1) September 11th
2) Enron Exposure
3) Terrorism Risk Exclusion
4) Hardening Commercial Lines Market
5) Demutualizations Continue
6) National Loss Of Health Insurance
7) Americans Aren't Saving Enough For Retirement
8) Health Care Delivery Moving Towards Defined Contribution
9) Cash Call at Lloyd's for WTC Bill
10) Life And Health Insurers Suffer 42% Profit Decline
11) e-Risk Coverage Emerges
12) St. Paul Quits Money-Losing Medical Malpractice Business
13) AIG Acquires American General
14) Economic Growth And Tax Relief Reconciliation Act
15) Projected 14% Increase In Health Care Costs In 2002
16) Independent Distributors Edge Captives For Life Sales
17) NAIC Progress On Modernization Initiatives
18) Disappearance Of The Patients Bill Of Rights
19) NAMIC Launches Catastrophe Facility
20) U.S. Agency Sues Allstate
21) 401(k) Plans Shows Decrease In Plan Assets In 2000
22) Captives, Alternative Risk Financing To Increase In 2002
23) Insurance Industry May Issue Hybrid Securities
24) Asbestos Exposure Will Ultimately Cost $200 Billion
25) Insurance Industry Sees Massive Job Losses

TERRORIST EXCLUSION – According to National Association of Insurance Commissioner's President, if Congress does not enact a federal backstop for terrorism insurance soon, "There is strong consensus among NAIC members...state insurance regulators will be left with no choice but to begin approving some exclusions for commercial lines."

PROVIDENT MUTUAL/NATIONWIDE – As previously announced, Provident Mutual's Board of Directors unanimously adopted a plan of conversion under which Provident Mutual will convert from a mutual insurance company to a stock company and become a wholly-owned subsidiary of Nationwide Financial.

LISTING REPRIEVE – Companies no longer meeting the requirements for a listing on the Nasdaq National Market may be able to transfer onto the Nasdaq's SmallCap Market in 2002, rather than being delisted by Nasdaq.  While less prestigious than the National Market, a listing on the SmallCap Market would save the companies and their investors from relying on trading shares on unregulated over-the-counter markets.

INFLATION OVERHAUL – For the first time since 1995, the Bureau of Labor Statistics is changing the weightings of each category of the Consumer Price Index to reflect shifts in consumer spending habits.  Only time will tell whether the changes will impact the official inflation rate significantly.  It is a potentially important development, however, since the Consumer Price Index is used to determine the size of Social Security checks, veterans' benefits and other federal payments, as well as affecting how the Federal Reserve sets interest rates and how the IRS adjusts tax brackets.  On an individual level, it can even change the size of alimony payments.
 

EEOC SUES ALLSTATE – After 15 months of trying to settle accusations that Allstate had practiced age discrimination against its agents, the Equal Employment Opportunity Commission took its case to court. At issue is Allstate's decision to convert its 15,000 strong sales force from regular employees with benefits to independent contractors, who receive higher commissions but no benefits. About 6,400 of the agents refused to sign agreements to become contractors and Allstate terminated them. However, 90% of those terminated were older than 40, hence the EEOC involvement and lawsuit.

BANKRUPTCY FILINGS – More public companies than ever (231 and counting) filed for Chapter 11 bankruptcy protection in 2001 and, more often than not, it's the shareholders who pay the price.  Among the largest filings in 2001, 20 companies saw more than a quarter-trillion dollars of market capitalization disappear. For more information on business bankruptcies, go to http://www.bankruptcydata.com. 

DEFENSE – According to Financial Advisors Legal Association, despite (or maybe because of) the trend toward arbitration, the average cost professionals pay to defend themselves against litigation could rise to $30,000 in 2002. Big NASD problem areas:  supervision, review of transactions and correspondence, outside business activities, private securities transactions and suitability. More at http://www.falegal.com.  

SUN LIFE TO BUY CLARICA – Canada is not immune to M&A activity in its insurance sector, and Sun Life Financial is buying rival Clarica Life for about $4.7 billion US. The deal will make Sun the nation's biggest insurer. Approximately 1,500 jobs (about 17% of the combined work force) are expected to be eliminated. Clarica will become a wholly owned subsidiary of Sun Life. Canada Life is now being eyed by Manulife and Great-West.
 

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CONTRIBUTION DEADLINES – As a reminder, both regular and Roth IRAs can be set up as late as April 15, 2002 for 2001 contributions.  The same is not true, however, for Education Savings Accounts...2001 contributions had to be made by 12/31/01 (that changes in 2002, however, when the deadline will be the same as for an IRA).  There is even more time to establish and contribute to a SEP-IRA for 2001...until the extended due date of the 2001 tax return.  Since other company plans, as well as self-employed Keogh plans, had to exist prior to 2002 to get a 2001 deduction, clients who missed the deadline might want to consider a SEP-IRA.

NEW LTC DESIGNATION – The American Association for Long-Term Care Insurance and the Health Insurance Association of America plan to offer a new designation for long-term care insurance. AALTCI members will pay $155 per course for each of the four courses and non-members will pay $215 per course. See details at http://www.aaltci.org.

MANDATORY DIVERSIFICATION – Enron fallout will possibly result in a maximum of 10% of company stock that workers can buy inside 401(k) savings plans. The Pension Protection Act of 2001 may face challenges from large employers, however, since unlike cash contributions, stock matches are not shown on income statements.

ADVISORS NEEDED – With the demise of double-digit returns, mutual fund companies are beginning to cater more to financial advisers and their broker-dealers to help sales.  Some tools: marketing and asset management techniques, administrative support, advertising materials, seminars for investors and asset management fees.  However, asset management fees that have been 1.5% plus in the past are now moving to 1%.

AARP AND LTC – An AARP survey is the latest to reveal that baby boomers may not be preparing to face their "golden years" if long-term care, such as nursing homes or assisted living, becomes a reality. In fact, about one third of those surveyed believe their medical insurance would cover the costs of long-term care and many believe that Medicare will cover the cost. Further, most have no clue that the national average for nursing home care is now $4,654 a month.  Additional details on the survey can be found at the AARP website. 

SMALL EMPLOYERS NEED HELP – According to a new survey by Nationwide Financial, 69% of small business owners reported having 401(k) plans, but few considered other savings plans. Major concerns: fiduciary/legal, complexity, administration and the belief that employees prefer wages. Sounds like a good market for good advisors.

CARS IN 2002 – The optional standard rate for business use of a car rises to 36.5 cents a mile in 2002, up from 34.5 cents in 2001.  Also, the luxury tax on new cars drops to 3% of the sales price above $40,000 in 2002, compared to 4% of the sales price above $38,000 in 2001.