Insurer says it shouldn’t have to pay for medical marijuana

AUGUSTA, Maine _ The Maine supreme court on Wednesday began considering whether a paper millworker left suicidal by narcotic painkillers should receive workers’ compensation for medical marijuana.

It’s the first time the court has considered the question of insurance reimbursement for medical marijuana.

Madawaska resident Gaetan Bourgoin won a ruling from the state’s Workers’ Compensation Board two years ago saying the paper mill’s insurer must reimburse him for medical marijuana. He contends marijuana is cheaper and safer than narcotics.

But Twin Rivers Paper Co. and its insurer appealed the ruling, arguing that paying for pot use, even for medical purposes, could expose the companies to prosecution since marijuana still is illegal at the federal level.

With medical marijuana legal in Washington, D.C. and 29 states, insurers across the country have been confronted with the same dilemma. Uneven state laws on reimbursement further complicate the issue.

Five states Connecticut, Maine, Minnesota, New Jersey and New Mexico have found medical marijuana treatment is reimbursable under their workers compensation laws, according to the National Counsel for Compensation Insurance. Florida and North Dakota, meanwhile, passed laws this year excluding medical marijuana treatment from workers’ compensation reimbursement.

Members of the Maine Supreme Judicial Court posed hypotheticals to the attorneys arguing the case. One asked Bourgoin’s attorney what he’d do if a client needed cocaine for pain treatment, and another asked Twin Rivers’ attorney whether she believes the federal government will start prosecuting insurers for medical marijuana reimbursement.

Justice Donald Alexander repeatedly questioned whether marijuana use should remain illegal under federal law and contrasted the drug with opioid-based painkillers, which he said drug companies have lobbied Congress to protect.

“Opioids are killing people every day in Maine,” he said.

Bourgoin’s case dates to 1989, when he hurt his back as a 29-year-old at the paper mill now known as Twin Rivers.

His attorney, Norman Trask, said Bourgoin pays for medical marijuana out-of-pocket and receives reimbursement from Twin Rivers’ insurer. Bourgoin previously took opioid-based painkillers, which caused other problems.

“At one point he was on such high dosages that they were concerned about his oxygen levels at night,” Trask said. “He became suicidal.”

Twin Rivers attorney Anne-Marie Storey said paying for medical marijuana puts the company in violation of federal law. The company contends that Maine’s medical marijuana law does not explicitly require an insurer to cover the cost of medical marijuana.

“This is not a case about making judgment over whether someone should use or not use marijuana as a matter of personal choice,” she said. There’s a scarcity of research on medical marijuana, and “nobody knows” how safe it is, she said.

5 Reasons Canada’s Housing Market Won’t Crash

Jason Phillips | Motley Fool

Much has been made over the past decade of Canada’s rising household debt, which is now at levels similar to those in the United States prior to the 2008-09 Financial Crisis.

With housing prices in Toronto up more than 30% over the past 12 months, and Vancouver prices having been inflated for several years, many are wondering: now that the Bank of Canada has raised interest rates twice in the last three months, will it be enough to topple the Canadian housing market?

There are five very important reasons why investors should not expect a housing correction in the Canadian market to be of nearly the same magnitude as the one experienced in the United States 10 years ago.

Reason #1: The United States incentivizes home ownership

In the U.S., federal policy actively encourages home ownership, whereas in Canada, policies are designed to encourage access to housing, but they do not explicitly favour home ownership over renting or leasing a property.

It seems then only natural to suggest that creating incentives for home ownership (like, for example, allowing mortgage interest to be tax deductible in the U.S.) would be more likely to create an environment ripe for a housing bubble.

Reason #2: Canada’s housing market is directly backed by the Federal government

In the U.S., Fannie Mae and Freddie Mac are responsible for providing guarantees on mortgage-backed securities and providing overall stability to the housing system.

At the time of the Financial Crisis, Fannie Mae and Freddie Mac were privately owned, with the “implicit” backing of the Federal government. Yet, when push came to shove, investors learned the hard way the difference between an implicit guarantee and direct backing.

By comparison, the Canadian equivalent responsible for providing insurance and stability, is the Canada Mortgage and Housing Corporation (CMHC) — a Crown corporation directly owned by the Canadian Federal government.

Reason #3: Canada does not allow non-recourse mortgages

In Canada, mortgages are typically “full-recourse” loans, meaning the borrower continues to be responsible for repaying the loan in the event of a foreclosure, which effectively incentivizes the borrower to do everything in their power to avoid foreclosing and losing the property.

Meanwhile, many U.S. states employ “non-recourse” mortgages, which, in the event of a foreclosure, allow the borrower to walk away from their homes, leaving the lender with no-recourse besides taking over ownership of the property.

It’s easy to see how non-recourse mortgages can exacerbate the problem of homeowners defaulting on their payments.

Reason #4: Canada has tighter restrictions on mortgage insurance

Canadian legislation prohibits lenders from issuing mortgages without loan insurance if the loan is greater than 80% of the value of the property.

Insurance which is purchased from the CMHC covers the entire amount of the loan for the entire life of the mortgage.

In the U.S., it is a little different; while many lenders will require insurance, they are not legally obligated to do so.

Moreover, in the U.S., loan insurance is “partial,” often covering 20-30% of the loan amount and is cancelled as soon as the value of the loan falls below 78% of the purchase price.

Reason #5: The relative absence of a subprime market in Canada

Sub-prime mortgages are made to riskier borrowers, such as those with a weaker credit history or less stable income.

In the U.S., before the housing crisis, the sub-prime mortgage market peaked at 23.5% of all mortgage originations.

By contrast, in Canada today, the sub-prime mortgage market, which includes Home Capital Group Inc. (TSX:HCG), accounts for less than 5% of originations, making the market significantly less risky.


Regardless of how you look at it, rising interest rates are not a good omen for the future of Canada’s housing market. And while delinquencies today are well below historical averages, that may actually be confirming evidence that a bubble is present.

Current and prospective homeowners should approach the market with caution. Those warning that the “sky is falling” and that the environment is similar to the situation in the U.S. 10 years ago, ought to think a bit more Foolishly.

Irma weakens into a tropical storm but keeps causing misery

By Tamara Lush


TAMPA, Fla. _ Hurricane Irma weakened into a still-dangerous tropical storm Monday as it pushed inland, triggering record flooding in Florida’s northeastern corner, while rescuers in its soggy, wind-battered wake mobilized to reach victims and learn the full extent of the damage.

The storm engulfed nearly the entire Florida peninsula, wreaking havoc from the state’s southernmost point up to the Georgia line, from the Atlantic coast to the Gulf side. It swamped homes, uprooted massive trees, flooded streets, cast boats ashore, snapped miles of power lines and toppled construction cranes.

“How are we going to survive from here?” asked Gwen Bush, who waded through thigh-deep floodwaters outside her central Florida home to reach National Guard rescuers and get a ride to a shelter. “What’s going to happen now? I just don’t know.”

More than 6.2 million homes and businesses remained without power, and 220,000 people huddled in shelters. Officials warned it could take weeks for electricity to be restored to everyone.

No deaths in Florida were immediately linked to the storm. At least 34 people were killed in the Caribbean as Irma _ at one point the most powerful hurricane ever recorded in the open Atlantic, with winds up to 185 mph (298 kph) _ ravaged a string of resort islands long known as vacation playgrounds for the rich.

By Monday morning, Irma was downgraded to a tropical storm, with winds of 65 mph (110 kph).

Irma’s wrath in the Sunshine State stretched hundreds of miles.

In the Keys, where the storm roared ashore Sunday morning with winds of 130 mph (209 kph), video showed houses shoved from their foundations and boats tossed onto the pavement. In Coral Gables, near Miami, fallen trees made streets look like jungle, and damaged power lines buzzed.

And more than 400 miles from where Irma first came ashore, storm surge brought flooding to the Jacksonville area at levels not seen in more than 50 years, with at least 46 people pulled from swamped homes.

The Jacksonville Sheriff’s Office warned residents along the St. Johns River to. “Get out NOW.”

“If you need to get out, put a white flag in front of your house. A t-shirt, anything white,” the office said on its Facebook paqe. “Search and rescue teams are ready to deploy.”

The full breadth of the damage statewide remained unclear, though, with communications and travel cut off by high winds and flooding. Search crews planned to go door-to-door in the hard-hit Keys to check on residents.

Around midday, Irma’s centre began pushing into Georgia, where a tornado spun off by the storm was reported on the coast, and firefighters inland had to rescue several people after trees fell on their homes.

A tropical storm warning was issued for the first time ever in Atlanta, and school was cancelled in communities around the state. More than 100,000 customers were without power in Georgia and over 80,000 in South Carolina.

Over the next two days, Irma is expected to push to the northwest, into Alabama, Mississippi and Tennessee.

People in the heavily populated Tampa-St. Petersburg area were braced for its first direct hit from a major hurricane since 1921. But by the time it struck in the middle of the night Monday, its winds were down to 100 mph (161 kph) or less.

Tampa Mayor Bob Buckhorn said the situation was not as bad as it could have been but warned residents that dangerous storm surge continued. He also reported downed power lines and other debris.

“What we feared the most was the surge,” he said on MSNBC.  “The surge is yet to be finished.”

In Redington Shores west of Tampa, Carl Roberts spent a sleepless night riding out Irma in his 17th-floor beachfront condo. After losing power late Sunday, he made it through the worst of the storm shaken but unhurt.

“The hurricane winds lashed the shutters violently, throughout the night,” he wrote in a text message,  “making sleep impossible.”

As morning broke, he couldn’t open the electric shutters to see outside.

East of Tampa, winds knocked a utility pole and power lines onto a sheriff’s cruiser late Sunday in Polk County. A deputy and a paramedic, who had just escorted an elderly patient to safety, were trapped for two hours until a crew could free them. Both were unhurt.

And more than 120 homes were being evacuated early Monday in just outside Orlando as floodwaters started to pour in. Firefighters and National Guardsmen went door-to-door and used boats to ferry families to safety.

A few miles away, 30 others had to be evacuated when a 60-foot sinkhole opened up under an apartment building. No injuries were reported.

Losses for insurers and banks lead US stocks lower

By Alex Veiga And Marley Jay


U.S. stocks are mixed Thursday as steep losses for banks and insurance companies are countered by gains in health care and technology companies. Banks are tumbling with bond yields, and insurance companies are falling as investors weighed the prospects of big losses caused by Hurricane Irma, which is projected to hit Florida this weekend.

KEEPING SCORE: The Standard & Poor’s 500 index fell 2 points, or 0.1 per cent, to 2,462 as of 3:30 p.m. Eastern time. The Dow Jones industrial average slid 57 points, or 0.3 per cent, to 21,750. The Nasdaq composite remained at 6,393. The Russell 2000 index of smaller-company stocks gave up 4 points, or 0.3 per cent, to 1,397.

HURRICANE WATCH: Insurance companies slumped as Hurricane Irma cut a path of devastation across the northern Caribbean, leaving at least 10 dead and thousands homeless. Reinsurance companies fell sharply because many of their policies are for catastrophic losses such as those caused by a hurricane.

XL Group fell $1.90, or 4.9 per cent, to $36.55 while Everest Re slid $15.38, or 6.8 per cent, to $212. Berkshire Hathaway, which owns GEICO and other insurers, slumped $3.37, or 1.9 per cent, to $173.42.

WEATHER OUTLOOK: The economy “is going to suffer a few dents from the storms,” said John DeClue, chief investment officer for U.S. Bank Private Wealth Management. While damage from hurricanes Harvey and Irma may slow the economy for a few months, DeClue said it “is in remarkably good shape,” which will help stocks keep rising.

He also said the effects of the storms will make sure the Federal Reserve moves slowly in raising interest rates.

EUROPE: The European Central Bank raised its economic growth forecast for the region this year. The central bank left its key interest rates and bond-purchase stimulus program unchanged, but investors expect the bank to start reducing its stimulus activity soon as the European economy continues to improve.

The ICE US dollar index, which measures the dollar’s value against a basket of other major currencies, continued to fall and reached its lowest level since January 2015. The euro strengthened to $1.2003 from $1.1913 and the dollar fell to 108.65 yen from 109.37 yen.

That helped technology companies, which make most of their sales overseas. Microsoft added $1.09, or 1.5 per cent, to $74.50. The weaker dollar makes U.S.-made products less expensive in other markets and increases company profits when they are converted back into dollars. That’s one reason tech companies have done far better than any other S&P 500 sector this year.

HEALTH CARE: AbbVie rose $4.70, or 6.1 per cent, to $81.75 and Bristol-Myers gained $2.92, or 4.9 per cent, to $62.79 after the companies reported positive clinical trial results. Eli Lilly climbed $1.07, or 1.3 per cent, to $81.58 after it said it will cut 3,500 jobs, or about 9 per cent of its total jobs. Biotechnology companies also rallied.

BONDS: Bond prices climbed and yields fell to their lowest level since November. The yield on the 10-year Treasury note fell to 2.05 per cent from 2.11 per cent late Wednesday. Lower bond yields are linked to lower rates on loans, and banks took steep losses. Bank of America fell 54 cents, or 2.3 per cent, to $22.88 and U.S. Bancorp lost $1.08, or 2.1 per cent, to $49.83.

MEDIA WOES: Cable providers and cable channel operators fell after Comcast said it expects to lose as many as 150,000 video subscribers in the third quarter and that competition has been unusually intense. It said intense storms also contributed to the problem. Comcast dropped $2.39, or 5.8 per cent, to $38.78.

Meanwhile Disney fell after CEO Bob Iger said the company’s earnings this year will be about the same as the year before, which disappointed analysts. Its stock lost $4.93, or 4.9 per cent, to $96.57.

CHARGE IT: MasterCard rose $3.51, or 2.6 per cent, to $136.40 after the debit and credit card payment processor raised its 2017 revenue forecast and its growth forecast for next year. Rival Visa also jumped $1.26, or 1.2 per cent, to $104.44 and PayPal and eBay also advanced.

BIG JUMP: RH vaulted after the furniture and housewares retailer raised its annual forecasts after a strong second-quarter report. The stock surged $20.61, or 41.7 per cent, to $70.03.

TAKING A SHINE: Gold rose to its highest price in a year as it climbed $11.30 to $1,350.30 an ounce. Silver jumped 21 cents, or 1.2 per cent, to $18.12 an ounce. Copper dipped 1 cent to $3.14 a pound.

ENERGY: Benchmark U.S. crude fell 7 cents to $49.09 a barrel in New York. Brent crude, used to price international oils, gained 29 cents to $54.49 a barrel in London.

Wholesale gasoline lost 1 cent to $1.66 a gallon. Heating oil rose 3 cents to $1.79 a gallon. Natural gas dipped 2 cents to $2.98 per 1,000 cubic feet.

MARKETS OVERSEAS: The German DAX rose 0.7 per cent and the CAC 40 in France gained 0.3 per cent. The British FTSE 100 rose 0.6 per cent. In Asia, Japan’s benchmark Nikkei 225 rose 0.2 per cent, while South Korea’s Kospi jumped 1.1 per cent. Hong Kong’s Hang Seng index gave up early gains to fall 0.3 per cent.

Couche Tard braces for hurricane Irma while rebuilding from Harvey’s destruction

By Dan Healing


LAVAL, Que. _ Employees of Alimentation Couche-Tard (TSX:ATD.B) in the Florida region are bracing for hurricane Irma as Texas staff continue to try to recover from “devastating” damage from hurricane Harvey, CEO Brian Hannasch said Wednesday.

“The flooding and damage done by Harvey is among the worst in our U.S. history and we continue to monitor daily the situation to help out our employees, their families and our customers,” he said on a conference call.

“As we approach the weekend, we’re now preparing for hurricane Irma while at the same time hoping the storm loses strength and turns back into the Atlantic.”

Alimentation Couche-Tard said it closed 123 stores because of Harvey and 24 were still shut down as of Tuesday.

Employees in the Florida region are topping up store inventories of fuel, water and batteries while hoping they don’t see  “panic buying” as occurred in San Antonio and Dallas where lineups for fuel forced people to wait as long as five or six hours, Hannasch said.

He said the company has had to deal with hurricanes since buying Circle K in 2003.

But its recent spate of acquisitions have increased its exposure, especially its deal that closed in June for San Antonio-based CST Brands which included more than 600 stores in Texas.

He said that deal and one for CrossAmerica Partners wholesale fuel network have “critically strengthened” the company.

Alimentation Couche-Tard has some property insurance for storms but doesn’t carry business interruption insurance, he said.

‘We view ourselves as being very, very geographically diversified and certainly that’s an advantage to us with situations we faced with Harvey and potentially here with hurricane Irma,” said Hannasch.

His comments came as Couche-Tard, which reports in U.S. dollars, announced it had $365 million or 64 cents per share of net earnings in the first quarter of its 2018 financial year.

After adjustments to exclude numerous items including the impact of the acquisition of CST and the sale of some of its assets, Couche-Tard says it earned about $380 million or 67 cents per share.

The adjusted earnings were up 17.5 per cent from the same time last year and total revenue including acquisitions was up 16.9 per cent at $9.85 billion as of July 23, about a month before devastating flooding began sweeping the U.S. Gulf states.

Analyst Irene Nattel said she has modestly increased adjusted earnings forecasts going forward because of the quarterly trend but added those predictions don’t include potentially negative results due to Harvey and Irma.

Hurricane Irma is already causing insurance stocks to plunge

Hurricane Irma is already causing insurance stocks to plunge

Thomas Franck Investments Reporter for

Hurricane Irma is not expected to touch Florida for several days but its impact was already being felt in the U.S. stock market.

Stock prices of home insurers tied to Florida plunged Tuesday after Irma strengthened into a Category 5 storm. This latest storm system follows Harvey, which dumped several feet of rain, destroyed thousands of homes and killed over 50 people in a matter of days.

Shares of HCI GroupUniversal Insurance Holdings, and Heritage Insurance Holdings, which provide property and casualty homeowners insurance in the Sunshine State, were down 13, 16, and 13 percent, respectively.

Reinsurers XL Group and Everest contributed some of the largest losses to the S&P 500’s decline, down 5 and 4 percent, respectively.

Collectively, insurance stocks are having their worst day of 2017. The S&P Insurance Industry (.IUX) is down 1.9 percent, on pace for its worst daily performance since Brexit lows in June 2016 when it fell 3.16 percent. The SPDR S&P Insurance ETF (KIE) is down 3 percent, also on pace for its worst daily performance since June 2016 when it fell 3.14 percent.

Its direct path is not yet clear, but Florida Gov. Rick Scott was not taking any chances, implementing a state of emergency for all 67 counties in the state on Monday.

With winds topping 175 mph, Irma on Tuesday became the strongest hurricane on record in the Atlantic basin outside of the Caribbean Sea and Gulf of Mexico, according to the National Hurricane Center.

Roberto Friedlander, head of energy trading for Seaport Global Securities, said that while the storm isn’t poised to have a major impact on energy infrastructure like Harvey, the focus will be on densely populated Miami.

“There is no modern historical precedent for a Miami hurricane, because the last direct hit was back in the 1920s. A direct hit from Irma could disrupt rail and container activity, and damage infrastructure for transportation, in addition to putting thousands of lives at risk,” wrote Friedlander. “Combined with rainfall, then we are looking at catastrophic flooding to a vast area that already has problems with water levels. Real estate risks are simply gigantic.”

HCI Group is headquartered in Jacksonville. Universal is based in Fort Lauderdale and Heritage is in Clearwater.

Experts are already predicting that final damage assessments of Hurricane Harvey will smash previous storm totals as the most expensive natural disaster in American history. Widespread flooding caused historic water damage to houses in southeastern Texas, displacing thousands who must begin the rebuilding process.

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