Realtors urge Ways and Means Subommittee to Make Forgiven Home Mortgage Debt Exclusion Permanent

(Washington, DC – Insurance News 360) – In testimony before the U.S. House Ways and Means  Subcommittee on Tax Policy in March, a representative of the National Association of Realtors urged  that mortgage forgiveness tax relief should be made permanent. This is an exclusion for  forgiven home mortgage debt following a foreclosure, short sale or loan modification should be made permanent to provide relief to troubled borrowers and minimize the damage to families, neighborhoods and communities.

“The exclusion for mortgage debt cancellation delivers a huge dose of fairness. When the investment in a home goes well, and the owner sells at a gain, the tax code generously waives capital gains up to $500,000,” said Realtor® Barry Grooms, 2018 vice president of Florida Realtors®, who testified on NAR’s behalf. “But what happens when things go sour, equity is lost and the family is forced to sell short? Up through last year, the exclusion stepped in and relieved the often-impossible tax burden. If allowed to expire, we are left with a tax policy that rewards good fortune but piles on when the tables are turned. This is neither fair nor smart.”

While the home equity situation in America is much better today and the volume of short sales and foreclosures has receded from record highs, there are still about 2.5 million homes underwater, according to industry data. This is down considerably from the downturn, when as many as a quarter of mortgaged homes in the U.S. had negative equity. Nonetheless, there are still a significant number of individuals struggling to keep up with their mortgage payments, and the exclusion is vital for lessening the financial impacts of a foreclosure, short sale or loan restructure and saving distressed families from a dire hardship.

In his testimony, Grooms urged Congress to make mortgage cancellation relief a permanent provision since the exclusion has already expired, leaving the future of troubled borrowers in serious doubt.

“Cases of negative home equity will ebb and flow as well, even with a stronger economy,” said Grooms. “This is why we need a permanent exclusion to minimize the damage to families, neighborhoods and communities.”

Additional information on NAR’s mortgage debt cancellation tax relief efforts is available at www.nar.realtor/topics/mortgage-debt-cancellation-relief .

Source: National Association of Realtors.

Millenials are most active generation to buy homes in 2017

(Washington, DC – Insurance 360) – Although inventory constraints and costs kept potential millennial-aged home buyers from  leaving their parents’ homes, that age group accounted for about 36 percent of home purchases in 2017, according to the National Association of Realtors’ 2018 Home Buyer and Seller Generational Trends Study. The study revealed that proximity to friends and family are more important to millennial buyers than location and closeness to a school.

Buyers in Generation X accounted for 26 percent of home buyers over the past year. Older baby boomers accounted for 14 percent of home sales, and the salient generation purchased just six percent of homes.

This year’s findings reveal how low inventory conditions affect prices and what it takes to be successful as a millennial home buyer.

“Realtors® throughout the country have noticed both the notable upturn in buyer interest from young adults over the past year, as well as mounting frustration once they begin actively searching for a home to buy,” said Lawrence Yun, NAR’s chief economist. “Prices keep rising for the limited number of listings on the market they can afford, which is creating stark competition, speedy price growth and the need to save more in order to buy.”

The 144 page survey revealed that younger baby boomers  were most common buyers of a multigenerational home,  because their adult children lived at home, as did their parents.

“Costly rents and growing student debt balances appear to make living at home more appealing, affordable and increasingly more common among young adults just entering the workforce,” said Yun. “Even in situations where three generations are all cramped under the same roof, it can significantly help some millennials eventually transition straight to homeownership. Eighteen percent of millennial buyers in the survey said their family home was their previous living arrangement.”

Source: National Association of Realtors.

Home sales increased three percent in February

(Washington, DC – Insurance News 360) – Low inventory and fast price growth did not hamper existing home sales in February, according to the National Association of Realtors (NAR). Instead, existing home sales increased three percent to 5.54 million (a seasonally adjusted annual rate), up from 5.38 million in January. This brings sales up 1.1 percent over March 2017.

“A big jump in existing sales in the South and West last month helped the housing market recover from a two-month sales slump,” said NAR Chief Economist Lawrence Yun. “The very healthy U.S. economy and labor market are creating a sizeable interest in buying a home in early 2018. However, even as seasonal inventory gains helped boost sales last month, home prices – especially in the West – shot up considerably. Affordability continues to be a pressing issue because new and existing housing supply is still severely subpar.”

In all housing types, the median price for existing homes was $241,700, which is up almost six percent from February 2017.  Housing inventory was up 4.6 percent, but at 1.59 million, is still lower than where it was a year ago, and has seen a year-over-year decrease for nearly three years.

“Mortgage rates are at their highest level in nearly four years, at a time when home prices are still climbing at double the pace of wage growth,” said Yun. “Homes for sale are going under contract a week faster than a year ago, which is quite remarkable given weakening affordability conditions and extremely tight supply. To fully satisfy demand, most markets right now need a substantial increase in new listings.”

The hottest metropolitan areas for home sales in February include San Francisco-Oakland-Hayward, Calif.; Midland, Texas; Vallejo-Fairfield, Calif.; San Jose-Sunnyvale-Santa Clara, Calif.; and Sacramento-Roseville-Arden-Arcade, Calif. More than a quarter of home buyers were first-time buyers in February.

NAR President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty, says first-time buyers are seeing stiff competition for the available listings in their price range. “Realtors® in several markets note that entry-level homes for first-timers are hard to come by, which is contributing to their underperforming share of overall sales to start the year.” she said. “Prospective buyers should start conversations with a Realtor® now on what they want in a new home. Even with the expected uptick in new listings in coming months, buyers in most markets will likely have to act fast on any available listing that checks all their boxes.”

Source: National Association of Realtors.

Geico, Liberty Mutual and Allstate announce Agreement to Eliminate Use of Occupation, Education as Insurance Rate Considerations

(New York, NY – Insurance News 360) – To comply with New York’s regulation that prohibits use of occupational status and educational level in considering an individual’s automobile insurance rates, three of the larger automobile insurance companies in the state have pledged not to use those factors. Geico, Allstate, and Liberty Mutual provide almost half of the private automobile insurance in the state  of New York.

“The use of education and occupation in determining insurance rates unfairly penalizes drivers without college degrees or who work in low-wage jobs or industries without having a rational relationship to driving,” said Superintendent Maria Vullo. “The result is that drivers with higher education and income pay less for auto insurance with no rationale evidence that they are better drivers.  We are pleased that GEICO has recognized its responsibilities to immediately comply with this regulation and we expect any other company that may be utilizing education and occupation in their underwriting to immediately agree to comply before the effective date of the regulation.”

During a multiple-year investigation, the state revealed that many insurers in the stae have, at one point, used education level and occupational status to determine what their insurance rates would be, without clearly showing how these factors were related to their driving. This skewed many  insured individuals’ rates from the start, whether there was truly more risk or not.

Under the DFS regulation, which was finalized in December 2017 and made effective this month, private passenger auto insurers are prohibited from using drivers’ occupational status or education level as a factor in initial tier placement unless the insurer demonstrates, to the satisfaction of the Superintendent of Financial Services, that its use of occupational status or educational level attained in initial tier placement or tier movement does not result in rates that are excessive, inadequate, or unfairly discriminatory.

The final regulation can be found here.

Source: New York State Department of Financial Services.

QBE Insurance fined $750,000 for issuing impermissible insurance coverage for college students

(New York, NY – Insurance News 360) – New York Financial Services Superintendent Maria T. Vullo announced punishment of QBE Insurance Corp., for issuing accident-only coverage to colleges and universities in New York. As of March 15, the company had ceased selling these policies, which did not comply with the Affordable Care Act or New York law.

“DFS will continue to vigorously enforce the insurance law and take action to protect all New Yorkers, including students attending college and other institutions of higher education, to ensure that they are receiving the insurance coverage they deserve in compliance with federal and state law,” said Superintendent Vullo.  “DFS appreciates QBE’s cooperation in resolving this matter and taking remedial steps to correct these violations of law.”

The DFS investigation found that QBE unlawfully sold the accident-only coverage for the 2016-17 school year to 25 institutions of higher education, covering 99,937 students.  The insurer also failed to issue certificates setting forth the essential features of the insurance coverage to each of the 99,937 students covered by the policies.

QBE is headquartered in Pennsylvania and licensed as a property and casualty insurance company in New York.

A copy of the consent order can be found here.

Source: New York State Department of Financial Services.

In an opinion column, North Carolina Insurance Commissioner Calls for Congress to Keep SHIIP Funding

(Raleigh, NC – Insurance News 360) – Commissioner Mike Caumey encouraged Congressional leaders to preserve the funding that goes to programs like North Carolina’s Seniors Health Insurance Information Program (SHIIP).  The North Carolina program gets $1.4 million each year, or 65 percent of their budget, from  federal funds.

It saved the state’s seniors $60 million by sitting down with them, talking and helping them to choose the right prescription coverage plan that meets their needs.

“SHIIP trains 960 volunteers across the state’s 100 counties. Those volunteers, along with our dedicated staff in Raleigh, counseled more than 102,000 Medicare beneficiaries across the state last year. In addition, SHIIP served almost 17,000 Medicare beneficiaries with disabilities. It counseled more than 28,000 people with incomes below 150 percent of the federal poverty level” Caumey wrote.

The organization also helps seniors to understand the confusion of Medicare and its Parts A, B, C and D, along with the different supplement plans that exist.

SHIIP provides unbiased information to help clear up this confusion, allowing them to decide for themselves which plan works best for them.

The people in Washington pushing to eliminate SHIIP funding say the program is duplicative. In reality, it isn’t.

Sure, the federal government operates a 1-800-MEDICARE call line which seeks to answer citizens’ questions about the federal health program. However, if consumers’ calls get too detailed or complicated, the federal call center usually refers the consumer back to state SHIIP programs for answers to their questions.

If Congress eliminates SHIIP funding, the calls to the federal call line would likely quadruple. The federal government would most likely have to increase its staff to handle the cost, most likely wiping out any savings associated with ending the program.

Source: North Carolina Department on Insurance.

Verisk prefill SmartSource Makes Property Insurance Quoting Easier

(Jersey City, N.J. – Insurance News 360) – Data analytics provider Verisk released SmartSource, a new property characteristics prefill program to speed up property insurance quoting processes, and to address questions of data reliability. It inputs property information into the Verisk replacement cost calculator, 360Value.

“Consumer expectations are rapidly changing, and insurers are constantly being challenged to improve their customer experience. But making quick underwriting decisions without reliable property data can often result in inaccurate rates, pre-bind defection, and abandoned quotes,” said Trish Hopkinson, product director of 360Value. “SmartSource provides a leap forward by offering insurance-ready, property-specific information that insurers can use to streamline the new business process and help reduce changes from quote to bind.”

SmartSource incorporates data from multiple proprietary and public sources and uses self-learning algorithms to continually improve the quality of its data. The application currently features up to 68 property-specific characteristics for more than 104 million U.S. residential properties. Those numbers are expected to grow as new data sources become available and are added to the application.

For more information, please visit www.verisk.com/360Value.

Source: Verisk.

In an opinion column, North Carolina Insurance Commissioner Calls for Congress to Keep SHIIP Funding

(Raleigh, NC – Insurance News 360) – Commissioner Mike Caumey encouraged Congressional leaders to preserve the funding that goes to programs like North Carolina’s Seniors Health Insurance Information Program (SHIIP).  The North Carolina program gets $1.4 million each year, or 65 percent of their budget, from  federal funds.

It saved the state’s seniors $60 million by sitting down with them, talking and helping them to choose the right prescription coverage plan that meets their needs.

“SHIIP trains 960 volunteers across the state’s 100 counties. Those volunteers, along with our dedicated staff in Raleigh, counseled more than 102,000 Medicare beneficiaries across the state last year. In addition, SHIIP served almost 17,000 Medicare beneficiaries with disabilities. It counseled more than 28,000 people with incomes below 150 percent of the federal poverty level” Caumey wrote.

The organization also helps seniors to understand the confusion of Medicare and its Parts A, B, C and D, along with the different supplement plans that exist.

SHIIP provides unbiased information to help clear up this confusion, allowing them to decide for themselves which plan works best for them.

The people in Washington pushing to eliminate SHIIP funding say the program is duplicative. In reality, it isn’t.

Sure, the federal government operates a 1-800-MEDICARE call line which seeks to answer citizens’ questions about the federal health program. However, if consumers’ calls get too detailed or complicated, the federal call center usually refers the consumer back to state SHIIP programs for answers to their questions.

If Congress eliminates SHIIP funding, the calls to the federal call line would likely quadruple. The federal government would most likely have to increase its staff to handle the cost, most likely wiping out any savings associated with ending the program.

Source: North Carolina Department of Insurance.

Verisk prefill SmartSource Makes Property Insurance Quoting Easier

(Jersey City, N.J. – Insurance News 360) – Data analytics provider Verisk released SmartSource, a new property characteristics prefill program to speed up property insurance quoting processes, and to address questions of data reliability. It inputs property information into the Verisk replacement cost calculator, 360Value.

“Consumer expectations are rapidly changing, and insurers are constantly being challenged to improve their customer experience. But making quick underwriting decisions without reliable property data can often result in inaccurate rates, pre-bind defection, and abandoned quotes,” said Trish Hopkinson, product director of 360Value. “SmartSource provides a leap forward by offering insurance-ready, property-specific information that insurers can use to streamline the new business process and help reduce changes from quote to bind.”

SmartSource incorporates data from multiple proprietary and public sources and uses self-learning algorithms to continually improve the quality of its data. The application currently features up to 68 property-specific characteristics for more than 104 million U.S. residential properties. Those numbers are expected to grow as new data sources become available and are added to the application.

For more information, please visit www.verisk.com/360Value.

Source: Verisk.

Oregon recovers more than $3.4 million for consumers in 2017

(Salem, OR – Insurance News 360) – On March 8, the Oregon Division of Financial Regulation announced that in the previous year, their investigations of insurance complaints had resulted in recovery of more than $3.4 million for individuals in more than 4,000 cases.

The biggest reason consumers filed complaints against their insurance companies were claim denials and delays, which made up more than 30 percent of all complaints.

Health insurance received 36 percent of the total complaints, and auto insurance complaints were another 30 percent of the total. But, it was life and health insurance claims that accounted for 75 percent of recovered insurance funds.

“Helping consumers understand their policies and making sure they receive the money they are owed is one of the most gratifying and important parts of our jobs,” said Andrew Stolfi, Oregon insurance commissioner. “We want consumers to contact us anytime they have questions or concerns about their insurance or financial products.”

Oregonians who need help with insurance or financial products are urged to contact the division, part of the  Oregon Department of Consumer and Business Services. The division’s advocacy team can help with a wide range of consumer questions and concerns, such as claim delays, unreasonable settlement offers, and unfair loan terms.

Oregonians with questions or concerns about their insurance or financial products are encouraged to contact our advocates one of three ways:

Call the advocacy team at 888-877-4894 (toll-free)

Visit http://dfr.oregon.gov/gethelp/Pages/file-a-complaint.aspx

Source: Oregon Division of Financial Regulation.