News
As auto insurance premiums rise, consumers dropping insurance to pay other bills
Auto insurance premiums are still on the rise leading consumers, now more than ever, to continue shopping for better deals, according to J.D. Power and TransUnion.
“Consumers are not relenting in their desire to find a more attractive premium for their auto insurance needs,” the Q2 2023 loyalty indicator and shopping trends (LIST) report states. “The second quarter of 2023 marks the highest shop rate we have recorded in now three years of tracking auto insurance shopping on a daily basis, at 12.5%.”
However, nearly 15% of respondents to a recent TransUnion survey said they own or use a car without valid insurance or allowed their coverage to lapse. Nearly 30% cited the inability to pay for coverage as the primary reason for not having insurance.
A First Look at How U.S. Insurers Are Adopting Global Climate Reporting Guidelines
U.S. insurers are adopting numerous strategies to deal with risks from climate change, according to a review out today that gives the first look at how or if insurance companies are adopting the widely used Task Force for Financial Disclosure guidelines.
The review of Climate Risk Disclosure Survey responses, submitted to state regulators each year by insurers operating in 27 member states and jurisdictions, was conducted by climate leadership group Ceres and the California Department of Insurance.
This is the first year in which responses on the survey were aligned with the recommendations of the Task Force for Financial Disclosure (TCFD) guidelines.
Barring Change, Allstate May Exit California Property Market Completely
The topic of a recent California insurance department workshop was the potential use of catastrophe modeling in ratemaking, but carrier representatives and consumers took the opportunity to air concerns about other problems in the state’s insurance market.
The state’s growing availability crisis is poised to get worse unless changes beyond the introduction of forward-looking catastrophe modeling to ratemaking take hold, carrier executives said.
“Change is critical to restoring the health to the California insurance marketplace and [to] avoiding increased nonrenewals and further carrier withdrawals from the state,” said Parr Schoolman, chief risk officer of Allstate Property and Liability, during the four minutes of remarks he delivered during a four-hour public workshop that was broadcast via Zoom and Facebook on July 13.
Among the changes Schoolman advocated were actions to speed up rate filing approvals and to allow insurers to include the costs of reinsurance in their rate indications.
“Allstate would prefer to material[ly] re-enter the property market by offering new policies to the vast majority of consumers. We’d expect we’d be able to target at least 90 percent of the available market in terms of availability, with the inclusion of wildfire catastrophe modeling and reinsurance costs being allowed in the setting of premiums.”
“Without pricing enhancements, Allstate will remain closed to new business and will evaluate additional non-renewals or the full withdrawal of property lines from the California market,” he stated
InsurTech/M&A/Finance💰/Collaboration
RapidSOS and Sfara partner to offer enterprises crash detection and emergency-response for easy integration into mobile apps
Sfara and RapidSOS have partnered to provide Emergency Communications Centers (ECCs) vehicle crash data to aid in emergency response, while also providing a cost-effective, easily integrated solution.
Sfara works with global organizations wanting to offer smartphone-based safety features to customers or employees. RapidSOS, the intelligent safety platform, securely links life-saving data from over 500M devices, apps, and sensors directly to RapidSOS Safety Agents, 911 and first responders.
“Sfara’s technology works at nearly any speed, including in the lower speed bands, which means it will capture far more incidents and injuries than solutions that capture only severe crashes. It’s not widely known, but 70% of claims involving injuries happen with an impact severity of 10 mph or less” said Erik Goldman, CEO of Sfara. “Plus, our solution dramatically reduces false positives, helping to preserve our country’s first responder resources for true emergencies.”
While of immediate interest to the insurance industry, the newly combined offering is available to a range of industries and businesses looking to provide safety solutions for loyalty, duty-of-care, and collision management, while also remaining competitive in a marketplace looking for new ways to service customers.
J.D. Power/Palantir Collaboration Announcement
First-of-its-Kind Collaboration Integrates J.D. Power Proprietary Datasets with Palantir’s Foundry and Artificial Intelligence Platform (AIP) to Create New Analytics Products; Automotive OEMs will also be able to Confidently Combine Their Data with J.D. Power Data to Develop Deeper Insights
In an industry-first collaboration that is intended to transform the way automakers, dealers, insurers and financing companies leverage data-driven insights, J.D. Power, a data and analytics company that analyzes more than 20 million vehicle transactions per year and has collected billions of vehicle configuration and performance datapoints, today announced a collaboration with Palantir Technologies Inc., (NYSE: PLTR) (“Palantir”) to develop generative artificial intelligence (AI) and predictive analytics solutions that will facilitate deeper insights and more strategic decision making by the automotive industry.
Betterview and EagleView Launch Strategic Property Intelligence Alliance
Advanced analytics and the largest collection of data assets aimed at supporting insurance companies in making better, more accurate decisions.
Betterview (San Francisco), an InsurTech provider of actionable property intelligence to property/casualty insurers, has entered into a strategic alliance with EagleView Technologies (Bellevue, Wash.), a provider of aerial imagery and data analytics.
EagleView’s imagery will be integrated into Betterview’s property intelligence platform to help insurers better understand a customer’s total property risk by providing broader, data-driven intelligence for both underwriters and claims professionals. Additional benefits of the alliance will include the ability for EagleView customers to gain direct access to Betterview’s property insights, scores, and data, according to a statement from Betterview.
“EagleView chose to join forces with Betterview and their cutting-edge property analytics,” comments Piers Dormeyer, CEO, EagleView. “We’re launching an alliance that leverages the expertise of both companies to scale our innovative solutions and deliver unparalleled property intelligence to our customers.”
LOOP Announces First-Ever Equity Program For Independent Agents; Focus on Minority Agents
LOOP, the B-Corp and mission-based car insurer, announces today its ‘Partner Agents’ program; the first ever equity-upside program for Independent Agents.
“We’re looking for Independent Agents that have a real presence in their community, who have boots on the ground, and who genuinely care for their clients and neighborhoods”
“The idea is that our Partner Agents should benefit, in a meaningful way, from the growth they help to create,” says John Henry, LOOP co-founder and co-CEO. “Reframing the Carrier/Agent relationship is long overdue, and it starts with giving agents a stake in your business, and a voice at the table.”
Digital MGA Foxquilt secures $12m funding
Leading North American digital MGA, Foxquilt has successfully secured $12 million in funding, spanned across two rounds with the initial closing at the end of 2022, led by ICM, and the latter in recent weeks with participation from both existing and new investors.
This substantial investment clearly underscores the confidence in Foxquilt’s innovative approach to insurance and its potential to transform the industry landscape.
According to Foxquilt, the funding will be used to fuel the firm’s plans to expand across North America. The funding will enable the MGA to scale its embedded enterprise capabilities, further develop its technology infrastructure, and expand its product offerings.
AI in Insurance
NAIC releases highly-anticipated draft model bulletin on artificial intelligence systems used by insurers
On July 17, 2023, the Innovation, Cybersecurity and Technology (H) Committee of the National Association of Insurance Commissioners (NAIC) released for comment a highly anticipated model bulletin (Model Bulletin) on regulatory expectations for the use of artificial intelligence1 systems (AI Systems)2 by insurers.**
The Model Bulletin encourages insurers to implement and maintain a board-approved written AI Systems Program (AIS Program) that addresses governance, risk management controls, internal audit functions and third-party AI systems. The goal of the AIS Program is to mitigate the risks of harm to consumers thru decisions made or supported by AI Systems, including third-party AI systems, that are arbitrary or capricious, unfairly discriminatory, or otherwise violate unfair trade practice laws or other legal standards, or that include data vulnerabilities.
The Bulletin also advises insurers of the information and documentation that insurance regulators may request during exams and investigations of the insurer’s AI Systems, including third-party AI Systems.
Commentary/Opinion
Viewpoint: Insurtech 2023 – sunshine after the showers?
Public insurtechs have significantly underperformed the market, which has led to a slowdown of the acquisition market. However, there is hope the insurtech sector may bounce back and be an attractive market with large growth upside.
Indeed, IA Capital Group’s managing partner Andy Lerner recently stated: “The drastic underperformance of the public insurtech stocks has resulted in the current venture capital opportunity to invest in top-tier private insurtechs at attractive valuations.”
In this paper we look at the recent underperformance and examine the opportunity to access a market with an enormous amount of potential upside at a discounted price.
The democratization of road safety - How insurance and telematics will lead the way
Traffic accidents claim millions of lives each year, making the democratization of road safety crucial. Learn how the insurance industry can contribute through risk assessment, education, collaboration, and driver monitoring technology.
In our world today, an unprecedented pandemic plagues our roads. Traffic accidents claim the lives of millions every year, with nearly 3,700 people losing their lives each day in crashes involving various modes of transportation. To put this into perspective, the average daily death toll due to COVID-19 over the last 3.5 years stands at 5,300. The need for democratizing road safety has never been more critical.
Democratization of road safety entails three crucial elements; access to superior road infrastructure, modern vehicles equipped with advanced safety features, and comprehensive information and training for drivers. While this may seem like an insurmountable challenge, the insurance industry can step up as the hero in this narrative and contribute significantly to safer roads.
Despite the potential of mobile telematics, several challenges hinder its widespread adoption. Concerns about data privacy and security, slower customer adoption and engagement, and the high cost of implementing telematics technology are the primary obstacles. However, advancements in Sentiance on-device technology addresses these challenges by ensuring secure data processing and reducing the costs of technology by up to 90%.
Sentiance
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