News
No homeowners' insurance? Why more than 6 million in US don't have it
More than 6 million homeowners nationwide – including a large number of Native American, Hispanic and Black homeowners – do not carry homeowners insurance, putting them at extreme risk in the event of natural disasters or other significant damage to their homes, a new study has found.
The study by the Consumer Federation of America found that uninsured property accounts for 7.4% of all properties in the country and leaves $1.6 trillion in property value unprotected.
“Being uninsured poses a potential threat not only to individual homeowners but also to communities and our national housing stock,” the Consumer Federation of America said in EXPOSED: A Report on 1.6 Trillion Dollars of Uninsured American Homes
“Being uninsured can foster deeper economic precarity for millions of homeowners across the country, especially those with lower incomes, and it is an important contributor to racial inequality," the report said. "Inequalities in who has homeowners insurance will likely widen the long-standing racial wealth gap, as uninsurance disproportionately impacts Hispanic, Black, and Native American homeowners. Over time, insurance access is likely to become a key decider of who can fully reap the benefits of homeownership, including maintaining their home and building wealth.”
Deepfakes are causing real-life harm
“Deepfake” technology has unleashed new powers to distort reality in ways and on a scale that is not yet fully understood.
Powered by artificial intelligence and machine learning techniques that are exponentially advancing their sophistication, deepfakes are increasingly difficult to detect. The result are attacks that distort reality more frequently and convincingly than many in the boardroom may realize, and are wreaking havoc via audio and video of real people saying and doing things they never said or did. Left unchecked, deepfakes will increasingly cause marketplace disruptions, inflict individual and corporate reputational harm, and undermine our fundamental understanding of truth.
In February, for example, a Hong Kong-based clerk working for an undisclosed multinational firm was duped into transferring a total of HK$200 million (approximately $25 million) to unauthorized fraudsters. According to published reports, the clerk made a total of 15 transactions after joining a video conference where the other participants resembled the clerk’s own coworkers, but were actually AI-generated deepfakes. Authorities speculate that fraudsters downloaded videos of the clerk’s co-workers in advance, and then used AI-powered technology to add fake voices and imagery to use in the video conference.
In this context, in-house counsel must ask, what are the legal and business considerations companies managing through such unprecedented risks? Consider the following.
Nord Stream sues insurers in London over 2022 pipeline blasts
Nord Stream is seeking more than 400 million euros ($436 million) from its insurers over explosions in 2022 which ruptured pipelines designed to transport Russian gas to Germany, court filings show.
Nord Stream AG names Lloyd's Insurance Company and Arch Insurance (EU) DAC (ACGL.O), opens new tab as defendants in its lawsuit, which was filed at London's High Court last month. Switzerland-based Nord Stream confirmed in an email there is a contractual dispute in London commercial courts between itself and insurers of the pipeline system.
"However, we ask for understanding that we are not in a position to provide any detailed comments to the legal proceedings," Nord Stream's communications team said.
Court filings state that Nord Stream's current preliminary estimate of "the costs to dewater and stabilise the pipeline, to undertake a full repair and to replace the lost gas inventory" is between 1.2 billion and 1.35 billion euros.
Nord Stream's lawsuit also says one of the pipelines looked "mangled and deformed" in one area where it had been damaged, but "appeared smooth and to have been cut" in another. Advertisement · Scroll to continue
Lloyd's declined to comment. Arch did not immediately respond to a request for comment.
Greenberg writes to Chubb customers about Trump bond
Chubb Ltd. Chairman and CEO Evan Greenberg Wednesday wrote to the insurer’s customers to explain the company’s decision to issue a surety bond for Donald Trump guaranteeing the $83.3 million verdict in the defamation case brought by writer E. Jean Carroll against the former president.
The letter was issued after Chubb came under scrutiny following the disclosure last week that it had provided the means to allow Mr. Trump to meet a deadline to post a bond while he appealed the judgment. Ms. Carroll sought damages from Mr. Trump after he accused her of lying when she said he raped her in the mid-1990s.
Mr. Greenberg said he had been made aware of customers’ concerns over Chubb providing the bond to Mr. Trump.
“I fully realize how polarizing and emotional this case and the defendant are and how easy it would be for Chubb to just say no. However, we support the rule of law and our role in it. We considered this the right thing to do and we frankly left our own personal feelings aside,” he wrote.
He said the bond would ensure that Ms. Carroll would be paid if Mr. Trump’s appeal is unsuccessful.
Research
Seven in ten women investors are rethinking if and when they can retire
Uncertain market conditions and the rising cost of living are significantly impacting women investors and their retirement plans. As they grapple with cascading economic headwinds, seven in ten (70%) women investors say that inflation and signs of a potential recession have made them rethink if and when they can retire, according to Nationwide's ninth annual Advisor Authority survey, powered by the Nationwide Retirement Institute.
Managing expenses and monthly payments has only become more challenging as the cost of living continues to rise. More than four in ten single women (43%) and married women (40%) report increased cost of living poses one of the biggest long-term challenges to their retirement portfolio.
Single women are facing unique financial challenges
As the number of single older Americans steadily grows, single women in particular are grappling with unique circumstances.
The survey found that market volatility and the rising cost of living are causing many single women investors to feel less financially secure than their married counterparts, with only 31% feeling optimistic about their financial outlook for the next 12 months, compared to 39% of married women.
Compounding this concern, more than four in ten single women (44%) are worried about their ability to afford monthly bills in retirement. Managing debt is also one of the biggest financial concerns in the next 12 months for single women (21%), with nearly one in three (31%) single women age 55 or older or retired expecting to be paying down credit card debt in retirement.
"While women in general face significant challenges when planning for retirement, single women are doing so without the balance provided by a partner's savings and income. For many, there is no back-up plan," said Ann Bair, Senior Vice President of Marketing for Nationwide Financial. "It's encouraging to see that more single women are working with an advisor – and that's helping them feel more confident and empowered in their retirement planning journey."
Home Insurance Prices Up 19% in 2023; 55% Since 2019. How to Navigate the Home Insurance Market in 2024 with Insights from Guaranteed Rate Insurance
Guaranteed Rate Insurance LLC, one of the fastest growing national insurance brokers, today released its proprietary homeowners insurance study which provides insights regarding the many changes that have occurred in the homeowners insurance market and offers strategic recommendations for customers to reduce their insurance costs in 2024.
As highlighted in the study, home insurance prices have increased 19% in 2023 and 55% since 2019. Guaranteed Rate Insurance expects the insurance market to improve slightly in 2024 but there still will be a persistent trend of homeowners premiums increasing, deductibles rising, insurance carrier restrictions, and the purchase of additional products, such as private flood insurance to protect against increased exposures to continue.
In a statement underscoring the significance of the study, Jeff Wingate, Executive Vice President and Head of Insurance at Guaranteed Rate said, "This study is top-notch, detailed, and is comprised of real data from our portfolio. I am thrilled to release this study and thank our team for the collaborative effort."
Wingate further emphasized, "These real-time insights allow us to work with our clients proactively, as we have a comprehensive understanding of market trends and an array of strategies available to lower costs, reduce risk and ensure our clients have proper coverage."
AI in Insurance
AXA XL Revolutionizes Insurance Underwriting with Machine Learning…
In a significant leap for the insurance industry, AXA XL embraces machine learning to transform underwriting processes, marking a key advancement in how insurance policies are assessed and issued. Matt O'Malley, AXA XL's U.S. country manager and East zone manager, highlights the pivotal role of data analytics in refining decision-making and enhancing client relations. This evolution not only streamlines operations but also augments the precision in catering to specific client needs.
Machine Learning: A Game Changer in Insurance
At the core of AXA XL's innovative approach is a machine learning tool designed to optimize pipeline management. This tool leverages the vast data reservoirs of the carrier to pinpoint predictive relationships, thereby enabling underwriters to proactively identify accounts that align with their underwriting criteria. O'Malley elucidates the transformative impact of this technology, emphasizing its ability to elevate conversion ratios by offering bespoke insights into potential clients' profiles across multiple lines of business.
The adoption of such technology signifies a departure from traditional, broad-spectrum appetite listings that often leave brokers in a quandary. Instead, AXA XL's nuanced, data-driven strategy fosters a more targeted and efficient engagement with brokers, ensuring a smoother transaction flow and heightened client satisfaction.
Enhancing Client Engagement Through Data
O'Malley's revelation about the 'aha moment' underscores the profound difference between generic business solicitation and the precision targeting enabled by machine learning. This technology not only refines AXA XL's approach to underwriting but also introduces a novel dimension to client engagement. By harnessing data to uncover unaddressed client needs, AXA XL is poised to solve a broader spectrum of challenges, thereby reinforcing its commitment to serving clients more comprehensively.
Navigating The Risks And Opportunities Of Generative AI In Insurance
The rise and rise of generative AI poses new questions for those of us working in insurance. Every day, people like us are finding new ways to use the technology’s uncanny abilities to process huge quantities of complex text, audio and video, as well as to generate ideas and usable first drafts across those three formats.
There has also been no shortage of discussion about the risks of using generative AI. It poses unique risks for insurers—bias, hallucination and IP infringement, to name a few. What I’m going to focus on is the degree to which those risks are being addressed by regulators and how insurers can ensure compliance with evolving regulations without sacrificing generative AI’s extraordinary potential for innovation.
Is regulation always a brake on innovation?
Absolutely not. Well-designed regulation can help shape a thriving digital economy and society.
Take the EU’s early regulation of digital mobile telephony. As soon as 1987, the EU got behind the GSM protocol for second-generation (digital) phones, leading to a radical transformation of European telecommunications, setting off a virtuous cycle of increased competition, increased investment, new innovation, price declines and accelerated adoption.
Meeri Savolainen is the CEO of INZMO
InsurTech/M&A/Finance/Collaboration
Startup raises $47 million to help bereaved family members
Empathy, a New York-based support platform for employees and life insurance beneficiaries who've lost loved ones, raised $47 million in Series B funding led by Index Ventures.
Why it matters: Employers often provide bereavement leave and life insurers pay settlements, but neither assist with death's emotional and logistical hardships.
Empathy, which works as an employee or policyholder benefit, provides help in areas like grief counseling, funeral planning, obituary writing, estate settlement, subscription cancellations, and probate.
Other investors include General Catalyst, Entrée Capital, Latitude, Brewer Lane, Allianz, MassMutual Ventures, MetLife, New York Life Ventures, Securian Financial, and Sumitomo.
What they're saying: "There are so many opportunities to really help someone who is grieving, beyond just giving them a lump sum of money and telling them to carry on" says Danny Rimer, a partner with Index Ventures.
Guidewire Selected by Encova Insurance to Streamline Operations
Guidewire Selected by Encova Insurance to Streamline Operations
The collaboration aims to leverage Guidewire InsuranceSuite on Guidewire Cloud to streamline core business operations and simplify IT infrastructure.
Having been a Guidewire customer since 2014, Encova is now poised to migrate its InsuranceSuite from a self-managed environment onto Guidewire Cloud across all lines of business and states of operation simultaneously.
Guidewire PartnerConnect Consulting Global Premier member PwC has been selected to lead the implementation project.
Guidewire Chief Marketing Officer Brian Desmond, said: “It’s been a true honour partnering with Encova in driving innovation and growth.
“As we transition into the next chapter together with Guidewire Cloud, we are excited to fulfill our role in delivering the agility Encova can depend on to continually enhance its offerings and services for agents and policyholders.”
Speaking about the new partnership, Casey Jordan, Encova VP, Information Technology Application Services, said: “By leveraging InsuranceSuite on Guidewire Cloud, we will be able to shift system maintenance to Guidewire, so we can stay current on the latest innovations and decrease our own on-premise technology infrastructure footprint, enabling our IT staff to focus on tasks that deliver value to our agents and policyholders. We will also be able to manage risk by maturing our business continuity and disaster recovery capabilities.”
“We are thrilled that Encova entrusted PwC again to deliver the next stage of its transformation journey through the implementation of InsuranceSuite on Guidewire Cloud,” said PwC Partner Imran Ilyas.
Innovation
AXA Climate partners with Reask on parametric windstorm insurance - Reinsurance News
AXA Climate, the climate risk insurance broker, has strategically partnered with Reask, a provider of climate risk modeling solutions, to leverage its Metryc product to offer advanced parametric windstorm insurance solutions.
axa-climate-logoThe partnership leverages the Metryc product to offer parametric solutions based on precise location-level wind speed data following tropical cyclone landfalls worldwide.
According to the pair, this collaboration represents a forward-thinking approach to parametric insurance in leveraging advanced data analytics to improve affordability, risk management, and claims responsiveness following climate-related events.
AXA Climate notes its commitment to designing innovative products and services that enable businesses and communities to adapt to and mitigate the impacts of climate change, fostering resilience and encouraging sustainable practices.
Regine Mollenhauer, Chief Underwriting Officer, AXA Climate, commented, “Choosing Reask as our partner was a strategic decision driven by their ability to deliver quality, high-resolution data on a global scale.
Canada
Reducing the Environmental Footprint of the Collision Industry - Autosphere
When it comes to the environment, our industry does not have the best of reputations. At a time when environmental challenges are multiplying, it’s high time we came to grips with them.
Protecting our environment and reducing the production of greenhouse gases may seem like abstract concepts. However, the reality is that these collective challenges come directly to us in our shops.
First of all, let’s think about the health and safety of our workers, whose great value I don’t need to stress, especially in these times of scarcity. Providing them with a healthy environment, free from toxic fumes and dust and where they are not exposed to corrosive products, is a moral obligation. The greener the company, the more attractive it will be for the new generation of workers.
Restoring our image
Let’s not forget the sad reputation that still hangs over our shops, perceived as polluters that our municipalities want to hide away in the recesses of their industrial parks. You can still see plastic parts removed from cars being repaired sticking out of blue bins… betraying some very sad practices.
The major collision networks also have a huge responsibility in reducing our environmental footprint. We need to set an example and inspire our entire ecosystem. Firstly, by understanding our impact and committing to best practice. This means considering and putting into action a multitude of concrete actions.
Sylvain Séguin, President of Réseau Fix