California storm losses estimated at more than $30B  January 17th 2023

California storm losses estimated at more than $30B

California’s flooding rains and heavy snows that killed at least 17 people have likely caused more than $30 billion in damages and economic losses, according to AccuWeather Inc.

The Pacific storms, known as atmospheric rivers, are estimated to have caused $31 billion to $34 billion of economic impacts through major flooding, widespread power outages, landslides, fallen trees and road closures, the commercial weather forecaster said.

“A substantial portion of the damage to homes and businesses occurred as a result of mudslides and landslides as well as water damage caused by the serious flooding,” Accuweather

The losses are more than triple those from December blizzards in Buffalo, New York, though less than the $180 billion to $210 billion caused by Hurricane Ian when it struck Florida last year. Accuweather expects damage costs to further rise as more storms sweep through California.

The Oakland Zoo remains closed after a rain storm caused a sinkhole in front of the entrance in Oakland, California, on Jan. 9.

“Additional damage and negative impact to the economy is expected to accrue as the parade of storms continues to affect parts of California through Jan. 18”

Accuweather’s calculations are based on direct and indirect impacts of the storm including damage to property, job and wage losses, crops, evacuation costs as well as airline delays, lost business and supply chain interruptions. The tally includes both insured and uninsured losses.

Risk managers worldwide say cyber is the biggest business risk today

Ransomware attacks, data breaches, IT breakdowns and other digital risks rank as the top business risk for the second consecutive year, according to Allianz Global Corporate & Specialty’s (AGCS) Risk Barometer, which surveys more than 2,700 risk management experts in 94 countries.

Scott Sayce, global head of cyber at AGCS and group head of the Cyber Center of Competence, said tension from the war in Ukraine and wider geopolitical problems are changing the cyber-risk environment and increasing the possibility of large-scale cyberattacks.

“The frequency of ransomware attacks remains high, with losses increasing as criminals hone their tactics to extort more money, while the average cost of a data breach is at an all-time high,” Sayce explained in the Risk Barometer report. “At the same time, attacks are not just restricted to large companies, increasingly we see more small and midsize businesses impacted. Then, there is also a growing shortage of cyber security professionals, which brings challenges when it comes to improving security.”

Duck Creek shares skyrocket after $2.6B go-private deal

Vista Equity Partners announced the take-private, all-cash transaction less than three years after Duck Creek went public with a market valuation of about $5 billion. Vista is set to pay $19 per share for the insurtech company with a go-shop period expiring Feb. 7 that allows Duck Creek to accept a better offer if one arises.

One of the first major insurance technology deals of the new year may signal what is expected to be a wave of consolidation across the industry.

Vista Equity Partners announced this week that it agreed to buy insurance technology provider Duck Creek Technologies Inc. in a take-private, all-cash transaction worth roughly $2.6 billion. The announcement comes less than three years after Duck Creek went public with a market valuation of about $5 billion.

Expand Your Pricing Paradigm

Summary   

With inflation high, a global recession possible, and consumers spending carefully, many companies are concerned about preserving profit margins. In this article, pricing consultant Rafi Mohammed argues that instead of simply adjusting prices, firms should consider adding new ways to charge customers. He outlines 18 different pricing tactics that can be used for various purposes: to accommodate buyers with different usage needs, to appeal to people on a tight budget, to spur purchases by customers who love a good deal, to achieve favorable prices when the value of an offering is uncertain, and to increase business efficiency.

Mohammed urges companies to think creatively about whether a pricing convention commonly used in other industries might work for their own product or service. For example, Allstate has borrowed the metering model and introduced auto insurance premiums based on actual miles driven. Mammoth Holdings, which owns more than 100 car washes, offers monthly subscriptions for unlimited washes. Some hotels sell day passes to their pools and fitness facilities. By creating a mix of pricing options, companies are likely to please existing customers and attract new ones.

Breakthrough Technologies for 2023

Technologies under development could revolutionize healthcare by editing humans' genomes to eliminate common diseases and providing "organs on demand."

The MIT Technology Review's always-interesting annual list of10 breakthrough technologies to watch contains two this year that could revolutionize healthcare.

One is a use of CRISPR to just edit away people's problems with high cholesterol by rewriting a sliver of their DNA. The other is work that could produce what the magazine calls "organs on demand" -- basically, a farm that would grow all the hearts, kidneys, livers and so on that we need, ending chronic shortages and making the lives of millions of people better.

Paul Carroll, editor-in-chief, Insurance Thought Leadership

3 Signs Your Underwriters Are in Trouble

Fortunately, technology is maturing just in time to respond to common challenges, allowing underwriters to refocus their time on what they do best.

Underwriters spend up to 40% of their time on non-core and administrative activities like re-keying and manual data entry.

As a result, many underwriters fail to service all the requests for coverage they receive. Time and energy that could be allocated toward more meaningful activities — like improving broker interactions, effectively pricing risks and winning new business — is wasted due to redundant, manual processes and inflexible systems.

Chris Mullan and Tim Crowe of Eigen Technologies

Car insurance premiums still on the rise, Michigan, Florida & Rhode Island drivers will pay highest premiums - Repairer Driven NewsRepairer Driven News

Auto insurance carriers are expected to raise premiums by an average of 8.4% this year after a slight 0.6% increase in 2022, according to ValuePenguin’s State of Auto Insurance in 2023 report.

The average cost of full coverage insurance is expected to reach $1,780 per year, and 45 states will see their car insurance premiums increase this year by at least 1% with drivers in Michigan, Florida, and Rhode Island paying the highest premiums.

Drivers with traffic violations this year will see their premiums jump 52% on average with traffic violations in North Carolina and California costing drivers the most causing a more than 100% premium increase. Car insurance for new electric vehicles (EVs) will be 28% higher than new gasoline-powered cars, according to ValuePenguin.