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August 30th, 2014

8/30/2014

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As the article stated yesterday---costs for PIP are not going up----there is simply more fraud and corruption lifting the costs as with Medicare and Medicaid.  We are reforming Medicare and Medicaid because the health industry fraud sucked the Trusts dry.  That is what is happening with PIP.  The insurance and health industries are inflation costs by fraud with soaring profits and then claiming PIP needs to be dismantled because it is too costly.....same as Medicare.  So, rather than having the costs of your health care covered with this auto insurance that is required by law---you are now going to be pushed into Medicaid which now mostly covers only preventative health care.  This eliminates yet another outlet for health coverage for the working and middle-class while insurance and health industry profits soar.

Notice the Maryland Assembly is about to end PIP and push Maryland citizens into the most private and profit-driven health system in the nation---Medicaid and preventative care.
  The No Fault auto premiums are no small payment---as many times as people use it the total premium amounts paid often covered costs.

Think that at the same time, your rates go higher and higher for simply being in an accident no matter it wasn't your fault.  That is what deregulating the insurance industry looks like.  It gives them the ability to charge anything they want as laws are on the books requiring you to have some kind of insurance.  Deregulating while making insurance mandatory----watch that disposable income disappear with rate hikes.

Tort-based auto insurance means the ambulance-personal injury lawyers that you see on TV will be the only recourse for paying medical bills and we all know these lawyers pocket most of the money won in the lawsuit with the plaintiff often receiving pennies on the dollar.  So, this will cost health care more and that money will go to lawyers and it will come from taxpayer Medicaid.
So, now the insurance, the health care, and lawyers are getting a cut money that always went to actual care for the patient who will be bankrupt and/or left with little access to care.

THESE ARE NEO-LIBERAL AND NEO-CON POLICIES MOVING ALL MONEY TO CORPORATE PROFIT ON THE BACKS OF THE AMERICAN PEOPLE.


All Maryland pols are neo-liberal and neo-cons doing all of the above.

'Rates did go down initially'---before the fraud and corruption sent them soaring.

PIP and No-Fault Auto Insurance Reform


More and more states are abandoning the PIP/No-Fault form of auto insurance in favor of a tort-based set of laws. PIP/No Fault originated in the 1930s as an alternative to the often slow and expensive process of litigating claims. The intent was to speed up the process by shifting the dispute resolution from the courts to the insurance companies. In theory, this was supposed to reduce insurance rates—and rates did go down initially.

By the mid-70s, almost 20 states had some form of no-fault insurance laws. However, over time, rates again rose until "No-Fault" states had higher rates than tort-based states. Beginning in 1980, states started repealing their no-fault laws, and now only nine states (Florida, Hawaii, Kansas, Massachusetts, Missouri, Minnesota, New York, North Dakota and Utah) have mandatory no-fault laws. Eleven states plus the District of Columbia have hybrid laws (Arkansas, Delaware, Kentucky, Maryland, New Jersey, Oregon, South Carolina, South Dakota, Texas and Virginia), which are a combination of no-fault and tort systems.

The pendulum seems to be swinging back to tort-based auto insurance. What does this mean for you as a policyholder?

The Good News

Tort-based systems, in theory, give you more choices for medical payments and could save you substantial amounts of money. As an example, depending on the insurance company and coverages selected, those with Colorado car insurance (the most recent state to revert to a tort-based system) could see savings of 10 percent to 30 percent, according to several recent Denver Post articles.

The Choices

PIP, or Personal Injury Protection, is still available (in most cases), should you wish (or need) to pay for it. If you choose to drop this coverage, or if you are already under a tort-based system and don't have this coverage, you can still purchase it with most policies to cover medical expenses. However, coverage will be limited, with a general ceiling of $50,000. This additional coverage, if purchased, will pay expenses incurred by you and your immediate family for injuries resulting from an at-fault auto accident.

Since many drivers are uninsured or underinsured, it is essential that you understand the ramifications of this and make an informed decision about the "Uninsured/Underinsured Motorists" coverage option.

What if?

What happens if you are at fault? Your auto policy should pay the other person's claims. Companies normally negotiate this with each other. If you have insufficient coverage, you may have to go to court—thus displaying the tort aspect of the law. Either you or your health insurance company will pay medical expenses for you and your family once those expenses exceed your auto policy coverages.

What if you are injured by another driver who is at fault? Generally, the two auto insurance companies will work together to determine fault and pay benefits accordingly. This resolves the problem in most cases. If not, or if the amounts paid are insufficient, it may be necessary to resort back to the court system to recover damages.

What if the other driver is at-fault and has no (or inadequate) insurance? Your insurance company normally covers your medical expenses. This protection is provided under the uninsured/underinsured motorist coverage. If you do not have this coverage, your health insurance usually pays the bills, or you can sue the other party.

Consider the "Deductible Gap"

Generally, under a tort system, medical payments from your own policy are limited. However, in most cases you can choose "additional medical payments" and "Uninsured/Underinsured Motorists" coverage as part of your auto insurance policy.

After years of rising rates, many people may choose to forgo any additional coverages. Adding these coverages creates financial strain if you have high-deductible health insurance, or no health insurance at all. However, there is a potentially huge gap between the amount paid under a tort-based policy and your health insurance deductible. If you have no insurance, the out-of-pocket costs could be staggering. If you are not at fault in the accident, the tort-based system allows you to go to court to receive compensation for these costs, as well as for pain and suffering. But you must do so within a specified time period, and a lot of out-of-pocket expenses may be involved.

What does this mean for health insurance?

As more costs are shifted to the health insurance system, your insurance costs are likely to rise. This also means more people will be without health insurance.

So, what is next?

This is a good time to look at your health insurance to make sure you will have adequate coverage if you drop your PIP/No-Fault coverage. Don't wait until you're in an unpleasant situation to find out if you need more insurance. Be prepared!

_______________________________________________

This is when PIP was working in the interest of citizens and government coffers.  Insurance corporations were earning profits in the millions while the Uninsured auto insurance pool was bursting at the seams with revenue. 

NOW, HOW CAN WE DIVERT THE MONEY PAID INTO THIS FUND FOR HEALTH CARE INTO PROJECTS THAT BENEFIT DEVELOPMENT CORPORATIONS.

This is when a good program was targeted for fraud and corruption just as with the other Federal programs Medicare and Federal Housing Authority.  Working well for citizens, leaving government coffers flush to handle future events, allowing millions in profits to be earned---BUT THAT WAS NOT ENOUGH.  You see the article below was written in 1993----HERE COMES NEO-LIBERAL CLINTON TO DEREGULATE ALL THAT HE CAN SEE......this is the deregulation that sent all of this surplus in the Maryland Automobile Insurance Fund to development corporations like Johns Hopkins in Baltimore.  There's Donald Schaefer funneling money from Transporation Trusts and now MAIF to balance the budget with the public's designated money.  Baltimore Development paraded all kinds of working class and poor out to praise Schaefer who was behind creating Baltimore Development Corporations to funnel all the city's revenue from where it was to go----to where they wanted to send it.

You see the insurance corporations were able to move more and more people into MAIF clearing its rolls of all but the best of drivers.  It went from helping low-income people to subsidizing the costs of these auto insurance corporations.  It was gutted of its funds for
pet projects.  I know Ravens fans love their stadium----but most of the fans are the ones no longer affording auto insurance because of the subsidy.  Note that the Uninsured Motorist insurance had high premiums and should have paid all health care costs when needed.

Remember, this was done through fraud and corruption because this money was not to be fungible.  It needs to come back to this government coffer.



I KNOW---LET'S SEND THIS PIP MONEY TO BUILD THE NEW FOOTBALL FIELD.----M AND T STADIUM AND BALANCE THE BUDGET WITH IT.


MAIF's embarrassment of riches

March 04, 1993|
By Frank A. DeFilippo  Baltimore Sun

THE Maryland Automobile Insurance Fund has a big-time problem. It's rich. So rich, in fact, that other state agencies are itching to get their hot little hands on MAIF's $118 million surplus.

MAIF's been approached about financing a new football stadium in Baltimore. Sen. George W. Della Jr. of Baltimore has sponsored a bill that would shift $50 million of MAIF's money to the general fund. And the Schaefer administration is pilfering $5.4 million from MAIF to help balance the budget.

MAIF is Maryland's state-run insurer of last resort. Any Maryland motorist who's turned down by at least two commercial insurers is automatically MAIFed.

MAIF's rates aren't cheap.
Depending on how bad a motorist's record is, the driver's age and ZIP code, bare-bones coverage can range from $2,559 to a stick-it-to-'em high of $8,677 a year.

That MAIF should be suffering such an embarrassment of riches during a time of budget cuts and deficits is an embarrassment itself. MAIF's $118 million surplus is larger than the $100 million budget shortfall that's being plugged with keno proceeds and other money.

In theory, at least, MAIF is supposed to be non-profit. It was created in 1973 as an antidote to the no-fault insurance craze at the time, kind of an everybody's-fault approach. It's run by a board of trustees and receives no state funds, nor are its assets part of the state treasury. To settle claims, MAIF has the power to attach salaries and seize property.

Over the years, the commercial insurance companies in Maryland have pumped $137 million into MAIF. In effect, good drivers subsidize the insurance of bad drivers. In 1980, MAIF had 30,000 policies. Today it has 135,000.

Much of MAIF's excess is due to changes in the way it does business as well as some shrewd investments. At the same time MAIF has reduced rates over the past three years, it's also lowered awards. MAIF is also now doing all of its work in-house instead of farming it out to free-lance adjusters and collectors.

So it should come as no surprise that the Schaefer administration's pie-slicers approached MAIF about lending the Maryland Stadium Authority $100 million to help finance a new football stadium if Baltimore wins one of two NFL expansion franchises.

There are serious legal questions about whether the Stadium Authority has a funding mechanism for another stadium if the city is awarded a team. Because of a change in the tax code, the use of tax-free bonds to finance stadiums expired at the end of 1990.


The authority argues, though, that it's confident that it can float tax-free bonds because there have been a number of test cases around the country that might allow it.

Moreover, the authority has a bonding limit of $220 million, of which it has already used $170 million to build the new baseball stadium. The authority will pocket another $30 million over three years from lottery proceeds -- on top of the $50 million in bond money left over from the ballyard -- a total of $74 million. But a new topless football stadium will cost about $130 million. Put a lid on it, and it'll cost millions more.

So here's the catch: If the authority can't float tax-free bonds, it will have to go to market with bonds at a much higher interest rate. But before it can go to market with bonds, the authority will need the General Assembly's approval to increase its bonding capacity. This could hoist the total bond package over the spending affordability limit. Allowing this is action the legislature is reluctant to take.

It's for this reason that Gov. William Donald Schaefer is bypassing the spending affordability limit and proposing the use of transportation bonds to finance improvements to Baltimore's Convention Center. Now he's trying to scoot around the spending limit again just in case there's a football team in the city's future.

So drive carefully. Get MAIFed, and the premiums you pay could wind up helping to finance some government geegaw.

Frank A. DeFilippo writes every other Thursday on Maryland politics.

_______________________________________

Here we are just a handful of years later and what the first article stated was in fact true in Maryland----it was the hybrid model Maryland adopted that sent auto insurance money to lawyers and doctors.

Now, they are working to end hybrid and make it all tort. 
People not being able to afford strong health coverage will be preyed upon -----80% of the American people.

Again, another public program that worked fine for the people gutted and dismantled by neo-liberals and neo-cons.  Profit over people every time

Again, we are at the height of Reagan/Clinton's deregulation frenzy.
I wonder if those voters wanting small government wanted to be pushed out of driving because they can no longer afford car insurance? 

Your Public Trusts are being gutted by small government and deregulation.


Why car insurance is so high Law suits: System encourages excessive litigation, raises premiums $130 to $150 a year

.
December 23, 1996  Baltimore Sun

WANT TO LOWER your car-insurance premiums? It could happen -- if legislators in Annapolis stop catering to powerful special interests. More than 60 percent of your premium covers liability. Of that amount, 19 percent could be saved if excessive litigation and fraudulent claims were eliminated.Sadly, state legislators yawned at the problem when a gubernatorial commission sought reforms this year. Too many of them want to please trial lawyers and doctors who vigorously fight for the status quo. These special interests know that lower insurance premiums would come out of their pockets.



_________________________________________



I have talked about AIG spinoff HighStar and its connection with the Ivy League schools like Johns Hopkins.  The subprime mortgage fraudulent loans were insured here with the idea that HighStar would break from AIG with the equity and leave taxpayers to pay 100% on the dollar for the fraudulent Credit Default Swaps.   This article does a good job doing this.  Geithner was the NY FED chief that watched as trillions of dollars of fraud ran through the mortgage industry and did nothing about it----he aided and abetted the massive fraud.  What many people may  not know AIG was more a Life Insurance agency with this HighStar hedge fund sucking all its profits into their bank accounts.  Indeed, the taxpayer bailout of AIG saved the shareholders and those insured by CDS-----but it left an AIG still in business and limping along saying it is healthy when indeed it is not.  AIG Life Insurance advertises on Free TV---you know , where you get life insurance with no checkup.  Like you get a house without having a job. 

SAME THING.  THIS IS THE SUBPRIMING OF LIFE INSURANCE.


They are simply selling as many policies as they can and gaining those monthly payments knowing the coming economic collapse will bankrupt them again.

You are guaranteed to get back what you put into this Life Insurance plan-----OH REALLY????  They will spin that Life Insurance money off as they did with HighStar----probably to HighStar just as the economy is ready to crash.  THEN WE WILL HEAR----WE CAN'T PAY YOUR PREMIUMS BACK!


They will keep doing this with every business sector until you and I get rid of the neo-liberals and neo-cons that have allowed this corporate system to be deregulated with no oversight and accountability.

AIG's Collapse: The Part Nobody Likes to Talk About


Hester Peirce JUN 16, 2014 12:00pm ET

  Earlier this month, American International Group announced the departure of Robert Benmosche, the CEO who led the company through most of its recovery from the financial crisis. Now that the company’s postcrisis chapter is underway, it is worth taking a fresh look at AIG’s downfall and rescue and the implications for reform.

The standard AIG story lays all the blame for the company’s problems on AIG Financial Products—an allegedly unregulated, irresponsible, derivatives dealer hiding within an otherwise solid insurance company.

Former Treasury Secretary Timothy Geithner repeats this traditional line in his recent book, where he recounts how an aggressive “hedge fund-like subsidiary called AIG Financial Products” brought the otherwise healthy insurance company to its knees and ultimately drove it into the Fed’s welcoming arms. Former Federal Reserve chairman Ben Bernanke made a similar claim when he told Congress how angry he was about AIG’s Financial Products unit—“a hedge fund attached [to] a large and stable insurance company.” And former Commodity Futures Trading Commission Chairman Gary Gensler, with typical dramatic flair, explained that AIG’s “subsidiary, AIG Financial Products, operating out of London, brought down the company and nearly toppled the U.S. economy.”

This widely repeated narrative ignores or downplays a critical aspect of AIG’s downfall--the insurer’s securities lending program run for the benefit of its regulated life insurance subsidiaries.

An endnote in Geithner’s tome explains that securities lending was one of “AIG’s major liquidity needs” at the time of its rescue. As I describe in a recent working paper, the company got itself into hot water by lending securities from its life insurance companies’ portfolios. AIG took the cash collateral it received for these short-term loans and—in a departure from insurance industry practice—invested much of it in longer term, illiquid residential mortgage-backed securities.

The securities lending program grew from about $10 billion at the end of 2001 to over $80 billion by the end of 2007. When borrowers stopped renewing the loans, returned their securities, and asking for their cash back, AIG was in a bind—the borrowers’ cash was tied up in reinvestments. 

To meet borrowers’ demands, AIG lent more securities and used the cash collateral from new borrowers to return to existing borrowers. This solution only aggravated the problem. When CEO Robert Willumstad took the reins of AIG in June 2008, the cash drain from securities lending worried him more than AIG Financial Products’ liquidity needs.

Losses from the securities lending program threatened the viability of a number of AIG’s regulated life insurance subsidiaries. To save them from falling below minimum capital requirements, AIG pumped billions of dollars into these units.

Government rescue money was critical to this recapitalization effort. Taxpayer funds were also critical in meeting securities borrowers’ demands for cash. Securities lending counterparties received $43.8 billion in the last quarter of 2008, comparable to $49.6 billion in collateral postings and payments to AIG’s derivatives counterparties.

As consequential as it was to AIG in a time of crisis, nobody likes to tell the securities lending part of the story. First, it doesn’t feed as nicely into the vilification of derivatives that laced crisis narratives and fueled calls for an intense derivatives regulatory regime. Second, the fact that heavily regulated insurance companies got into trouble does not support the call for greater reliance on government regulators. Finally, the rescue of a deeply troubled company is less defensible than the rescue of a healthy insurance company with a troubled derivatives subsidiary.

The Fed’s contention that its loan was adequately secured rested on the supposition that apart from the derivatives unit, AIG was sound. The banks that went in to AIG in September 2008 to assess whether it was worth rescuing concluded that it was not.

As one of the private bankers subsequently explained, “The value of the company in its entirety was not necessarily sufficient to cover the liquidity need that the company had.”


Geithner recounts in his book that—looking for confirmation that a loan to AIG would comply with the legal requirement that “the Fed can only lend against reasonably solid collateral”—he asked Warren Buffett “what he thought about the earning power of AIG’s traditional insurance subsidiaries.” Buffett “was pretty positive about their underlying value, which made [Geithner] more confident that [the Fed] could meet the legal test of being secured to [its] satisfaction.” Buffett’s words of assurance to Geithner weren’t matched by a willingness to put his own money on the line; he refused AIG’s overtures to invest during 2008.

AIG was on the verge of filing for bankruptcy when the Fed stepped in with a better deal for shareholders and creditors. The government subsequently re-rescued the company by devoting additional taxpayer funds to it and softening the lending terms.
 At any of these re-rescue points, the government could instead have let the company go through bankruptcy.

By continuing to prop up AIG, the government shielded the company from the toughest regulator of all—the markets. AIG’s problems were not confined to one unregulated corner; problems also arose in full view of insurance regulators. Rather than assuming the Fed will be better than AIG’s other regulators, we ought to allow the truly superior regulator—the market—to do its job.







_____________________________________________

I spoke yesterday about Life Insurance corporations being the most leveraged and ready to collapse of the insurance industry but guess what is the next in line of threatened insurance corporations-----

THAT'S RIGHT----WORKMAN'S COMP.

They have been allowed to create the same over-leveraged financial status that will have them bankrupt with this coming economic collapse.  No more worker's compensation----

THAT'S HOW YOU GET RID OF THE NEW DEAL SAY NEO-LIBERALS AND NEO-CONS!  BLOW THEM UP AS WE DID THE HOUSING MARKET WITH FRAUD AND CORRUPTION!


Coming after more public wealth and no public justice in place to protect or give us recourse....that is what neo-liberals and neo-cons have been building these few decades-----Clinton and Obama taking the people's party and handing it to Wall Street.  Run and vote for labor and justice in all Democratic Primaries!  WE CAN REVERSE THIS!


Rapidly writing new contracts for worker's comp that they could not afford----sound familiar?


IMPLODING ALL OF THE NEW DEAL PROGRAMS TO PROTECT THE AMERICAN PEOPLE DURING HARD TIMES.


After Tower Group collapse, lingering concerns about industry’s reserve adequacy

By Adam Cancryn and Saurabh Nair, SNL Financial Posted: May 6, 2014

...................................................

Most of the concern centers on long-tailed commercial lines, particularly workers’ compensation. Claims behavior takes longer to develop than in other sectors, making it more difficult to tell how much money should be set aside even years after a policy is written. Misjudging those reserving needs can be disastrous. SeaBright Holdings Inc. sold in 2013 after reserve charges pressured its operations, and Meadowbrook’s stock dropped nearly 35% from 2012 through 2013 amid several quarters of reserve charges. Tower Group served as the highest-profile example of reserving gone wrong, with its shares losing more than 80% in the six months before it hastily agreed to a sale.

Those companies ran into problems with business written during a softer market between 2007 and 2011, when they grew their books rapidly just as the rates being charged for coverage were at their most inadequate. When claim costs far outstripped the rates they originally charged, the insurers had to quickly build up their loss reserves. Analysts now consider the 2010 accident year one of the worst performers of the cycle, attributing the troubles to low prices and more expensive claims driven by high unemployment.

“The troubles they have now is on stuff they wrote years ago,” Keefe Bruyette & Woods analyst Robert Farnam told SNL.


The 10 workers’ comp insurers with the greatest adverse development in 2013 reported an aggregate $702.6 million in charges. SeaBright and Meadowbrook did not make that list. Tower Group was also absent, as it has not yet submitted all of its filings, but it said in February that its U.S.-taxed subsidiaries recorded $269.2 million of 2013 reserve charges.

Despite the issues, the sector continues to steadily release reserves.
Companies argue that Meadowbrook and Tower Group in particular are isolated situations, driven just as much by reckless growth as the broader industry conditions.
The rest of the industry, they contend, was more prudent in writing business during the soft market, leaving it with less risk and the ability to make up for a few unfavorable accident years with better results from other parts of their books of business. The insurers themselves are also working with much more detailed data than analysts and outside actuaries, they say, allowing them to most accurately evaluate their reserves.

“We look at it on a much more granular basis, and we think we have certainly better information,” W. R. Berkley Corp. Vice President of External Financial Communications Karen Horvath told SNL. Analysts have singled out W.R. Berkley’s reserving position as one of the more concerning in the industry, predicting that its quarterly releases would soon slow. But the company in the first quarter released about $25 million, extending a string of favorable reserve development that dates back to 2007.

Even so, skeptics are not quite willing to accept insurers’ assurances as fact. They worry that companies are already drawing down their reserves for the 2012 and 2013 accident years to supplement earnings or balance out problems in earlier years, without enough data to be sure about how those most recent years will ultimately perform.


“There is just no way a company would know or have the type of certainty under which they would be able to release reserves from some of the most recent business,” said Standard & Poor’s credit analyst Siddhartha Ghosh, who warned that the workers’ comp sector will eventually have to strengthen reserves significantly. “We don’t think that’s a prudent way of addressing reserves.”

He pointed to the previous market cycle, when workers’ comp companies released $12.4 billion of reserves between 1994 and 2000 and then had to scramble to add back $10.6 billion from 2001 to 2005 to make up for their overconfidence.

The sector’s fortunes over the next several years will depend heavily on whether insurers can keep raising prices, analysts said.
The workers’ comp business is still not reliably profitable despite recent pricing actions, and low interest rates continue to pressure investment income. If companies can continue to move their prices considerably and consistently higher over the next couple years, the new premium should be enough to cover costs. If the rate hikes falter and claims from recent policies start piling up, though, the reserving actions that insurers used to buoy earnings for so long could stick them with a deficit that will take years to fill.

“It’s a simple equation,” Ghosh said. “The premium coming in has to be higher than the losses going out.”


________________________________________________
This is a pretty good analysis of the coming bond market crash.  Notice it states that the insurance market will be taken out----Life Insurance the first to go.  See why you are seeing all those Life Insurance ads requiring no medical checkup or anything-----

THEY ARE SIMPLY GOING TO POCKET THOSE MONTHLY PREMIUMS.


This was written in 2013 acting as if the crash would come in 2014 but Bernanke allowed the QE bond bubble machine to continue another year and Yellen is now having to address it as the FED is leveraged out.  The crash will come soon......the FED is simply manipulating the inevitable.

'The most vulnerable are those who can least afford to suffer losses: Seniors who are approaching or in retirement, who have shifted large amounts of their money into fixed income investments.

Your tax-free municipal bonds could tank.

Your annuities and other insurance policies could turn to dust.

Your money invested in bank and insurance company stocks could vanish right before your very eyes'.


All of this is pretty important----yet, we do not hear a thing about it from media, labor or justice, our pols---and all of these national leaders know it is coming.  Their policies created this mess and labor and justice leaders are constantly backing neo-liberals.
  It is important to have Governors and Mayors that will work through this in the people's interest and not corporate interest.

This article is not
hyperbole---it will happen.
I did edit out his marketing ---

The Next Great Bubble about to Collapse

Martin D. Weiss, Ph.D. | Saturday, January 19, 2013 at 7:30 am

130 Senator Orrin Hatch warns that the bubble has the power to “destroy the retirement savings of millions of Americans.”

Famed economist Leonard E. Burman of Syracuse University is warning the U.S. Senate of “disastrous consequences for ourselves and the rest of the world.”

Goldman Sachs … Bank of America … Morgan Stanley … Royal Bank of Scotland … JPMorgan … and Oppenheimer Funds are all warning that it could bankrupt millions of investors.

Congressman Ron Paul says, simply, “this country will be ruined.”

These and many other authorities are talking about the greatest financial bubble in human history:

A bubble that is now more than EIGHT times larger than all the stock exchanges in the United States combined.

A bubble so massive, it is four times larger than the dot-com bubble of the 1990s and the housing bubble of the 2000s combined.

Now that bubble has begun to burst.

As it implodes, it will launch interest rates into the stratosphere … crush the feeble U.S. economy … destroy major U.S. banks and insurance companies … drive your cost of living through the roof, threaten your standard of living and financial security … and push the U.S. government to the very brink of financial collapse.

But the best defense is a strong offense -- and this crisis will also create windfall profit opportunities for a select group of investors who make the right moves now.

Just a few days ago, Weiss Research analyst Tom Essaye hosted a special online summit meeting to explain exactly how, and I’ll give you a transcript of the meeting in a moment.

In our online summit, he was joined by Safe Money editor Mike Larson and Real Wealth editor Larry Edelson. Here’s the transcript…

The Next Great Bubble about to Collapse
with Tom Essaye, Mike Larson and Larry Edelson — abridged transcript

Tom Essaye: If there’s anyone who knows how to capitalize on bursting bubbles, it’s our firm, Weiss Research.



For nearly a year now, I’ve been sounding the alarm again; NOT for the bursting of a bubble in the tech sector or housing sector … but in a market that is many times larger than all the stock exchanges in the United States COMBINED.


Debt is created in the bond market. That’s where the government goes to borrow money. So do states and local governments. Companies, too.

Borrowers sell bonds — or notes and bills — that guarantee investors a certain rate of interest or “yield” over time.

Since the turn of the century, the U.S. bond market has simply exploded in size — adding $20.7 trillion in new debt.


But now, despite massive new initiatives by the U.S. Federal Reserve, the meteoric rise in prices that characterized the debt market since the turn of the century has sputtered, stalled and is now dead in its tracks.

Millions of investors all over the world — including many of the world’s richest central banks — have started to stampede for the bond market’s exit.

And now, we’re beginning to see the first cracks appearing in this massive bubble.


This chart of the PIMCO Total Return Bond Fund is a perfect picture of the bubble in the bond market — and also the beginning of the crash.

On the left side of the chart, you can see the bubble in the bond market being inflated.

On the right-hand side, you can see how prices just plunged well below their support levels.

And just look at this chart of the iShares Municipal Bond ETF: It just fell off the proverbial cliff, giving back every penny it gained since last July!

But this crash has barely begun. The last few Treasury auctions showed that bidding from foreign central banks is plunging to the lowest level in years.

In addition, U.S. investors are starting to turn bearish on Treasuries. A recent report from a top industry watchdog showed that nearly 20% of all Treasury investors have started to cut back their holdings.

Even Fitch — the normally conservative ratings firm — is warning that a massive bubble has been created in the bond market.

This is huge. Bubbles are like an enormous Ponzi scheme: They collapse when the money stops flowing in.

The moment that happens, it’s over. And it’s beginning to happen right now!

As this bubble — the greatest bubble mankind has ever seen — implodes, the consequences will be devastating for millions of unprepared investors, just like the tech bubble was and just like the housing bubble was.


The most vulnerable are those who can least afford to suffer losses: Seniors who are approaching or in retirement, who have shifted large amounts of their money into fixed income investments.

Your tax-free municipal bonds could tank.

Your annuities and other insurance policies could turn to dust.

Your money invested in bank and insurance company stocks could vanish right before your very eyes.






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August 29th, 2014

8/29/2014

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THE INSURANCE INDUSTRY IS THE NEXT VEHICLE FOR PREDATORY FRAUD AND GUTTING OF PUBLIC WEALTH. FOR OVER A DECADE CONGRESS HAS LOOSENED POLICY TO ALLOW INSURANCE CORPORATIONS TO OPERATE LIKE BANKS WITH THE MONEY THEY COLLECT.  THEY ARE NOW USING THEM WITH LEVERAGING SCHEMES AND COMPLETE DISREGARD TO THE SAFETY OF YOUR FUNDS.  A CRASH IS COMING THAT WILL CAUSE THESE CORPORATIONS TO GO INTO BANKRUPTCY JUST AS AIG INSURANCE DID IN 2008.  PLEASE CONSIDER THAT PLACING YOUR MONEY IN THESE POLICIES WILL RESULT IN THE SAME FRAUD AND USE OF FUNDS AS FODDER AS HAS HAPPENED WITH OUR PENSIONS. 


IFAwebnews.com > National >

P&C industry enjoys portfolio boost from soaring stocks in 2013

P&C industry enjoys portfolio boost from soaring stocks in 2013
By IFAwebnews Staff Posted: May 30, 2014


When Republican pols say they are going to rebuild oversight and accountability they mean they are going to stop all that Food Stamp or pension fraud by employees faking injury.  They do not mean they are going to stop the billions of dollars in corporate fraud from corporate fleecing of consumers and policy holders.  Neo-liberals simply say nothing and let it all continue because their goal is to empty government coffers to restructure for Trans Pacific Trade Pact and global tribunal rule.

I have shown so much data that shows the billions of dollars in corporate fraud and yet this corporation working for the insurance industry states that 90% of insurance fraud is by the consumers or 'non-professional' fraudsters.  That's the 99% for you and me.
  Given that most Americans were pushed into poverty with last decade's massive corporate fraud, no doubt some average Americans are looking for ways to survive the stagnant jobless economy.  Insurance corporations might want to join the fight to get rid of neo-liberals and neo-cons so we can rebuild a domestic economy and citizens have jobs to and consume.

Insurers continue to count the cost of soaring fraud

July 2012  Experian Identity and Fraud


'The vast majority of fraud – more than 90 per cent - is being carried out by consumers or ‘non-professional’ fraudsters, so-called first-party fraud'.

Below you see what is really happening----insurance corporations are creating reasons to get rid of all consumer protections regarding policies that create some level of cost protection.
You will notice that this article refers to pushing the cost of business onto Medicaid and the public as does health care reform.  Yet another move to send most Americans to Medicaid-level of care for all health care.

Is insurance fraud causing auto No-Fault premiums to rise, or are insurance companies price-gouging and trying to hide the truth?


February 20, 2012 by Steven Gursten

Insurance lawyer says truth is not what the insurance industry would like public to believe

There is a lie being spread by the auto No-Fault insurance industry in Michigan --
a lie that our auto insurance premiums are more expensive due to insurance fraud.

This from an insurance industry that is making record-breaking profits– and on the heels of a $1 billion raise. The insurance industry would love to divert attention away from its own profits and find something – anything – to blame the cost of our premiums on.

In a recent press release from the Property Casualty Insurers Association of America (PCI), the group stated that fraud is “forcing” drivers into paying more for their auto insurance, especially in states like Michigan:

Soaring medical bills, high attorney fees and rampant fraud and abuse are forcing drivers in (several of the nation’s largest states including Michigan) to pay significantly more for auto insurance than they should,” said Paul Blume, senior vice president of state government relations for PCI. “Over the last several years, fraud rings and abuses of the system have cost consumers over $1.6 billion in New York and Florida alone. This amounts to a “fraud tax” on hardworking citizens and the cost trends in these states are unsustainable.”

This fraud and abuse argument couldn’t be farther from the truth. The insurance industry always lumps Michigan into its paint-with-a-broad brush approach. Yet the insurance industry has not produced actual cases of No-Fault insurance fraud in Michigan.


Yes, there have been widely publicized abuses occurring in other states. Yes, I will be the first to say there are some No-Fault insurance lawyers who are too aggressive today, and from time to time I blog about these excesses as well.

But unlike what is happening in some states, in Michigan the insurance companies are making record-breaking profits. In other words, the real cost driver of auto insurance remains an insurance industry that is almost entirely unregulated in what it can charge Michigan drivers who are forced by law to purchase No-Fault insurance.


Want to really curb insurance fraud? I’d start with empowering our insurance commissioner to regulate clearly excessive premiums that insurance companies charge here in Michigan. And then watch the cost of No-Fault insurance premiums plummet.

There is no reason why insurance companies should make more money off the backs of Michigan drivers in this state than they do in any other state in the US.

And fraud goes two ways. If we are really serious about fraud, then why not start tackling the insurance company IME industry of cut-off doctors that find nothing wrong with anyone, and that always deny people their PIP benefits, no matter how serious the injuries?  THAT'S WHAT WE ARE TALKING ABOUT!

There will always be accusations by the insurance industry’s spin doctors, but so far these accusations have been without any factual support. In fact, this report from the National Crime Insurance Bureau puts Michigan at the lower end of questionable claims.

Let’s control excessive insurance industry profits before we pass No-Fault “reform” Meanwhile, this same insurance industry wants to increase profits even more. There is a huge push by the insurance industry for No-Fault “reform” that would eliminate vital insurance protections. In exchange for the suggestion of lower premiums (they refuse to promise), drivers would be able to choose lower amounts of PIP insurance coverage that provide limited No-Fault (PIP) benefits – including levels clearly insufficient if someone is seriously injured in a car accident, truck accident or motorcycle accident.

These auto accident victims would simply be pushed onto Medicaid. And taxpayers will be stuck footing the bill.

So while the deep-pocketed insurance industry is aiming to take away our most important insurance protections – touted by the insurance industry itself as the best No-Fault system in the nation — I’d look to the insurance industry first as the reason why our No-Fault insurance premiums are so expensive.

It’s not because there’s rampant insurance fraud in Michigan. And it is not because of the cost of medical care or No-Fault attorney fees, as the insurance industry spin-doctors would like us to believe.

It is because, again, Michigan is one of the only states that does not allow our insurance commissioner the power to regulate excessive profit-gouging by our own auto insurance companies. To put it simply, our insurance is high because the insurance industry makes it that way, in order to charge more and make higher profits in Michigan than in any other state in the country!


- Steve Gursten is one of the nation’s top insurance attorneys handling auto accident lawsuits. He is head of Michigan Auto Law and president of the Motor Vehicle Trial Lawyers Association. Steve frequently writes about Michigan auto insurance and insurance company abuse, and is available for comment.

Related Information:

Help save Michigan No-Fault: Write your representatives


Charade over “savings” from Michigan No-Fault “reform” has finally stopped

Michigan No-Fault insurance resource center

Michigan Auto Law is the largest law firm exclusively handling car accident, truck accident and motorcycle accident cases throughout the entire state. We have offices in Farmington Hills, Detroit, Ann Arbor, Grand Rapids and Sterling Heights to better serve you. Call (888) 996-0279 for a free consultation with one of our Michigan insurance attorneys.

__________________________________________

This is a great article written last decade by New York's Attorney General Spitzer known to be actually fighting for corporate responsibility at the time.  This shows the degree of fraud and corruption that existed before the economic crash of 2008------everyone knew AIG insurance corporation was loading itself with fraudulent debt----and it shows what exists today as no attempts to change this environment have happened.  In fact, neo-liberals Obama and Congress are making it worse.

So, when insurance corporations paint consumers as driving fraud in order to hide profiteering and fraud by these very corporations-----you have a free-for-all as regards Rule of Law and accountability.  The American people are being required by law to buy these No Fault Insurance plans-----or with Affordable Care Act----the Catastrophic Care policies with rates that just keep rising.  You cannot escape them unless you opt out of driving and/or accessing health care.
......WHICH IS THE POINT.


I actually cried when Spitzer was brought down with prostitution charges.  You can believe these charges came to light to get rid of him although his behavior was unexcusable.  The point now is that this corporate fraud is going to soar with Trans Pacific Trade Pact seeking to end all US Constitutional rights of WE THE PEOPLE.


This is only a partial post of this article----you should check out the whole article.



 
State Attorney Generals And Other Agencies ?Investigate? Insurance Industry "Widespread Fraud And Corruption" Charges

Extent Of Government Agencies Insurance Industry Investigations, Results
[Notes: the "Headlines" lists (below) tell the extent of the investigations for each agency.
"Articles Library" following the headlines lists (farther below) includes the articles full text.]





Introduction - AGs Investigations, Results (various states)

On October 14, 2004,

NY Attorney General Eliot Spitzer Announced A Lawsuit Brought Against Marsh & McLennan Companies, "The Nation's Leading Insurance Brokerage Firm", For "Fraud, Bid-rigging and Antitrust Violations".  The following Major Insurance Companies AIG, Hartford, ACE, and Munich American Risk Partners" were named in the Complaint as Participants." AG Spitzer said, "The insurance industry needs to take a long, hard look at itself."  "If the practices identified in our suit are as widespread as they appear to be, then the industry's fundamental business model needs major corrective action and reform." "There is simply no responsible argument for a system that rigs bids, stifles competition and cheats customers," he added, "alleging that it steered unsuspecting clients to insurers with whom it had lucrative payoff agreements, and that the firm solicited rigged bids for insurance contracts."  "The Attorney General's office has uncovered extensive evidence showing that it distorts and corrupts the insurance marketplace and cheats insurance customers." "Marsh, at times, solicited fake bids" "even as it claimed in public statements that its "guiding principle" was to always consider its client's best interests." The "immediate victims of the illegal practices were ... mainly large corporations seeking property and casualty coverage, but also small and mid-size businesses, municipal governments, school districts and some individuals." In a press conference, Attorney General Spitzer indicated, as referenced by the title of his Press Release, "Investigation Reveals Widespread Corruption In Insurance Industry", that as the investigation continues, it could proceed further into property & casualty, expand into auto, health and other areas of insurance. "Trust me," Spitzer said upon filing his complaint against Marsh, "this is Day 1".





Introduction - National Association of Insurance Commissioners (NAIC) and States Departments Of Insurance (DOIs) Investigations, Results (if any)
[also includes other related state and federal agencies as may be applicable].

It Is Proven Extremely Doubtful For Most DOIs, If Any, To Investigate Or Take Real Criminal Action Against Insurance Companies That They Are Supposed To Regulate, Which Historically They Have Had A Warm And Cozy Relationship With For 150 Years. If Ever, There Has To Be A Legal Action Taken And/Or Criminal Conviction First Before DOIs Might Take Any Meaningful Action, If Any, ... And That Is To Justify Their Reason For Being. Instead state DOIs' do occasional "Market Conduct Examinations" which is no more than fluff for the Press and to deceptively show state citizens that they are supposedly doing their jobs and to justify their Agency's reason for being and to protect their jobs. EXPECT the usual politically correct announcements of alleged cooperation with state Attorney General Probes, an alleged task force set-up to investigate that we will never hear from again ... and then, even after Attorney General investigations and criminal prosecutions take place, expect no actions from the state DOIs and NAIC. This section nonetheless will cover their deceptions and announcements of their intent to cooperate with state Attorney General probes (esp. as they have all of the state insureds complaints, etc.) even though they won't share these files or information or ultimately will not cooperate with their state Attorney General's investigation ... this section also includes comments, studies and reports from FBIC and outside industry experts.

Unfortunately, based on decades of industry knowledge and experience, one should not expect any meaningful new investigative or prosecutorial results from the NAIC or state DOIs with exception of a token prosecution from a few states DOIs … who know in cases that if they don't prosecute, NY Attorney General Spitzer's office will. Otherwise, expect "the usual deception, cover-up, well disguised lack of 'real' and 'meaningful' cooperation or actions in most if not all cases. Expect their appearances of going through the exercises to satisfy the media, possibly a few meaningless fines from insurance companies which usually each state DOI gets to keep, along with a meaningless company warning or reprimand and/or temporary suspension of an employee (with pay) ... But in the whole grand scheme of things, any actions will be meaningless and have no measurable effect or contribution toward reform and the final results ... in fact expect just the opposite and maintenance of the status quo.

The truth of the matter is the NAIC’s and state DOIs’ historical record of duplicitous rhetoric, consistently staunch, pro-insurer allegiance and secretive anti-consumer positions being well disguised to the contrary for decades as they deceptively continue to portray themselves as champions of the consumer and protectionists of the people. This deception has been well maintained under a strict industry non-transparent cloak of secrecy tightly hidden behind a wall of silence made possible by decades of successful industry legislative lobbying affording them unnecessary special laws and an exemption from federal laws that are exclusive only to the insurance industry.  Regardless, in the interest of objectivity, FBIC will look to report the announcements along with outcomes and results of the NAIC and state DOI investigations and cooperation with state Attorney General offices which NONE are expected ... and then let you be the judge. The investigations are indicated as of this writing and date have just begun ...


The NAIC's and individual states DOIs' past three decades actions and track record strongly indicates a strong biased favoring of insurers versus a near total lack of actions in the protection of consumers from the unscrupulous and unlawful actions by many of the country's largest and most powerful national interstate insurers which are indicated as bad faith insurers. From research, experience and input from the many thousands of Americans, FBIC knows not to expect any meaningful actions or any real cooperation by the NAIC or individual states DOI commissioners and the Departments they oversee. Instead, FBIC expects the usual politically correct press releases from them espousing the same rhetoric and hyperboles in the past, indicating the alleged actions they are supposedly taking to investigate the insurers related criminal activities. According to their alleged usual routine, they will issue these periodic press releases to the media which espouse and give the implication that investigations are underway, active, and ongoing. As usual they hope their press releases will be adequate enough to stave off the persistence of the Press looking for interviews and more specific details. Their preferred modus operandi in between press releases is the exact opposite, that is to run and hide quietly behind their vaulted tightly closed doors and remain as quiet as possible. But when given no choice by a persistent reporter for the Press, their canned routine is to comment only on their last press release, no more and no less.  When cornered and really pressured into a corner for comment, the occasional use of the "we never comment on ongoing investigations" appears to be most suitable.


_______________________________________


Below is a stat that has a broad range.....actually most government watchdogs place the amount at $400 billion a year and rising.  This amount is staggering and it is why neo-liberals and neo-cons are claiming that the Medicare Trusts will be empty in just a decade.  IT WAS LOOTED BY THE HEALTH INDUSTRY AND FRAUDULENT INSURANCE CLAIMS.  Then, neo-liberals allowed these same health institutions write the Affordable Care Act privatizing all public health and deregulating and making global corporations of our health care.

Please stop allowing neo-liberals to control the Democratic Party.  The people's party is the one that should put protecting public wealth first.



Industry Execs Targeted for Health Fraud
Posted in Health Insurance , Medicaid , Medicare


June 1st, 2011



Health care fraud, especially in the areas of Medicare and Medicaid, is known to be costly. In fact, the government is said to lose between $60 billion and $2 trillion to fraud every year.

We Must Stop the Rampant Fraud in the Health Care Industry

www.huffingtonpost.com/rep-bernie-sanders/we-must-stop...  

Jun 29, 2009 · What we have seen over the last several decades is the systemic fraud perpetrated by private insurance companies, private drug companies, and private for ...

_______________________________________

I am shouting about this corporate fraud because it is expanding into insurance industries like LIFE INSURANCE.  If you watch free TV the commercials are on Life Insurance corporation after another.  They are using the decline in American people's wealth as the scare tactic behind buying LIFE INSURANCE.....you don't want to leave your family with your expense.  This is the same industry that used AIG to bring down the economy and take millions of people's homes through the subprime mortgage fraud.  We got your house, now come to us to protect you after you die......OH REALLY?????

What they are doing is setting the stage for the exact economic collapse that took AIG into bankruptcy unable to pay its debt and having US taxpayers paying 100% of insurance bets on subprime mortgage loans.  Only this time, it will be Life Insurance.  They are taking all that equity you and I are paying each month and using it to leverage 1,000 times what they can afford and guess what?  AN ECONOMIC COLLAPSE IN THE BOND MARKET IS JUST AROUND THE CORNER.  They will be taken into bankruptcy with your equity disappearing.

NEO-LIBERALS IN CONGRESS ACTUALLY PASSED LEGISLATION ALLOWING INSURANCE CORPORATIONS TO ACT AS BANKS WITH THE POLICY INSTALLMENTS----LEVERAGING BEYOND WHAT CAN BE COVERED.


ALL OF MARYLAND'S POLS ARE NEO-LIBERALS AND NEO-CONS.


This is a partial clip of a great look at how the insurance industry is being allowed to become as entwined and leveraged as the financial industry creating the same conditions of too-big-to-fail and propensity to collapse.

Systemic Risk and the U.S. Insurance
Sector

By J. David Cummins and Mary A. Weiss
Temple University




Systemic Risk and the U.S. Insurance Sector

Abstract

This paper examines the potential for the U.S. insurance industry to cause systemic risk events that spill over to other segments of the economy. We examine primary indicators that determine whether institutions are systemically risky as well as contributing factors that exacerbate vulnerability to systemic events. Evaluation of systemic risk is based on a detailed financial analysis of the insurance industry, its role in the economy, and the interconnectedness of insurers. The primary conclusion is that the core activities of the U.S. insurers do not pose systemic risk.
However, life insurers are vulnerable to intra-sector crises because of leverage and liquidity risk; and both life and property-casualty insurers are vulnerable to reinsurance crises arising from counterparty credit exposure. Non-core activities such as derivatives trading have the potential to cause systemic risk, and most global insurance organizations have exposure to derivatives markets. To reduce systemic risk from non-core activities, regulators need to develop better mechanisms for insurance group supervision.



By way of preview, the analysis suggests that the core activities of insurers are not a major source of systemic risk. However, there are several sources of exposure to intra-sector crises, which could potentially spill over into the broader economy if sufficiently severe. For example, a substantial proportion of insurers have very high exposure to one or a few reinsurance counterparties, suggesting the possibility of a reinsurance spiral that could lead to substantial financial deterioration. In the life insurance industry, the high leverage of the life insurers, exposure of surplus to reinsurance defaults, and insurer investment in mortgage backed securities raise concerns about sectoral stability.


MEANWHILE-----

While they are leveraging themselves to the point of collapse-----they have a new revenue source-----SELLING YOUR PERSONAL INSURANCE DATA
....a profit bonanza.  So, too-big-to-fail and emergency bailouts with bankruptcy clearing all that need to pay consumer LIFE INSURANCE policies and VOILA-----you have AIG all over again.

THAT'S WHERE NEO-LIBERALS AND NEO-CONS ARE TAKING US!


All of that data you send in that is supposed to be confidential?  FORGET ABOUT IT-----IT IS EARNING INSURANCE INDUSTRIES BILLIONS OF DOLLARS AS A PRODUCT.


How the Insurance Industry Should Leverage Big Data

  Posted February 27, 2014


The Insurance Industry generates vast amounts of data, from legacy systems, call centre dialogues to customer records and it is multiplying rapidly. It is time for the insurance companies to start getting access to all this available data and start analysing it. In this video, Laura Hay – National Leader Insurance KPMG, talks about the massive potential of Big Data, Mobile and Predictive Analytics for the Insurance industry.


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