UNLOCKING OWNERSHIP – A group of MassMutual and Connecticut Mutual policy owners are circulating a petition to "unlock their ownership interests."  The board of directors is not in favor of demutualizing, so the MassMutual Policy Owners Association is coordinating a petition drive to call a special meeting and elect a slate of directors who favor demutualization.  More information can be found at http://www.massmutualownersassociation.com. 

GENETIC DANGER - In Congressional testimony, actuaries stated they believe restricting health insurers' access to genetic test results could prevent the industry from properly underwriting risk. The current genetic testing bill in Congress defines genetic testing so broadly that health insurers may not have enough information to set appropriate prices.

JOBS AND HOMES – Housing sales dropped 3% in July, indicating would-be homebuyers may be getting nervous about growing layoffs even though the official U.S. unemployment rate is at a low 4.5%. The housing market was bucking the current economic trend, but it is starting to slip despite seven interest rate cuts that have reduced the Fed Funds rate to 3.5%.

MORE SCHWAB CUTS - Declining market activity has forced Charles Schwab to cut another 2,400 jobs  (about 11% of its work force). Trading at the largest online brokerage is down about 50% from the beginning of the year.
 

ASSOCIATION SUITS – The American Dental Association and two dentists have sued Aetna, the third-largest U.S. dental provider, for not paying dentists the full amount for service and for libeling dentists outside of its network. In addition, the Medical Society of the State of New York filed in New York State Supreme Court against Aetna, Cigna, Empire Blue Cross & Blue Shield, Excellus, Oxford Health and Unitedhealth, claiming that the companies' business tactics harm both patients and physicians.
  
RUMOR? – According to Britain's Sunday Telegraph, Zurich Financial Services has put its U.S. specialist life insurer, Kemper Life, up to sale for about $1.5 billion.  Zurich, which acquired Kemper Life for just over $2 billion in 1995, called the report "conjecture."
  
BURNING EXPOSURE - According to Weiss Ratings, in the western fire-prone states, just eight large property and casualty insurers are exposed to 74.5% of the home insurance risk. Further, at year-end 2000, the top eight homeowners insurers in the nation controlled a record 58% of the national market, compared to only 26% in 1965. Details at http://www.WeissRatings.com.
  
LOSING COVERAGE – Predictions are that hundreds of thousands of senior citizens may be losing their Medicare+Choice coverage because the number of plans willing to take Medicare patients is expected to continue declining.  In 1998, there were 346 Medicare+Choice plans available.  That number has declined to 179 plans this year.  More will be known after the September 17 deadline for plans to tell the government whether they intend to stay in the program.

KNOWLEDGE DIGEST - Every time we visit this site, it gets better...and we visit it at least every other week for E-News reports!  Already the most comprehensive insurance industry news site, they just added a new section on claims. If you need more information than we provide on about virtually any industry topic, go to http://www.knowledgedigest.com. 

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THE INCREDIBLE SHRINKING SURPLUS – Congress returns next week, both to a pile of unfinished tax bills and to a shrinking surplus.  With a new budget report saying that the non-Social Security surplus has evaporated, lawmakers must either find offsetting tax hikes or cut spending to cover the cost of any new tax cuts.  Some small tax cuts may become law, but larger tax reduction proposals, such as capital gains relief, charitable deduction legislation, and making this year's earlier tax cuts permanent, are in trouble.  The reduced surplus projections may also doom any action on privatizing Social Security for now.

ALTERNATIVE DRUGS – Humana now has an "alternative drug option" function on the secured portion of its Web site. Member plans can go online to search for medication alternatives in the same therapeutic class of a given drug with the estimated co-payments. If you want to become better informed regarding not only prescription drugs, but also herbal substances and supplements, check out:
http://apps.humana.com/prescription_benefits_and_services/main.asp

STILL WORKS – Intelligent direct mail programs are still a great source of leads for producers. Recognizing that, NAIFA has entered into a partnership with ThinkDirectMarketing, the leading provider of online marketing database products and services. ThinkDirectMarketing will provide content and educational programs to assist NAIFA members with their direct mail campaigns. The program will be rolled out at the NAIFA Convention in Salt Lake City from Sept. 8th to the 11th.

NEW DAY TRADING RULES – The New York Stock Exchange increased the minimum balance day traders must have in their accounts for risky trades. $25,000 is now required in an account before a day trader is allowed to margin trade on stocks. Previous minimum was $2,000.
 

INTERNET STUDY – Despite explosive growth in traffic, many insurance Internet sites fail to measure up to bank and brokerage sites, according to a recent eInsurance study by Booz-Allen & Hamilton.  According to the survey, the online insurance market is expected to account for 1.5% of total net premiums written by 2005, with P&C products accounting for 88% of the online market. Sure seems like a lot of room for everyone else! More on the survey at: http://www.strategy-business.com/enews/index.html. 

LEADS - Progressive Insurance has launched an agent referral system, which provides sales leads to Progressive independent agents. The program includes e-mail notification to agents with the prospect's contact information. In the first month of the new program, more than 50,000 referrals were made.

HOLISTIC MONEY ADVICE – A new specialty emerging in the financial planning arena is called life planning, which aims for a holistic approach to a client's financial needs by delving more deeply into what the client's goals are and how to meet them in ways consistent with the client's values.  A panel at the upcoming Financial Planning Association's convention will debate whether life planning is part of financial planning or a new discipline.  

REASONABLE EXPECTATIONS – The most recent PaineWebber monthly survey of investor optimism shows that investors on average expect a 9.4% return from stocks over the next year.  The survey has been conducted monthly for Paine Webber by Gallup since June, 1998. The highest expectation was 18.4% in December 1999 and the lowest was 8.7% in April.

THE FOOLS ARE RIGHT – The Motley Fools have long held that index funds have and will continue to outperform actively managed funds. According to Morningstar, through July diversified index funds were down about 8.4%, while the average diversified actively managed fund was off 10.3%. Now that the Internet Gold Rush is over people are looking for safer harbors.