June 11: Elsewhere with the actuaries

As I write this, the Big Ten has 12 members, and the Big 12 has ten.

  • New York adopts a 60-day prior approval law with a 60-day deemer provision for health insurance, the New York Times reports. The law covers individual and small business policies and requires a medical loss ratio of 82%. (Recall Obamacare requires 80% and 85%.)
  • Industry losses from the Chilean earthquake are likely to top $8 billion. Munich Re raised its  estimate 43 percent, to $1 billion, and says a hard market for cats will ensue. Swiss Re re-estimates at $630 million, net of retros, up from $500 million.
  • Massachusetts continues to struggle with its beta version of Obamacare. Insurers want rate increases, and the state is saying no. The DOI’s solvency arm, meanwhile, foresees a financial train wreck. The whole point of the Obamacare model is to give insurers more leverage in negotiating stingier reimbursements, thus breaking the inflation expectations baked into the health care system. If insurers can’t pull that off, it’s a bad, bad thing.
  • This WSJ online piece (not behind the Journal’s firewall) is a really interesting take on BP and its use of captives to self-insure. It concludes by considering a capital-market solution to enormous third-party liabilities, sort of a cat bond for liability losses.
  • Obligatory Actuaries-pick-the-World-Cup article here.
  • Shortest possible Monopoly game: 21 seconds. Read the story, before you watch the video; the guys in it seem to be in a hurry.
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