Catastrophic Event Ripple Effects; Losses, Reform, Investments and Innovation  February 23rd 2023

Insured losses for Turkey-Syria quakes could top $5B: CoreLogic

CoreLogic Inc. on Wednesday said industry insurable losses in Turkey could exceed $4 billion for powerful earthquakes that struck near the Turkey-Syria border beginning late on Feb. 5 and continued through the morning of Feb. 6 and another $1 billion for a second quake two weeks later.

A magnitude 7.8 earthquake occurred in southern Turkey near the northern border of Syria on Feb. 6 at 4:17 a.m. local time. A magnitude 6.7 aftershock followed 11 minutes later, according to the U.S. Geological Survey.

Florida reinsurance rules of engagement redefined by reforms: Demotech -

For reinsurance capital, the rules of engagement in Florida’s property insurance marketplace have been redefined thanks to the wave of significant legislative reforms that have been enacted, according to rating agency Demotech.

Citing the “financial impact of the disparate, disproportionate levels of litigation” Demotech explained that 2022 may prove to be a year to remember for policyholders that have previously had to “bear the availability and affordability burdens” caused by the costs of litigation and fraudulent claims in Florida’s property insurance marketplace.

With Florida’s catastrophe reinsurance renewals at June 1st 2023 set to be more challenging due to the global hard reinsurance market and its higher pricing, Demotech believes that the legislative reforms enacted can “redefine the Florida residential property insurance marketplace.”

Saying that, “Catastrophe reinsurance coverage associated with policies covered by the June 1 and July 1, 2023, renewals will reflect the cumulative reforms enacted to date as well as some component of any additional reforms enacted in the upcoming session.

“As such, the rules of engagement in Florida’s residential property insurance marketplace have been revised.”

Joseph Petrelli, President and Co-founder, Demotech

CSAA Invests $25M in California Wildfire Innovation Fund

CSAA Insurance Group made a $25 million commitment to the California Wildfire Innovation Fund, a climate-solutions strategy to help reduce the severity and frequency of catastrophic wildfire by supporting forest restoration-related economic development.

The fund was developed by CSAA Insurance Group in partnership with Blue Forest, the non-profit behind the Forest Resilience Bond, which deploys private capital to finance forest restoration projects for wildfire prevention.

The California Wildfire Innovation Fund targets emerging investment opportunities in forest restoration, wood utilization and wildfire mitigation. Emphasis is placed on industries and projects that add system capacity, create value for forest restoration byproducts, and unlock carbon offset revenue through carbon storage and sequestration.

Munich Re exceeds profit guidance in 2022 as premiums swell - Reinsurance News

German reinsurer Munich Re has exceeded its profit guidance for 2022 with a result of €3.4 billion, as the reinsurance division performed well despite the impacts of large losses and the war in Ukraine.

Group-wide, profit increased from more than €2.9 billion in 2021 to just over €3.4 billion, beating the guidance for the year by around €100 million. The reinsurer’s profit for the fourth quarter of 2022 was €1.5 billion versus €871 million in the prior year period.

For the year, the operating result reached €3.6 billion compared with €3.5 billion in 2021, as the other non-operating result improved from -€91 million in 2021 to -€81 million in 2022.

Across the business, gross written premiums (GWP) increased by almost 13% to more than €67 billion.

ACORD Releases Results of "Insurance 2040" Survey

ACORD, the global standards-setting body for the insurance industry, today unveiled the results of an industry-wide survey on the future of insurance. ACORD CEO Bill Pieroni presented the findings of Insurance 2040: Prospects and Predicaments for Innovation & Value Creation at the DXC Connect Insurance Executive Forum in Charleston, SC, highlighting key insights and priorities for insurers as they look to the future.

ACORD surveyed insurance professionals for their perspective on the outlook for the industry over the next twenty years. Survey participants identified the technologies, capabilities, practices, and strategies projected to have the greatest impact in the global industry in both the near and long term. Respondents represented an industry-wide view, across lines of business, organization types, and geographies.

Property hard market expected to continue: Amwins

Property markets will remain hard with no softening in the foreseeable future, while in primary casualty lines, renewals remain largely flat except for challenged classes such as heavy auto-exposed and trucking, according to a report Wednesday from Amwins Group Inc.

Due to the challenges in the property market, however, reinsurers are being “extremely cautious” with all their capacity, which may negatively impact casualty markets further into 2023, Amwins said.

We The excess casualty sector continues to see “moderate” rate increases anywhere from flat to 15%, depending on account size, losses and risk exposure, but without the tumult of two years ago with insurers “hinting” at expanding limit offerings, Amwins said.

Is learning and development the key to unlocking stronger retention?

Employee development strategies can increase retention in addition showing the unique value proposition of insurance companies amid a competitive talent market.

Allianz Global Corporate & Speciality (AGCS) knows the long- and short-term benefits of developing its employees in strengthening its succession plan and boosting attrition rates. The organization has ramped up its development programmes since the pandemic.

“One of our cultural values is personal growth, and for the last two to three years we’ve had a very heavy focus on it,” said Brenda Leadley (pictured), North American head of human resources at AGCS.

“This focus is supported by personal development plans with objectives and actions.

“We have beefed up our technical academies for our sales and underwriting team members, as well as our Allianz University.”

Statement from Carrie Martinelli, Vice President, Talent, Selective Insurance, on Insurance Careers Month and the Benefits of a Unique Career Path in the Industry

February is Insurance Careers Month, a time to celebrate the industry's positive impact on society and the broad career opportunities it offers nearly 3 million people in the United States. The insurance industry depends on its diverse and talented workforce to assess risk, ensure customers have appropriate insurance coverages, and pay claims, helping customers recover from loss. In addition to a wide range of skills and abilities, insurance employees bring curiosity and a desire for new skills that the industry's abundant career opportunities provide.

An informal survey of Selective Insurance employees revealed that 42% had no prior insurance experience. We think this is the case with many insurance job seekers. Individuals are as likely to start working in insurance mid-career from other fields as they are to join the industry directly from high school or college, regardless of field of study. These new-to-the-industry employees experience rich and rewarding career benefits, including:

Young Voices Reflect on Industry Talent Crisis

It’s no mystery: The insurance industry is experiencing a monumental shift.

A 2021 report from the U.S. Chamber of Commerce forecasted that nearly 400,000 insurance industry employees were expected to retire from the insurance industry workforce within the next few years. In 2012, The Institutes found that eight out of 10 millennials reported having limited knowledge and understanding of the employment opportunities available within the insurance industry.

A talent crisis has emerged. One insurance expert envisions the phenomenon as more of a “talent cliff.”

“I use the term cliff to emphasize the severity of this problem,” said Dr. Brenda Wells, a distinguished risk management and insurance program director and professor at the East Carolina University College of Business. “Because we are just not replacing people fast enough.”