Insurance statistics in Washington state

Each year, the Insurance Information Institute, an industry-backed research group, compiles data on the insurance industry in each state.

From this year's Washington edition:

• Number of people working in the insurance industry in Washington state: 49,445.
• Their payroll: $3.2 billion.
• Premium taxes paid: $406 million
• Premiums: About $19 billion.

The report includes a lot of other information, including details about which companies write the most insurance, losses incurred, etc.

Aetna fined $1 million for insurance violations

A Connecticut insurance company has been fined $1 million by Washington State Insurance Commissioner Mike Kreidler for multiple violations over several years.

Aetna Life Insurance Company has agreed to pay the fine. The violations include issuing unapproved insurance policies, failing to file legally-required documents with the state and charging unapproved rates.

“All insurers must comply with state law, and most of them do,” said Kreidler. “I hope that this fine and compliance plan resolves these problems with Aetna.”

Among the violations:

• Starting in 2005, Aetna issued health, disability or life insurance policies to more than 4,400 people that did not comply with state law. Among the violations: The policies had not been filed for approval with Washington state.

• Also starting in 2005, the company issued health policies that did not include all Washington state health care mandates. Nor did they describe Washington’s appeals and grievance process, as required by law.

• For more than three years, Aetna continued to sell a health policy that had been disapproved.

• Starting in 2009, Aetna issued other health, disability and life policies that had not been filed with the state. Some of those health policies that did not include all Washington state mandates. Nor did the company have an approved appeals and grievance process for those plans.

• In 2010 and 2011, Aetna issued medical and dental plans for more than 100 Nordstrom retirees that had not been approved by Kreidler’s office, as required by law.

The company has also agreed to a compliance plan designed to prevent similar problems in the future.

Fines issued by Kreidler’s office do not go to the insurance commissioner’s office. The money collected goes to the state’s general fund.

Yak insurance vs. yakking about insurance

Nepalese herders, tired of losing their livestock to snow leopards, have come up with an insurance plan to compensate them when a leopard kills a yak.

The herders pay about $1.50 a year to cover each yak, and are paid about $50 if the yak is killed by a snow leopard.

(On a side note, we're betting that this story is driving a significant amount of traffic to insuranceyak.com, which is a blog devoted not to yak insurance, but to yakking about insurance.)

Order approving Amerigroup WA acquisition by WellPoint

We've gotten a number of calls from analysts about this: Here's the final order approving acquisition of Amerigroup Washington Inc. by WellPoint, Inc.

For the full history and the rest of the documents, see this page and scroll down to "Amerigroup Washington Inc."

Happy Holidays

Happy holidays from the Ontario Insurance Law Blog.  We'll be back in January with our weekly posts.  We wish you all the best in 2013.

When Has FSCO Mediation Failed - Part 2

Last week, we blogged on the Court of Appeal`s decision in Hurst v. Aviva, which held that insureds may proceed to bring court actions or arbitration proceedings if 60 days have passed since an application for mediation at FSCO has been filed and no mediation has taken place.

The Court released its decision in Younis v. State Farm Insurance Company, 2012 ONCA 836 (C.A.) concurrently with Hurst.  In the Hurst actions, the 60 day period had elapsed prior to the insured filing a court action.  In Younis, however, the claimant applied for mediation on July 14, 2011 and filed a court action a few days later. State Farm`s motion to stay the action took place well after the 60 day period had elapsed.  Justice Sloan refused to stay the action. 

The Court of Appeal allowed the appeal.  The Court held that the insured commenced his action in contravention of the statutory requirement by not waiting 60 days.  Since Younis had not waited until mediation had failed, his action was barred.  To allow otherwise would permit insured person to immediately commence civil actions and the statute did not permit this tactic.

High wind warning in south Puget Sound -- gusts up to 60 mph Sun and Mon

The National Weather Service has issued a high wind warning for the south Puget Sound area, including south Tacoma, Olympia, the southern part of Hood Canal, Montesano, Chehalis and Centralia.

A "southerly wind 15 to 30 mph will develop late this evening (Sunday)...then switch to southwest wind 30 to 40 mph with gusts to 60 mph late tonight and Monday morning," the NWS said. "Winds will slowly ease Monday afternoon."

High winds -- especially when soils are soaked, as they are now -- can topple trees, cut power lines, etc. After winter storms, we often get a flurry of calls from folks wondering what their homeowners and auto insurance covers. Here are some of the most common questions we get, along with the answers.

Update: (10 a.m. Monday) The winds have died down, although we might get a bit of snow tonight.

Hole-in-one golf insurer extradited to face felony charges in WA

From a news release we sent out today:
OLYMPIA, Wash. – A Connecticut businessman who insures golf tournament hole-in-one prizes but has a history of failing to pay has been extradited to Washington to face charges.

Kevin Kolenda, 55, of Norwalk, Conn., was flown from Connecticut to Washington under guard Thursday. He has been booked into the King County Jail. He’s expected to be arraigned Monday at King County Superior Court in Seattle.

“It’s rare that we have to go to these extremes to rein in a scammer,” said Washington Insurance Commissioner Mike Kreidler. “But Mr. Kolenda’s been thumbing his nose at regulators for years. Arresting him seems to be the only way to get his attention.”

In August, Kolenda was charged in King County Superior Court with five counts of transacting insurance without a license, a class B felony. His arraignment was slated for Sept. 5, but he failed to show up. A judge issued a bench warrant for Kolenda’s arrest.

In addition to failing to show up in court, Kolenda also ignored a Washington cease-and-desist order in 2004 and a $125,000 fine in 2008.

On Sept. 26, Kolenda was arrested on the Washington bench warrant by police in Norwalk. He has been held since then in jail in Connecticut, pending extradition. His transfer to Washington was approved in November by Connecticut Gov. Dannel Malloy.

“I’m very grateful to everyone who’s helped us get Mr. Kolenda here to Washington to face justice,” said Kreidler. “He has a long history of selling illegal insurance and refusing to pay prize winners.”
In some cases, charities have had to come up with the prize money that Kolenda refused to pay. In others, the prize winners agreed to forgo a prize.

Kolenda in 1995 started a business called Golf Marketing, working out of a home his parents owned in Norwalk. Since then, the business’ name has changed several times, including: Golf Marketing Worldwide LLC, Golf Marketing Inc., Hole-in-Won.com, and currently Hole-in-Won.com Worldwide. The company also has a regional office in Rye, N.Y.

Kolenda has repeatedly failed to pay winning golfers in Washington. Among them:

• In 2003, Kolenda illegally sold insurance for a tournament in Bremerton. But when a golfer got a hole in one and tried to claim the $10,000 prize, Kolenda wouldn’t pay.

• In 2004, Kolenda sold insurance for a Vancouver tournament. Again, a golfer got a hole in one. Kolenda refused to pay the $50,000 prize. After a hearing at which Kolenda failed to appear, he was ordered in 2008 to pay a $125,000 fine. He never did.

• In 2010, Kolenda sold coverage to pay $25,000 for a hole in one during a golf tournament in Snohomish. A player got a hole in one. His golf partners signed notarized forms attesting to the hole in one. The prize remains unpaid, despite numerous calls and emails from the partners and tournament officials.

Similar allegations have been made against Mr. Kolenda and/or his business in numerous other states, including Montana, Ohio, Georgia, California, New York, Hawaii, Alabama, Massachusetts, Florida, Connecticut and North Carolina.

Job opening: .NET developer

We're recruiting to fill a position for an information technology specialist 4 (.NET developer) in our operations division in Tumwater, Wash.

The successful applicant's duties will include software development of mission-critical agency systems, systems analysis, as well as software unit and quality assurance testing.

For more specifics, duties, salary, timeline, etc., please see the full job listing.

Guilty plea from man who hit car, then bought insurance

A Blaine man who rear-ended another driver, rushed to buy insurance, then claimed that the crash happened afterward has pleaded guilty to insurance fraud.

Mark Traxler, 51, let his auto insurance lapse in January because he didn't pay the premium.

Two weeks after his coverage ended, he hit a car in Bellingham, causing more than $5,000 in damage.

He immediately went to his insurance agent and paid for new coverage. By nightfall, the other driver had made a claim against his policy.

The problem: Traxler said that the accident happened after he'd bought the coverage, when a 9-1-1 call placed by the other driver indicated that it happened before.

Traxler today pleaded guilty in Whatcom County Superior Court. He was sentenced to 364 days in jail, but 354 were suspended on the conditions that he do 80 hours of community service, pay a $250 crime victim penalty assessment, a $200 filing fee and a $500 fine.

When Has FSCO Mediation Failed - Part 1

We previously blogged on the decision in Cornie v. State Farm, in which Justice Sloan held that insureds may commence claims against their accident benefits carriers if 60 days have elapsed since an application for mediation has been filed, even if mediation itself has not occurred.  The Court of Appeal has now released its appeal decision in Hurst v. Aviva, 2012 ONCA 837 (C.A.).

Section 281(2) of the Insurance Act prevents insured persons from commencing court actions or arbitrations against their insurers unless they first seek mediation and mediation has failed.  The claimants waited 60 days after applying for mediation and when no mediation had taken place, they commenced actions.  FSCO`s position was that the prescribed 60 day time limit for conducting mediation did not begin to run until an application for mediation had been assessed by FSCO and found to be complete.  FSCO refused to issue a report declaring the mediations had failed.  The insurers in four actions brought motions to have the actions stayed on the basis that they were barred by s. 281(2) as mediation had not taken place.  Justice Sloan dismissed the motions and the insurers appealed. 

The Court of Appeal dismissed the appeals.  The Court concluded that the process is intended to be completed with 60 days after an application for mediation has been filed; however, if mediation has not taken place within 60 days, insured persons are free to pursue either court action or arbitration. 

The Court rejected the insurers` arguments that the cost to the industry could be $83 million as a result of the interpretation of the Act that does not require mediation to actually take place.  The insurers submitted statistics that 75% of claims are resolved by mediation at FSCO.  One has to expect a flood of court proceedings as a result of this decision, along with significant costs to insurers.

Job opening: Market analyst

We're recruiting to fill one permanent position for a market analyst in our Tumwater, Wash. building.

The person will be responsible for conducting market analysis of regulated entities (e.g. insurance companies) under the direction of our chief market analyst. We provide regulatory oversight of market interactions between consumers and companies, in order to protect consumers and promote a healthy business environment.

Please see the full job listing for a description of the job duties, salary, benefits, etc.

Coming soon: Our revamped website

For more than a year now, we've been working hard behind the scenes developing an easier-to-use website. While insurance industry professionals -- agents, brokers and insurers -- are familiar with navigating our site, testing showed that consumers could only complete site-related tasks about a third of the time. That's a problem, obviously, when a key part of our mission is informing and protecting consumers.

So we've revised the navigational structure of the site to make it a lot more intuitive. For years, for example, much of the navigational structure on the site simply mirrored the agency's organizational chart, rather than putting things where average users would expect them to be.

Along the way, we've repeatedly tested the changes on both consumers and industry professionals to make sure that we really are improving things, rather than just changing them.

The upshot: Successful task completion on the website for consumers, which is about 33 percent on our current website, rises to nearly 80 percent on our new prototype website, pictured below.

We're also changing the look and feel of the site to update it. The site isn't live yet, but we're expecting to make the change in mid-January.

There will inevitably be some hiccups and things we'll need to fix, but we think you'll like the new site better. And we know it will be easier to use.

20,000 Washingtonians potentially affected by data breach at Nationwide Insurance

An October data breach in a Nationwide Insurance computer network resulted in personal information for thousands of Washingtonians being stolen, according to company officials.

"On October 3, 2012, a portion of our computer network that is used by Nationwide Insurance and Allied Insurance was criminally intruded upon by an unidentified perpetrator. We discovered the attack that day, and took immediate steps to contain the intrusion," Nationwide attorney Samuel Lee notified our office recently.

The company has said that more than 1.1 million people's personal information may have been affected. Some of them are not Nationwide customers. Apparently, some people who might have just gotten quotes, etc. are on the list of those who may have been affected. We've been contacted by some of these people, and since they're not Nationwide customers, they initially think the letter is some kind of scam or sales pitch for ID theft services.

"Although we are still investigating the incident, our initial analysis has indicated that the compromised information included individuals’ name and some combination of their Social Security number, driver’s license number and/or their date of birth and possibly their marital status, gender, and occupation, and the name and address of their employer," Lee wrote.

The attack was reported to law enforcement, including the FBI, who are investigating. Nationwide is sending notification letters to 20,916 people whose personal information may have been compromised. The company says it is tightening network security. It is also offering a year of free credit monitoring and identity theft protection services to those 20,916 people.

In the letter being sent out, the company apologizes for the data breach and says "we are not aware of any misuse of your information at this time."

Nationwide customers should watch for a letter in the mail, or they can call a special hotline the company has set up: 1-800-760-1125.

The state attorney general's office also maintains an excellent page with detailed tips on preventing and dealing with identity theft.

Appellate Jurisdiction

Under the Courts of Justice Act, appeals relating to amounts greater than $50,000 must be made to the Court of Appeal.  Appeals of judgments relating to amounts under $50,000 are to the Divisional Court.  Where only a portion of a judgment is appealed, does the jurisdiction change?

In Grammatico v. Chambers, 2012 ONSC 6518 (Div. Ct.), the parties disagreed on whether the proper court to hear an appeal was the Divisional Court or the Court of Appeal.  The substantive judgment involved sums greater than $50,000, the threshold imposed by s. 19(1.2) of the Courts of Justice Act for appeals to the Court of Appeal. The defendant argued that it sought to appeal an interest component relating to costs, rather than the substantive judgment.  Since the amount would be less than $50,000 the defendant's position was that the appeal was to the Divisional Court.

Justice Eberhard held that the appeal was to the Court of Appeal.  The jurisdiction for appeal must be determined by the aggregate of the sums awarded.  The fact that only one part of the decision was under appeal did not determine jurisdiction.

Think you have flood insurance? Make sure.

Again, we can't say it enough: Homeowners and businesses in flood-prone areas should make sure they have adequate flood coverage.

“Standard homeowners or business policies do not cover flooding,” said Insurance Commissioner Mike Kreidler. “It’s tragic when people don’t discover that until it’s too late.”

The federally-run National Flood Insurance Program (www.floodsmart.gov) is the first stop for most people seeking flood coverage. The program was created by Congress in 1968. It offers flood insurance to homeowners, renters and business owners in communities that have taken certain steps to help reduce the risk of flooding. There is a 30-day waiting period for most policies, so it’s important not to delay.

Many insurance agents offer National Flood Insurance Program policies. The average NFIP policy costs about $600 a year.

“Renters should also strongly consider flood coverage for their belongings,” Kreidler said. “That coverage, which starts at $49 a year, is inexpensive. Replacing your stuff is not.”

Mortgage lenders in flood-prone areas typically require flood coverage. But homeowners often later let that coverage lapse.

The National Flood Insurance Program website has online tools to estimate the flood risk at a particular address, as well as damage estimates from different flood levels.

Don't forget flood coverage

We can't stress this enough: many people assume that their homeowners policy includes flood coverage.

It doesn't. Standard homeowners-, renters- and business policies do not cover flood damage. If your property is in a flood prone area, you should strongly consider buying flood coverage.

How do you know if you're in a risky flood area? Type your address into the red box on the home page for the federally run National Flood Insurance Program. That's where most people buy their flood coverage. Many local insurance agents sell these policies.

And if you think a few inches of water wouldn't cause much damage, you might be surprised. The NFIP put together an interesting interactive simulator that details -- item by item -- the costs of different levels of flooding in a typical home. See the link above.

Costs on a Summary Judgment Motion

In Mo v. Johnson, the defendant successfully moved for summary judgment dismissing the plaintiff's claim.  Justice Morgan's decision on costs is reported at 2012 ONSC 6307 (CanLii). 

One of the arguments made by the plaintiff was that the defendant was only entitled to costs of the motion, not the entire action.  Justice Morgan disagreed, holding that:

[24]      I agree with Mr. Bizezinski that where summary judgment dismisses the action, it is the costs of the action in its entirety that are at issue. To hold otherwise would allow a party who brings spurious litigation to cause the opposing side to incur substantial costs with no means of compensation. 

The defendant was awarded costs of the entire action on a substantial indemnity basis due to the plaintiff's conduct, which was described as "aggressive and high-handed".  The decision is a nice synopsis of some of the basic principles relating to costs. 

Job opening: Senior market analyst

We're looking for a senior market analyst in our Tumwater office. Here's the job description, including salary, responsibilities, and timeline. The deadline for applying  is just before 5 p.m. on Monday, Dec. 3.*

Also, we still have an opening for an Information Technology Specialist 4 (.NET developer).

*Update: The deadline has now been extended to Dec. 17, 2012.

One computer, one camera, fake invoices...and four different insurance claims

A Renton man has been sentenced to jail plus community service after submitting thousands of dollars in bogus claims for a $4,900 laptop, and a $3,200 camera.

Between December 2010 and September 2011, Michael Tran Lai, 32, filed multiple claims with four different insurance companies claiming the loss of the MacBook Pro laptop and Nikon camera. He claimed they were stolen from a car, or lost in luggage while travelling, or stolen from his hotel room. The invoices turned out to be fake.

He also filed multiple claims for the same accident damage to his Lexus.

Laid was sentenced Nov. 16 to 10 days in jail, 160 hours of community service, and $854 in court fees and costs. A restitution hearing is also pending.

Tips to avoid a turkey-fryer fire...because here's what that looks like

The turkey-fryer disaster video is a YouTube holiday staple, and it's not surprising. Oil burns really well. Turkeys are big.

The biggest mistake seems to be this: overfilling the pot and plunging a big turkey in while the flame is lit, causing a lot of oil to splash over the sides and, yup, ignite.

Bigtime.

  

And sometimes, this happens on a deck or close to a house.

So if you must fry your turkey, here are some key tips:

• Fry outside, away from the house.
• Do not overfill the pot with oil.
• Properly thaw the turkey.
• Turn off the flame before adding the turkey.
• Use the grappling-hook thing to lower the turkey in carefully (and not splash oil).
• Be careful of oil splattering on your arms. Splashed boiling oil can cause horrible burns.
• And -- if in doubt, review video No. 2 above -- keep a grease-approved fire extinguisher handy.

Bonus round: Actual turkey-fryer-mishap-victim William Shatner reviews these points in his cautionary video "Eat, Fry, Love."

Cost of Productions

Who pays for the cost of producing documents?

In Veillette v. Piazza Family Trust, 2012 ONSC 4782 (S.C.J.), the plaintiffs brought a motion to compel the defendant to answer undertakings and refusals he gave on an examination in aid of execution.  The defendant took the position that the plaintiffs must pay any charges for obtaining the documents.

The Court cited two cases dealing with production of documents before trial, Ho v. O’Young-Lui, 2002 CanLII 6346 (ON SC), and Traverse v. Turnbull, [1996] N.S.J. No. 212 N.S.C.A. which held that the general rule is the party in possession or control of the documents is to produce them at their expense, although the court has residual discretion to depart from that rule where fairness and justice so require.  The general rule may be altered if its application would prevent a party from presenting its case.  Justice Kane held that there was no reason to depart from the general rule.

Although this case deals with an examination in aid of execution, disagreement over who pays for documents can often arise in the context of examination for discovery.  The Veillette case is useful in providing a succinct argument as to why plaintiffs should bear the cost of producing their documents.

Flood warning update

Flood warnings remain in effect in the following counties: Grays Harbor, Lewis, Mason and Thurston, with some gale warnings and small craft advisories offshore.

Here's the complete list from the National Weather Service office in Seattle.

Flood, high wind and storm warnings in WA

The National Weather Service has issued a long list of flood-, wind- and storm warnings, watches and advisories today. Here's a roundup:

A flood warning has been issued for the Chehalis River at Centralia (in Lewis County) and the Chehalis River near Grand Mound (in Thurston County). Moderate flooding is expected, and the weather service is warning motorists not to try driving through flooded areas -- the most common cause of flood-related deaths in Washington.

In Lewis County, the flood warning will be in effect from Tuesday morning to Wednesday evening, with the river expected to hit flood stage around 9 a.m. Tuesday and crest 4 feet over flood stage around 4 p.m. Tuesday.

What's that mean? At four feet over flood stage, the weather service says, "The Chehalis River in Lewis County will flood some residential and commercial areas with water encroaching upon the first floor of some homes and businesses. Swift flood waters will cover some roads.

At Grand Mound, the river's expected to hit flood stage around 7 a.m. Tuesday and crest about 2 1/2 feet over flood stage around 4 a.m. Wednesday. Flooding of several roads in Independence Valley is expected, including SR 12 and James-, Independence-, Moon- and Anderson roads. Flood waters are expected to cut off access to and from Chehalis Reservation and inundate nearby farmland.

Minor to moderate flooding is also predicted the the Chehalis River near Doty (Lewis County), the Newaukum near Chehalis (Lewis), the Satsop River near Satsop (Grays Harbor County) and the Skokomish River near Potlatch (Mason). There's a flood advisory -- meaning minor flooding is possible -- for a dozen western Washington counties, as well as western Kittitas, Klickitat and Yakima counties.

A high wind warning is in effect for Seattle and the central coast areas, with the strongest winds occurring as we post this, with the warning lasting until 3 p.m. South winds of 25-35 miles an hour have been reported, with gusts near 60 miles an hour.

A winter storm warning has been issued for the Cascade mountains above 4,500 feet, with periods of heavy snow expected to persist through evening. An additional 1-2 feet of snow is likely, especially over the North Cascades, the weather service says.

Similarly, a winter weather advisory is in effect for the Olympic mountains above 5,000 feet, with 6-11 inches of snow expected, but tapering off late today.

Fraud charges for man who hit car, then bought insurance

A Blaine man who rear-ended another driver, rushed to buy insurance, then claimed that the crash happened afterward has been charged with insurance fraud.

Mark Traxler, 51, let his auto insurance lapse in January because he didn't pay the premium.

Two weeks after his coverage ended, he hit a car in Bellingham, causing more than $5,000 in damage.

He immediately went to his insurance agent and paid for new coverage. By nightfall, the other driver had made a claim against his policy.

The problem: Traxler said that the accident happened after he'd bought the coverage, when a 9-1-1 call placed by the other driver indicated that it happened before.

Traxler has been charged in Whatcom County Superior Court with insurance fraud.

The search for Big Daddy: barbecue case leads to insurance fraud charges

In the summer of 2011, a Renton man named Cassk Thomas, Jr. filed a claim with his insurer, saying that someone had stolen his his 26-foot, 8,500-pound, two-tank, three-grill barbecue smoker, dubbed "Big Daddy."

The barbecue had been stored behind a locked fence, he told police. Two screws on a hinge had been removed. The smoker, as well as the double-tandem-axle trailer it was mounted on, was gone. Thomas provided his insurance adjuster with an invoice from a Spokane company, totalling $32,343, for the trailer and smoker.

Thomas' insurer, American Family Insurance, paid Thomas $30,474 for the lost barbecue, as well as $24,668 for lost income while he sought a replacement barbecue.

Upon investigation, it turned out that the trailer was actually purchased from a company in Texas for less than a third of what Thomas claimed. A former business partner said it cost $9,470, and she provided paperwork showing that.

The company Thomas had named as the manufacturer in Spokane apparently does not exist. It's not listed with the state departments of licensing or revenue, not on the Internet, the business address is a residence and, in repeated attempts, no one answered the phone there. A company official named by Thomas turned out to be an old roomate of his.

Thomas has been charged in King County Superior Court with 1st degree theft and insurance fraud, both of which are felonies.

Martin v. Fleming - Deductibles

The Court of Appeal has now released its decision in Martin v. Fleming, which can be found at the following link: Martin v. Fleming, 2012 ONCA 750 (C.A.)

At issue was the operation of the deductible where a plaintiff has been in multiple accidents.  The motions judge ruled that where the plaintiff has been involved in two accidents and the actions are tried together, there is a deductible for each action.

In a brief endorsement, the Court of Appeal dismissed the appeal. They followed the motion judge's reasoning that s. 267.5(7) is unambiguous and the plaintiff is subject to two deductibles.

Although this is a brief endorsement, it is important to those defending claims where the plaintiff has been in multiple accidents.  Insurers for each defendant retain the benefit of the deductible.

A hard lesson for victims with flooded houses: standard homeowners policies don't cover flooding

The New York Times has a nuts-and-bolts story about insurance concerns in the wake of Hurricane Sandy, and all of the lessons apply here in Washington.

The biggest one -- and something that we repeat often -- is that a standard homeowners policy does not cover flooding. For that coverage, people typically buy a policy from the federally-run National Flood Insurance Program.

The problem is that unless required to by their lender, many homeowners simply don't get flood coverage. (And even those whose mortgage requires it often later let it lapse.)

The article covers things like who pays for tree removal, will you be reimbursed for living costs if your home is uninhabitable, and will an insurer cover the cost of ruined food when the power fails.

25 free apps

The U.S. Department of Health and Human Services has compiled a list of free health-related applications, created by the feds, regarding health. They include apps for the iPhone, iPad, Android and iPod Touch.

The apps include:

Find a Health Center: Created by the Health Resources and Services Administration, this map-linked app helps you find the nearest federally funded health center, which will care for you even if you have no health insurance. Based on your income, you pay what you can afford.

The popular BMI calculator, which helps determine your body mass index.

Brrd Brawl: A mobile game developed to give jittery quitting smokers something to do with their hands.

52 Weeks of Women's Health: Info on 52 health topics, ranging from eye health to contraception. Also helps track medications, allergies, etc.

Other apps include help triaging injuries in the field, treating radiation injuries, quitting smoking, tracking the flu in your area, tracking a pregnancy and reuniting after a disaster.

Expert Independence

Do the new rules pertaining to expert evidence impose a higher duty than at common law?  When an expert is alleged to be biased due to a connection to one of the parties or a matter in issue, does it go to admissibility or weight? 

In Henderson v. Risi, 2012 ONSC 3459 (S.C.J.), the defendant proffered an expert, Mozessohn, to give testimony at trial regarding irregularities in the financial records of Timeless Inc., provide an opinion on the value of shares in Timeless held by the plaintiff, and critique the plaintiff expert's opinion.  The plaintiff objected to the admissibility of Mozessohn's evidence on the basis that he was not independent or impartial since he was a partner in the accounting firm that acted as Timeless' Trustee in Bankruptcy.  Mozessohn testified that there had been no communication between members of his firm about the case.

Justice Lederman quoted the Newfoundland Court of Appeal in Gallant v. Brake-Patten 2012 NLCA 23 (CanLII), which summed up the law regarding the admissibility of expert evidence where the allegation is the expert lacks institutional independence as opposed to personal advocacy:

In summary, in civil cases, if expert evidence meets the Mohan criteria for admissibility, it is admissible.  Bias or partiality in expert evidence which is based on the expert having a connection with a party or issue or a possible pre-disposition or approach in the case is a reliability issue which is best determined when the whole of the expert evidence is considered in the context of all of the trial evidence.  As such, the issue is one of weight and not admissibility.

Plaintiff's counsel argued that the new r. 4.1 and the changes to r. 53 imposed a higher level on duty on an expert in Ontario, and that the question of institutional independence must be determined at the admissibility stage rather than leaving it to be considered as a matter of weight.

Justice Lederman disagreed and allowed the expert to give testimony.  Rules 4.1 and 53 simply remind experts of their already existing obligations to provide opinion evidence that is fair, objective and non-partisan.  Any lack of institutional independence went to weight rather than admissibility.  The new rules impose no higher duties than already existed at common law.

Job opening: .NET developer

We're recruiting to fill a position for an information technology specialist 4 (.NET developer) in our operations division in Tumwater, Wash.

The successful applicant's duties will include software development of mission-critical agency systems, systems analysis, as well as software unit and quality assurance testing.

For more specifics, duties, salary, timeline, etc., please see the full job listing.

Three companies fined $605,000

Insurance Commissioner Mike Kreidler is fining three companies a total of $605,000 for violating Washington insurance laws.

“Our insurance laws protect consumers and maintain a level playing field in the insurance market,” said Kreidler. “Break the law and you’ll face the consequences.”

The fines were as follows:

PacifiCare of Washington (now known as UnitedHealthcare of Washington, Inc.) has agreed to pay a $400,000 fine for what state financial examiners concluded were improper royalties paid to an affiliated company. The company contended that the payments were administrative fees, but acknowledged that it had failed to annually reconcile the payments with actual costs to show that the company wasn’t overpaying.

In addition to the fine, the company has recovered the $72.9 million it paid between 1999 and late 2006.

STA Travel Inc., based in Texas, agreed to pay $115,000 for allowing unlicensed staffers to sell insurance policies in Washington. The company is a travel agency specializing in international college student travel. It sells travel insurance as part of its travel services.

Although the company’s office manager was a licensed insurance agent, under Washington law, all staff selling travel policies needed to be licensed. Policies were sold by unlicensed staffers from 2005 to 2011.

Lenovo (United States) Inc., incorporated in Delaware, has agreed to pay $90,000 for improperly selling 1,327 service contracts in Washington. The company failed to register as a service contract provider, as required by state law. The service contracts were sold from mid-2008 through mid-2012.

Fines collected by the insurance commissioner's office do not go to the agency. The money is deposited in the state's general fund to pay for other state services.

License revocation for insurance agent who allegedly faked own death

Washington Insurance Commissioner Mike Kreidler has issued an order to revoke the license of an Enumclaw insurance agent who allegedly faked his own death as part of a $2 million scam.

Aaron Travis Beaird, manager of Team Financial Services LLC, "knowingly devised a scheme and artifice to defraud consumers and to obtain money and property by means of false and fraudulent pretenses," according to the order.

Beaird would recomment to his clients that they liquidate one investment and transfer the money into another investment or insurance policy, making the checks out to his business.

The problem: Beaird didn't actually invest the money or buy a policy. Instead, according to the license revocation order, he'd take the money for "his own use and benefit." To cover things up, he would provide his clients with fake account statements.

Beaird was arrested in early July on federal charges of wire fraud and mail fraud. Investigators said he left a fake suicide note in his car, which was found parked near a bridge on June 23rd.

He pleaded guilty in federal district court Aug. 28th. He admitted to defrauding at least 11 people out of more than $1 million. He is currently incarcerated, awaiting sentencing,  at the SeaTac Federal Detention Center.

Beaird has the right to demand a hearing to contest the order.

Update: (Nov. 20) The revocation has taken effect.

Flood advisory issued for most of western Washington

The National Weather Service office in Seattle has issued an urban- and small-stream flood advisory for 14 counties throughout western Washington. Nearly 2 inches of rain has fallen across much of the area in the past 24 hours, with another 1-2 inches expected today.

Affected counties include:

CLALLAM COUNTY
ISLAND COUNTY
JEFFERSON COUNTY
SAN JUAN COUNTY
SKAGIT COUNTY
WHATCOM COUNTY
KING COUNTY
KITSAP COUNTY
LEWIS COUNTY
MASON COUNTY
PIERCE COUNTY
SNOHOMISH COUNTY
THURSTON COUNTY
GRAYS HARBOR COUNTY

Minor flooding is expected in urban areas and small streams into this evening, according to the NWS. The flood advisory has been extended to 6:30 p.m. today.

Restricting Summary Judgment

Are courts beginning to restrict the use of summary judgment?

Justice Brown took the opportunity to comment on summary judgment in a decision encompassing two cases, George Weston Limited v. Domtar Inc and 1318214 Ontario Limited v. Sobeys Capital Inc., 2012 ONSC 5001 (S.C.J.).  These were two cases from the Commerical List in Toronto where counsel sought to schedule summary judgment motions.  In George Weston, the plaintiff sought to schedule a summary judgment motion prior to examinations for discovery.  In 1318214 Ontario, discoveries were mostly complete and when the plaintiff sought to set the matter down for trial, the defendant advised it intended to bring a motion for partial summary judgment to limit the issues for trial.

Justice Brown laments the motion culture in Toronto and what he sees as a reluctance of counsel, especially counsel who have practiced for less than 15 years, to bring cases to trial.  He suggests that instead of bringing summary judgment motions, counsel should take more cases to trial and that courts should facilitate the process by approving innovative ways of proceeding to trial; for example, evidence could be a hybrid of written and viva voce evidence.

It will be interesting to see if other judges share Justice Brown's concerns and if courts will start restricting the use of summary judgment motions.  Defence counsel and insurers will need to carefully assess each case to determine whether the appropriate way is to proceed by way of summary judgment or whether it might be more beneficial to simply proceed to trial. 

Market Conduct Examiner position extended to Nov. 13

Please help us spread the word - We're currently hiring for a Market Conduct Examiner. Sound interesting? This person will work under our Chief Market Conduct Examiner or Lead Examiner Analyst, analyzing, reviewing and identifying the market conduct practices of health insurance companies and other regulated entities that could harm consumers.

This job posting is open until Nov. 13, so if you know someone who may be interested and who's up to the challenge, please tell them soon! See the salary, specific duties and other qualifications.

Arraignment for Spokane man who claimed repo-ed truck was stolen

Andrew James Petrie, 28, was arraigned today in Spokane County Superior Court for claiming that his truck had been stolen when in reality it had been repossessed.

He faces one count of first-degree attempted theft and one count of insurance fraud.

In what state am I most likely to hit a deer?

Each year, State Farm compiles a list of deer-vehicle collisions and creates a list of states in which you're most likely to hit a deer.

West Virginia has topped the list for six years in a row, with other particularly dangerous states being virtually all of the northern Midwestern states and the mid-Atlantic states. South Dakota's No. 2, and Iowa's No. 3.

Washington, it turns out, is one of the lowest-risk states, coming in at No. 43 this year. Your odds of hitting a deer in the Evergreen State are a mere 1 in 477, according to State Farm's estimates.

The company estimates that there are about 10,700 collisons with deer in Washington state each year. (Compare that with, say, Pennsylvania's 115,000.)

Oregon is No. 37 on the list, and Idaho's 33.

Arizona, perhaps not surprisingly, is the stae in which you're least likely to run into a deer. Armadillos, however, were not part of the study.

Here's the full list.

Second Independent Medical Examination - Evidence

What evidence is necessary on a motion to compel the plaintiff to attend a second independent medical examination?

In Nasir v. Kochmanski, 2012 ONSC 4088 (S.C.J.), the plaintiff was a minor who was injured in a motor vehicle accident.  The claim alleged the plaintiff was struck while a pedestrian and sustained a head injury and various psychological impairments.  He had been assessed by a number of medical doctors and psychologists, both treating and arranged by plaintiff`s counsel.  He had been assessed by a paediatric neurologist on behalf of the defendant, although no report had been prepared.  The defendant sought to have the plaintiff assessed by a psychologist.  The proposed assessor wrote a letter to defence counsel outlining the assessment, its length, information she would require from the plaintiff`s parents, and test results from other assessments she required.

Justice Daley permitted the assessment.  The proposed assessment was outside the scope of expertise of the neurologist, according to the psychologist`s letter.  There was no evidence the assessment would delay trial or prejudice the plaintiff.  Since the plaintiff was very young, his evidence would be of limited evidentiary value, and the most probative and reliable evidence would have to come from experts.  Trial fairness favoured the second examination.

It should be noted that the evidence in support of the motion appears to come from a letter from the proposed assessor.  Justice Daley stated that it would have been preferable to have an affidavit or report from the neurologist outlining the need for a further examination, but accepted that there was enough evidence to support the motion.  There is some inconsistency in the case law as to the form of evidence needed on a motion for a further examination, and counsel should carefully consider whether it would be beneficial to have affidavit evidence. 

  

Kreidler fines insurer $500,000

Washington state Insurance Commissioner Mike Kreidler is fining Ohio-based BCS Insurance Company $500,000 for issuing hundreds of thousands of policies using unapproved rates and policy language.


“A fair insurance market depends on companies playing by the rules,” said Kreidler. “When an insurer files rates and policy language with us, that’s what we expect them to use.”

BCS Insurance has agreed to pay the fine. An additional $250,000 fine is suspended, provided the company commits no similar violations for two years. The company has also agreed to a two-year plan, including internal audits, to make sure the company is in compliance with Washington state law.

An investigation by Kreidler’s office found that between 2007 and 2009, BCS issued over 500,000 travel insurance policies that were different from the policy language filed with the state. Rates for identical benefits were inconsistent, depending on who the customer was.

How much of my driving record can an insurer use?

We get this question all the time.

The answer's found in a section of state law called WAC 284-30-500(3). (WAC stands for Washington Administrative Code.) Here's the key section, with some highlighting we added:

(3) It is an unfair practice for any insurer to consider traffic violations or accidents which occurred more than three years in the past, with respect to the acceptance, rejection, cancellation or nonrenewal of any insured under a private passenger automobile insurance policy, unless, because of the individual's violations, accidents or driving record during the three years immediately past, the earlier violations or accidents are significantly relevant to the individual's qualifications for insurance.

So insurers generally cannot use the older data as a basis to reject/cancel/non-renew you, but there is no prohibition against using the older data to assess risk and rate -- meaning set the cost of -- your auto policy.

Even if you have a problem driving record, it's always a good idea to shop around for alternative rates, since insurers don't all charge the same rate for the same level of coverage.

Catastrophic Impairment: Aviva v. Pastore

The Court of Appeal has released an important decision relating to catastrophic impairment:

Aviva Canada Inc. v. Pastore, 2012 ONCA 642 (C.A.)

The insured was injured in a 2002 motor vehicle accident as a pedestrian and sustained an ankle injury. She alleged her gait had been altered and was diagnosed with a pain disorder.  A DAC found her to be catastrophically impaired in 2005 due to a marked mental or behavioural impairment under s. 2(1.1)(g) of the SABS.  An assessment under s. 2(1.1)(g) is carried out with reference to the AMA Guides, which provide for an assessment of function in four categories:

(1)              Activities of daily living (ADL);

(2)              Social functioning;

(3)              Concentration, persistence and pace; and

(4)              Deterioration or decompensation in work or work-like settings.

Pastore was diagnosed with a number of psychological disorders and the DAC concluded that she had a class 4 marked impairment in activities of daily living.  The DAC concluded she was catastrophically impaired on the basis of the one class 4 impairment.  The insurer did not agree with the assessment and the matter proceeded to mediation then arbitration.

At arbitration, the arbitrator agreed with the DAC assessors and held that one marked impairment was enough to comply with the Guides approach to impairment.  In addition, it was appropriate to consider physical pain in assessing mental disorder, as it was not possible to factor out all physically based pain since it was intertwined with mentally based pain. The Director's Delegate upheld the decision, but the Divisional Court overturned the arbitrator.

The Court of Appeal allowed the appeal and reinstated the arbitrator`s decision.  The conclusion that only one marked impairment is sufficient to meet the definition of catastrophic impairment was a reasonable one. In addition, it was not an error for the DAC assessors to consider both physical and mental pain.

Pastore appears to have lowered the bar for catastrophic impairment based on a mental disorder and more claimants may be able to fit themselves into a catastrophic designation than prior to this decision.

Here come the rains

After an unusually dry early fall, western Washington's long rainy season begins in earnest this weekend, when the first of a series of wet weather systems moves into the Pacific Northwest.

Weather Underground reports that:

A front bringing heavier rain will arrive late Saturday... with significant precipitation continuing Sunday and Monday.

Rainfall amounts during the period from Saturday afternoon through Monday evening will likely be around 3 to 8 inches in the mountains... with the heaviest precipitation over the Olympics and north Cascades. The snow level will be mainly around 10000 feet.

Rainfall over the western Washington lowlands will probably range from 2 to 4 inches along the coast and 1 to 2 inches over the interior lowlands.

Because of the long dry spell, forecasters say, flooding is unlikely. But rivers are expected to rise sharply.

Drivers should also be extra cautious. During dry weather, oil that has dripped off cars and trucks onto roadways doesn't have a chance to be washed away. The rains will spread that oil, making roads extra-slick for the first couple days of rain.

Guilty plea in insurance fraud case over "stolen" bicycles

A Pierce County man pleaded guilty today to two counts of forgery after falsely claiming that two bicycles worth $17,000 were stolen from his garage.

John L. Southerly, of Fox Island, was sentenced in Pierce County Superior Court to 45 days of electronic home monitoring and $800 in fees.

In May 2011, Southerly told his insurance company that two Specialized Epic bicycles and accessories had been stolen. He filed a police report with a Pierce County sheriff's deputy, saying that he'd left his garage door open and discovered that the two bikes, valued at $17,562, were gone.

Southerly told his insurer, Travelers Indemnity Co., that he'd bought both bikes from an Arizona company. When Travelers asked for copies of his receipts, Southerly sent an email that was purportedly from the bike company. The bike company email came from a Gmail account. Attached was an invoice for each bike. Southerly later also filed a sworn statement of proof of loss for the bikes.

Travelers sent an investigator to talk to the bike shop owner and try to verify that the invoices were authentic. No, the owner said, pointing out discrepancies.

Then, last June, Travelers received an email from a different Gmail address.

"This is Detective Harris," it began. "I work out of the Tacoma office. I am trying to follow up on a case that involves Mr. Southerly..."

The email didn't contain contact information for this "Detective Harris," or even specify which law enforcement agency the detective supposedly worked for.

Travelers denied Southerly's claim and turned the case over to the state insurance commissioner's Special Investigations Unit. It quickly determined that there was no "Detective Harris" working for the Pierce County Sheriff's Office, the Tacoma Police Department or the Lakewood Police Department.

With search warrants, the Special Investigations Unit determined that both Gmail accounts listed Southerly's real email as a secondary contact and were sent from Southerly's IP address.

Southerly, who did not show up for a scheduled court appearance earlier this year, was arrested in August while leaving a gym after a workout.

Got an old Medicare supplement plan? You might save money by switching to a newer plan

Consumers who are on Medicare Supplement plans may be able to save money – and possibly increase their coverage – by moving to Medicare Supplement plans that insurance companies issued after June 1, 2010.
As a result of a change in federal law, many Medicare Supplement companies issued new plans that started on that date. Many of the plans issued after that date use the same Medicare Supplement letter as plans issued prior to June 1, 2010. But the coverage often costs less, and is sometimes more comprehensive, than a same-lettered plan issued prior to that date. As a result, in some situations, you might be able to get more for your money by switching plans.
For example: a Plan G issued after June 1, 2010 may cost less and provide more comprehensive coverage than a pre-June 1, 2010 Plan G.
So if you’re on a Med Supp plan that you bought before that date, you might want to check the prices of newer Med Supp plans to see if it would be worthwhile to switch.

Note: Headline -- we'd accidentally typed "Medicaid" rather than "Medicare," has been corrected.

Motion to Add Municipal Defendant Dismissed

A motion to add a municipality as a defendant was recently dismissed.

In Temporin v. DiVincenzo, 2012 ONSC 5213 (S.C.J.), the plaintiff was injured in a 2007 motor vehicle accident. Although the City of Burlington had been named as a third party, the plaintiff did not move to add it as a defendant until 2012. The plaintiff ordered the police report in 2007, but did not receive officer's notes as counsel had inadvertently neglected to send payment.  The notes were ultimately received in 2010 when a follow up request was made.  They referred to road conditions consisting of "fierce" black ice. The plaintiff argued that the two year limitation period for adding the municipality began in 2010.

Parayeski J. dismissed the motion. The failure to follow up for police notes until 2010 did not give rise to a discoverability issue. The plaintiff had not exercised reasonable diligence and even though there was no prejudice to the municipality, this did not justify it being added as a defendant post-limitation.

This decision is a good example of the maxim that limitation periods are not enacted to be ignored.  The burden is on plaintiffs to act diligently to identify defendants within the appropriate limitation period.

Why did my health insurance go up so much? Often, it's because you had a birthday.

We often hear from consumers who say that their rate increase was substantially higher than what we approved.

One of Washington's major health insurers, for example, recently increased its premiums for individual plans an average of 13.5 percent. The highest increase among the plans was 21.5 percent. But we subsequently heard from consumers who are seeing rate hikes of 35 percent or more.

What's going on? Birthdays.

If you had a birthday in the past year and your new age ends in a zero or a five (55, 60, etc.), then you can expect a rate increase when your individual health plan renews. This is because you moved into a higher age band. (The insurers group ages together, five years at a time.) Since medical costs tend to increase with age, your premiums tend to jump every time you move to the next five-year band.

And when an age band increase combines with an across-the-board rate increase for everyone who’s on the health plan, you get a sort of double-whammy: the total rate increase can be substantially higher than what our agency approved.

Spokane man charged for claiming repossessed truck was stolen

A Spokane man was charged today with attempted first-degree theft and insurance fraud for claiming that his Toyota Tacoma pickup truck had been stolen, when in reality it had been repossessed. In fact, the man gave the keys to the repo man and was allowed to get his stuff out of the truck before it was towed away.

Andrew James Petrie, 28, is slated for arraignment Oct. 22 in Spokane County Superior Court.

On March 1, 2012, Petrie bought a 2000 Toyota Tacoma pickup from a Spokane car dealer. He paid with a personal check for $8,280. But the check was returned; Petrie's bank account had been closed.

The dealership said it gave Petrie two chances to pay for the truck, then sent a repo man to Petrie's mother's house. Petrie came out of the house, handed over a key to the truck, and was allowed to retrieve his personal items before the truck was towed away.

About three hours later, Petrie called Safeco Insurance and said the vehicle had been stolen from a different home. He said the thief had first broken the truck's back window, trying to take the sound system out. He later said that a construction company's trailer had been attached to the truck, and was also stolen.

A Safeco investigator checked with the dealership, and with the construction company. The insurer denied the claim, and notified our Special Investigations Unit that it suspected fraud. After investigating further, our office asked the state attorney general's office to file charges.

Average annual premiums for health insurance

Was looking through the latest annual Kaiser Family Foundation report on health insurance premiums this morning and came across this chart. Yikes.

These are nationwide averages. The report has a number of other interesting charts and data, summarized here. 

Election of Arbitration or Court Proceeding

Gordyukova v. Certas Direct Insurance Company, 2012 ONCA 563 (C.A.)

The subject of this appeal is s. 281.1(1) of the Insurance Act, which provides that an insured shall commence a court proceeding or arbitration within two years of the insurer's refusal to pay benefits.

The plaintiff was in a motor vehicle accident in 2001.  She applied for accident benefits and a dispute arose over certain medical benefits.  After mediation failed, she issued a Statement of Claim in 2002. In 2005, the insurer advised her she had exhausted her non-catastrophic limits for medical and rehabilitation benefits.  Her application for a catastrophic designation was rejected so she commenced an arbitration at FSCO in 2008.  Certas brought a motion to stay the arbitration on the grounds that the CAT dispute should be added to the court action. The arbitrator ruled the plaintiff could not proceed with both the court action and the arbitration, but could proceed with arbitration if she discontinued the court action.  The arbitrator ruled he was not ruling on the limitation issue.  The plaintiff gave notice of her intention to discontinue the court action and proceed with arbitration, and the insurer brought a motion seeking a ruling on the limitation issue.  The arbitrator ruled the plaintiff could add all of the matters pending before the Superior Court to the arbitration.

Certas appealed, arguing that the plaintiff could not re-elect the method of proceeding eight years after the court action was commenced. The matter was appealed to the Director 's Delegate then the Divisional Court.

The Court of Appeal held that the arbitration should be stayed.  Section 281.1(1) of the Insurance Act requires an election between a court action and an arbitration. It provides that a proceeding shall be brought within two years. The insured has the choice of forum, but cannot switch forums after the expiry of the limitation period.  Since the court proceeding included a claim for "continued accident benefits", it would necessarily include a determination of the CAT issue. 

Dental insurance: Where to find it, or how to find free/low-cost care if you can't afford it

We hear from a lot of consumers who want to buy dental insurance on their own, without getting it through an employer. Many companies -- and here's a list -- sell dental insurance directly to Washington state consumers.

When we hear from people who want to buy dental insurance on their own, they often wonder whether there are any particular questions they should ask the insurance company. Here are some suggestions:
• Is your current dentist in the dental plan’s network?
• What benefits does the plan provide? (If you don’t know, ask the company for a copy of the policy. They have to give you a copy if you specifically ask.)
• Does the plan have a waiting period before it will cover pre-existing conditions? If so, how long is the waiting period?
For many people, dental insurance isn’t within their price range. Fortunately, there are a number of low-cost or no-cost dental programs, and the Department of Health has a list of those programs on its website.

I ride a motorcycle. Do I need insurance?

Motorcyles and mopeds are exempted from Washington mandatory vehicle insurance law, so no, there is no law requiring you to have coverage.

But here's why you may very well want to get it anyway: You are still liable from the state's financial responsibility law. Meaning that if you hit something/someone and it's your fault, it's your responsibility to pay for the damage. And since even a minor scrape or ding to another vehicle can cost hundreds of dollars to fix, state officials believe that many motorcycle owners in Washington voluntarily choose to carry coverage.

Also, if you financed your bike with a loan, your lender will almost certainly require coverage so the lender doesn't lose its money if the bike is wrecked/stolen/vandalized/etc.

Golf insurer in CT arrested for selling illegal insurance in WA

A Connecticut businessman who specializes in insurance for golf tournament hole-in-one prizes has been arrested in his home state after failing to appear for a felony arraignment in Seattle earlier this month.

Kevin Kolenda, 54, was arrested Wednesday in his hometown of Norwalk, Conn. He faces five counts of transacting insurance without a license, a class B felony.

"We've been warning the public about Mr. Kolenda's scam for years," Insurance Commissioner Mike Kreidler said in a recent press release. "He has a long history of selling illegal insurance, refusing to pay prize winners, and thumbing his nose at regulators."

Kolenda was supposed to appear in court Sept. 5 for arraignment on those charges, but he failed to appear. So the judge issued a bench warrant for his arrest.

Kolenda has ignored a previous cease and desist order from our office, as well as a $125,000 fine.

Update (9/28/2012): Added King5 video at top of post.

Why did you make my auto/homeowners insurance rates go up?

Q: My auto and homeowners insurance rates went up, and my agent and insurer said that it's because Washington state required them to charge more. Did you require this?

A: We get this question fairly often. While we do review rates for many kinds of insurance, no, we did not tell your auto/homeowners/etc. insurer to raise its rates. It's up to insurers to decide when, or if, they will submit proposals to us to increase or decrease rates. (In some cases, notably health coverage, insurers often reduce benefits in order to moderate rates hikes.)

Again: While we may review the rates, the insurance company is the one proposing any changes.

There are many insurers selling auto and homeowners policies in Washington. If your insurer is raising rates too high, maybe it's time to shop around. Need help? Here are some tips when shopping for auto coverage, and here are some tips when shopping for homeowners coverage.

Threshold Motion Successful

Surveillance evidence can be useful in showing that the plaintiff does not meet the Insurance Act threshold.

In Dahrouj v. Aduvala, 2012 ONSC 4090 (S.C.J.), the plaintiff was injured in a minor rear end collision.  She was a homemaker and alleged she developed chronic pain which impaired her functioning in the home and her social interaction in the community.

The evidence at trial was that the plaintiff visited her family doctor on multiple occasions prior to the accident complaining of head, neck and back pain.  She made similar complaints post-accident.  The defendant obtained surveillance showing the plaintiff engaged in a variety of activities, including scraping snow and ice off her car, pumping gas, reaching for groceries on an upper shelf and carrying groceries.  Justice Hackland described the video as “particularly devastating” to the plaintiff’s credibility, as it showed the plaintiff stretching and lifting, the activities she alleged restricted her functioning as a homemaker.

The plaintiff’s expert diagnosed her with “central sensitization”, based on a 45 minute interview and relying only on the plaintiff’s self reports.  Justice Hackland preferred the defence expert, who conducted a more thorough assessment and whose opinion was corroborated by the surveillance evidence.

Justice Hackland held the plaintiff had not proved she sustained a serious, permanent impairment of an important physical function.  As a result, she was not entitled to general damages and her recovery was limited to $32,000, the amount the jury awarded for past housekeeping. 

Surveillance of the plaintiff can be extremely important in defending claims, especially those alleging chronic pain.  When surveillance can be combined with expert opinion, it can be effective in showing that the plaintiff’s claim does not meet the threshold.

Open enrollment for children ends Oct. 31

Do you need health insurance for your child? Open enrollment for individual health insurance for children is now underway. From Sept. 15-Oct. 31 you can buy an individual plan for your child or add them to your plan with out having to fill out a health questionnaire.

Under health reform, health plans can no longer deny children coverage if they have a pre-existing medical condition, but they can create open enrollment periods. Washington state has two annual enrollment periods: March 15-April 30 and Sept. 15-Oct. 31.

If you need coverage now, don't wait. You have until the end of Oct., but the sooner you enroll, the faster you'll get coverage.

The next open enrollment starts March 15. Here's a list of plans in the individual market by county and what to do if you miss the enrollment period.

Life insurance explainer: What are life settlements?

Life settlements are when you sell your life insurance policy to someone else. You get immediate cash, and they collect the value of the policy when you die.

There's a similar type of transaction, known as a viatical settlement, in which a terminally ill person sells his or her life insurance to someone else.

Both these types of transactions are mentioned as options in a notice that life insurers are required to send to some Washington policyholders.

According to a New York Times article published last month, the fast-growing life settlements business swelled to $12 billion in transactions by 2007, but has dropped off dramatically, with only $3.8 billion worth of policies changing hands in 2010. Life settlements brokers maintain, however, that with trillions of dollars in life insurance out there, the industry is still in its infancy.

Health insurers rebates

Q: I've read in the news that health insurers are having to send rebates to their customers because of health care reform. But I didn't get a rebate? What's going on?

A: Yes, we've heard from a number of folks that are wondering whether they're going to get a rebate. The rebates are from companies that aren't putting enough premium dollars toward actual medical care (as opposed to marketing, administrative costs, etc.).

Here in Washington, however, most companies are already spending a high percentage of your premium dollars on medical care. That's the good news. But that also means that few Washingtonians will get rebates. Here's more about the rebates and a state-by-state breakdown.

Consumer alert: Real Benefits Association

Consumer alert

An unlicensed company named "Real Benefits Association" may be offering bogus discount health care plans in Washington state.

Again: This company is not licensed to do business in Washington state.

We've heard from consumers who said they paid monthly premiums to the Real Benefits Association, believing that they would receive legitimate medical and prescription drug coverage, but to date, the company has paid none of the health care claims they submitted.

Real Benefits Association and its owner, David Clark, were issued a cease and desist order by our office in January 2010. They are operating in violation of that order by collecting premiums for bogus discount health care coverage from Washington state consumers.

Friday wildfire update: We're hearing that some insurers have stopped writing new policies in the fire areas

The AP is reporting that wildfires in central Washington have merged and now cover more than 47 square miles, with officials urging more than 100 homeowners north of Ellensburg and in the Liberty area to evacuate. Here is a checklist of things to do if a wildfire is approaching a home.

Crews are digging lines, using bulldozers and trying to douse the flames and protect structures with fire retardant dropped from aircraft. Here are maps showing the areas that are burning. The fire began Sept. 8th with a lightning strike near Cle Elum. 775 firefighters are on scene, but fire commanders this morning ranked both the terrain difficulty and growth potential of the blaze as "extreme."

We have heard a few reports from consumers that some homeowners' insurance companies have stopped approving new policies in areas close to the fires. Nobody wants to hear this if they're trying to close a deal on a home, for example, but insurers are allowed to suspend writing new policies in cases like this.

It's a common practice, for example, with earthquake insurers to stop writing policies after a quake, for fear of aftershocks. And flood insurance typically comes with a 30 day waiting period, to prevent people from waiting until the storm clouds are overhead before they buy coverage.

Several other fires are burning in the state. Most of the state is now at high or very high fire danger.

U.S. 97 in both directions is closing today from 8 a.m. to 6 p.m. from milepost 150 (at the junction of SR 970) to milepost 177 (8 miles south of the junction of U.S. 2) for back-burning and fire containment operations.

Update: (5:02 p.m.) Some insurers have also stopped writing new auto policies in certain Eastern Washington zip codes due to the fires.

Adding an Insurer as a Defendant Rather than a Statutory Third Party

Can an insurer add itself as a defendant rather than as a statutory third party?

In Azad v. Dekran, 2012 ONSC 4257 (S.C.J.), the Personal insured the defendant and brought a motion pursuant to r. 13.01 to intervene as an added defendant.  It wished to allege that the accident did not occur or was staged and to crossclaim against its insured.  It preferred this route rather than being added as a statutory third party since s. 258(14) of the Insurance Act prohibits a statutory third party from taking a position incongruous to its insured.

Master Dash dismissed the motion, holding that it was not a proper use of r. 13.01.  One of the purposes of s. 258 is to permit an insurer to contest the plaintiff’s claim in a situation where it denies coverage.  The plaintiff’s action is not the appropriate forum to decide issues between the insured and insurer.  Any dispute could be decided in subsequent proceedings, including a proceeding to recover the statutory minimum paid to the plaintiff. 

Master Dash noted that if the accident was staged, the plaintiff would not be entitled to damages; on the other hand, if the trial court did award damages, it would mean there was a legitimate accident and there would be no basis for a crossclaim against the insured.  In addition, as a statutory third party, the insurer would have a right to discover its insured.

Master Dash refused to follow the decision in Esho v. Dekran, 2012 ONSC 3638 (S.C.J.), where the insurer was added as a defendant.  Now that there are conflicting decisions on this issue, perhaps it will be up to the Divisional Court to provide clarity.

Monday wildfire update

Firefighters are making good gains against eastern Washington wilfires, with the list down to five active blazes in Chelan, Yakima, Kittitas, Okanogan, Klickitat counties.

Here's the morning update from Washington Emergency Management Division.

Washington wildfire update

Firefighters are making big gains containing the state's eight major fires, according to the latest update from the Washington Emergency Management Division.

The 91,000-acre Barker Canyon fire in Douglas and Grant counties is 63 percent contained, and the 23,000-acre Apache Pass fire in Lincoln County is 80 percent contained.

Seven aircraft and more than 1,100 firefighters are still wrestling, however, with the large Wenatchee River fire in Chelan County, which is only 10 percent contained. It covers more than 28,000 acres. More than 850 homes and other structures are threatened by that blaze, according to the update.

So far, the number of homes lost in this latest wave of wildfires is just 3, although about 14 non-residential structures have also burned.

See the report above for more detail.

Washington state fire update

According to the state's Emergency Management Division, early 3,000 firefighters and more than a dozen aircraft are battling seven fires -- several of which involve multiple large individual blazes -- on more than 150,000 acres throughout the eastern part of the state.

The largest is the Barker Canyon fire in Douglas and Grant counties, which includes more than 91,000 acres and this morning was only 20 percent contained.

Then there's the 25,000-acre Wenatchee River fire in Chelan County, which is only 8 percent contained. And then there's Lincoln County's 24,500-acre Apache Pass fire, which is about 40 percent contained. Smaller fires are burning in Yakima, Kittitas, Ferry, Okanogan and Klickitat counties.

So far, only a few homes appear to have been lost to fire, although some other structures (barns, etc.) have also burned. About 600 homes are considered threatened by fire at this point. We have a number of important tips for fire victims making insurance claims.

More details on each fire, including evacuation information, is available in this document prepared by the EMD. And for the latest information, see the agency's list of fire updates.

And for anyone in fire-prone areas, please see these tips to protect your belongings and property.

New report: More than 740,000 homes nationwide at high or very high risk of wildfire

A private research firm, Corelogic, has produced a report estimating wildfire risk in 13 western states, including Washington.

The upshot: More than 740,000 homes are ranked as high risk or very high risk for wildfire damage. All told, those homes represent $136 billion in total property value, according to Corelogic. The states with the highest number of properties at risk at California, Colorado and Texas.

Here in Washington state, the company estimates, there are more than 9,000 homes at high or very high risk, with a combined value of $1.3 billion. The study also takes a closer look at several high-value metropolitan areas with high fire risk, including Los Angeles, San Diego, and Boulder.

The report is free, although you have to register to read or download it.

It comes on the heels of a July statement by specialized insurer Lloyd's, which predicted "more frequent and severe wildfires as a result of climate change." Lloyd's warned that traditional risk assessment and pricing by insurers could understate the actual fire (and financial) risk.

Production of Statements Made Following an Accident

A recent motion decision deals with two issues that can arise in defending claims: the extent of litigation privilege with respect to statements made following an incident, and whether reviewing such a statement prior to examination for discovery waives privilege.

In Knox v. Applebaum Holdings, 2012 ONSC 4181 (CanLii) the plaintiff brought a motion seeking production of a statement prepared by the defendant’s property manager following an accident in its parking lot.  The accident occurred at 8:55 p.m..  The property manager was quickly notified, travelled to the parking lot, took pictures and called her risk manager to report what she had found at 12:35 a.m.  At this point, she was aware that two people had been injured.  She typed up a statement detailing her recollection of what she had seen and learned of the accident while it was fresh in her mind.  The statement was delivered to the adjuster later that day.

On the motion, the issues were whether the statement was protected by litigation privilege and whether privilege was lost when the property manager reviewed it when she prepared for her examination for discovery.

Justice Hockin held that litigation privilege attached to the document.  The property manager knew there was an accident and that two people had been injured.  She believed that litigation would follow.  It did not matter that the defendant was not represented by counsel at the time.  The dominant purpose of the document was to facilitate her employer’s defence and to assist in her forensic involvement of the case. 

Privilege was not waived.  Justice Hockin relied on Wronick v. Allstate (1997), 7 C.P.C. (4^th) 285 (Gen. Div.) where Justice Leitch held that reviewing a privilege document to refresh one’s memory in preparation for examination for discovery does not amount to a waiver of privilege.

"I own a business, but don't offer health coverage. Will I be penalized in 2014?"

Starting in 2014, under federal health care reform, some employers who fail to offer affordable health coverage to their employees will have to pay penalties of $2,000 to $3,000 per employee.

Small businesses won't be affected. Under the law, if an employer has fewer than 50 employees, the penalties do not apply. (If you have 25 or fewer workers and average wages up to $50,000, your company may be eligible for a health insurance tax credit to help offer coverage to your workers.)

If you're a medium- or large employer, though, you could be hit with the penalty unless you offer employees affordable coverage.

So what's affordable? The Kaiser Family Foundation has built this simple flowchart to determine what qualifies as affordable health coverage and what doesn't. It also explains which penalties apply in each case.

Good news: We're back online

We've got our website back online. Thanks for your patience.

Our website's down; we're working to fix it

Our agency website (www.insurance.wa.gov) is currently down, due to a major network problem affecting multiple state agencies.

Even if you can access the site, you won't be able conduct transactions or do use our other online applications.

We and others are working hard to resolve the problem.

Who will have to pay a penalty for not having health coverage?

If federal health care reform takes effect as planned in 2014, some people will pay a penalty of $95 if they do not have health coverage. (This is what's known as the individual mandate.)

And the penalties would get bigger. In 2015, it would be $325. In 2016 and beyond, it would be $695.

But will you have to pay?

For most people, the answer's no. There are a number of exemptions. There's a religious exemption, for example. Members of Indian tribes are exempt. Very poor individuals and families -- such as a family living on less than $18,700 a year) are exempt. So are those that have to pay more than 8 percent of their income  for health insurance.

Also, most people already have coverage that already satisfies the requirement. If you're on Medicare, for example, there's no penalty. If you're on TRICARE (the health plan for members of the military, retirees and their families), there's no penalty. If you get coverage through the VA, through your employer, Medicaid, or the Children's Health Program, there's no penalty.

The Kaiser Family Foundation offers an excellent, simple flowchart that lays this out in more detail. It includes estimates on the cost of insurance through the new health care exchanges, and a link to a KFF online calculator to help figure out premiums and tax credits to help you buy coverage.