News
Insured disaster losses to again top $100 billion; 2023 warmest year on record
Insured losses from natural catastrophes will pass the $100-billion threshold for the fourth year running in 2023, reinsurance giant Swiss Re said Thursday.
Insured losses from severe thunderstorms reached an all-time high of $60 billion in 2023, while the February earthquake in Turkey and Syria was the costliest natural catastrophe to date for the year, it said.
"With 2023 expected to be the warmest year on record, the effects of climate change are becoming apparent," said the company.
Nevertheless, the estimated total amount of insured losses in 2023, at $108 billion, is down by 23 percent from $141 billion recorded in 2022.
Total economic losses were estimated at $269 billion, a nine percent drop from 2022.
Revealed – US P&C sector underwriting loss for first nine months of 2023
AM Best report outlined factors that resulted in latest figures. The US P&C sector incurred a net underwriting loss of $32.2 billion in the first nine months of 2023, according to AM Best’s First Look Report.
This was a $7.6 billion worsening compared to the corresponding period in the previous year.
The industry saw a 9.7% growth in net earned premiums and a 2.2% reduction in policyholder dividends.
Meanwhile, it saw an 11.9% surge in incurred losses and loss adjustment expenses (LAE), accompanied by a 7.3% increase in other underwriting expenses.
The personal lines segment, particularly the homeowners line of business, emerged as the primary contributor to an underwriting results downturn.
Allstate poised for strategic downsizing in Florida amidst regulatory changes: CEO Tom Wilson
Allstate’s CEO, Tom Wilson, unveiled key insights into the company’s underwriting and growth strategy at the Goldman Sachs 2023 US Financial Services Conference, expressing confidence in the overall trajectory of the business while simultaneously acknowledging the likelihood of further reducing the company’s footprint in Florida until sufficient returns become viable.
While the legislative shift was deemed positive, management indicated a commitment to downsizing in Florida until the opportunity for adequate returns arises.
Allstate’s market share in Florida has already dwindled from ~12% to less than 3%, and this contraction is expected to persist. Despite this, overall sentiment toward the homeowners segment remains positive, with plans for continued growth in other markets.
Commentary/Opinion
Embedded Insurance: 6 Industries Offering Seamless Coverage
A recent post by Insurtech Insights estimated that by 2032, embedded insurance could account for about 16% of total global insurance distribution (€1.5 trillion of GWP). This article looks at 6 sectors, including the automotive industry, that are integrating insurance options into their transaction to create a seamless experience for their customers
Embedded insurance has gained popularity in recent years driven by consumer demand and technological advancements that enable seamless insurance transactions. It offers the seamless integration of insurance products and services into existing platforms, transactions, or experiences, providing customers with convenient and tailored coverage at the point of need.
This innovative approach not only enhances consumer convenience but also opens new revenue opportunities for insurers and businesses. In this article, we look at how embedded insurance is making waves in multiple industries such as real estate, e-commerce, and beyond.
Niall Kavanagh, Business Development, Skytek
The Good, the Bad Bots, and the Ugly Hackers: Examining AI Concerns in Security and Real Estate in 2023
Today’s email was crafted with the support of my friends Pete Thomas and Sal Lifrieri.
In the iconic 1966 Spaghetti Western film The Good, the Bad and the Ugly, Clint Eastwood’s character Blondie (The Good) partners up with Tuco (The Ugly) as they search for buried treasure during the American Civil War.
However, they must contend with the dangerous Angel Eyes (The Bad) who also seeks the fortune. This classic showdown of opposing forces vying for the prize is an apt metaphor for examining the promise and perils of artificial intelligence (AI) in the security industry and real estate sector. Let’s explore the good, the bad, and the ugly when it comes to AI.
Kaenan Hertz is a professional in the areas of block chain, telematics, wearables, analytics, artificial intelligence (AI) and Insurtech. He has played a key role in innovating many start-ups and established carriers. His advice has been widely appreciated in the financial community, which resulted in multiple quotes and publications in various media.
Research
Insurers still struggle to deliver seamless digital experience – report
Shortcomings impacting customer satisfaction
Many insurers are still struggling to deliver a seamless digital experience to their customers even as digital channels become more vital to maintain customer satisfaction, according to a new study by J.D. Power.
Customers say their average auto repair cycle time has doubled over the past two years – now exceeding 23 days – and the average time for home repairs is also on the rise. With that in mind, insurers need to work harder to manage customer expectations, according to J.D. Power’s 2023 U.S. Claims Digital Experience Study.
However, the study found that with many insurers still floundering when it comes to delivering seamless digital experiences, overall customer satisfaction is 854 (on a 1,000-point scale), a three-point drop from 2022.
“Across all of our insurance claims experience studies, we find that the more insurers can do to manage expectations, keep customers updated and make it easy for them to manage the claims process without a lot of effort, the more satisfied customers become – even when repair cycle times are longer than ever,” said Mark Garrett, director of global insurance intelligence at J.D. Power.
InsurTech/M&A/Finance/Collaboration
Top insurtech funding rounds, November 2023
There were about 40 funding events in the insurtech sector between November 1 and November 30, 2023, according to a review by Digital Insurance. What follows is a selection of these, focusing on those in the insurtech and property & casualty sectors that are part of the venture-capital financing model. (Other funding events, such as private-equity infusions, are included in the overall count.)
A portion of the data was sourced from Crunchbase. Other information, including quotes from investing VCs, comes from company announcements. For our previous edition, which covered the month of October, click here
Driver Technologies Launches Video Telematics-Based Driver Score
The new service aims to improve risk classification and underwriting by using mobile device-based telematics.
Driver Technologies, Inc. (New York) a provider of AI-based road safety technology, has announced its Driver Technologies Rating Service Inc. (DTRS) is rolling out its newly launched Driver Score to commercial fleets and insurance partners. Driver Score is the first video telematics based score using mobile devices that helps insurance companies underwrite and classify the risk instead of implementing traditional factors such as demographics and credit scores, according to a Driver Technologies Statement.
The Driver app transforms a user’s smartphone into a dash cam designed to improve road safety, providing users with a Driver Score after 10 hours of recorded driving. The software also provides coaching along the way to promote good driving habits.
“Nowadays, it’s difficult to find great coverage at an affordable price due to factors such as a poor credit score, which can damage a driver’s reputation, when really a driver’s driving behavior should be the key determinant,” says Rashid Galadanci, CEO and Co-Founder, Driver Technologies. “We are extremely excited to launch Driver Score as the first app-based video telematics scoring system to our commercial fleets to help promote good driving habits and create more opportunities for users to have the coverage they deserve.”
Miles O’Donnell is a Vancouver, Washington-based student with an interest in journalism and business administration currently working as a junior reporter for Insurance Innovation Reporter. His interests include politics, philosophy and music.
Eberl Announces Integration with Snapsheet for Streamlined Claim Processing with Direct Access to Mitigation & Repair Contractors
Eberl integrates with Snapsheet - revolutionizing claim processing with seamless access to mitigation and repair contractors.
Eberl unveils its latest offering, "Flex Repair," which represents a comprehensive approach to delivering end-to-end claim solutions for valued partners.
The integration enables Eberl and Snapsheet insurance partners to access Eberl’s network of independent adjusters, third-party administration services, and a comprehensive service provider network. Learn more about the benefits of streamlining your claims process by emailing flex@eberls.com.
AI in Insurance
Insurtechs using AI, ML and cloud computing.
These companies are leveraging AI, machine learning and cloud technology.
Digital Insurance
Introducing Gemini: Google’s most capable AI model yet
A note from Google and Alphabet CEO Sundar Pichai
Every technology shift is an opportunity to advance scientific discovery, accelerate human progress, and improve lives. I believe the transition we are seeing right now with AI will be the most profound in our lifetimes, far bigger than the shift to mobile or to the web before it. AI has the potential to create opportunities — from the everyday to the extraordinary — for people everywhere. It will bring new waves of innovation and economic progress and drive knowledge, learning, creativity and productivity on a scale we haven’t seen before.
That’s what excites me: the chance to make AI helpful for everyone, everywhere in the world.
Nearly eight years into our journey as an AI-first company, the pace of progress is only accelerating: Millions of people are now using generative AI across our products to do things they couldn’t even a year ago, from finding answers to more complex questions to using new tools to collaborate and create. At the same time, developers are using our models and infrastructure to build new generative AI applications, and startups and enterprises around the world are growing with our AI tools.
This is incredible momentum, and yet, we’re only beginning to scratch the surface of what’s possible.
Google and Alphabet CEO Sundar Pichai
[Ed. Note: Recommended] Top Five Questions Claims Executives Have About Generative AI
Generative AI presents significant opportunities to transform insurance claims.
GenAI is a technology that uses machine learning models to generate new data that shares the same characteristics as the training set. This technology has the potential to revolutionize the way insurers operate, offering unprecedented opportunities for automation, personalization, and risk assessment. GenAI can generate new content, outputting text strings or images based on the model’s training.
In this report, the third in a series about GenAI in insurance, Datos Insights asked its team of experts and former insurer CIOs what the top five GenAI-related questions that claims executives are asking about GenAI today.
Clients of Datos Insights’ Life, Annuities, & Benefits or Property & Casualty service can download this report.
Deb Zawisza, Senior Principal at Datos Insights