August 2010 - Susman
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Earthquake hits Malibu

Several small earthquakes have been felt by residents in Malibu over the last few hours.  According to the USGS, a 4.0 quake hit in the Channel Islands region at 10:42PM last night, followed by a 2.2 magnitude at 7:22am this morning.  No damage has been reported.  Good time to check in with your insurance agent and be sure your Earthquake Insurance is in effect!

In this issue we focus on Pet Insurance

We all love our wonderful pets, but what liability issues arise when they are under your control. When you consider that dog bites account for one-third of all homeowners insurance liability claims, costing $387.20 million in 2008, up 8.70 percent from 2007, understanding how you are liable becomes an important issue. Read about the three kinds of law that impose liability on owners. Find out which dog breeds insurance companies frown upon. Learn how to live with your pet in harmony, even if you’re allergic to them, and much more.

State Facts: Are You Legally Liable for Your Dog?

According to the Centers for Disease Control and Prevention, more than 4.7 million people are bitten by dogs annually, resulting in an estimated 800,000 injuries that require medical attention. With over 50 percent of the bites occurring on the dog owner’s property, the issue is a major source of concern for insurers.

Over the years, many states have passed laws with stiff penalties for owners of dogs that cause serious injuries or deaths. In about one-third of states, owners are “strictly liable” for their dogs’ behavior, while in the rest of the country they are liable only if they knew or should have known their dogs had a propensity to bite (known as the “one free bite” principle).

More

Pet Insurance: Companies Growl At Certain Dog Breeds

Rottweilers, Akitas, Dobermans — some are more likely to bite, but fans of those breeds say insurers are breed profiling

Those doe-eyed, tail-wagging pooches waiting for new homes may be as loyal as any dog lover could want. But anyone planning to adopt or purchase a dog should beware: Fido or Fifi could be a killer when it comes to homeowner liability insurance.

Based on the dog-bite claims they see, insurers feel that some breeds are a poor risk. It’s a trend that began about 10 years ago, at around the same time as statistics were released showing that pit bulls, Rottweilers and German shepherds were responsible for more than half the dog bite fatalities in the U.S. over a 19-year period. Despite opposition from consumers, many insurance companies still maintain a will-not-cover breed blacklist. The list varies from company to company, according to Loraine Lacey, president of Independent Insurance Agents and Brokers of Orange County, depending on each company’s experience.

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Dog Bite Liability

Most dogs are friendly, loving members of the family, but even normally docile dogs may bite when they are frightened or when protecting their puppies, owners or food.

According to the Centers for Disease Control and Prevention (CDC), more than 4.7 million people are bitten by dogs annually, resulting in an estimated 800,000 injuries that require medical attention. More than 50 percent of dog bites occur on the dog owner’s property, and they account for one-third of all homeowners insurance liability claims.
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Allergies To Pets

Learn to live with your pet in harmony, even if you’re allergic to them

The benefits of having a pet usually outweigh the drawbacks of pet allergies for many people. You’d be surprised to know how many people, with non-life-threatening allergies, live with pets despite having allergies to them!

It’s not you, it’s me

Any and all cats and dogs may cause reactions for people who are allergic to animals. Cats tend to cause more reactions than dogs for allergic people, although some people are more sensitive to dogs than cats. Contrary to popular belief, there are no “non-allergenic” breeds of dogs or cats; even hairless breeds may cause symptoms.

More

Quick Links

American Humane: Protecting Animals

Adoption & Pet Care

What Kind of Pet is Right for You?

Be careful on a trampoline

A quick and friendly reminder about trampolines.  Be careful!  Ok, the real reason for this quick video is to try to help explain why when you’re purchasing Homeowners insurance, one of the questions you will be asked is if the house has a trampoline.  Think they are completely safe?  Think again. 🙂

Health Care Update – August 20th, 2010

Removing lifetime and annual dollar limits for essential health benefits

As part of the health care reform law, health insurance companies must remove lifetime and annual dollar limits on covered services (in network and out of network) that the U.S. Department of Health and Human Services (HHS) considers “essential health benefits.” This change goes into effect September 23, 2010, although certain annual limits can be removed in phases over the next four years.

HHS has not given us the final definition of “essential health benefits” yet, but based on the information and examples it has released, as well as our own research of current state and federal mandates, we have come up with a list of approximately 26 services we believe will be affected. There may be variations in certain states. The services still may be subject to copays and other cost shares.

This provision of the health care reform law also restricts annual or lifetime dollar limits at the plan level except transitional annual dollar limits as defined in the legislation.

A waiver program will be available for certain types of plans like mini-med and limited benefit plans so they can retain annual plan limits. We are waiting for more information on this program from HHS.

Administrative services only (ASO) plans also are required to comply with the health care reform law lifetime and annual limits provision for plan years that start on or after September 23, 2010. We will provide guidance to ASO clients, but the final decision on how they choose to comply is theirs.

Obama in Los Angeles

President Obama made a trip through Brentwood today.  Well, a really fast trip in that.  The streets were closed down in a several mile radius in all directions surrounding the area he would pass through.  Helicopters flew overhead.  People waited, and waited.  Here is the few minute video of the preparation and the actual drive through of the President of the United States.

Update on Health Care Reform

Here are some updates on Health Care Reform and how it can affect you or your business.   Remember, you can also visit http://www.healthcare.gov/ to get information.

Unions/collectively bargained plans

Whether fully insured or self-insured, unions must implement the same provisions as other grandfathered plans for plan years beginning on or after September 23, 2010. However, fully insured plans get some special treatment in the interim final grandfathering rules. The following allowances are given to collectively bargained agreements (for the life of the agreement) that were ratified before March 23, 2010:

· The plans may change carriers and remain grandfathered.

· The plans may make benefit plan changes (such as plan design) or change employer/employee organization contribution amounts and remain grandfathered.

· The interim final rules on grandfathering are silent as to whether grandfathered health insurance coverage is exempt from the anti-abuse rules.

When the last of the collectively bargained agreements expires, the special allowances end as well. From that point on, the grandfathered status of fully insured plans will be determined as it is for any other health plan.

Self-funded plans that are kept as collectively bargained agreements are treated like any other plan. For self-funded plans, whether or not they are kept as collectively bargained agreements, a change in third-party administrators will not result in the loss of grandfathered status.

If a group customer requests that we implement health care reform changes earlier or later than its renewal date because its ERISA plan year differs from the renewal date, we will honor the request.

60-day notice of plan changes

Another health care reform law provision requires plans to create a uniform summary of benefits. And any material modifications to the terms of the plan must be communicated to members 60 days before those changes go into effect. Based on our review, we believe that the 60-day notice provision will not go into effect right away; however, it must be implemented before March 23, 2012 (two years after the law was enacted). The U.S. Department of Health and Human Services will be giving us more guidance on this provision. When it does, we will let you know.

No discrimination based on compensation

Benefits cannot be based on wages

The health care reform law notes that, effective September 23, 2010, plans may not discriminate in favor of highly compensated employees. This means that group health plans cannot base eligibility or the level of benefits on an employee’s wage. The group can offer different levels of benefits as long as they comply with ERISA and are not tied to the amount an employee makes. The legislation defines a highly compensated employee is someone who is:

· One of the five highest paid officers.

· A shareholder who owns more than 10% in value of the employer’s stock.

· Among the highest paid 25% of all employees (exceptions apply).

Waiting periods

We do not believe we will need to change our approach to allowing groups to offer different waiting periods to different employee levels. The health care reform law "nondiscrimination by compensation" provision is specific to the benefit offerings of a medical plan and not the waiting periods established by a company.

Grandfathered vs. non-grandfathered plans

No matter how a plan is structured, in order for it to be a grandfathered plan, it must have been in effect when the health care reform law was passed on March 23, 2010, and no changes are made to the benefits or the benefit plan. For non-grandfathered plans, the plan sponsor of a group health plan (other than a self-insured plan) may not set up rules about health insurance coverage eligibility (including continued eligibility) for any full-time employees based on the total hourly or annual salary of the employees. Nor can the sponsor set up rules that in any way favor employees who receive more compensation.

Offering benefits only to currently eligible employees

A group can retain grandfathering status by continuing to offer benefits only to currently eligible employees (instead of all employees), as long as the benefits are not tied to how much those employees make. In addition, the health care reform law notes that the plan sponsor of a group health plan (other than a self-insured plan) may not set up rules about health insurance coverage eligibility (including continued eligibility) for any full-time employees based on the total hourly or annual salary of the employees. Nor can the sponsor set up rules that in any way favor employees who receive more compensation.

Executive physicals

Because this health care reform law provision is specific to plans and not to benefits, executive physicals (and similar benefits) are not affected.

Getting to the bottom of your health care costs

Did you know: Health care fraud and abuse accounts for 3% of health care spending?

The National Health Care Anti-fraud Association estimates conservatively that 3% of all health care spending, or $68 billion, is lost to health care fraud each year – that’s more than $180 million per day.

This content is provided solely for informational purposes: it is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.  We’re just passing along information we are getting in hopes of assisting you in navigating the new rules and regulations as they come.