A $150 million settlement was approved Thursday by the California Public Utilities Commission (CPUC) between Pacific Gas and Electric Co. and the CPUC's Safety and Enforcement Division regarding PG&E's involvement in the Zogg Fire, KCRA-Sacramento reported. In 2020, a fallen tree in Shasta County landed on PG&E energy conductors, which caused a fire that burned 56,338 acres and killed four people. PG&E was taken to trial after the CPUC opened an investigation and alleged that the tree that started the Zogg Fire had not been removed in time due to poor recordkeeping by the electric company.
A federal judge in Texas has struck down a crucial Affordable Care Act policy: the mandate that private health insurers fully cover preventive care services at no cost to patients, the New York Times reported. The ruling took effect immediately last week and applies nationwide. It affects dozens of potentially lifesaving preventive health care services that the federal government recommends, including drugs that prevent H.I.V. transmission and screenings for adolescent depression. Health policy experts describe free preventive care as one of Obamacare’s most transformative policies because it took away a financial barrier to needed care for tens of millions of Americans. It is also one of the law’s more popular provisions, with 62 percent of the public recently saying it is “very important” that it stay in place. The new court ruling has already brought the Affordable Care Act back into the political fray, as Democrats quickly vowed to protect the law. The Biden administration plans to appeal the ruling, setting up the possibility of yet another presidential election cycle with a potential Supreme Court challenge to Obamacare looming. For now, even though the ruling has wide reach, most people aren’t likely to see their health benefits change overnight. (Subscription required to view article.)
The district court characterized the agreement not as creating a trust but as a device designed to win priority over a prior, perfected security interest.
A long road lies ahead to repair confidence in crypto after unprecedented bankruptcies and hacks, including the major challenge of giving investors a way of insuring against such events, Bloomberg News reported. Stock brokerage accounts often come with some cover against outcomes like bankruptcy but digital-asset platforms provide few if any shields, a reality underlined by the November collapse of Sam Bankman-Fried’s FTX exchange. Investors seeking such policies face a tough task. Traditional insurers are wary and crypto-native solutions in decentralized finance — or DeFi — account for a fraction of the $1.1 trillion digital-asset sector. For instance, funds locked in DeFi insurance protocols amount to about $300 million, compared with more than $80 billion in DeFi services overall, according to data from DeFiLlama. “Last year highlighted the importance of insurance but it seems a very difficult problem for DeFi to solve,” said Riyad Carey, a research analyst at crypto data provider Kaiko. “To properly protect a protocol or position is challenging.” The largest DeFi insurance provider is Nexus Mutual, a member-based service accounting for about 70% of funds locked in crypto-native insurance protocols. Nexus Mutual has paid out roughly $5 million in claims from the bankruptcies of FTX and crypto lender BlockFi. It expects to pay another $2 million but those figures are dwarfed by the billions of dollars eviscerated by FTX alone.
State regulators moved forward Thursday with placing United Property & Casualty Insurance Co. into receivership after higher-than-expected losses from Hurricane Ian helped push the insurer into insolvency, the Tampa Bay Times reported. Interim Insurance Commissioner Michael Yaworksy sent a letter to state Chief Financial Officer Jimmy Patronis to trigger a process that will lead to seeking court approval to place the St. Petersburg-based insurer into receivership, according to documents posted on the Office of Insurance Regulation website. United Property & Casualty agreed to the move. United Property & Casualty has faced deep financial problems for months, including announcing in August that it would exit Florida’s troubled homeowners’ insurance market. Tampa-based Slide Insurance Co. on Feb. 1 picked up 72,000 of United Property & Casualty’s policies. In a Feb. 10 filing with the federal Securities and Exchange Commission, parent company United Insurance Holdings Corp. said United Property & Casualty was expected to be placed into receivership because of insolvency.
Wells Fargo & Co agreed to pay $300 million to settle a shareholder lawsuit claiming the bank hid that it had pushed unnecessary insurance on auto loan customers, according to documents filed in U.S. court on Tuesday, Reuters reported. The Construction Laborers Pension Trust for Southern California, which led the class action brought on behalf of investors, said in federal court in San Francisco that Wells Fargo and its former chief executive, Timothy Sloan, had agreed to settle. The bank did not admit wrongdoing. The deal requires approval from U.S. Judge James Donato, who is overseeing the case. Trial in the case had been scheduled for Feb. 27. The lawsuit stems from one of the San Francisco-based bank's past scandals over sales practices that resulted in government investigations and fines. Wells Fargo disclosed in July 2017 that hundreds of thousands of customers had been unnecessarily charged for "collateral protection insurance," which covers auto lenders when borrowers are uninsured. The bank said it had learned of concerns a year earlier. Shareholders sued in 2018, alleging Wells Fargo misled them when Sloan said in November 2016 that he was "not aware of any issues" when asked about the bank's sales practices and culture.
The Fourth Circuit sides with the Third on the Affordable Care Act’s ‘individual mandate.’ Majority says it was a tax measured by income, thus giving the IRS a priority tax claim.
California’s flooding rains and heavy snows that killed at least 17 people have likely caused more than $30 billion in damages and economic losses, according to AccuWeather Inc., Bloomberg News reported. The Pacific storms, known as atmospheric rivers, are estimated to have caused $31 billion to $34 billion of economic impacts through major flooding, widespread power outages, landslides, fallen trees and road closures, the commercial weather forecaster said Wednesday. “A substantial portion of the damage to homes and businesses occurred as a result of mudslides and landslides as well as water damage caused by the serious flooding,” Accuweather said. The losses are more than triple those from December blizzards in Buffalo, New York, though less than the $180 billion to $210 billion caused by Hurricane Ian when it struck Florida last year. Accuweather expects damage costs to further rise as more storms sweep through California.
Republican Gov. Ron DeSantis signed a sweeping property insurance bill on Friday. How much and when it will work to stabilize the stormy market is another question, the Associated Press reported. One of the key goals of the legislation is to keep the claims process from ending up being settled in courtrooms, a problem that DeSantis said drives up legal costs for insurers. “This bill reins in the incentive to litigate,” DeSantis said before signing the bill in Fort Myers, an area devastated by Hurricane Ian in September. “This is going to make a huge, huge difference.” Florida has struggled to keep the insurance market healthy since 1992 when Hurricane Andrew flattened Homestead, wiped out some insurance carriers and left many remaining companies fearful to write or renew policies in Florida. Risks for carriers have also been growing as climate change increases the strength of hurricanes and the intensity of rainstorms. The bill new law will create a $1 billion reinsurance fund, put disincentives in place to prevent frivolous lawsuits and force some customers to leave a state-created insurer of last resort, Citizens Property insurance, for a private insurer, even if the policy costs more. It will also set more stringent deadlines throughout the claims process to try to insure homeowners don’t face coverage delays.
American International Group Inc said on Wednesday its subsidiary, AIG Financial Products (FP), had filed for chapter 11 protection, Reuters reported. The filing concludes a process that has been ongoing since the 2008 financial crisis, the insurer said, adding it will not have a material impact on its balance sheet or that of recently listed life and retirement insurer Corebridge Financial Inc. Connecticut-based FP has no material operations or businesses and no employees. AIG, FP's largest remaining creditor, had been accused of misleading investors about its exposure to subprime mortgages and credit default swaps during the financial crisis of 2008, culminating in $182.3 billion of federal bailouts.
