In this week's news will talk about how Auto insurance shopping hits record levels in Q3 2024, California moves to regulate data privacy, and much more…
What are the primary risk concerns across the insurance industry?
Cyber incidents, climate change, and business interruption have emerged as the primary risk concerns across key market segments in the insurance industry, according to the “RiskScan 2024” survey released by Munich Reinsurance America (Munich Re US) and the Insurance Information Institute (Triple-I).
The survey, which examines risks in five categories – insurance risks, market dynamics, natural disasters, emerging technologies, and property and casualty (P&C) insurance costs – gathered insights from five market segments: P&C insurance carriers, P&C agents and brokers, middle-market business decision-makers, small business owners, and consumers.
The findings highlight cyber incidents as a top concern across all segments, with climate change and business interruption also ranking high.
The heightened concern around climate change stems from the increasing frequency and severity of extreme weather, while business interruption remains a key issue due to lingering effects of the pandemic, natural disasters, and supply chain challenges.
The survey, which examines risks in five categories – insurance risks, market dynamics, natural disasters, emerging technologies, and property and casualty (P&C) insurance costs – gathered insights from five market segments: P&C insurance carriers, P&C agents and brokers, middle-market business decision-makers, small business owners, and consumers.
The findings highlight cyber incidents as a top concern across all segments, with climate change and business interruption also ranking high.
The heightened concern around climate change stems from the increasing frequency and severity of extreme weather, while business interruption remains a key issue due to lingering effects of the pandemic, natural disasters, and supply chain challenges.
RGA, Manulife subsidiary seal US$4.1 billion reinsurance agreement
Global life and health reinsurer Reinsurance Group of America (RGA) and John Hancock, a subsidiary of Manulife Financial Corporation, announced a reinsurance agreement covering approximately US$4.1 billion in liabilities.
The agreement includes US$1.9 billion in long-term care (LTC) liabilities and US$2.2 billion in structured settlements. This transaction builds on the ongoing partnership between RGA and Manulife, which spans multiple business lines and international markets.
The reinsured LTC block consists of policies issued in 2007 or later, which align with RGA’s existing LTC portfolio. The structured settlements block leverages RGA’s experience in longevity risk and its 25-year history providing asset-intensive reinsurance solutions.
The agreement includes US$1.9 billion in long-term care (LTC) liabilities and US$2.2 billion in structured settlements. This transaction builds on the ongoing partnership between RGA and Manulife, which spans multiple business lines and international markets.
The reinsured LTC block consists of policies issued in 2007 or later, which align with RGA’s existing LTC portfolio. The structured settlements block leverages RGA’s experience in longevity risk and its 25-year history providing asset-intensive reinsurance solutions.
Auto insurance shopping hits record levels in Q3 2024
For the second consecutive quarter, the LexisNexis US Insurance Demand Meter has reported "nuclear" levels of auto insurance shopping and new policy growth, with Q3 2024 setting a record since the tracking of US insurance consumer shopping behavior began over a decade ago.
Insurer-led marketing initiatives and industry rate increases spurred significant activity among price-sensitive consumers, driving nearly half (45%) of all US policies in force to be shopped within the past 12 months.
According to LexisNexis Risk Solutions, US consumer auto insurance shopping grew 31.2% year-over-year in Q3 2024, up from 16.1% growth in Q2. New auto policy volumes increased by 25.9% year-over-year, compared to 19.5% growth recorded in Q2.
The data highlighted increased activity among traditionally less active consumer segments, including the 66+ age demographic and preferred, long-tenured customers. Rate increases appeared to drive this shift.
Insurer-led marketing initiatives and industry rate increases spurred significant activity among price-sensitive consumers, driving nearly half (45%) of all US policies in force to be shopped within the past 12 months.
According to LexisNexis Risk Solutions, US consumer auto insurance shopping grew 31.2% year-over-year in Q3 2024, up from 16.1% growth in Q2. New auto policy volumes increased by 25.9% year-over-year, compared to 19.5% growth recorded in Q2.
The data highlighted increased activity among traditionally less active consumer segments, including the 66+ age demographic and preferred, long-tenured customers. Rate increases appeared to drive this shift.
Oklahoma issues guidelines for AI use in insurance
Oklahoma Insurance Commissioner Glen Mulready has released a bulletin offering guidance for insurance companies on the use of artificial intelligence (AI) in their operations.
The bulletin provides regulatory standards and details on the documentation and information the Insurance Department may require during investigations or examinations related to AI implementation.
The guidelines align with those established by the National Association of Insurance Commissioners (NAIC), emphasizing fairness, transparency, accountability, and compliance with state laws aimed at reducing AI-related risks, the Oklahoma Insurance Department stated.
In December 2023, the NAIC introduced a model bulletin, and, since then, 19 states have adopted it. An additional four states have taken similar actions concerning AI regulations in the insurance sector.
The bulletin provides regulatory standards and details on the documentation and information the Insurance Department may require during investigations or examinations related to AI implementation.
The guidelines align with those established by the National Association of Insurance Commissioners (NAIC), emphasizing fairness, transparency, accountability, and compliance with state laws aimed at reducing AI-related risks, the Oklahoma Insurance Department stated.
In December 2023, the NAIC introduced a model bulletin, and, since then, 19 states have adopted it. An additional four states have taken similar actions concerning AI regulations in the insurance sector.
California moves to regulate data privacy
The California Privacy Protection Agency has moved forward with new regulations that clarify when insurers must adhere to the California Consumer Privacy Act (CCPA) and specify how companies may use “automated decision-making technology” (ADMT), including machine learning tools.
These proposed rules follow the CCPA, which became law in 2018 and took effect in 2020, and seek to address emerging privacy issues related to automated technology in the insurance industry.
The agency’s proposed rules confirm that insurers must comply with CCPA requirements for personal information not governed by the state’s insurance code.
These proposed rules follow the CCPA, which became law in 2018 and took effect in 2020, and seek to address emerging privacy issues related to automated technology in the insurance industry.
The agency’s proposed rules confirm that insurers must comply with CCPA requirements for personal information not governed by the state’s insurance code.
