| COVID Takes $8 Billion Bite Out of Global Multiline Insurers Global multiline insurers (GMIs) took an $8 billion hit in 2020 thanks to the COVID-19 pandemic, according to a new report from S&P Global Ratings. However, no insurer among those rated in the report fell into a position where its capital position was insufficient to meet regulators' expectations. The cannabis market in the US got some uplifting news last week when officials in New York finalized a deal to legalize recreational marijuana in the state, opening the doors for a $4.2 billion industry, according to The New York Times. Lemonade, an internet-based insurer, said that it doesn't use artificial intelligence to deny claims or coverage based on a person's characteristics after a “poorly worded tweet" drew heated criticism online. Clients who submit claims are asked to make videos explaining what happened. In its tweet, the New York-based company said those recordings are analyzed for fraud by artificial intelligence (AI) to “pick up non-verbal cues that traditional insurers can't." That led to an outpouring of tweets accusing the company of discrimination based on race and other traits. Hard market conditions for most management and professional liability lines are carrying over from the past year, with the first half of 2021 seeing a slew of corporate bankruptcies, widespread layoffs and cyber breaches, according to Risk Placement Services (RPS). As a result, insurance carriers in nearly every line of business in this sector are raising premiums and rates, reducing capacity and putting accounts under the microscope. If you specialize in these lines, it's important to have ongoing communication with your insureds so there are no surprises at renewal! U.S. insurers offering cyber coverage have been implementing significant pricing and underwriting actions in 2021 in response to a spike in cyber claims, according to Fitch Ratings. Fitch predicts that immediate improvement is unlikely this year from these actions and reports that insurers are worried about the long-term.
THE COVID-19 pandemic has forced policyholders to provide underwriters with photo images of their properties. There are benefits to policyholder-supplied photos including slightly reduced cost over live inspectors, faster turnaround time, no physical contact, etc. The problem - policyholders naturally want to provide the best impression of their property and may avoid sending photos of scorched electrical outlets, water-damaged interiors, rotting facias, etc. There is no industry better positioned to fight cybercrime than the insurance industry. Insurers have one thing in common that others (including cybersecurity companies) do not: a direct financial incentive to protect insured clients and prevent financial loss. So does it increase cyber crime? Things are looking pretty rough for GEICO, as not only did the insurer recently suffer a data breach, but it was also discovered that the hackers responsible are using consumers' compromised information to fraudulently apply for unemployment benefits. Low-cost social media can lead to unexpected high costs. The potential for abuse by employees, as well as employers, is considerable. Employees can be especially prone to misuse social media and privacy rights violations are among the most common risks.
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| The New York State Workers' Compensation Board has proposed a regulation that would clarify the length of paid family leave when an employee takes it intermittently.
In some situations, such as when an employee is caring for an elderly parent, the employee may not need to take paid family leave all at once. For example, if the parent has a home health aide visit twice a week, the employee may need to take leave of a few non-consecutive days a week. However, the law creating the paid family leave requirement and the implementing regulations state the maximum amount of leave in terms of weeks, not days.
The change proposed by the board states, "When any employee takes family leave in daily increments, the employee’s maximum number of days of paid family leave is calculated based on the average number of days worked per week multiplied by 12 as of January 1, 2021." An employee who works an average of five days per week could take up to 60 days; an employee working an average of three days a week could take up to 36. Anyone who wishes to comment may do so by sending an email to regulations@wcb.ny.gov. The comment period closes on July 25, 2021.
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| By Sue Keegan, AIC, MBA, Learning & Development Manager
3 Things
Have I mentioned Pre-Licensing?? Personal Lines and P & C Pre-Licensing begins 06/08/2021. Get in on this now!
2 Ideas
1 Question
What’s your favorite ice cream flavor? Mine is called Charlie Brown and it is chocolate ice cream with peanut butter chunks and it is divine. Thankfully my daughters both work at a local ice cream shop (shout out to Gannon’s Isle, Syracuse, NY), so I have an unlimited supply. Let me know your favorite ice cream flavor via email at skeegan@biginy.org or post in our Community. |
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Wednesday, May 26, 2021 1:00 p.m. - 2:00 p.m. ET Register Now Join the Travelers Institute for a dynamic conversation on the future of cities in the post-pandemic era, including a look at two of our nation's most vibrant urban centers, New York and San Francisco. Kathryn S. Wylde, President & CEO of the Partnership for New York City, and Jim Wunderman, President & CEO of the Bay Area Council, two champions of economic development and urban growth, join us to share their unique perspectives on how the pandemic has changed or accelerated trends and public policy priorities. Presented by the Travelers Institute, the Partnership for New York City, the Bay Area Council, Big I New York and Big I Connecticut Speakers Kathryn S. Wylde, President & CEO, The Partnership for New York City Jim Wunderman, President & CEO, Bay Area Council Joan Woodward, President, Travelers Institute; Executive Vice President, Public Policy, Travelers
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| With three weeks of session remaining, activity in the capitol is ramping up to fever pitch (virtually, of course.) This is typically the time when bad bills start moving fast and furious, and we've got your back.
On Wednesday, Assemblywoman Hunter amended her bill to modernize the process for placing excess lines coverage. The amended bill includes provisions to significantly streamline the required affidavit, eliminating all required information except name and NAIC code of the declining insurer and the reason the broker believed the insurer would consider writing the coverage. However, the provisions eliminating the requirement to obtain three declinations have been removed from the bill. This was the outcome of months of negotiations with the committee chairman and Assembly leadership in order to reach a compromise on a bill that could pass the committee. While not the full reform that we originally sought, this compromise bill will still significantly reduce the paperwork burden for agents and brokers accessing the excess market. Pressure on the legislature to pass Single Payer healthcare is ramping up. The numbers for the New York Health Act, which would enact a single-payer healthcare system, are staggering: more than 160,000 jobs eliminated; $253 billion in new taxes on employers and workers (more than double the entire state budget); business tax increases of over 2,000%. We are recruiting a small team of passionate agents who work in the health and benefits space to join us in meetings with several key Senators. Lobbying training and talking points will be provided ahead of the meetings, which are expected to take place between June 1st and 4th. Click here to add your name to the list, and we will follow up when meeting dates and times are confirmed. On Thursday, the Assembly Insurance committee passed harmful legislation to ban the use of lead paint exclusions in rental habitational coverage. The bill would send shockwaves through the market, making it extremely costly and difficult to obtain coverage. Big I NY lobbied members of the insurance committee and launched a grassroots email campaign ahead of the committee vote. The bill now heads to the floor in the Assembly. Big I NY continues our efforts to stop this ill-advised bill.
Big I NY this week joined a broad-based group of employers in calling for the defeat of legislation that would allow employees to secure liens on their employer's personal or company property based on a merely the claim of wage and hour violations. This will threaten the financial viability of businesses, especially small businesses and their ability to secure, establish, or stabilize creditworthiness.
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| Watch: Scott Hobson announces winner of Stack the PAC.
Big I Tri-County comes out on top in the first ever Stack the PAC competition. The competition encourages the local associations to raise money for IAPAC (Independent Agents Political Action Committee). IAPAC is a non-partisan committee established to help protect the industry by supporting the election of state candidates who understand the importance of our profession.
Big I Tri-County had 44.4% of its members participate to raise $12,000. In addition to bragging rights, Tri-County takes home a pretty awesome trophy.
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| New York lawmakers are currently considering the passage of a massive government takeover of health insurance. The numbers for the New York Health Act, which would enact a single-payer healthcare system, are staggering: more than 160,000 jobs eliminated; $253 billion in new taxes on employers and workers (more than double the entire state budget); business tax increases of over 2,000%. It is no understatement: single payer is an existential threat to our profession. We and a diverse coalition of allies have successfully held this devastating bill at bay for years, but the threat is growing. In the wake of a historic leftward shift in the Senate after the 2020 elections, the concern that single payer could pass have never been greater. Big I NY has identified a small number of moderate Democratic senators whose votes will be crucial. We are recruiting a small team of passionate agents who work in the health and benefits space to join us in meetings with several key Senators. Lobbying training and talking points will be provided ahead of the meetings, which are expected to take place between June 1st and 4th.
Click here to add your name to the list, and we will follow up when meeting dates and times are confirmed.
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| Businesses have filed nearly 1,700 lawsuits for business interruption coverage claims following lockdowns in 2020 and there are now 120 cases on appeal, in both state and federal courts, that allege insurance companies wrongfully denied coverage for pandemic-related business interruption claims. New reports indicate that Colonial did have cyber insurance, but how does a cyber policy work in the event of a cyberattack? Learn how important cyber coverage really is by reviewing this current cyber attack. When excluding COVID-19, total workers' comp claim frequency fell 7% during the year. The U.S. workers' comp system saw net premiums decline 10% during 2020, while carriers recorded $260 million in COVID-19 claims and other key economic metrics are at or near historic highs, according to the National Council on Compensation Insurance (NCCI). Being authentic, staying consistent and having fun are just the basics of a strong social media strategy. If you have been hesitant to step into the fray, read about how to keep it simple, yet effective. An association of insurance agents for Allstate has filed a lawsuit against the insurer, alleging a breach of contract. The lawsuit was filed by the National Association of Professional Allstate Agents (NAPAA) in the US District Court, Northern District of Illinois on May 18, 2021. The civil action seeks declaratory relief, injunctive relief, and monetary damages based on eleven counts of breach of contract. Read more on the lawsuit.
With pandemic lockdown restrictions slowly easing, demand for active shooter insurance policies has surged – and for tragic reasons. Client inquiries for mass shooting insurance have risen 50% year-over-year in the past six weeks. The demand has been particularly strong from the healthcare sector, despite fatal and mass shootings in US hospitals being comparatively rare.
One-third of consumers went from being fully insured to under- or uninsured during the COVID-19 pandemic, according to TransUnion. A TransUnion study conducted in March found that 70% of respondents said it was important to have full auto insurance, but 34% said they went from being fully insured to uninsured or under-insured during the pandemic. Eighteen percent (18%) said they missed one or more payments, and 27% said they canceled a policy. Only 20% adjusted payment plans, while 32% increased deductibles to lower premiums. According to LexisNexis, there was also movement in policy renewals away from March and April and toward May and June. This trend was more pronounced in the non-standard market, particularly for new policies. Concerning policies that were in force February 1, 2021, fewer had terms starting in October and November, with more starting in December and January. How could this impact your agency in both operations and revenue flows? State regulators in New York will soon draft rules that will require employers to protect workers from airborne infectious disease. A new state law tasks state labor and health officials with coming up with minimum workplace standards around things like the availability of personal protective equipment, social distancing and quarantine requirements. Governor Andrew Cuomo signed the bill into law last week.
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| By Jim Lombardo, CPCU, AAI, AIM, MBA, AVP of Learning & Development
A little bit about me: sometimes I do not want to talk to anyone. And at other times, I will chat your ear off! Yesterday when I was at the barber, he was asking me questions about my job and if it has been affected by COVID. I told him that I just work from home a bit more now, and other than that, I have been busy. I knew what was coming next: “So what do you do?”
I decided to answer with, “I’m in the insurance business: I help support agents with education, training, research, and more.” I continued, rather proudly, that “our industry was considered essential and we've been busy helping our clients and customers with anything and everything the whole time.”
I share this with you not to talk about me but to talk about YOU!! You are in such a wonderful industry: helping people, protecting businesses, allowing people to feel safe.
We need to promote what we do! Pat ourselves on the back more often—shout out to the world we are proud to be in insurance and finally, recruit more people into our wonderful career paths...and on that note, we have a pre -licensing class coming up soon.
On June 8th we have a class starting that is virtual and with a leading local instructor, Don Reese.
So here is a link to use to share with your staff, your partners and anyone you may be thinking of approaching for insurance- let’s get going!
If you have any questions, comments, concerns, or suggestions, let me know. I would love to “chat your ear off!”
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