As a viable part of the global economy, should folks with creativity related jobs be provided an insurance system against creativity disability?
By: Ringo Bones
Picture this scenario: a very lucrative crime fiction writer whose works so far – lets say 20 of them – managed to crack the top 5 of the New York Times bestseller list, eleven of them even reached the number one spot. Not only that, his or her books managed to become a required reading of every major law enforcement agency around the world – akin to Tom Clancy’s The Hunt for Red October becoming a required reading for US Navy’s cadets-in-training. Thus making the writer a veritable cash cow. Then imagine our writer out of whim joining some “maverick” Evangelical cult that made him or her no longer able to write those gristly but fictional ways of committing murder. Thus resulting in the loss of his or her multi-million dollar a year livelihood. If this happens, what does his or her financial estate do? Sue the cult or collect some form of insurance?
Even though there might have been a legal precedent with regards to this scenario, as of late, I’ve been too lazy to check out the current US Supreme Court docket about legal and / or financial liabilities when it comes to persons affected by creativity disability. Especially if creativity is the main source of livelihood of that person in question. But the question now is, is some kind of creativity disability insurance economically viable enough to be underwritten by today’s insurance providers?
After checking on existing insurance policies on offer, I think for it to be economically viable, creativity disability insurance could be modeled after occupational disability insurance. Unfortunately, occupational disability insurance – also called permanent health insurance – is quite a complicated subject that often grabs the news headlines upon claims refusals. Your typical occupational disability insurance policy provides the policyholder with a source of income in the form of disability benefits when the policyholder is no longer able to perform substantially all of the material acts of his or her occupation, as designated in the policy. Should disability benefits also be applicable for those working in the creative fields like novelists and songwriters?
But it can easily get complicated from the point of view of the disabled – even the creatively disabled – claimant. Imagine the claimant having a firm belief of the Protestant Work Ethic and has a moral perception that receiving easy money is morally reprehensible. In other words, the claimant wants to retain the ability to engage in a sure form of employment while collecting disability insurance benefits. Might this prove in the end to be economically essential, in which the insurance company could make a creativity disability insurance with such proviso at a much lower premium – thus making it widely available?
Returning to the scenario I’ve mentioned, could this be resolved or eased by the existence of some form of creativity disability insurance; or is the existing civil court systems around the world could easily handle this as a “mere” torts and damages compensation settlement case? Given the rarity of such cases, its safe to say that I don’t know – yet. Maybe, the only really viable solution to this dilemma is for anyone who works in the creativity fields to become more empowered with the assistance of their friendly neighborhood broker in selecting the right insurance products. Thus, enabling them to make appropriate decisions with respect to benefit design, understand the policy’s wording and how it will impact them in the event of a claim arises.
Thursday, December 17, 2009
Friday, December 4, 2009
Do Pessimists Make Good Insurance Company CEOs?
Given that the primary business of insurance companies has been on dwelling on what’s the worst that could happen, does this make pessimist prime candidates for insurance company CEOs?
By: Ringo Bones
Maybe that bloke named Murphy who they named Murphy’s Law should have started his own insurance company, who knows, he could have made a bundle – or what about Friedrich Nietzsche? Just a few historically famous “pessimists” who would have made top notch CEOs for today’s insurance companies. A will to power ones investment portfolio? Or is it just a routine risk management as usual?
After reading Bright-Sided by Barbara Ehrenreich, a pet theory of mine has been renewed once again. A theory pertaining to why people with a naturally pessimistic disposition are better suited to be insurance company CEOs compared to their cheery, chirpy counterparts – especially ones that practice unnecessary discrimination when it suits them while maintaining a happy disposition. Despite the howls of protest of those cheery CEOs that ran their company to the ground during the Bush Administration over the accuracy of Barbara Ehrenreich’s pet theories on why Wall Street buckled only proves Ehrenreich’s insights on this contentious issue to be self-evident. Even though recent findings in cultural anthropology and archeology had always tried to tell us that too much positive thinking – especially when combined with leaving things to chance – could be humanity’s undoing.
Humanity’s earliest ancestors manage to survive through a series of supposedly insurmountable challenges like climactic extremes, super-volcanic eruptions and earthquakes that would make those catastrophic tragedies that happened within our living memory seem tame in comparison. Thanks to humanity’s intelligence and wit – largely driven by constantly worrying about the worst that’s yet to come. In other words - pessimism. Could it be that Natural Selection is Mother Nature’s very own risk assessment strategy? If humanity manages to survive through the worst aspects of climate change that is yet to come, it is safe to bet that it is because we finally took action on the most pessimistic ramblings of Al Gore over the dangers of climate change.
Unfortunately, corporate America has a habit of firing overtly cautious employees with pessimistic disposition. The very same people who could have warned the impending subprime mortgage crisis that can trace its roots back in 2006. The Wall Street overlords have no use for such folks, favoring instead to “yes men” too spineless to point out to their very own mistakes and shortcomings. Sadder still, this corporate oversight grew in popularity during the time when Ronald Reagan ruled the Free World where Wall Street amassed huge profits during the “Decade of Greed” of the 1980s.
Bright-Sided by Barbara Ehrenreich really did point out the culture of a “happiness delusion” that undermined the true potential of corporate America. An overtly positive thinking without a safety net, or worse still – using the ideology of happiness delusion as a safety net, really did almost destroy America. During the 1980s, this happiness delusion became an industry in itself with books, office accessories, posters, etc. and it did become mandatory in the corporate world – especially Wall Street. I just hope that an overtly positive thinking won’t be used as a fairy-dust against failure anymore. Folks that worry so much in working out solutions in making good out of worst situations now need the much-deserved commendation they were once ignored. Maybe somebody should hire Barbara Ehrenreich as a risk assessor.
By: Ringo Bones
Maybe that bloke named Murphy who they named Murphy’s Law should have started his own insurance company, who knows, he could have made a bundle – or what about Friedrich Nietzsche? Just a few historically famous “pessimists” who would have made top notch CEOs for today’s insurance companies. A will to power ones investment portfolio? Or is it just a routine risk management as usual?
After reading Bright-Sided by Barbara Ehrenreich, a pet theory of mine has been renewed once again. A theory pertaining to why people with a naturally pessimistic disposition are better suited to be insurance company CEOs compared to their cheery, chirpy counterparts – especially ones that practice unnecessary discrimination when it suits them while maintaining a happy disposition. Despite the howls of protest of those cheery CEOs that ran their company to the ground during the Bush Administration over the accuracy of Barbara Ehrenreich’s pet theories on why Wall Street buckled only proves Ehrenreich’s insights on this contentious issue to be self-evident. Even though recent findings in cultural anthropology and archeology had always tried to tell us that too much positive thinking – especially when combined with leaving things to chance – could be humanity’s undoing.
Humanity’s earliest ancestors manage to survive through a series of supposedly insurmountable challenges like climactic extremes, super-volcanic eruptions and earthquakes that would make those catastrophic tragedies that happened within our living memory seem tame in comparison. Thanks to humanity’s intelligence and wit – largely driven by constantly worrying about the worst that’s yet to come. In other words - pessimism. Could it be that Natural Selection is Mother Nature’s very own risk assessment strategy? If humanity manages to survive through the worst aspects of climate change that is yet to come, it is safe to bet that it is because we finally took action on the most pessimistic ramblings of Al Gore over the dangers of climate change.
Unfortunately, corporate America has a habit of firing overtly cautious employees with pessimistic disposition. The very same people who could have warned the impending subprime mortgage crisis that can trace its roots back in 2006. The Wall Street overlords have no use for such folks, favoring instead to “yes men” too spineless to point out to their very own mistakes and shortcomings. Sadder still, this corporate oversight grew in popularity during the time when Ronald Reagan ruled the Free World where Wall Street amassed huge profits during the “Decade of Greed” of the 1980s.
Bright-Sided by Barbara Ehrenreich really did point out the culture of a “happiness delusion” that undermined the true potential of corporate America. An overtly positive thinking without a safety net, or worse still – using the ideology of happiness delusion as a safety net, really did almost destroy America. During the 1980s, this happiness delusion became an industry in itself with books, office accessories, posters, etc. and it did become mandatory in the corporate world – especially Wall Street. I just hope that an overtly positive thinking won’t be used as a fairy-dust against failure anymore. Folks that worry so much in working out solutions in making good out of worst situations now need the much-deserved commendation they were once ignored. Maybe somebody should hire Barbara Ehrenreich as a risk assessor.
Friday, November 20, 2009
Should Rock Stars Get Professional Indemnity Insurance?
As our contemporary society gets more and more litigious, should Rock Stars – scapegoats du jour since Ronald Reagan ruled the free world – have professional indemnity insurance?
By: Ringo Bones
For those of us old enough to remember the PMRC Rock Music censorship debacle and the “frivolous” wrongful death lawsuit against Judas Priest, We – the music loving public - managed to reach a consensus back then that Tipper Gore’s PMRC is nothing more than a US Government scheme to misdirect the American public’s ire against Sen. John McCain, Charles Keating and the rest of the folks that brought us the Lincoln Savings & Loan Scandal of 1989. But does the “Parental Advisory Explicit Lyrics” warning label still hold enough political clout to protect Rock Stars against any liability pertaining to professional indemnity related lawsuits? After all, as professional singers / musicians they do fall under the legalese purview of professional indemnity, right?
Professional indemnity insurance is usually used to protect you – the practitioner of your chosen profession – from legal action taken for losses incurred as a result of your professional advice – i.e. what you say regardless of whether it is based on opinion or fact. Under existing law, professional indemnity insurance provides indemnity cover if your client (do fans and audience members count?) suffers a loss - either - material, financial or physical – directly attributed to negligent acts. Frivolous lawsuit or not, does this mean that Rock stars should be held accountable for what they say / preach?
But this does raise problems – especially when it comes to the fidelity of the playback medium that the artistic works of these so-called Rock Stars are delivered. Did Lady Gaga really said “F-F-F_ Her Face” when heard through a lo-fi audio playback system – especially when the medium is a highly compressed and somewhat not-so-pristine MP3 download? This is probably the reason why an overwhelming majority of record label executives are not so gaga when it comes to sound quality. Maybe it is all down to liability? – enough said.
By: Ringo Bones
For those of us old enough to remember the PMRC Rock Music censorship debacle and the “frivolous” wrongful death lawsuit against Judas Priest, We – the music loving public - managed to reach a consensus back then that Tipper Gore’s PMRC is nothing more than a US Government scheme to misdirect the American public’s ire against Sen. John McCain, Charles Keating and the rest of the folks that brought us the Lincoln Savings & Loan Scandal of 1989. But does the “Parental Advisory Explicit Lyrics” warning label still hold enough political clout to protect Rock Stars against any liability pertaining to professional indemnity related lawsuits? After all, as professional singers / musicians they do fall under the legalese purview of professional indemnity, right?
Professional indemnity insurance is usually used to protect you – the practitioner of your chosen profession – from legal action taken for losses incurred as a result of your professional advice – i.e. what you say regardless of whether it is based on opinion or fact. Under existing law, professional indemnity insurance provides indemnity cover if your client (do fans and audience members count?) suffers a loss - either - material, financial or physical – directly attributed to negligent acts. Frivolous lawsuit or not, does this mean that Rock stars should be held accountable for what they say / preach?
But this does raise problems – especially when it comes to the fidelity of the playback medium that the artistic works of these so-called Rock Stars are delivered. Did Lady Gaga really said “F-F-F_ Her Face” when heard through a lo-fi audio playback system – especially when the medium is a highly compressed and somewhat not-so-pristine MP3 download? This is probably the reason why an overwhelming majority of record label executives are not so gaga when it comes to sound quality. Maybe it is all down to liability? – enough said.
Should Audio Gear Manufacturers Get Product Liability Insurance?
Given everyone’s much greater awareness of the health of our hearing, should audio gear manufacturers avail themselves of product liability insurance in case of future class action lawsuits?
By: Ringo Bones
For some years now, the tobacco industry had been experiencing it first hand after a series of class action lawsuits put forth by cigarette smokers now suffering from lung cancer and other related diseases. Suing them for failing to fully warn against the full extent of the dangers of tobacco use. Given the relative ”success” of these lawsuits from the standpoint of the plaintiffs, will similar class action lawsuits will soon be besetting audio gear manufacturers after legions of Generation X-ers figure out why they can’t hear anymore?
If you happen to sell, supply or deliver goods – even in the form of repair service – you may need coverage against claims of goods causing injury, death or damage. Product liability insurance covers you if any of these events happen to another business or person by the failure of your product or the product you are selling. From a legalese standpoint, product liability is the area of the law in which manufacturers, distributors, suppliers, retailers, and the rest who make products available to the public are held responsible for the injuries those products cause. Usually, there are three major types of product liability claims: manufacturing defect, design defect, and the failure to warn – also known as marketing defect.
While the tobacco industry – more often than not – had always resorted to that legal gray area of knowing only the harmful effects - i.e. health risks - of their product only several centuries after they started selling tobacco products to their customers, the warning signs of hearing loss usually manifest itself in very obvious ways. As in pain - hence the threshold of pain part of our hearing. But is this self-evident truth be enough to protect hi-fi and public-address systems manufacturers against future class-action lawsuits pertaining to hearing loss?
Warning signs and legal disclaimers are seldom – if ever – banded about by audio gear manufacturers in their adverts. The only audio gear manufacturer that I know of that warns their potential customers of the dangers of using their products at very high decibel levels is Polk Audio. On the advert of their SRT System, Polk Audio clearly warned that this audio system is capable of extreme sound pressure levels. The said advert even states that SRT Systems are supplied with a sound pressure level meter to help you – their prized client – determine safe listening levels. In my opinion, this is like a cigarette manufacturer providing their loyal customers with a great healthcare package.
As an avid Rock concert patron and sometimes performer, it is probably the sound reinforcement / public-address system side of audio gear manufacturing that should be availing themselves of product liability insurance. Given that contemporary Rock concert sound reinforcement systems can easily deliver clean and continuous 120 to 130-dB sound pressure levels to a relatively large number of people is a recipe for a large-scale hearing loss – not to mention the health-related class action lawsuit.
Will audio gear manufacturers do a Winchester House-like descent into superstition in the face of an impending class action lawsuit? I hope not. After all, the 19th Century firearm magnate William Wirth Winchester managed to ply his wares long before the American society became the litigious entity that it is today. With the use of contemporary American Rock music as a torture device in Guantà namo Bay Prison – i.e. playing American Rock music to terror suspect detainees, I think audio gear manufacturers must now have product liability insurance or get one as soon as possible. Thanks to the malfeasant way that the Bush-Cheney consortium conducted America’s “War on Terror”.
By: Ringo Bones
For some years now, the tobacco industry had been experiencing it first hand after a series of class action lawsuits put forth by cigarette smokers now suffering from lung cancer and other related diseases. Suing them for failing to fully warn against the full extent of the dangers of tobacco use. Given the relative ”success” of these lawsuits from the standpoint of the plaintiffs, will similar class action lawsuits will soon be besetting audio gear manufacturers after legions of Generation X-ers figure out why they can’t hear anymore?
If you happen to sell, supply or deliver goods – even in the form of repair service – you may need coverage against claims of goods causing injury, death or damage. Product liability insurance covers you if any of these events happen to another business or person by the failure of your product or the product you are selling. From a legalese standpoint, product liability is the area of the law in which manufacturers, distributors, suppliers, retailers, and the rest who make products available to the public are held responsible for the injuries those products cause. Usually, there are three major types of product liability claims: manufacturing defect, design defect, and the failure to warn – also known as marketing defect.
While the tobacco industry – more often than not – had always resorted to that legal gray area of knowing only the harmful effects - i.e. health risks - of their product only several centuries after they started selling tobacco products to their customers, the warning signs of hearing loss usually manifest itself in very obvious ways. As in pain - hence the threshold of pain part of our hearing. But is this self-evident truth be enough to protect hi-fi and public-address systems manufacturers against future class-action lawsuits pertaining to hearing loss?
Warning signs and legal disclaimers are seldom – if ever – banded about by audio gear manufacturers in their adverts. The only audio gear manufacturer that I know of that warns their potential customers of the dangers of using their products at very high decibel levels is Polk Audio. On the advert of their SRT System, Polk Audio clearly warned that this audio system is capable of extreme sound pressure levels. The said advert even states that SRT Systems are supplied with a sound pressure level meter to help you – their prized client – determine safe listening levels. In my opinion, this is like a cigarette manufacturer providing their loyal customers with a great healthcare package.
As an avid Rock concert patron and sometimes performer, it is probably the sound reinforcement / public-address system side of audio gear manufacturing that should be availing themselves of product liability insurance. Given that contemporary Rock concert sound reinforcement systems can easily deliver clean and continuous 120 to 130-dB sound pressure levels to a relatively large number of people is a recipe for a large-scale hearing loss – not to mention the health-related class action lawsuit.
Will audio gear manufacturers do a Winchester House-like descent into superstition in the face of an impending class action lawsuit? I hope not. After all, the 19th Century firearm magnate William Wirth Winchester managed to ply his wares long before the American society became the litigious entity that it is today. With the use of contemporary American Rock music as a torture device in Guantà namo Bay Prison – i.e. playing American Rock music to terror suspect detainees, I think audio gear manufacturers must now have product liability insurance or get one as soon as possible. Thanks to the malfeasant way that the Bush-Cheney consortium conducted America’s “War on Terror”.
Tuesday, November 10, 2009
Hi-Fi and Audio Video Equipment Insurance Anyone?
Given the recent rise of insurance providers offering coverage of your precious hi-fi, AV, and even Internet-connected computer equipment, is it wise to avail yourself of this type of insurance?
By: Ringo Bones
In my neck of the woods, the electric power, cable and telephone utility companies are recently diversifying their business by offering very reasonably-priced insurance policies that cover hi-fi, audio-video, and even Internet-connected computers against fire, lightning, and damage via electrical surges. With premiums that average at just pennies-per-day, is it wise to get hold of such insurance policies?
Given that most homeowner’s insurance policies – even though they provide coverage against fires – these seldom, if ever, provide coverage against destruction by fire of your irreplaceable high-end hi-fi and other electronic equipment. So it is definitely wise to obtain a separate insurance policy for your hi-fi and other electronic equipment - especially if they are very hard to replace like vintage vacuum tube-based audio gear. Obtaining a separate coverage is far from easy, which is the reason why most people opt not to get one. But for those who decides that their audio-video gear are important enough to warrant insurance coverage, there are tips to follow to allow one smooth processing of their application for them to insure their AV gear.
The problem of proper insurance coverage for high-end hard-to-replace hi-fi, AV, Internet-connected computer and other electronic equipment is rather easily solved. Specifically:
1. Keep a file with all your purchases of the hi-fi, AV, and other electronic gear that you’ve acquired over the years. One usually assumes such a file exists for tax write off purposes, but it is never safe to say never and probably equally unsafe to assume anything!
2. Using a film and / or digital camera (preferably both types of camera), photograph everything you intend to be insured. This serves as a photo documentation of all the hi-fi and other electronic equipment that you own and intend to be covered by insurance.
3. Using a high-quality copier, copy all your receipts and color copy all your photos – especially your digital photos - and keep them in a bank safe deposit box. That way you’ll have records and documentation that will survive any untoward occurrence. I mean what is the point in keeping records in your house - especially if it gets burned together with those items you intend to insure in case of fire. And if possible, have these items notarized by a qualified attorney.
4. Bring in a qualified estimator who will identify the replacement value of your hi-fi and other equipment you intend to insure if the amount and / or scale of your investment demand’s it.
5. You can now safely go to your insurance underwriter armed will all of the information collected above safe in the knowledge of a smooth and speedy processing.
6. Always insure your equipment for “full replacement value” rather than settle for a depreciated figure. Usually the insurance company will tell you that depreciation coverage allows them to sell you a less expensive policy and that you are taking a form of tax write off anyway. However, individual owners of up-market vintage hi-fi gear or other AV equipment seldom, if ever, employ chartered Certified Public Accountants from their local top accounting firms and "bank" their depreciation funds for future replacement. It makes more sense to try and obtain the most complete replacement coverage available to you.
Of all the tips cited above, proper documentation of all the gear that you own that’s intended to be insured is probably the most important. Especially now that insurance adjusters no longer respond as if they are born yesterday concerning privately-owned hi-fi, AV and other electronic equipment. But let us not forget that loss adjustment is still a very difficult matter and requires technical training in which a special group of persons known as loss adjusters perform this work. Loss adjusters typically work for the insured or for the insurance company. Also, if several insurance companies are involved in one loss, it is advantageous to have a single adjustment bureau handle the entire matter.
While many fire insurance policies also have endorsement for extended coverage like vandalism and malicious mischief, nevertheless the properties are only protected for specific perils. Like damage due to lightning strikes and / or the resulting electrical surge / damaging electrical spikes.
There are after all millions of up-marked high-end hi-fi gear around the world that had suffered some kind of calamity. Fortunately, no one I know was unlucky enough to have lost his or her vintage 1950s era Quad II amplifier with the oft-partnered Quad ESL 57 in a fire, flood or a freak electrical surge caused by a lightning strike. If the worst ever comes, it’s nice to know that we can insure our really expensive and hard-to-replace hi-fi, AV and other electronic gear. Especially if they cost on average 10,000 US dollars or more.
By: Ringo Bones
In my neck of the woods, the electric power, cable and telephone utility companies are recently diversifying their business by offering very reasonably-priced insurance policies that cover hi-fi, audio-video, and even Internet-connected computers against fire, lightning, and damage via electrical surges. With premiums that average at just pennies-per-day, is it wise to get hold of such insurance policies?
Given that most homeowner’s insurance policies – even though they provide coverage against fires – these seldom, if ever, provide coverage against destruction by fire of your irreplaceable high-end hi-fi and other electronic equipment. So it is definitely wise to obtain a separate insurance policy for your hi-fi and other electronic equipment - especially if they are very hard to replace like vintage vacuum tube-based audio gear. Obtaining a separate coverage is far from easy, which is the reason why most people opt not to get one. But for those who decides that their audio-video gear are important enough to warrant insurance coverage, there are tips to follow to allow one smooth processing of their application for them to insure their AV gear.
The problem of proper insurance coverage for high-end hard-to-replace hi-fi, AV, Internet-connected computer and other electronic equipment is rather easily solved. Specifically:
1. Keep a file with all your purchases of the hi-fi, AV, and other electronic gear that you’ve acquired over the years. One usually assumes such a file exists for tax write off purposes, but it is never safe to say never and probably equally unsafe to assume anything!
2. Using a film and / or digital camera (preferably both types of camera), photograph everything you intend to be insured. This serves as a photo documentation of all the hi-fi and other electronic equipment that you own and intend to be covered by insurance.
3. Using a high-quality copier, copy all your receipts and color copy all your photos – especially your digital photos - and keep them in a bank safe deposit box. That way you’ll have records and documentation that will survive any untoward occurrence. I mean what is the point in keeping records in your house - especially if it gets burned together with those items you intend to insure in case of fire. And if possible, have these items notarized by a qualified attorney.
4. Bring in a qualified estimator who will identify the replacement value of your hi-fi and other equipment you intend to insure if the amount and / or scale of your investment demand’s it.
5. You can now safely go to your insurance underwriter armed will all of the information collected above safe in the knowledge of a smooth and speedy processing.
6. Always insure your equipment for “full replacement value” rather than settle for a depreciated figure. Usually the insurance company will tell you that depreciation coverage allows them to sell you a less expensive policy and that you are taking a form of tax write off anyway. However, individual owners of up-market vintage hi-fi gear or other AV equipment seldom, if ever, employ chartered Certified Public Accountants from their local top accounting firms and "bank" their depreciation funds for future replacement. It makes more sense to try and obtain the most complete replacement coverage available to you.
Of all the tips cited above, proper documentation of all the gear that you own that’s intended to be insured is probably the most important. Especially now that insurance adjusters no longer respond as if they are born yesterday concerning privately-owned hi-fi, AV and other electronic equipment. But let us not forget that loss adjustment is still a very difficult matter and requires technical training in which a special group of persons known as loss adjusters perform this work. Loss adjusters typically work for the insured or for the insurance company. Also, if several insurance companies are involved in one loss, it is advantageous to have a single adjustment bureau handle the entire matter.
While many fire insurance policies also have endorsement for extended coverage like vandalism and malicious mischief, nevertheless the properties are only protected for specific perils. Like damage due to lightning strikes and / or the resulting electrical surge / damaging electrical spikes.
There are after all millions of up-marked high-end hi-fi gear around the world that had suffered some kind of calamity. Fortunately, no one I know was unlucky enough to have lost his or her vintage 1950s era Quad II amplifier with the oft-partnered Quad ESL 57 in a fire, flood or a freak electrical surge caused by a lightning strike. If the worst ever comes, it’s nice to know that we can insure our really expensive and hard-to-replace hi-fi, AV and other electronic gear. Especially if they cost on average 10,000 US dollars or more.
Saturday, October 31, 2009
The Great Health Insurance Coverage Debate
Health insurance providers have recently used the flimsiest excuse to deny coverage of their policyholders. Will proposed reforms finally end the injustice?
By: Ringo Bones
Ever since Rocky Mountain Health Plans managed to get themselves in hot water after denying coverage of one of Colorado’s youngest citizens. A four month-old infant, whom Rocky Mountain Health Plans point out as overweight. Thanks to extensive media coverage – thanks to the baby’s father being very influential in their local media / TV network – Rocky Mountain Health Plans later reversed their decision - Not to mention a doctor’s examination which later confirmed that the four month-old baby to have a normal body mass index.
Back in May 2008, a law was passed in the United States that prohibits the firing of employees and insurance providers choosing to hike insurance premiums if genetic testing reveals a certain employee or policyholder to have a higher health risk than the norm. From our perspective, the passing of this law - which the late, great Senator Ted Kennedy was one of the main proponents – might seem like the great health insurance coverage reform that will finally save us all. And also, the former US Supreme Court Justice Sandra Day O’Connor was also very vocal on her campaign against any genetic testing that will be used to disadvantage any health insurance policy holder and employee. Especially if the test data could result him or her having to pay higher insurance premiums just to retain coverage or getting fired from the job due to being a “health risk”.
Unfortunately, unscrupulous health insurance companies – and their numbers are growing – have used the flimsiest excuses to deny their policyholders coverage. One of the flimsiest excuses getting media attention these days is the health insurance company claim – though not all of them fortunately – is that spousal abuse is a preexisting condition that could result in some policyholders a denial of coverage.
From overweight and underweight infants to spousal abuse, as 2009 draws to a close, we’ll probably be seeing more flimsy excuses that would be used by health insurance companies as a reason to deny coverage. Maybe one day, they’ll consider being too smart for your own good a preexisting condition thus leaving you high and dry in your time of need. I mean do we actually lose our value every time we see a doctor if health insurance providers consider us nothing more than “assets”?
By: Ringo Bones
Ever since Rocky Mountain Health Plans managed to get themselves in hot water after denying coverage of one of Colorado’s youngest citizens. A four month-old infant, whom Rocky Mountain Health Plans point out as overweight. Thanks to extensive media coverage – thanks to the baby’s father being very influential in their local media / TV network – Rocky Mountain Health Plans later reversed their decision - Not to mention a doctor’s examination which later confirmed that the four month-old baby to have a normal body mass index.
Back in May 2008, a law was passed in the United States that prohibits the firing of employees and insurance providers choosing to hike insurance premiums if genetic testing reveals a certain employee or policyholder to have a higher health risk than the norm. From our perspective, the passing of this law - which the late, great Senator Ted Kennedy was one of the main proponents – might seem like the great health insurance coverage reform that will finally save us all. And also, the former US Supreme Court Justice Sandra Day O’Connor was also very vocal on her campaign against any genetic testing that will be used to disadvantage any health insurance policy holder and employee. Especially if the test data could result him or her having to pay higher insurance premiums just to retain coverage or getting fired from the job due to being a “health risk”.
Unfortunately, unscrupulous health insurance companies – and their numbers are growing – have used the flimsiest excuses to deny their policyholders coverage. One of the flimsiest excuses getting media attention these days is the health insurance company claim – though not all of them fortunately – is that spousal abuse is a preexisting condition that could result in some policyholders a denial of coverage.
From overweight and underweight infants to spousal abuse, as 2009 draws to a close, we’ll probably be seeing more flimsy excuses that would be used by health insurance companies as a reason to deny coverage. Maybe one day, they’ll consider being too smart for your own good a preexisting condition thus leaving you high and dry in your time of need. I mean do we actually lose our value every time we see a doctor if health insurance providers consider us nothing more than “assets”?
Tuesday, October 27, 2009
Will US Bank Closures Bankrupt the FDIC?
As American bank closures now reached the 100 mark, will this eventually bankrupt the Federal Deposit Insurance Corporation?
By: Ringo Bones
As bank after bank in the US are forced to close after stress-test failure compliance which at currently at the 100 mark is the most it had been since the fallout of the Savings & Loan scandal of 1989. But will this eventually lead to the bankruptcy and / or collapse of the Federal Deposit Insurance Corporation or FDIC? After all, if the FDIC gets its funding from the American taxpayer, it can never run out of money because it has always relied on revenues collected from taxes, right?
The Federal Deposit Insurance Corporation (FDIC) began life in January 1934 as part of President Franklin D. Roosevelt’s “New Deal” to make bank deposits – especially savings accounts – as secure as the US Government itself. Banks might and could still fail but depositors will never be left high and dry. All US banks, whether or not they are members of the Federal Reserve System, are eligible for deposit insurance if they meet the FDIC requirements usually by submitting to FDIC examinations and pay an annual assessment based on their total deposits. Virtually all of the American banks now participate in this system of deposit insurance.
Before a new bank can begin operations, it must satisfy the chartering authority on certain essentials. There must be a legitimate need for the bank’s services, it must be adequately capitalized, and it must be under competent management. Banks may not later open branches or change its capital structure without approval by the proper authority. And banks are required to submit regular reports on their condition. Banks are not allowed to pay interest on demand deposits, and the maximum rate it may pay on time deposits are set by the FDIC. It may not underwrite, that is, buy for resale or distribution, security issues other than those of the federal or state governments or their agencies. The bank must maintain reserves against its depositors equal to a specific percentage of its deposits. It may not continue operation if its capital has been impaired. If the book value of the stock (the capital and surplus in back of it) is below the par value, stockholders must pay an assessment to wipe out the deficiency or the bank will be closed.
The elaborately detailed control of banks today – that eventually lead to the rise of the Basel Accord / Basel II regulations about how much capital banks need to mitigate financial and operational risks – gives banking management less room than it once had for the exercise of its own discretion. But these regulations – that date back after the great economist John Maynard Keynes and his team was consulted by President Roosevelt in formulating a “New Deal” – have made an important contribution to the sound condition of modern commercial banking.
The recent American economic crisis has been largely defined by large financial institutions that are supposedly too big to fail that are taking excessive financial risk. Unfortunately, when they eventually – and do – fail, they take usually a number of smaller banks down with them. Thus causing the FDIC to provide pay outs to bank savings account holders. Even though the FDIC only has to pay up to a maximum set account, given the number of bank failures – now and in the near future – this could reach in the hundreds of billions of dollars. Given that American financial firms had always been too profitable thanks to the overly-generous US Government subsidies provided to them from the time when Ronald Reagan ruled the free world, will these financial institutions be always taking excessive financial risks with scant regard of whether it might bankrupt the FDIC? After all, the American taxpayer has always been their insurance underwriter of last resort, right?
Well-formulated financial reforms and regulations – especially ones with teeth – can become harder to legislate the further we seem to move away from the current crisis and into the “apparent (?)” state of economic recovery. Although recently the DOW reaching above 10,000 points is by no means an irrefutable indicator of true economic recovery. As some American financial institutions that are recently bailed out by American taxpayer money readily returned to they’re previous status quo of excessive executive bonuses and risk taking. Especially as the big fat profits slowly rolled in. Most of us will probably be asking who are these financial institutions responsible to - The companies’ shareholders or the state? Given that the US Government is now for all intents and purposes beholden to Chinese bond holders thanks to the Bush-Cheney consortium’s policy of using Chinese money to buy Arab crude oil, legislating effective financial regulations will now be at the whim and whimsy of corporation-owned lobbyists of Capitol Hill.
By: Ringo Bones
As bank after bank in the US are forced to close after stress-test failure compliance which at currently at the 100 mark is the most it had been since the fallout of the Savings & Loan scandal of 1989. But will this eventually lead to the bankruptcy and / or collapse of the Federal Deposit Insurance Corporation or FDIC? After all, if the FDIC gets its funding from the American taxpayer, it can never run out of money because it has always relied on revenues collected from taxes, right?
The Federal Deposit Insurance Corporation (FDIC) began life in January 1934 as part of President Franklin D. Roosevelt’s “New Deal” to make bank deposits – especially savings accounts – as secure as the US Government itself. Banks might and could still fail but depositors will never be left high and dry. All US banks, whether or not they are members of the Federal Reserve System, are eligible for deposit insurance if they meet the FDIC requirements usually by submitting to FDIC examinations and pay an annual assessment based on their total deposits. Virtually all of the American banks now participate in this system of deposit insurance.
Before a new bank can begin operations, it must satisfy the chartering authority on certain essentials. There must be a legitimate need for the bank’s services, it must be adequately capitalized, and it must be under competent management. Banks may not later open branches or change its capital structure without approval by the proper authority. And banks are required to submit regular reports on their condition. Banks are not allowed to pay interest on demand deposits, and the maximum rate it may pay on time deposits are set by the FDIC. It may not underwrite, that is, buy for resale or distribution, security issues other than those of the federal or state governments or their agencies. The bank must maintain reserves against its depositors equal to a specific percentage of its deposits. It may not continue operation if its capital has been impaired. If the book value of the stock (the capital and surplus in back of it) is below the par value, stockholders must pay an assessment to wipe out the deficiency or the bank will be closed.
The elaborately detailed control of banks today – that eventually lead to the rise of the Basel Accord / Basel II regulations about how much capital banks need to mitigate financial and operational risks – gives banking management less room than it once had for the exercise of its own discretion. But these regulations – that date back after the great economist John Maynard Keynes and his team was consulted by President Roosevelt in formulating a “New Deal” – have made an important contribution to the sound condition of modern commercial banking.
The recent American economic crisis has been largely defined by large financial institutions that are supposedly too big to fail that are taking excessive financial risk. Unfortunately, when they eventually – and do – fail, they take usually a number of smaller banks down with them. Thus causing the FDIC to provide pay outs to bank savings account holders. Even though the FDIC only has to pay up to a maximum set account, given the number of bank failures – now and in the near future – this could reach in the hundreds of billions of dollars. Given that American financial firms had always been too profitable thanks to the overly-generous US Government subsidies provided to them from the time when Ronald Reagan ruled the free world, will these financial institutions be always taking excessive financial risks with scant regard of whether it might bankrupt the FDIC? After all, the American taxpayer has always been their insurance underwriter of last resort, right?
Well-formulated financial reforms and regulations – especially ones with teeth – can become harder to legislate the further we seem to move away from the current crisis and into the “apparent (?)” state of economic recovery. Although recently the DOW reaching above 10,000 points is by no means an irrefutable indicator of true economic recovery. As some American financial institutions that are recently bailed out by American taxpayer money readily returned to they’re previous status quo of excessive executive bonuses and risk taking. Especially as the big fat profits slowly rolled in. Most of us will probably be asking who are these financial institutions responsible to - The companies’ shareholders or the state? Given that the US Government is now for all intents and purposes beholden to Chinese bond holders thanks to the Bush-Cheney consortium’s policy of using Chinese money to buy Arab crude oil, legislating effective financial regulations will now be at the whim and whimsy of corporation-owned lobbyists of Capitol Hill.
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