testimony. Rats. So I sent a second e-mail with an attachment.

Here’s where the story gets better. I was late getting to school to teach the early class, so I parked with a valet parking service across the street from the College of business. As I got out of my car, my wife called me. I was carrying some books and a brief case so I had to put them down. As I did so I dropped my phone onto the driveway in the parking area. Before I could pick it up – it was run over by both the front and back tires of an SUV the size of a federation starship. I cringed as each wheel ran over the phone. I was getting a bit addled by the stress at this point. I bent over to pick up my phone and then my glasses fell off. I couldn’t find them after a couple of frantic minutes of searching. Luckily, no more cars came into the area and and I had to call over a parking attendant to help me find them which he promptly did. They skidded about 15 feet from where I was standing, but were otherwise unharmed. My phone, in the meantime, said “No Service.” i remember thinking, “No kidding.”

I turned off the poor phone and started to walk to my office building. I stopped and looked left and right. Then, to be extra prudent I looked up to make sure there was nothing falling from the sky. I crossed the street safely and I turned the phone back on. While looking like it got run over by the Enterprise, it worked perfectly. I softly said a “Thank you, Mr. Motorola!” and went on my way. I taught a good class and came back to my office where I had an e-mail message asking where my testimony was. I sent off another copy and said that I followed the subcommittees directions and had sent it to a the subcommittee e-mail address. I received a quick thanks and then I went to the Atlanta airport for the 4:00 flight to Regan-National. All the way to DC I was waiting for the next event. Luckily nothing happened and my nervous ticks were almost entirely in remission by the next morning.

Part II ‘The Testifying Experience” to come….

Anti-Life Insurance

2009-06-03T15:52:36-04:00

A Buckinghamshire man diagnosed with terminal cancer is to collect a second winning payout of £5,000 after betting he would stay alive.

Jon Matthews, 59, from Milton Keynes, was diagnosed with mesothelioma, a cancer linked to asbestos, in 2006 and told he had months to live.

He placed two bets, each with a £100 stake at odds of 50/1, that he would be alive in June 2008 and in June 2009.

A third wager will earn him a further £10,000 if he lives until 1 June 2010.

The widower will collect his second lot of £5,000 winnings on Monday.

via marginal revolution

Perhaps an actuary could comment on the pricing of this contract.

Note that traditional life insurance is really death insurance (i.e. one insures one’s self against a premature death). So this contract is true life insurance?

Book Update

2009-06-03T15:43:08-04:00

Thanks to Mike the Actuary for noting that Amazon now has a copy of our book, The Future of Insurance Regulation for order. It is a new improved version of papers presented last July at the AEI.

A New Treasury Blueprint?

2009-06-03T08:04:00-04:00

It seems similar to the last, according to this Reuters report, but it looks like insurance consumer protection might be regulated at the federal level.

"The Fed could also lose some of its consumer protection responsibilities, which would move to a new agency that would supervise financial products, such as credit cards, mortgage-related products and insurance."

Or does it mean that the whole industry ball of wax gets the federal treatment?