LANDMARK SETTLEMENT? - In settling a lawsuit with the state of Texas, Aetna has promised to give doctors more control over medical treatments and to prohibit financial incentives for doctors to limit care. Some are saying that the settlement could serve as a model for HMO regulation on a national level.

MORE DESIGNATIONS? - With the convergence of the financial services industry, the alphabet wars are heating up. The ABA recently introduced its newest designation, the Certified IRA services professional (CISP). Add that to their CTFA (trust and financial advisor), CRSP (retirement services professional), CSOP (securities operation professional), CRCM (regulatory compliance manager), CFSSP (financial services security professional), as well as all the other industry designations, and you have an alphabet soup that would make Campbell's proud!

LIMRA NOTES - Group life insurance annual premiums are down for the first time in five years: 1995 - up 21%; 1996 - up 11%; 1997 - up 7%; 1998 - up 31%; and 1999 - down less than 1/2 of 1%. On another front, group disability posted its fourth year of double-digit growth. Also, look for big changes in the annual LIMRA meeting. It will be held over two days instead of three, "making for a shorter, crisper, no-nonsense event, with an emphasis on the substantive exchange of information."

TRIPPED UP? - Until the July 1998 acquisition of Green Tree Financial Corp., Conseco CEO Stephen Hilbert had been considered a skillful consolidator, acquiring more than 40 insurers over 17 years. The Green Tree acquisition, however, may prove to be his and the company's undoing. Conseco stock, which was trading at about $58 before the Green Tree acquisition, is now in the 7 3/4 range and institutional investors are reported to be calling for Mr. Hilbert's resignation and even for the sale of the entire company. Conseco announced on March 31 that it planned to sell its Conseco Finance Corp. (the former Green Tree). While Conseco paid $6 billion for Green Tree, analysts estimate that Conseco Finance will fetch as little as $2.2 billion. The various ratings agencies have placed Conseco under review, with S&P recently lowering Conseco's corporate credit rating to BBB-. To add to the company's woes, a class action lawsuit on behalf of people who purchased Conseco stock from April 28, 1999 through March 31, 2000 has just been filed, charging that Conseco and certain of its officers and directors "issued a series of materially false and misleading statements concerning its subsidiary Conseco Finance, which was formerly known as Green Tree Financial Corp." Conseco's stock price plunged about 60% during the period covered by the lawsuit.

LTC CONSOLIDATION - GE Capital is reported to have won its bid to purchase the long-term care operations of Travelers Life and Annuity, on the heels of its acquisition of the Phoenix Home Life group life and health operations. Despite the recent trend of consolidation in the LTC provider ranks, Prudential Select Brokerage appears to be in the LTC game for keeps. They recently announced the appointment of Joseph Schroeder as Director, Long Term Care Distribution.

VARIABLE ANNUITIES AND QUALIFIED PLANS - Tax sheltering a shelter has never made a lot of sense to us and the "chickens have come home to roost" in Alabama, where a class action suit has been filed against several carriers for selling variable annuities in qualified plans. This from Howard Wight...more as things develop.

CONVERGENCE - The Financial Services Roundtable, a trade group representing large U.S. banks, announced that several more “nonbank” companies have joined the group: American General, Washington Mutual and Ford Motor Credit Corp. are joining Aegon USA, Associates First Capital, Credit Suisse First Boston, Raymond Jones, Jeff-Pilot, ReliaStar, State Farm and USAA as nonbank members.

ALLSTATE: DEATH OF A SALESMAN - That's the title of Fortune Magazine's recent article about the "good hands people." Allstate's share price has dropped from about $50 in July 1998 to about $22 today...just barely above book value. The company bought back up to $4.5 billion of its own shares in a failed attempt to shore up its price. Competition and lawsuits are hurting the P&C giant and now "it faces what some describe as a near rebellion in its agent ranks." As previously mentioned in E-News, instead of offering policies exclusively through its 15,500 trained agents, the company announced it would spend a billion dollars to begin selling insurance through a toll-free number and the Web.

INVESTMENT ADVISER DISCLOSURE - The SEC is proposing to create a one-stop Internet-based investment adviser registration and disclosure system (IARD) that will track the history of all investment advisers and be available to the public free of charge.

SERIOUS PLAINTIFFS - Several FBI agents are suing CIGNA, claiming the company "dramatically increased its premiums and reduced benefits on group life insurance for retired FBI agents, in spite of past promises that retired agents would continue to be charged the same rate schedule as active agents." The lead litigant is reported to be Elliot Ness.

POLITICIANS! - Chuck Quackenbush is in even more hot water than he was in our last issue. He already faces an April 26 state Assembly hearing over reports he ignored his own legal team's recommendation to issue $3.3 billion in fines against State Farm, 21st Century and Allstate for underpaying claims from an earthquake. He instead created a $12 million fund with donations from the companies and now he is accused of giving $500,000 of the funds to a community group to promote earthquake safety. The group has no connection to earthquakes and is located in an area where quakes are few and far between. The donation was to the Sacramento Urban League, whose main purpose is to promote employment for minority groups. Lawmakers and consumer groups question why the nonprofit group ran television ads featuring Quackenbush when he was running for reelection. Doesn't look good for the "Quackster."