Newsweek's Evan Thomas to Speak at Annual Meeting
Evan Thomas, assistant managing editor at Newsweek and a frequent guest on public affairs television and radio shows, will be the luncheon speaker at NOLHGA's 25th Annual Meeting in October. The meeting will be held at the Four Seasons Resort Jackson Hole in Jackson Hole, Wyoming, and the luncheon is scheduled for the afternoon of October 7.
Thomas is Newsweek's lead writer on major news stories and has written more than 100 cover stories on subjects ranging from war to politics to celebrity profiles. His reporting and writing on the tragic events of September 11 and the aftermath contributed to Newsweek's being honored with the most prestigious award in the magazine industry--the National Magazine Award for General Excellence for 2002. He was the magazine's lead writer on the Iraq War and continues to write major stories on intelligence and national security issues. He has won numerous journalism awards, including a National Magazine Award in 1998 for Newsweek's coverage of the Monica Lewinsky scandal.
Thomas has been a regular weekly panelist on the syndicated public affairs talk show Inside Washington since 1992. He has appeared on many other television shows as a commentator, including NBC's Meet the Press and Today, CBS's Face the Nation, ABC's Nightline and Good Morning America, CNN's Larry King Live, and PBS's Charlie Rose and The NewsHour with Jim Lehrer.
NOLHGA's 2008 Annual Meeting will be held October 7 and 8, with an MPC meeting on October 6. More information on the meeting will appear in the NOLHGA Wire and other NOLHGA publications in the coming weeks.
Staff Contact -Subprime Mortgage Crisis Discussion Scheduled for Legal Seminar
NOLHGA's 16th Annual Legal Seminar will feature a presentation on the subprime mortgage crisis by Michael P. Braun (a partner at McKee Nelson in New York) and Robert E. Armour (Managing Director of Huron Consulting in Chicago). The two will explain how the market operates and how the underlying transactions are structured. They will then discuss how the crisis has spread through the U.S. and world economies and the effects the crisis may have on the U.S. insurance industry.
Braun, whose practice focuses on securitization transactions, has represented issuers, underwriters, and institutional purchasers in a broad range of securitization transactions. He is a graduate of the University of Michigan and received his J.D. from Vanderbilt Law School. Armour, a CPA with extensive experience in the fields of accounting and finance, has significant experience with the insurance industry, both in his position with Huron as well as in his previous 15-year tenure with PricewaterhouseCoopers. He earned his Bachelor's Degree from the University of Wisconsin at Madison.
NOLHGA's 2008 Legal Seminar will be held July 17-18 at Boston's Fairmont Copley Plaza Hotel (a NOLHGA MPC meeting will take place on July 15 and 16). Hotel reservations can be made by calling 617.267.5300, and a special rate of $219/night is available for the entire week and weekend (a few smaller, single rooms are available at $209/night).
Staff Contact - National Heritage Life Insurance Company (Delaware)NHL Estate Scores $26.8 Million Victory in Investment Advisor Case
On April 15, 2008, the Orange County (Florida) Circuit Court ruled in favor of the National Heritage Life Estate in its claims against Bear Stearns for breach of its contractual and fiduciary duties as an investment advisor. The case, Denn v. Bear Stearns & Co., was tried before a Florida magistrate in October and November 2007. The parties completed their post-trial briefing schedule in January 2008.
The estate claimed that in response to flawed investment advice from Bear Stearns, NHL purchased high-risk, volatile securities products that resulted in millions of dollars in losses to the company and ultimately "deepened the hole" of the eventual insolvency. Bear Stearns argued that its relationship with NHL was that of a "broker" and did not rise to the level of "investment advisor." In addition, Bear Stearns noted that NHL was aware of the investment risks and that all investments had been approved by the commissioner.
The court ruled the contractual relationship between Bear Stearns and NHL included investment advisor and brokerage services and created a duty of good faith and fair dealing. Finding that duty was breached, the court stated, "The investments recommended and selected by Bear Stearns were high-risk, extremely volatile, and completely inappropriate for NHL. Bear Stearns knew this from the outset of the relationship and through its actions and inactions prevented NHL from determining the extremely risky nature of its investments until it had suffered significant financial losses."
Although the court rejected NHL's "deepening of the insolvency" theory, the court did award the estate $26.8 million plus interest in "expectation" damages calculated as a combination of the dollars invested plus the expected return on those dollars. For a copy of the opinion, please contact Meg Melusen at NOLHGA.
Task Force Chair - Dan Orth; Staff Contact -Motion to Reconsider Granted in Nebraska Viaticals Case
On April 16, 2008, the District Court of Lancaster County (Nebraska) reversed its earlier ruling against the Nebraska guaranty association and granted the association's motion for summary judgment in Harvey v. Nebraska Life & Health Insurance Guaranty Association.
The case involved a group of plaintiffs seeking guaranty association coverage for viatical settlements purchased from a now-defunct broker known as Future First Financial Group. In the original decision (issued in August 2007), the district court acknowledged that Future First was not and never had been an insurance company. The court further acknowledged that Future First was not licensed in Nebraska, nor did it transact in any of the lines of insurance recognized by Nebraska's insurance code. Nevertheless, the court held that Future First was a "member insurer" and that the viatical settlements should be covered by the association as "supplemental contracts" to direct non-group life policies.
In its motion to reconsider, the Nebraska association argued that Future First was not a "member insurer" and that the viatical products were not "supplemental contracts" within the meaning of the guaranty association statute. The judge did not alter her opinion on those points, but instead focused on Nebraska's coverage exclusion for "any portion of any policy or contract not guaranteed by the insurer or under which the risk is borne by the policy or contract holder" and ruled in favor of the guaranty association.
With the plaintiff's case dismissed, the court's order will become final after 30 days unless the plaintiff appeals. The opinion, which will remain unpublished, is available from Meg Melusen at NOLHGA.
Staff Contact -GA Contact Information
The Nevada Life And Health Insurance Guaranty Association has a new e-mail address. The association can now be reached at [email protected].
Staff Contact - De Gadd