News
Fla. State Police Say Auto Theft Crime Ring Issued Fake VINs, Phony Insurance
Florida law enforcement pushed back this week against a nationwide surge in auto thefts, announcing that 23 people were arrested for their alleged participation in a crime ring that forged vehicle identification numbers for stolen luxury vehicles.
Arrest warrants have been issued for four other suspected criminals, bringing the total number of suspects to 23.
“The members of this criminal organization orchestrated a multi-stage scheme to defraud potential car customers at every step of the way, selling stolen vehicles with fraudulent VINs, illegally sourced license plates, and dummy insurance policies,” Florida Department of Law Enforcement Commissioner Mark Glass said in a press release.
The department said a multi-agency investigation dubbed Operation Gone in 60 Days launched in July 2018 when agents began looking into allegations that Florida commercial driver licenses were being illegally distributed to people who had not completed the required training courses. Investigators discovered a criminal organization that issued fraudulent VINs for high-end vehicles obtained through fraud or theft.
The criminals sold the vehicles below market value and fraudulently assigned “illegally sourced” license plates, FDLE said. They also stole from their customers by collecting money for “dummy” auto insurance policies that quickly lapsed.
The Department of Financial Services’ Division of Insurance Fraud, the Florida Highway Patrol and the National Insurance Crime Bureau assisted with the investigation.
Vehicle thefts have been on the upswing nationally, NICB said earlier this month. The organization said the number of stolen vehicles surpassed 1 million in 2022, the highest number of thefts since 2008 and a 7% increase from 2021. The stolen vehicles had an estimated value of $8.9 billion, NICB said.
“We are seeing vehicle theft numbers that we haven’t seen in nearly 15 years, and there is very little deterrent to stop criminals from committing these acts as they are just property crimes, like shoplifting,” stated David J. Glawe, NICB’s president and chief executive officer. “We must reinvest in local law enforcement, provide the necessary resources for prosecution and community policing programs, and implement early intervention programs given the high incidence of juvenile offenders involved in vehicle thefts.”
More than a third of the US population, from the Midwest to the East Coast, under air quality alerts from Canadian wildfire smoke
More than third of the US population is under air quality alerts, covering more than a dozen states from the Midwest to the East Coast, as smoke from Canadian wildfires sweeps across parts of the United States, prompting officials to call on the public to take safety precautions just weeks after similar wildfire smoke blanketed the Northeast.
Over 120 million people are under the alerts and some of the worst air quality, which is classified as “very unhealthy,” is centered over the Chicago, Cleveland, Detroit and Indianapolis metro areas. Some improvement in the air quality is expected on Thursday, particularly over the Great Lakes area, where rain and storms will help cleanse the air.
Canada is seeing its worst fire season on record as hundreds of blazes rage across the country – with more than 250 burning “out of control,” according to the Canadian Interagency Forest Fire Centre. Several Canadian cities also recorded unhealthy air quality index readings Wednesday, according to IQAir.
Wildfires -- and their toxic smoke -- are affecting us more often. What can we do about it?
As massive clouds of smoke cross into the US, air quality alerts have been issued for the entire states of New York, Iowa, Wisconsin, Illinois, Indiana, Michigan, Delaware and Maryland as well are parts of Kansas, Missouri, Minnesota, Ohio, Pennsylvania, Virginia and North Carolina, the National Weather Service said.
Can UBI Turn Shoppers into Advocates?
Usage-Based Insurance (UBI) programs are becoming more influential to customers throughout their relationship with their insurer. As we seek to better understand the influence, let’s first look at the impact of UBI on shopping decisions.
Make or Break the Bundle
A recent survey revealed the large influence UBI programs have on buyer behavior. Rising insurance rates have customers seeking ways to save on their auto insurance premiums, and many are turning to a UBI program to help lower costs. Shoppers who switch carriers indicate UBI is taken into consideration in their decision to bundle or unbundle.
Of those who bundle after recently switching, 81% say they choose to have multiple policies with the same insurer because of a UBI offering. For the unbundlers who switch, 92% attribute their decision to unbundle to of a UBI program offered by a different insurer.
Unbundlers prioritize savings with 70%* choosing different insurers for auto and home coverage in order to save money on premiums.
Mark Garrett, Director, Insurance Intelligence, J.D. Power
Progressive's 36 Discounts Leave the Competition Behind
According to a recent comprehensive guide to auto insurance discounts, AutoInsurance.org discovered that Progressive offers more discounts than anyone else. Farmers comes in at a close second.
There's more to discounts than the number of available options, though. The discount percentage and the ability to stack discounts are factors that matter just as much or more, depending on a person's situation.
According to AutoInsurance.org's guide to auto insurance discounts, Progressive offers more options than anyone else.
Auto Insurance Providers Ranked by Available Discounts
Customers may benefit from more discount options. Here are six major companies ranked from most to least discount options:
- Progressive – 36
- Farmers – 34
- Geico – 32
- Allstate – 29
- 21st Century – 22
- State Farm – 20
Insurance companies offer many discounts in common, but some providers offer unique discounts. AutoInsurance.org has published an exhaustive list of discounts available by company.
Types of Auto Insurance Discounts Auto insurance discounts can be broken down into three categories.
Vehicle discounts are mostly safety feature-related. Not every company will offer a discount for each individual safety feature. Still, chances are high that a newer vehicle with excellent safety features will qualify for several safety discounts, including the following:
- Automatic braking
- Blindspot warning
- Forward collision warning
- Providers may also offer discounts for new cars, hybrid or electric vehicles, and farm vehicles.
Melanie Musson, a nationally recognized insurance expert with AutoInsurance.org, says, "Vehicle-related safety discounts can help offset the higher cost to insure newer cars."
Driver/Customer Discounts A customer's driving history has a significant impact on rates, and a good driver discount can provide substantial savings. Most insurers offer a discount for bundling home and auto insurance and insuring multiple vehicles.
One driver-related discount that many are surprised to learn of is the good credit discount. Both Progressive and State Farm offer this way to save.
Personal Discounts People in some lines of work are eligible for a discount. For example, nurses and other healthcare workers are qualified for savings with some insurance policies. Another popular discount that most insurers offer is for military service.
Other personal discounts include good student, further education, and recent graduate.
Check out AutoInsurance.org's complete analysis of auto insurance discounts here: Auto Insurance Discounts (2023)
Prioritizing technology gives carriers an edge – report
Insurance carriers that prioritize technology investments to improve customer service are likely to gain a competitive edge over their less tech-savvy competitors, according to a new report from insurance platform provider Socotra.
The survey, titled Becoming the Preferred Provider: What Insurance Producers Want from Insurers, 2023, offers insights into the preferences of agents and brokers in the US and the UK when selecting insurance providers.
The report highlights the importance of offering a superior user experience (UX) for producers and their customers. Insurers who provide advanced technology platforms with enhanced convenience, transparency, and the ability to quote, bind, and deliver policies online will have a distinct advantage in the market, Socotra said.
Conducted by Global Surveyz Research, the survey involved 100 senior-level employees from insurance agents, independent agents, and insurance brokers in the US and UK. All respondents worked with tier two to five insurance carriers with up to $5 billion in direct written premiums.
“One hundred percent of the agents and brokers surveyed said it was important to be able to quote, bind, and deliver policies online. This was remarkably consistent,” said Dan Woods, founder and CEO of Socotra. “Our survey respondents also prioritized paying premiums and filing claims online, suggesting these features are now necessary for carriers expecting to attract and retain the best producers.”
The report found that agents consider a user-friendly agent portal (54%), a user-friendly customer portal (50%), and digital claims processing capabilities (42%) as the most essential technologies. These findings underscore the evolving expectations of customers and highlight the need for insurance carriers to invest in UX to meet the demands of their agents and policyholders. Failing to prioritize user-friendly portals and efficient claims processing may result in carriers falling behind competitors and potentially losing valuable customers, Socotra said.
Commentary/Opinion
How tech can move insurers from prediction to prevention
"Predict & Prevent" is not a new concept to the insurance industry, but it has a special resonance today – especially when considering wildfire risk. In 2023, California's heavy winter and historic snowpack are expected to heighten wildfire risk, a concern for insurers given the state's annual average of 400,000 to 1 million acres burned.
But despite increased levels of risk, prediction and prevention is becoming more attainable than ever for insurers. Whereas five to 10 years ago this approach was considered idealistic and implausible, now thanks to digital transformation insurers can fully embrace and implement this proactive strategy. Focusing on wildfire risk, let's see how new technology and other industry trends have made prediction and prevention an option for insurers.
The shift towards this as a viable strategy is made possible by technological advances over the last decade. Popularly known as the "Fourth Industrial Revolution," the explosion of new technologies – including artificial intelligence, Internet of Things (IoT), and big data analytics – has had a widespread impact on every industry. Not only do these new technologies create value for insurance companies – and improve expense ratios when used correctly – but they also make it easier to predict risk.
David Tobias, Co-Founder And Chief Operating Officer, Betterview
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Root Insurance remains tight-lipped on takeover talk
Discover the latest on Root, the US car insurtech, amid takeover rumours. Learn about potential embedded finance opportunities for the company's future.'
US car insurtech Root is remaining tight-lipped about its future, following speculation that the Ohio-based firm was in talks about a potential takeover
Root is remaining tight-lipped about its future, amid rumours that the US car insurtech is in negotiations with a prospective private buyer.
According to the Wall Street Journal, citing insiders close to the matter, Root has engaged in conversation with Embedded Insurance – a company led by serial insurance industry founder James Hall.
Neither Embedded Insurance, James Hall nor Root founder and CEO Alex Timm have publicly addressed the speculation – though in an email to the Wall Street Journal, Root said that the company regularly “evaluates how best to deliver shareholder value in accordance with its fiduciary duties”.
After five-and-a-half years of growth, Root went public by listing on the Nasdaq exchange in October 2020. The IPO raised almost US$725m and valued the company at US$6.5b, representing a value of about US$27 per share when its first day of trading closed. But Root’s stock price has since tumbled by more than 53% and stands at less than US$12.50 per share at time of writing – although it has jumped higher this week since the takeover talk emerged.
Incline P&C Group secures $125 million investment from Braemont Capital to drive expansion
Incline P&C Group, the leading insurance program market services firm, has secured a significant investment of $125 million from Braemont Capital.
Braemont, known for partnering with exceptional companies during their growth inflection points, aims to support Incline in expanding its platform and remaining at the forefront of innovation in the insurance industry.
The exact financial terms of the deal remain undisclosed.
Incline P&C Group, headquartered in Austin, brings over 75 years of combined industry experience. The company has gained recognition for its expertise in program management, disciplined underwriting processes, risk management, reinsurance, and economic alignment with partners.
Currently, Incline’s programs encompass a diverse range of insurance lines, including private passenger auto, cargo, commercial auto, flood, homeowners, motorcycle, pet, and workers’ compensation insurance.
Robert Covington, Managing Partner of Braemont, expressed his satisfaction with the partnership, stating, “Incline is a leading program carrier, and we are pleased to partner with Chris McClellan and the leadership team to help expand the platform and continue to be an innovator in the insurance industry. The company has experienced incredible growth in premium volume and program acquisition and through this investment, we are excited to join Incline on their mission to continue to be the premier insurance program market services firm.”
Chris McClellan, President and CEO of Incline P&C Group, added, “In Braemont, we have found a long-term investment partner with a strong record in insurance and financial services investment experience. Their relationship-driven mindset will add great strategic value to Incline as we advance our company, meet the needs of our clients and expand our capacity for new business,”
Barclays acted as the financial advisor to Incline in the transaction.
Levlr reconciles differing contractor, insurer estimates
Jeff Diem, a Denver-based restoration contracting estimator, often encountered gaps between contractors' estimates and insurance company adjusters' estimates to repair residential property damage.
During a recent interview, Diem showed Digital Insurance a contractor's estimate for a relatively small residential repair, costing $8,200, containing 51 line items for specific items and materials. The estimate was generated using Xactimate, a software used by most contractors in the industry. Then Diem showed us the insurance adjuster's estimate, which was $3,000 less and contained only 41 line items.
"This is a small one," he said. "We do these for full homes, fires and floods. They will be hundreds of line items long and for hundreds of thousands of dollars. If you're an adjuster with 150 of these, you are the bottleneck. One of two things is going to happen. You're either going to take too long to review them, and that makes your policyholder angry, or you're going to rush it and be inaccurate, overpaying a claim."
Reconciliation of estimates became a constant burden for Diem as owner and founder of Elkmont Estimates, which writes estimates for contractors to help get those estimates approved by insurance carriers.
"We noticed that our clients were asking us time and time again to compare and reconcile these estimates," he said. On average, residential damage restoration contractors may spend about 80 hours per month on these reconciliations, Diem added.
Instead of hiring more staff to find and process the discrepancies, last year Diem founded Levlr, which provides software to automatically reconcile discrepancies in the estimates.
"It compares these two documents using machine learning," Diem said. "It will show the user everything that's been changed or modified or removed."
Levlr can send questions on discrepancies back to the contractor to review. This reduces the time needed to check estimates and increases their accuracy, according to Diem. The software is also useful for other vested interests in handling property damage claims.
"A project manager for a restoration company may have 15 of these at a time before another project manager is hired," Diem said. "An adjuster may have 100 to 150 of these at any given time. And then the light bulb moment went off, oh, my gosh, I've got public adjusters. I've got attorneys, I've got independent adjusters, I've got captive adjusters and the contractor side, all that are performing the exact same task, with no tool to take care of it."
Levlr software went live in April as a beta version for certain selected users. The company is open to users from both the carrier and contractor sides, Diem said.
"This is something that on the data side, you have larger organizations that are always looking for something like this, and they don't have access to this data or analysis that we could provide to them as well," he said.
The increasing costs of construction materials intensifies the need to manage what materials are really needed for a repair, observed Ellen Carney, principal analyst for application development and delivery at Forrester Research.
"Insurers are all about recovery and subrogation these days and want to pay a fair price for materials, and considering construction material inflation, Levlr is a good way to manage this," Carney wrote in a response to questions. "That lumber inflation is going to come roaring back, since a lot of the eastern Canada is softwood impacted by the wildfires."
AI in Insurance
A.I. is not all hype, it's the fourth industrial revolution: Dan Ives
- Wedbush analyst Dan Ives does not believe AI is a hype cycle but a “fourth industrial revolution playing out.”
- “I think we are just starting what we believe is the start of a new tech bull market, despite many of the bears continuing to really being skeptical,” Ives told CNBC’s “Squawk Box Asia.”
- He said he expects “a trillion dollars of incremental spend over the next decade” into A.I.
Corvus Insurance adds Generative AI Enhancements to Underwriting Platform
Generative AI drives advanced Automation features within Corvus Risk Navigator, eliminating routine manual tasks to reduce workload, accelerate growth, and increase book value.
Corvus Insurance (Boston), a specialty insurance MGA offering Smart Commercial Insurance products powered by AI-driven risk data, has announced new AI- and NLP-driven features to increase the degree of automation of routine manual tasks in the underwriter’s workflow within Corvus Risk Navigator.
Corvus reports that these features have further reduced the workload on its underwriters, increasing quoting efficiency and speed while delivering an industry leading loss ratio below 40 percent.
The Corvus Risk Navigator platform, which Corvus describes as built from the ground up through close collaboration between Corvus’s underwriting and security teams, places real-time suggestions into the underwriting workflow based on a matrix of data including firmographics, threat intelligence, claims, and peer benchmarking.
The platform’s new features, including those built with Large Language Models (LLMs) and natural language processing (NLP), have accelerated underwriters’ decision-making by automating routine tasks, giving them time back to spend on high value accounts to uplevel broker relationships and ultimately grow book value, Corvus says.
Specific workflow efficiencies added to the platform include the following as described by Corvus:
Automated industry verification: A new capability enabled by a large language model replaces manual research and validation of industry classification that is typically performed by underwriters.
Automated application intake: Information is now ingested from a wide variety of insurance applications received by email, including answers to security control questions, replacing manual data entry.
Instant guideline validation: A helpful tool in the underwriting workflow analyzes the information in an application against the complex matrix of underwriting guidelines to instantly show the underwriter whether control questions were answered favorably, removing the need for manual cross-referencing.
“In order to maintain our industry-leading loss ratio, Corvus is focused on building trusted relationships that extend value to all insurance stakeholders, including brokers, risk capital partners, and policyholders,” comments Mike Karbassi, Chief Underwriting Officer, Corvus. “Corvus aims to not only hire the best underwriters in the industry but also to equip the team with technology that automates routine tasks and enables each underwriter to spend more time on activities that drive value for their partners, leading to higher growth and greater book value.”
Canada
What will set Aviva Canada's auto care centres apart?
Aviva Canada is seeking to provide a personalized and convenient experience for policyholders at its new AutoCare centres, particularly at a time when vehicle repair centres across Canada may be grappling with long backlogs and a shortage of materials and skilled labour.
An Aviva leader also told Insurance Business that they want to inject a strong sustainability element into the initiative.
“It really is about the customer and making sure that they get faster, more personalized service,” said Rosallie Papa-Reid (pictured), VP national auto claims at Aviva Canada.
“Skilled labour and supply chain issues are making the whole process a little more difficult for customers. So, now is the right time [to launch this initiative].”
The inaugural Aviva AutoCare Centre launched in North York, Toronto earlier this month. Additional locations are set for the Greater Toronto Area and Alberta by the end of the year.
“We are looking at places in Mississauga and as well as Hamilton [in Greater Toronto], and then also two locations in Alberta, likely Calgary and Edmonton,” Papa-Reid said of the rollout.
“The plan is to make our mark across the country. We are full speed ahead and already in negotiations and discussions with our partners.”
“Aviva AutoCare Centres offer our customers a more personalized service that matches Aviva's promise to be there for them when they need us, helping to take some of the stress away from the claims process,” said Kim Leggette, head of claims at Aviva Canada in a press release.