“There has never been a better time to be in the world of insurance.” - - Tokio Marine HCC  February 9th 2023

The Insurance Industry is Like No Other - Tokio Marine HCC

There are not many industries that have the potential to impact and affect so many areas of global life. There are even fewer that rise to the challenge of making that potential impact a reality – Tokio Marine HCC is one such company.

“There has never been a better time to be in the world of insurance.”

CEO Susan Rivera, Tokio Marine HCC

2023 global economy to be shaped by high inflation and geopolitics: Munich Re

High inflation and low growth are expected to mark the global economy in 2023. However, it will cope better than initially expected with the consequences of the war in Ukraine, sharp price increases and higher interest rates, according to Munich Re’s Economic Outlook for 2023.

“The global economy is different from that of pre-Covid and pre-war times, and it will likely stay that way for quite a while. With inflation, higher interest rates, government interventions and geopolitical risks shaping the outlook. On the positive side, we can now say that the forecasts do not look as grim as many had expected half a year ago.”

Michael Menhartm Chief Economist, Munich Re

Zurich Insurance delivers highest profits since 2007

The key results:

🔵 Group business operating profit (BOP) rises 12% to USD 6.5 billion, the highest since 2007

🔵 Proposed dividend increase of 9% to CHF 24 per share

🔵 Property and Casualty (P&C) BOP rises 14% to USD 3.6 billion; P&C combined ratio stable at 94.3%

🔵 Life BOP grows 8% to USD 2.0 billion, with lower capital intensity after the execution of a back book sale

🔵 Farmers BOP up 18% to USD 1.9 billion

🔵 Customer loyalty significantly improved during the last three years; 2.1 million net new retail customers in 2022

🔵 Very strong capital position with estimated Swiss Solvency Test (SST) ratio at 265%

Gig economy insurance set to grow, GlobalData predicts

The market for gig economy insurance in the UK is set to grow amid continuing cost-of-living pressures, according to predictions from GlobalData.

The present cost-of-living crisis will increase the market size of gig economy insurance, according to predictions from GlobalData.

Household budgets are under pressure in many countries as a result of spiraling inflation, high interest rates and rising economic uncertainty. According to the US government’s Bureau of Labor Statistics, more than 400,000 Americans work two full-time roles; while in the UK, the Office for National Statistics (ONS) estimates that 1.2mn people have second jobs – a number that has been growing in recent years.

Despite this, GlobalData has found that nearly 25% of consumers surveyed hadn’t even considered that they would need insurance to cover them for liability when carrying out a second job. Around 12% had considered taking out insurance but decided against it.

Surplus lines premiums hit record $63.32B: WSIA

Surplus lines premiums reported to U.S. surplus lines stamping and services offices was a record $63.32 billion in 2022, a 24.1% increase over 2021, while the number of transactions increased 6.9%, to 5.6 million, the Kansas City, Missouri-based Wholesale & Specialty Insurance Association said Tuesday.

The stamping office with the largest number of premiums was California, with $16.13 billion, a 22.2% increase, while the number of transactions increased 9.8%, to 912,395, the report said.

The total for all offices reflected a slower premium growth rate than for the first half, when premiums increased 32.4%, to $31.4 billion, and transactions increased by 9.4%, to 2.8 million, according to the WSIA

AI: Friend or foe for risk managers?

AI brings the promise of progress and threat of disorder, as the launch of ChatGPT demonstrates

At the end of last year, ChatGPT – an AI-driven chatbot – was launched. Its ability to answer almost any question with lucid detail saw it reach over 100 million users by January, making it one of the fastest growing consumer applications ever.

One savvy student even managed to use the programme to write his assignment and then used a 3D printer to write out the answers for him. The arrival of ChatGPT has since made colleges and universities revisit their plagiarism policies.

The arrival and rapid adoption of ChatGPT was a microcosm of AI as a concept – innovative functionality with uncertain consequences.

The global AI market size was estimated at $120 billion in 2022 and it is expected to hit $1,597 billion by 2030, with Asia-Pacific the fastest growing region, according to Precedence Research.

For risk managers, this has left the conundrum of early adoption: wait too long and you get left behind, go too early and unforeseen issues derail you.

LexisNexis Risk Solutions Celebrates 35th Anniversary, Continued Innovation of C.L.U.E. Auto

LexisNexis® Risk Solutions, a leading provider of data and analytics for the insurance industry, is celebrating the 35th anniversary of LexisNexis® C.L.U.E.® Auto (Comprehensive Loss Underwriting Exchange), the auto insurance industry's most comprehensive claims history database. LexisNexis Risk Solutions also celebrates the 20th anniversary of LexisNexis® Current Carrier® Auto, which has grown to include more than 96% of auto insurance policy data to help insurers validate underwriting information and improve customer experience.

C.L.U.E. Auto helps enable U.S. insurers to quickly and seamlessly access claims information to expedite the underwriting process, help predict the potential for future claims, and through continued innovation, help discover even more important claims that typically go unnoticed by other solutions. These data analytics insights are even more critical in today's market as consumers are increasingly shopping their auto insurancei and insurers' profitability is challenged by increasing claims severityii and other economic factors.

Wells Fargo to pay $300 million to settle car insurance lawsuit

Wells Fargo will pay $300 million to settle a lawsuit claiming it improperly charged customers for unneeded auto-collision protection insurance — and hid the practice from investors.

The deal was announced Tuesday by the law firm that sued the bank after a New York Times investigation revealed that about 274,000 customers were put into delinquency and almost 25,000 vehicles were wrongfully repossessed.

Pedestrians pass in front of a Wells Fargo bank branch at night in New York. Photographer: Craig Warga/Bloomberg Wells Fargo stopped charging customers for the insurance but didn't tell investors, according to a statement issued by Robbins Geller Rudman & Dowd.

The law firm filed a securities-fraud class action alleging that the bank's stock traded at artificially inflated prices. Wells Fargo disclosed in a regulatory filing that it had been aware of the problem since 2016, the year before the 2017 New York Times story, according to the statement.

U.K. Motor Insurance Providers Must Tune Up Data Enrichment Strategies as Cost of Living Crisis Changes Vehicle Ownership

Trends in car values, ownership duration, age and mileage are changing, not least due to the U.K.’s cost-of-living crisis.

Understanding these changes is key to more fair and accurate insurance pricing as well as a smooth claims process for consumers. U.K. motor insurance providers can soon keep pace with the multiple risk factors associated with car insurance through the development and imminent launch of LexisNexis® Vehicle Insights from LexisNexis® Risk Solutions, the data, advanced analytics and technology provider to the insurance market. Motor insurance providers in the U.K. are now being invited to test the new solution in readiness for a full launch in mid 2023.

Car insurance rate hikes could require state approval under new bill - Chicago Sun-Times

The bill would empower the state’s insurance department to reject or modify rate hikes and would end the use of non-driving factors in setting rates.

The bill, which has been talked about over the last year, comes after car insurers made $896 million in excess profits in Illinois during the first year of the pandemic — when drivers commuted less and costs declined — and then raised rates by more than $1.1 billion in 2022.