Research
Lex Machina Releases 2024 Insurance Litigation Report
Lex Machina, a LexisNexis company, today releases its 2024 Insurance Litigation Report. The report examines insurance litigation trends in federal district and appellate courts. Focusing on the three-year period from 2021 to 2023, it surveys emerging trends in case filings, venues, judges, law firms, parties, timing metrics, case resolutions, findings, and damages. The report often focuses on different sets of data, e.g., filtering cases in order to provide analytics on general insurance cases, business liability insurance cases, business interruption insurance cases, hurricane-related insurance cases, homeowners policy insurance cases, and federal appellate cases.
"As insurance litigation is particularly diverse and nuanced with a wide variety of underlying claims, it is crucial to be able to hone in on the litigation trends in these different subsets of cases, as we do in this report," said Ron Porter, Lex Machina's insurance legal data expert and editor of the report. "By doing so, we gain important data-driven insights into the shifts and patterns in the practice area of insurance litigation. Practitioners can use these insights to sharpen their litigation strategy and advise their clients."
Findings from the report include:
In 2023, 17,654 insurance cases were filed in federal district courts....SEE FINDINGS
News
Ford abandons dealership EV program after months of indecisiveness
Ford Motor Co. rolled back requirements for its dealership electric vehicle (EV) certification program last year, then it paused the program last month and now it is scrapping the program altogether.
Starting July 1, all U.S. Ford dealers will be eligible to sell EVs, according to The Detroit News. The decision came after Ford completed a dealership tour in recent months. The company heard from more than 1,000 dealerships during 11 meetings.
Marin Gjaja, Ford’s Model e EV business division chief operating officer, told The Detroit News that the program was introduced amid a spike in demand for EVs during the pandemic. He said EV sales haven’t grown as quickly as expected as customers remain concerned about their price, access to charging stations, and how an EV would change their lifestyle.
“We’re getting into the tough innings,” Gjaja told the newspaper. “We’re getting into the early majority customer who isn’t in it just for technology and willing to pay a premium. They want a practical, usable vehicle. They have questions they need to really understand the value for them. And it’s just a very different sale. …We need Ford and our dealers pulling together to help bring the market along.”
Telematics, Driving & Insurance
Intuit to Acquire Zendrive to Expand Usage-Based Auto Insurance
[EDITOR'S NOTE - In light of recent lawsuits over driving data and widespread consumer distrust and unwillingness to have their driving behaviors "tracked", data shared with insurers, we will be watching closely to see if this is the missing piece]
Intuit plans to acquire technology and add employees from Zendrive to accelerate the development and adoption of Karma Drive, a telematics-powered, usage-based auto insurance product offered by Intuit business unit Credit Karma.
The transaction is expected to close in the fourth quarter of fiscal year 2024 and certain Zendrive employees — including CEO Dennis Ellis and Co-founder and Chief Technology Officer Pankaj Risbood — will join Credit Karma, the companies said in a Thursday (June 13) press release.
“With Zendrive’s technology and experience, we strive to make usage-based auto insurance more accessible than ever and bring more transparency, fairness and accuracy to consumer auto insurance pricing, while providing insight into their driving behaviors,” Joe Kauffman, president of Credit Karma, said in the release.
Because Karma Drive is powered by telematics, the product gives carriers better visibility — with member consent — into members’ driving behaviors, according to the release.
Credit Karma members can choose to participate in a trial of this telematics-powered offering — without first having to purchase a policy — so that they can get real-time feedback on their driving and can view potential personalized discount offers based on their driving habits before purchasing a policy, the release said.
“Zendrive’s mission is to make roads safer with data and analytics, and we pride ourselves on delivering experiences that help create awareness for safe driving habits,” Ellis said in the release. “Intuit’s customer-obsessed culture is a perfect match for our team. Together we will democratize access to fair insurance for all Americans based on their driving habits, not their financial situation.”
Credit Karma launched Karma Drive in December 2023, saying that a vehicle is many members’ most costly asset and that usage-based car insurance may help them save money.
Commentary/Opinion
U.S. commercial insurance rates rose 6.3% in Q1
Growth in Q1 2024 remained on-trend with previous quarters, which have consistently seen around 6% price increases each quarter since the COVID pandemic.
Commercial lines insurance prices increased 6.3% year-over-year in the first quarter of 2024, according to Willis Towers Watson's (WTW) latest Commercial Lines Insurance Pricing Survey (CLIPS).
Data for the CLIPS is obtained directly from commercial lines carriers, with participants consisting of many of the top-10 commercial lines companies and top-25 U.S. insurance groups. The 43 participating insurers reportedly represent around 20% of the U.S. commercial insurance market, excluding state workers compensation. The survey compares prices charged during a quarter with prices charged in the corresponding quarter of the previous year.
Growth in Q1 2024 remained on-trend with previous quarters, which have consistently seen around 6% price increases each quarter since the COVID pandemic.
In a release, WTW offered a closer look at coverage statistics that stood out in their survey. One of these was excess umbrella liability coverage, which has reportedly seen significant price increases over the last few years. This line of business experienced its smallest growth in Q4 2022, compared to other recent quarters, but from early 2023 to present, prices for excess umbrella liability have climbed back to double-digit quarterly increases.
Thinking about skipping out on homeowners insurance? 4 reasons not to
As the cost of homeowners insurance goes up, the number of homeowners who are insured is going down. Currently "88% of homeowners are covered," a decline "from upwards of 95% just a few years ago," said Money, citing "the latest data from the Insurance Information Institute (III), an industry trade group."
It is understandable that some homeowners are arriving at this decision — there has been a "rapid pace of premium increases" in recent years, alongside "the typical inflationary pressures of late," said Money. And to be fair, in some instances, "insurers are pulling out of high-risk areas, leaving residents in a scramble to find replacement coverage."
But even with the pressures that paying for homeowners insurance can create, it's still not worth the financial gamble of going without.
Auto Insurance Costs Dip in May: Key Industry Reports Ahead
Is inflation trending lower? Yes. The Fed's preferred inflation gauge, the PCE Price Index, has fallen to 2.70% from a peak above 7% two years ago.[1] While still higher than the FOMC's 2% target, there's hope that slow progress on the inflation front over the back half of this year and through 2025 will occur, allowing Chair Powell and the Fed to begin cutting interest rates before too much longer.
That's been the zeitgeist, the proverbial carrot dangling in front of stock-market traders, for months. And that has, in part, fueled the rally in equities. It's not so much easing monetary policy itself, but the prospect of an easing policy rate that has promoted an underlying bullish tone across sectors. Outperforming GDP growth numbers over the second half of 2023 and robust corporate earnings results so far in 2024 have been positive catalysts too.
Angst with Auto Insurance Don't tell that to households struggling to keep pace with the cost of living, however. For those of us familiar with markets and macroeconomics, we know that prices writ large are not going to come down, but the pace of increase has dropped.
Innovation
Vertafore's Project Impact aims to deliver up to two hours of time savings per day for servicers at independent insurance agencies
Vertafore®, the leader in modern insurance technology, announces Project Impact, an initiative to deliver technology enhancements and workflow improvements that make the work of account managers, customer service representatives and other core agency staff more efficient.
Over the next two years, Project Impact aims to deliver up to two hours of time savings per day for each servicer through a combination of enhancements from day-to-day activities to major product improvements, with a focus on the most important workflows at an agency.
"Project Impact has delivered a partnership experience for us that is markedly different from other software providers."
In the most recent Agency Universe Study, the Big "I" found that more than half of respondents are searching for more operating efficiencies to better service their clients. Project Impact is ultimately expected to deliver up to two hours of savings per day per account manager at independent insurance agencies.
To set the course for Project Impact, Vertafore staff shadowed 98 servicers at independent agencies of all shapes and sizes, observing their day-to-day workflows in AMS360®, Sagitta® and WorkSmart®. From this, the Vertafore team identified opportunities to streamline important workflows and reduce the time spent on routine tasks.
Events
InsurTech Hartford Innovation Challenge 2024
Wednesday, June 19, 2024 · 11:00 a.m. Eastern Time
About This Webinar
The InusrTech Hartford Innovation Challenge is a contest open to companies across the globe. The 2024 contest has 3 award categories:
Top Emerging Risk Solution
Best Health & Safety Solution
Best Emerging InsurTech
This is a virtual event and will include presentations form the finalists in each category and will announce the winners at the conclusion of the event. REGISTER HERE
Predict & Prevent
Moen Enters into Strategic Arrangement with Homeowners Insurance Provider to Help Control Rising Costs
Moen, the leader in water experiences in the home, today announced an initiative with a major insurance provider designed to drive adoption of Flo Smart Water Monitor and Shutoff devices through special savings and installation programs for its customers. This program can significantly reduce the number of insurance claims customers file related to catastrophic water damage because of residential leaks.
“Additionally, together with the insurance industry, we can help to reduce wasted water, which is especially important in areas where water is scarce. Across the country, an estimated one trillion gallons of water are wasted due to leaks each year.5”
“Not only does water damage create financial and emotional hardship for homeowners, it strains the home insurance industry. Nationally, we estimate that insurers pay out over $15 billion in water claim damages annually. Moen can help insurance companies reduce water damage claims caused by water leaks and alleviate costs associated with those claims,” said Jeff Barnes, vice president, business development, Moen. “Additionally, together with the insurance industry, we can help to reduce wasted water, which is especially important in areas where water is scarce. Across the country, an estimated one trillion gallons of water are wasted due to leaks each year.5”
Moen will be working with Farmers Insurance® to help provide Smart Water Monitor and Shutoff devices to policyholders.
InsurTech/M&A/Finance/Collaboration
Insurtech Lemonade partners with Homesite
According to its website, Lemonade has partnered with Homesite to offer home insurance in several states, including Kansas, Kentucky, Minnesota, North Carolina, New Mexico, and Utah.
Generally speaking when it comes to home insurance, Lemonade is currently the risk bearer in several states: Arizona, Colorado, Connecticut, District of Columbia, Georgia, Illinois, Indiana, Iowa, Maryland, Massachusetts, Michigan, Missouri, Nevada, New Jersey, New York, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Virginia, and Wisconsin.
Founded in 1997, Homesite, owned by AmFam, was the first company to enable customers to purchase insurance directly online in a single visit. It now offers Home, Renter, Life, Small Business, Condo, and Flood Insurance.