Commentary/Opinion
Structural Insurance Transformation Needed: ‘Predict and Prevent’ To the Rescue
A variety of technology-based solutions, including sensors, telematics, AI, geospatial data and have the potential to enable the insurance industry to shift its paradigm from ‘insure and pay’ to ‘predict and prevent.’
A new paradigm of predict and prevent is gaining traction. IBHS has encouraged the insurance industry influence improved construction and greater building resilience standards. Sensor technology combined with preventative measures, such as moving assets from harm’s way show promise but have a long way to go balancing efficacy with pragmatic actions. Distracted driving avoidance and driver coaching is making a difference in larger fleets with much room to improve smaller fleets and personal auto. However, predicting and prevention is also being applied more broadly, such as shoring up storm walls in places like Manhattan and Miami. Meanwhile the devastating Maui fires illuminate major gaps in prevention and how controversial measures to clear vegetation get in the way of progress.
Alan Demers and Stephen Applebaum as published by Insurance Innovation Reporter
Litigation Management Technology: The Solution to Enhanced Efficiency and Training in Litigation Management
The landscape of litigation management continues to face significant challenges that demand novel solutions. The 2023 CLM Litigation Management Study, which was carried out by Suite 200 Solutions, revealed that 87% of participants believe that a majority of litigated claims settle "later in the process than is necessary."
Furthermore, 96% of respondents agreed that successful case resolution was primarily due to efficient processes within their firms or teachable skills. These findings amplify the need for innovative technologies to facilitate efficient processes, predictive analytics, and professional training, leading to a paradigm shift in litigation management.
Dwayne Hermes, Founder & CEO at Hermes Law and ClaimDeck
News
Peltz's activist hedge fund builds stake in Allstate
Insurance giant faces potential shakeup amid catastrophe losses
Trian Fund Management, the activist hedge fund led by Nelson Peltz, has reportedly acquired a stake in Allstate.
The move signals a potential shakeup for the insurance giant, which has reported five consecutive quarters of losses that it largely attributed to natural catastrophes and the impact of climate change.
Sources told Reuters that Allstate has enlisted the services of investment bankers to strategize on how to respond to Trian’s involvement.
Like other insurers, the Northbrook, Illinois-based company has struggled to raise premiums at a pace that matches costs incurred from increased payouts related to severe weather events like wildfires and hurricanes.
500K Vehicles Stolen in H1 2023; Dodge Chargers Top List
Vehicle thefts continue to plague the nation, according to a new report released by the National Insurance Crime Bureau (NICB). The report was released to coincide with National Crime Prevention Month.
Nearly 500,000 vehicles were reported stolen nationwide in the first half of 2023, an increase of more than two percent compared to the first half of 2022.
Illinois reported the largest increase in vehicle thefts of any state at 38%, followed by New York with a 20% increase and Ohio with a 15% increase over the first half of 2022.
It’s important to note that law enforcement agencies may still be entering thefts for the first half of 2023, so these numbers may change, said the NICB.
“Vehicle thefts increased to near-record highs in the United States last year, and unfortunately, current trends indicate total thefts this year may surpass 2022,” said NICB President and CEO David J. Glawe.
“With little deterrent to stop these criminal actors, law enforcement agencies and communities will continue to suffer.”
Analyzing data from the National Crime Information Center (NCIC), NICB’s report showed that between January and July 2023, there were more than 80,000 thefts per month, peaking in May when 87,993 vehicles were reported stolen.
In a recent report, the Highway Loss Data Institute (HLDI) highlighted the most stolen vehicles for model years 2020-22.
InsurTech/M&A/Finance💰/Collaboration
Tractable and PartsTrader Announce Strategic Partnership - CollisionWeek
Partnership will combine Tractable’s AI with PartsTrader’s auto parts data.
PartsTrader and Tractable have formed a strategic partnership to bolster how the industry uses AI to process claims. The collaboration will launch with the integration of PartsTrader’s historical parts price data into Tractable’s Auto Reviewer solution, enabling insurers to automate and optimize the review of subrogation claims to ensure repair costs are both accurate and fair.
The partnership between PartsTrader and Tractable enables a more deeply collaborative repair ecosystem that leverages the latest technology and most comprehensive data available. In the coming months, the companies will collaborate on additional product integrations that streamline and accelerate the claims process to benefit both insurers and policyholders.
Tractable’s Auto Reviewer solution uses AI to accelerate subrogation, a claims process through which insurers determine cost responsibilities in multi-party claims, and which demands meticulous accuracy and consistency. Historically, this has required manual, time-intensive checks by adjusters. Now, with the industry’s first complete subrogation solution powered by AI, PartsTrader’s data will be integrated with Tractable Auto Reviewer to ensure that the right auto parts were used and appropriately sourced during the repair process, and that costs reflect pricing and availability consistent with the timing of the accident.
Howden Launches Innovation Hub With £500M of Delegated Underwriting Capacity, Commits £10M for Insurtech Funding
Howden, the London-based insurance group, has launched Howden Ventures, subject to Lloyd’s approval, with £500 million ($607.1 million) of delegated underwriting capacity, to create an investment and risk incubator that will fast-track insurance product development.
Howden Ventures will draw expertise and resources from specialist innovation teams across the global insurance market. The platform includes delegated underwriting authority, backed by leading Lloyd’s underwriters, including Tokio Marine Kiln, Chaucer, and Liberty Specialty Markets, which provides £500 million of syndicated underwriting capacity to support the development of new insurance solutions.
Howden, the London-based insurance group, has launched Howden Ventures, subject to Lloyd’s approval, with £500 million ($607.1 million) of delegated underwriting capacity, to create an investment and risk incubator that will fast-track insurance product development.
Howden Ventures will draw expertise and resources from specialist innovation teams across the global insurance market. The platform includes delegated underwriting authority, backed by leading Lloyd’s underwriters, including Tokio Marine Kiln, Chaucer, and Liberty Specialty Markets, which provides £500 million of syndicated underwriting capacity to support the development of new insurance solutions.
As new funding for the global insurtech sector continues to fall following the collapse of Silicon Valley Bank, Howden Ventures has initially committed £10 million ($12.1 million) of new funding to the sector, with a view to support at least five new startups over the next two years.
By bringing together funding, underwriting capital, expertise, governance and distribution all in one place, Howden Ventures will create an end-to-end platform and commercial solution that accelerates new product development and insurance innovation, the company said in a statement. As the UK government moves forward with its planned Solvency II reforms, Howden Ventures will help bring these policy priorities to life by developing innovation in the insurance sector and helping improve the sector’s social impact, Howden said.
Nirvana Secures $57M in Series B Funding to Expand Its IoT-based Commercial Insurance Platform and AI-Powered Safety Program for Fleets
Nirvana Insurance, provider of modern insurance for physical operations, today announced a $57 million Series B funding round. Lightspeed Venture Partners reaffirmed its commitment to Nirvana by returning to lead the round, with additional participation from General Catalyst and Valor Equity Partners.
The new funding positions Nirvana to continue helping fleets utilize their IoT and sensor data to access insurance cost savings and customized risk management solutions.
"Commercial fleets today produce a tremendous amount of data, yet most insurers still insist on a cookie-cutter approach to insurance that does nothing to incentivize safety. Nirvana is bringing insurance into the modern era, changing how the industry considers risk," said *Raviraj Jain, Partner at Lightspeed Venture Partners.
"Their incredible growth is a testament to the opportunities AI and data analytics are opening up in fleet insurance and beyond, especially given that the IoT fleet management market is expected to continue growing."
Dutch raises $18 million
Pet telemedicine service Dutch has closed an $18 million Series B funding round, bolstering its total funding to $43 million.
Established in 2021 and headquartered in Oakland, Dutch provides pet parents with telemedicine services, now priced at just $7 per month for unlimited calls, a significant reduction from its previous $15 per month rate.
Dutch offers a monthly or annual pet health membership, granting pet owners unlimited access to Dutch-affiliated veterinarians through video chat and messaging. Depending on a pet’s specific needs, Dutch vets may recommend prescription medication (where permitted) or non-prescription treatment options. Additionally, members benefit from free standard shipping on all products for up to 5 pets, with medications incurring extra charges.
The membership also includes free pet insurance – the Dutch Protector plan offers $10,000 of emergency insurance from Pets Best. This plan covers accident insurance for the first pet and offers virtual vet care for up to 5 pets within a household.
People
WTW hires from Marsh for global chief claims officer role
Former Marsh LLC global claims executive Rob Powell will join Willis Towers Watson PLC early next year, the brokerage said Monday.
London-based Mr. Powell will be global chief claims officer, reporting directly to Adam Garrard, global head of risk and broking.
Previously, Mr. Powell was global chief claims officer at Marsh where he oversaw the brokerage’s claims operations, advocacy and forensic advisory services. He joined Marsh in 2014.
Events
Annual Insurtech on the Silicon Prairie Conference, Oct. 23-24, 2023, in Omaha, NE.
AM Best Executive Vice President and Chief Strategy Officer Andrea Keenan will deliver the opening presentation at the Insurtech on the Silicon Prairie Conference, a leading technology and innovation-focused event attended by insurance industry participants and regulators.
Keenan directs AM Best Rating Services’ strategy globally and is responsible for the commercial, public relations, business development, industry research and corporate events teams. Her session, titled, “From Traditional to Transformational: Harnessing Innovation in Insurance,” also will discuss AM Best’s perspectives on innovation and how the rating agency explicitly considers an insurance company’s innovation efforts in its rating process.
Keenan also will discuss AM Best's framework for evaluating the performance of managing general agents and other Delegated Underwriting Authority Enterprises. The session is scheduled for 8:45 a.m. (CDT) on Tuesday, Oct. 24.
Webinars/Podcasts/Interviews
Insurance: An ‘AI Playground’ - Insurance Journal TV
Insurance “is one of the best playgrounds for artificial intelligence,” says Applied Systems CEO Taylor Rhodes.
“Its potential is massive, but the practical uses are still unclear. Insurance is a data-rich environment, but the data is stuck in systems that are hard to get to.” Ultimately, can insurance professionals focus on things that matter most, with AI playing a role? “How do we use it safely and in a high-value way?”
For several years, Applied has been partnering with Google on data science and machine learning. On this recording, Taylor previews AppliedNet 2023, coming soon in Las Vegas and attracting some 4,000 industry pros. Taylor also addresses how the firm manages culture for 2,500 employees in multiple corporate and work-at-home settings. (Insider note:
This year, Applied celebrates 40 years in business. Following much tinkering in the 1970s, independent agent Bob Eustace founded the firm in 1983 in his basement with “The Agency Manager,” or TAM, the first PC-based software for agents. There are still 20,000 users on TAM; however, that’s down from 35,000 last year as Applied seeks to migrate agents to newer software in Epic or EZLynx.
EMEA
Allianz announces Italian expansion with major acquisition
Company expects a 1% increase in P&C market share
Allianz has announced its agreement to acquire Tua Assicurazioni S.p.A. from Assicurazioni Generali S.p.A. for a consideration of €280 million.
Tua Assicurazioni possesses a property and casualty (P&C) insurance portfolio with recorded gross written premiums totalling about €280 million in 2022. Most of these premiums are managed through a distribution network comprising nearly 500 agents.
The successful completion of this transaction is contingent upon obtaining regulatory approvals, which are anticipated to be granted at the beginning of 2024. Once finalized, this acquisition is expected to augment Allianz’s market share in Italy by approximately one percentage point.