Wednesday, February 29, 2012

Landslides and mud-slides: NOT covered by a standard homeowners policy

The New York Times has an interesting story today about a significant hazard here in the rainy Pacific Northwest: mudslides.

Mudslides and landslides, the article notes, are "a topographical drama less spectacular but far more common than the potentially deadly earthquakes, avalanches and tsunamis that loom in anxious minds across the Pacific Northwest."

And here's what many homeowners don't know: mudslides and landslides aren't covered by a standard homeowners policy. So it can be very difficult to collect for losses caused by any form of land movement unless you bought specific additional riders or policies, like these:

Landslide coverage: You may be able to buy a special rider for your homeowners policy that includes coverage for contents for all perils, including earth movement. But this type of rider only covers contents, not the structure, and some insurers don't offer this option at all. For the structure, you may be able to buy separate earth-movement coverage from what's known as the "surplus lines" market, meaning insurers who specialize in risks that the traditional insurance industry doesn't cover. But if your home is on a hillside, it may be difficult to get this kind of coverage.

Flood insurance: Flood insurance may apply to some kinds of earth movement, such as water-related erosion, mudflows or flash floods. Most homeowners seeking flood coverage start with the National Flood Insurance Program, which is federally run but sold by local agents and brokers.

Earthquakes: Quake damage is another category of risk not covered in a standard homeowners policy, but you can buy this coverage to protect against losses from an earthquake -- or quake-triggered landslides.

Tuesday, February 28, 2012

Job opening: Actuary

We have a job opening for a full-time, permanent actuary at our main office in Tumwater.

The person will be reviewing health and disablity insurance rate filings, as well as helping our company supervision divisions financial analysis work. For a full description of the job, salary range, benefits, etc., please see the job listing.

Wednesday, February 22, 2012

Insurance companies and agents fined

We'll be posting a news release on this shortly, but we've issued the following fines and other enforcement actions:
  • Fidelity National Title Insurance Co. and Chicago Title Insurance Co.: Fined $100,000 for wrongfully offering discount club memberships to people who were in a position to send title business to the companies.
  • Aetna Life Insurance Co.: Fined $20,000 for failing to promptly handle appeals from consumers.
  • Charter Warranty Services, Inc., Mechanical Breakdown Protection, Inc., and Paul Pawlusiak, of Detroit, Mich.: Ordered to stop selling unauthorized motor vehicle service contacts.
  • Scott L. Stevens and RV, of Mill Creek: Ordered to stop acting as an agent for a service contract provider not authorized to do business in Washington state.
  • Cynthia L. Rushing, of Spokane: License revoked for misappropriating funds.
  • Trevor D’Jon Losse, of Cle Elum: Fined $1,000 for multiple violations, including failing to disclose other state disciplinary actions against him.
  • Robert Tychsen, of El Cajon, Calif.: Fined $1,750 for selling insurance in Washington without a license.
  • Douglas D. Wellsandt, of Hayden, Idaho: Fined $5,000 for violations including falsely stating that Washington policies had been sold in Idaho.
  • Ross S. Wolf, of Sammamish: Fined $2,000 for violations including acting as an insurance company’s agent without having been appointed by the company.
Orders and details about these cases are posted online at

The fines collected do not go to the agency. They are deposited in the state's general fund to pay for other state services.
Washington consumers with questions, problems or complaints can call us at 1-800-562-6900 or e-mail (Not in Washington? Here's how to reach your state's insurance regulator.)

Tuesday, February 21, 2012

A company that insured the Titanic goes under, leaving behind maritime relics

The Wall Street Journal's Leslie Scism has a story today about Atlantic Mutual, the company that insurered the Titanic and many other ships for more than a century, before the company was ordered into liquidation two years ago.

The story details the maritime artifacts and records amassed by the company. Many of the items -- model ships, paintings, old maps, gold coins, barometers, etc. -- may be sold soon.

Tacoma man sentenced to prison for insurance fraud, forgery

A Tacoma man has been sentenced to more than two years in prison for insurance fraud and forgery after filing a false auto insurance claim.

Cash B. Knott, 46, was sentenced Friday in Pierce County Superior Court to 29 months in prison and must pay $1,200 in costs and assessments. He pleaded guilty in January to two counts of forgery and one count of felony insurance fraud.

On Nov. 6th, less than a month after getting coverage from Progressive Direct Insurance Co. for his 1992 Ford Ranger pickup, Knott filed a $5,674 insurance claim with Progressive. He said someone had scratched the paint, stolen his chrome wheels and tires, and stolen his navigation and entertainment system, 1,000 watt amplifier and other electronic components.

He provided Progressive with a Sept. 2 stereo shop invoice for $4,547.84 worth of stereo equipment, a copy of his check, and a bank statement showing the withdrawal from his checking account.

The problem: When contacted by an insurance adjuster, the stereo shop said it had no record of such a purchase. All they could find was that Knott had bought an amplifier -- for $109 -- on Sept. 2.

Insurance Commissioner Mike Kreidler's Special Investigations Unit obtained a search warrant for Knott's bank records. The bank found no checks written to the stereo shop, and none whatsoever for $4,547.84.

Monday, February 20, 2012

Homeowners insurance: What's NOT covered

People often assume that homeowners insurance is a catch-all, covering virtually any event.

Not true, unfortunately. There are many things that a typical homeowners policy does NOT cover. Among them:
  • floods
  • earthquakes
  • breaks in a water line leading to your home
  • termites
  • stolen pets
  • damaged or stolen cars, boats and motorcycles (these would typically be covered, however, by your car/boat/etc. insurance)
Also, here's a list of what IS covered by a typical homeowners policy, as well as add-ons you might want to consider.

Tuesday, February 14, 2012

Cease and desist order issued for "Prolong Plus" auto warranties

A New Jersey-based company selling vehicle warranties paired with engine additives has been ordered to stop selling unauthorized vehicle warranties in Washington state. The order takes effect immediately.
The Choice Manufacturing Company, Inc., also known as The Choice Warranty, Inc., is not authorized to sell vehicle service contracts in Washington. Their application was denied in 2008 because they didn't meet several requirements of the state's insurance law.

Despite that denial, however, the company continued to sell its "Prolong Plus" vehicle warranty in Washington. When state officials investigated, the company and principal Peter Masi refused to provide information or cooperate.

Our office has received several complaints from people who bought the warranties. Each said that the company had wrongly denied claims.

The Prolong Plus warranty requires consumers to put additives in their car radiators, engine oil, air conditioning or batteries. The additives are manufactured by Choice Manufacturing.

What if you live in Washington and bought one of these warranties? Even though the warranty was not legally sold here, the company is still required to honor the terms of the contract.

Update: On Aug. 6, 2012, the company agreed to pay a $10,000 fine.

Most and least expensive cars to insure is out with its annual list of the most- and least-expensive cars to insure. (Scroll down after clicking that link to reach the table listing the cars.)

Among the cheapest to insure: minivans, small SUVs, and some large pickup trucks. The lowest-cost vehicle to insure is the Toyota Sienna.

The most expensive will come as no surprise. The list, topped by the Audi R8 Spyder Quattro convertible, is dominated by expensive European sports cars.

The folks at, an industry news site, put together a short slideshow with the top cars in each category.

Give us your feedback

We're tuning up our agency website (not this blog; we've already done that part) and would love to get your feedback.

Our survey takes less than a minute. Please take a quick look at the site and give us your thoughts.

Thank you!

Thursday, February 9, 2012

Surpluses of nonprofit health insurers in WA at $2.4 billion

The Seattle Times had a story today about a change in the law we've proposed.

The background: Washington's three major health insurers -- all of whom are non-profit companies -- have amassed surpluses totalling more than $2.4 billion.

Commissioner Kreidler is asking lawmakers to let him consider those surpluses when the companies propose increases in health insurance premiums. The That, hopefully, could ease future premium hikes. In the individual and small group markets, insurance premiums, on average, have more than doubled since 2005.

The bill is SB 5247. It has cleared a key committee and is currently in the Senate's Rules Committee.

Wednesday, February 8, 2012

How to look up the number of complaints against an insurance company

We've created an easy online tool to look up the number of complaints against insurance companies.

We're the insurance regulator in Washington state, so the data's only for our state. But it can provide some insight into who we hear a lot of complaints about, and who we don't.

Since the market share of these companies varies widely, we also calculate what we call the "complaint index." That's simply the ratio of complaints divided by market share, to make the results easy to compare.

Tuesday, February 7, 2012

Survey: 57 percent of people in low-income families have no health insurance

The Commonwealth Fund today released the results of a new survey on the uninsured. Among the group's findings:
  • 57 percent of people in low-income families (those earning less than about $30,000 for a family of 4) had no health insurance at some point last year.
  • 35 percent have been uninsured for two years or more.
  • Among moderate-income adults (about $30,000 to $56,000 for a family of 4), some 36 percent of adults in those families were uninsured during the past year.
None of this should come as a surprise. We do our own report on the uninsured in Washington state, and income is by far the largest factor correlated to being uninsured. The less you make, the more likely it is that you don't have health insurance.

We've also found that in most income brackets, the younger you are, the more likely that you're uninsured. See the report link above for more data and details.

Car sharing and usage-based insurance bills move forward

Everyone in Washington state is required to have basic liability insurance if you own a car. Well, here's two bills that could impact how you get insurance and how much you pay for coverage.

The first, House Bill 2384, creates an insurance framework for peer-to-peer car sharing programs. Several other western states (OR, CA) have passed similar bills. Here's how it would work: You sign-up with a program to share your car when you're not using it. Your financial liability for the car transfers to the program during the time it's in use. Of course you still need insurance coverage for when you're driving your car, but the program is responsible for having insurance coverage for any car in its use. The bill report has all of the details if you want to know more.

Next is an issue we've seen before: Usage-based insurance (House Bill 2361). Nothing prevents an insurance company from creating a usage-based insurance product today, but under our state law, all auto insurance products and why they cost what they do is public once the premiums are approved by our office.

Certain information is considered confidential (ie. those pesky credit scoring models) but only if they've been carved out in state law. This bill would allow insurers who want to offer a usage-base product the ability to keep their products confidential. Also, there would be limits on how the insurance company could use your information and they couldn't sell it to anyone.

So why should you care? Well, you could get your rates reduced depending on how you drive. This means: the amount of miles, where you drive, the time of the day you drive, your speed, etc. Of course it goes both ways - if you have a lead foot or tend to brake hard, you could see your rates go up. Here's the full details.

Both bills must pass a February 14 deadline to stay alive.

Monday, February 6, 2012

Job openings: Actuary, investigator, HR consultant, etc.

We have four job openings, although some of the application deadlines are coming up soon. (Check each listing for the deadline, some may have closed by the time you're reading this.) We're looking for:
We're a small agency, but we do have job openings periodically. Most are due to retirements or resignations, rather than new positions. When we have job openings, we post them on our jobs page, as well as on the state's site.

Friday, February 3, 2012

Insurers and agents fined more than $1.3 million in 2011

Insurance Commissioner Mike Kreidler fined insurance companies, agents and brokers more than $1.3 million in 2011.

Violations included wrongly denying medical claims, overcharging customers, misappropriating clients’ money, charging unapproved rates and submitting false documents.

“These cases are the exception, not the rule,” said Kreidler, who’s been the state’s insurance regulator since 2001. “The vast majority of insurers, agents and brokers comply with the law.”

The largest fine, issued in January 2011, was against six Chubb & Son subsidiaries, which were ordered to pay $534,000 for violations including a long-running pattern of failing to properly document why the companies were charging higher or lower rates for certain policyholders.

Other major fines included $100,000 from American Bankers Insurance Co. of Florida (June 2011) and $100,000 from Regence BlueShield (August 2011).

Over the past 11 years, Kreidler has issued more than $13 million in fines against insurers, agents and brokers who violated the law. The agency’s disciplinary orders are posted online at

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.