Weather’s Cooler, News is Not

Summer may be winding down here in the Midwestern states — in Chicago, temperatures are finally back in the 70s, we’ve gotten a smattering of rain, and school is back in session (thank God!) — but insurance news shows no signs of cooling off for the fall. In fact, with state legislative sessions gearing up to reconvene, things can only get hotter.

Probably the biggest news from the Great Lakes region was the Aug. 18 Illinois Supreme Court overturn of the State Farm decision on aftermarket parts. Long a bone of contention between the industry, auto body shops and the original equipment manufacturers (OEMs), this long-awaited ruling restores insurers’ ability to use certified aftermarket parts in repairing damaged vehicles. Insurers estimate they save millions by using the more competitively priced aftermarket parts. More importantly, they’re claiming a moral victory over venue shopping in class-action litigation (Madison County, Illinois, has long been considered a “judicial hellhole” by the American Tort Reform Association) and for consumer choice. Also in Illinois, Gov. Rod Blagojevich signed a medical malpractice reform bill into law. Insurance pundits are saying this is a double-edged sword; while they’re pleased with the caps on noneconomic damages, they’re concerned over the fact that med-mal writers will now have to seek rate approval in a state where open rating has reigned for years.

And finally, Ohio is going out of its way to prove it has nothing on Chicago when it comes to graft and corruption. Between an ongoing investigation of the disappearance of rare coins and the loss of investment assets at the state’s Bureau of Workers’ Compensation, and Gov. Bob Taft’s guilty verdict in an ethics violation, Ohio has definitely been in the headlines.

This along with the usual spate of insurance fraud stories, ranging from the silly (a fictional Illinois insurance agent/company who ripped off carnival operators in Kentucky and Nebraska) to the sick (the Chicago commodities firm executive who not only torched his house for the insurance bucks, but incinerated his 90-year-old mother in the process). See this month’s Fraud Roundup for all the gory details.

Summer is traditionally a slow news season for the insurance industry in the Midwest. But if this summer’s roster of stories is any indication, fall should be anything but boring.

Topics Illinois