THE REGULATORREGULATOR INSURANCE REGULATORY EXAMINERS SOCIETY New consumer unit Last-minute news Indiana rebounds from about 1998 CDS • The IRES registration national media inquiry center will open up at 2 by Scott Hoober p.m. Sunday. You can pick special to THE REGULATOR up your program packets then. As public officials, insurance commissioners are accustomed to being in the public eye. Chicago But rarely does the media attention reach the level of intensity experienced several months ago by Indiana’s Sally McCarty and her staff: a negative article on the front page of the Wall Street Journal. The 1998 CDS Reporter Scott Paltrow knocked the department’s “tiny budget” and its “dilapidated” offices, aired allegations • Board of Directors meets that Indiana regulators fail to protect consumers Sunday at 4 p.m. in room and said that, in general, state-by-state regula- York 1,2,3. IRES mem- tion of insurance results in too tight a bond bers welcome. between regulators and the industry they regu- • Sunday night welcome late. reception/dance starts at Yet McCarty says that for the most part, the 6:30 p.m. in the Regency impact of the Jan. 14 article — at least in-state — Ballroom. has been positive. Commissioner • Registration/check-in Getting people’s attention McCarty re-opens 7 a.m. Monday “What the article did for us was get a lot of people paying a lot of attention to our situation, and that has been • Ballots for IRES Board of more positive than negative,” McCarty said. Directors must be turned in “Some of the ideas that I had for the department, as a new by 4 pm Monday. commissioner, I’ve been able to make into reality at a much faster • For other last-minute pace because of that article. And one of them is a new Consumer details on the CDS, check Protection Unit that we started up in late June.” the Society’s web site: While the article certainly gave the Indiana Department of www.go-ires.org Insurance a black eye, much of its criticism was dated. Worst of all, though, McCarty and her department weren’t the Journal’s intended target. JULY 1998 “It’s no secret that Scott Paltrow is a big proponent of federal regulation of insurance,” McCarty said of the Journal’s reporter. President’s Message ...................... 2 “He reviewed the 1995 NAIC surveys of the state departments Meet the IRES Board ................... 3, 9 and found that in 1995 the Indiana department had not conducted any Trilogy of insurance fraud .............. 6 market conduct exams. And given the size of our market [sixth Continuing ed news ...................... 13 Bulletin board ................................ 16 continued on page 4 The Regulator 1 President’s Forum The Regulator Christel L. Szczesniak, CIE Wayne Cotter, Senior Editor IRES PUBLICATIONS COMMITTEE It was a good year, Stephen M. Martuscello, New York, CHAIR Scott Laird, Texas • Frank Seidel, Pennsylvania • Wayne Cotter, New York but IRES still needs • Don Koch, Alaska IRES Officers & Board of Directors more participation Executive Committee President ................ Christel Szczesniak, CO ........ 303-894-7499 When I took over last summer in Charlotte as President-elect ........ Gary W. Meyer, MO ............ 816-889-6207 president of IRES — has it been Vice President ......... Stephen Martuscello, NY ....... 518-474-9838 Secretary ............... Jann Goodpaster, OR ........... 503-246-3715 a year already? — I announced Treasurer ............... Tommy Thompson, OK .......... 405-841-8756 three themes for the coming Past president ......... Gerald A. Milsky, VA ........... 804-371-9074 At Large ................. Angela Ford, NC .................. 919-733-4935 year: Communication, Educa- Board of Directors tion and Participation. Paula J. Bicica, CIE, Vermont Stephen M. Martuscello, CIE, New York All three of those themes of L. David Blair, Ohio A.W. McPherson, CIE, Missouri Ernest E. Branch, CIE, Louisiana Gary W. Meyer, CIE, Missouri course come together in The Gary L. Domer, CIE, Colorado Gerald A. Milsky, CIE, Virginia Angela Ford, AIE, North Carolina Michelle M. Muirhead, AIE, Nebraska Society’s annual Career Devel- Joseph Fritsch, CIE, New York Bruce R. Ramge, CIE, Nebraska Jann Goodpaster, CIE, Oregon Shirley A. Robertson, AIE, Nevada opment Seminar, and as mea- John A. Hartley, CIE, Oklahoma Frank D. Seidel, CIE, Pennsylvania R. Weldon Hazlewood, AIE, Virginia Christel L.. Szczesniak, CIE, Colorado sured by CDS we’ve done a Donald P. Koch, CIE, Alaska Nancy S. Thomas, CIE, Delaware Ron L. Kotowski, Illinois Tommy Thompson, CIE, Oklahoma superb job on all three of my Scott Laird, Texas Shirley H. Williams, AIE, North Carolina Howard L. Magill, CIE, Tennessee themes. Education? I sincerely believe that the CDS next COMMITTEE CHAIRS month in Oak Brook, Ill., will be the best one ever. Executive ............................. Christel Szczesniak, CO Communication? We’ve done a better-than-ever Accreditation & Ethics .......... Gary W. Meyer, MO, chair job of letting members and nonmembers alike know Meetings & Elections ............ Jann Goodpaster, OR, chair about the CDS, with excellent mailings and a new Publications ......................... Stephen Martuscello, NY, chair and effective Web site. Education ............................ Angela K. Ford, NC, chair Participation? Well, if the program is education- Membership ........................ Gerald A. Milsky, VA, chair ally sound and the communication does its job, I Finance ............................... Tommy Thompson, OK, chair would expect to hear that more people than ever before have signed up to attend. At this writing, our LEGAL COUNSEL: Craft-Fridkin-Rhyne, Kansas City CDS headquarters hotel was completely out of IRES Section Chairs rooms. We must be doing something right. MARKET CONDUCT PRODUCER LICENSING & CONTINUING ED Kirk Yeager, Colorado • Michelle Shirley Williams, North Carolina • But IRES alone can only do so much. Muirhead, Nebraska Laurna Landphier, Wiscconsin The Society does a wonderful job of providing FINANCIAL RATES & FORMS: PROPERTY-CASUALTY Joseph Fritsch, New York • Donald Carbone, Susan Howe, Colorado • Michelle van services to its members. But it can only keep on New York Haagen, Maine doing that job if it gets support from each of you. RATES & FORMS: LIFE-HEALTH CONSUMER SERVICES & COMPLAINT HANDLING No, I don’t just mean signing up to come to the Paul Bicica, Vermont • Stephen Lee McLellan, District of Columbia Martuscello, New York ENFORCEMENT & COMPLIANCE CDS. As important as that is, there’s more to being a Janet Glover, New York • Susan full-fledged member of IRES than coming to the CDS. Ezalarab, AIE, Wisconsin THE REGULATOR is published every other month by the How about offering to speak or lead a panel at next www.go-ires.org INSURANCE REGULATORY Opinions expressed in this publication are the year’s CDS? authors’ and do not necessarily represent the EXAMINERS SOCIETY opinions of the authors’ employers or IRES. The same is true across the board. 130 N. Cherry., Suite 202 Olathe, KS 66061 Getting your AIE and CIE is important, but then 913-768-4700 FAX 913-768-4900 you need to give something back to your profession IRES Continuing Education Line: 913-768-NICE David V. Chartrand, executive secretary Joy Moore, C.E. Coordinator ©1998, All Rights Reserved, by the Insurance Regulatory Examiners Society continued on page 13 2 The Regulator MEET YOUR BOARD MEMBERS* Paul J. Bicica, CIE John A. Hartley, CIE, AIC IRES Board of Directors IRES Board of Directors A regulator for 11 years, currently serves as A regulator for 20 years, currently serves as Chief of Consumer Services, Vermont market conduct examiner, Oklahoma Department of Banking Insurance & Securi- Insurance Department ties If I weren’t a regulator, I’d be: “. a retired If I weren’t a regulator, I’d be: “Doing some- regulator.” thing else to make the world a little better.” The biggest issue facing insurance regulation The biggest issue facing today: Federal insurance regulation intervention into the today: “The exponen- insurance industry. tially increasing com- plexity of insurance My proudest accom- products. Consumers plishment: “Raising who are used to older, straightforward a family and serving my country.” products are buying newer products they don’t understand.” If I could do one thing over, it would be: “Spend more time with my family when the My proudest accomplishment: “Being the first kids were little.” member of any generation of my family to graduate from college.” Family: “Married to Jean for 26 years, four children, six grandchildren and another Family: “I live on a river in the woods with my due about now.” wife Stacey. After 17 years as a Social Security hearing officer, she now works as Hobbies: Sport fishing, quail hunting, Civil editor of a national insurance consumer War re-enactor. newsletter.” Favorite quote: “Hit the ball over the fence and Hobbies: Playing softball and golf, learning to you can take your time going around the sculpt. bases.” Favorite quote: “You gain strength, courage and confidence by every experience in *More Board profiles on page 9 which you stop to look fear in the face. You must do things you think you cannot do.” — Eleanor Roosevelt The Regulator 3 Media probe actually helped, commissioner says continued from page 1 plaints and retrieved $3 million for consumers, the highest number of companies of all the states, and department put out a news release. And not a single second in terms of foreign companies], he thought TV station or newspaper ran it. that was curious. Consumer protection “I think he had the article in mind and picked us Even before the Journal interview, back when as a likely candidate.” McCarty was deputy commissioner, she’d seen a By the time Paltrow arrived to interview need to upgrade and expand Consumer Services — to McCarty, then take a second look at tough cases, to work more acting commis- closely with unresponsive companies and, perhaps sioner, the situation most of all, to have the time to sit back and spot reflected in the trends before it’s too late.