Author: Farkas Laura

MBIA Inc. reported a fourth-quarter loss today after a $3.5 billion write-down in its credit derivatives portfolio. The bond insurer, struggling to maintain the top credit ratings necessary for its business, posted a loss of $2.3 billion, or $18.61 a share, compared with profit of $181 million, or $1.32 a share in the same quarter… Continue reading MBIA Posts Fourth-Quarter Loss, Hit Hard by Derivative Write-downs

U.S. congressional investigators stated on Wednesday that insurers’ handling of damage claims from hurricanes, where both wind and water destroy property, needs closer government scrutiny.This comes after the Government Accountability Office (GAO) urged better assessment of “the accuracy of flood payments on hurricane-damaged properties” following bitter complaints from some Gulf Coast homeowners about insurance coverage… Continue reading GAO Says Hurricane Claims Handling by Insurers Need Closer Examination

On Wednesday, FGIC Corp’s (Financial Guaranty Insurance Co) bond insurance arm lost its top “AAA” rating from Fitch Ratings, which could also cause downgrades to more than 100,000 municipal bonds.     Fitch cut FGIC’s “AAA” insurer financial strength rating by two notches to “AA,” saying the insurer does not have the capital required for… Continue reading FGIC’s Bond Unit Loses its Top Rating from Fitch

The world’s second-largest reinsurer, Munich Re, announced a 11 percent record gain in 2007, in part due to the absence of costly hurricanes and a tax gain. Munich Re said full-year net income (before minority interests) grew from 3.9 billion euros ($5.8 billion) from 3.5 billion euros in 2006, beating the firm’s profit projections. What… Continue reading Munich Re Posts Record Gain

The largest health insurer in the nation, UnitedHealth, is under fire, facing penalties of up to $1.3 billion for tens of thousands of alleged violations, including wrongly denying claims, losing patient records and failing to respond to complaints.     California Insurance Commissioner Steve Poizner announced he is suing UnitedHealth’s California subsidiary, Pacificare, for mishandling… Continue reading Health Insurer Facing Billion-dollar Penalty

After the universal health care bill he supported died in a Senate committee, California Gov. Arnold Schwarzenegger has vowed to continue pressing for legislation that would provide health insurance to the state’s uninsured. “I’m as determined as ever,” Schwarzenegger said. “The issue is not going to go away.” He called the bill a golden opportunity… Continue reading Governor’s Health Bill Terminated in Committee

In more earnings news, Arthur J. Gallagher & Co. reported fourth-quarter net income of $23.4 million, down from $24.6 million last year. The insurance brokerage said the fourth-quarter profit decline was prompted by a loss on discontinued operations. Fourth-quarter revenue totaled $410 million, up from $398.7 million in the year-ago quarter. Arthur J. Gallagher announced… Continue reading Brokerage Profits Down, Announces Plans to Sell Some Ops

Allstate Corp. posted a 37.3 percent decline in fourth quarter net income, thanks in large part to claims driven by California wildfires in the past few months. The largest publicly traded U.S. home insurer posted net earnings of $760 million, down sharply from $1.21 billion in the same period a year ago. Fourth-quarter operating income… Continue reading Allstate Posts Steep Earnings Decline

After industry-wide investigations into its producer compensation and insurance placement practices, American International Group Inc. announced it will pay a $12.5 million settlement agreement to 10 jurisdictions. Regulators in Florida, Hawaii, Maryland, Massachusetts, Michigan, Oregon, Texas, West Virginia, Pennsylvania and the District of Columbia accused AIG of paying agents and brokers undisclosed contingent commissions and… Continue reading AIG Makes Million-dollar Settlement

As part of an ongoing effort to stave off a recession and shore up the U.S. economy, beleaguered by the housing market slump and credit crunch, the Federal Reserve is expected to lower U.S. interest rates later today. (The Fed is expected to announce its decision at approximately 2:15 p.m. EST.)    Financial markets are… Continue reading More Fed Rate Cuts Expected Today