Some 41 million Americans will travel 50 miles or more from home over the Thanksgiving holiday period, down 1.4 percent from last year, according to the AAA. This marks the first decline in Thanksgiving travel since 2002, also a time of economic challenge. ItÃ¢â‚¬â„¢s also the fourth consecutive travel holiday this year with a year-to-year decline in the number of travelers. More than 33.2 million motorists are expected to hit the road this Thanksgiving, a 1.2 percent decrease on last year. Another 4.54 million plan to travel by air and the remainder by train, bus or other transportation. According to AAAÃ¢â‚¬â„¢s Leisure Travel Index (LTI), Thanksgiving holiday travelers can expect to pay more for airfares and car rentals this year. On average, car rental prices are four percent higher than a year ago, though prices vary from location to location. For anyone renting a car itÃ¢â‚¬â„¢s important to double-check insurance coverage before you get to the rental car counter. Check out I.I.I. information on car rentals and insurance coverage. Have a happy and safe Thanksgiving!
The 2008 Atlantic hurricane season ends Sunday. A summary of the well-above average season is offered by Colorado State UniversityÃ¢â‚¬â„¢s Tropical Meteorology Project team. Of the eight hurricanes occurring in 2008, it is Hurricanes Gustav and Ike thatÃ‚ had the most impact on insurers. ISOÃ¢â‚¬â„¢s Property Claim Services (PCS) unit estimates that Gustav resulted in approximately $1.9 billion in insured damage in the U.S., while insured damage from Ike in the U.S. is estimated at $8.1 billion. This would make Ike the fifth most costly hurricane in U.S. history. Check out further I.I.I. hurricane facts and stats.Ã‚
Medical malpractice claims related to hospital infections are on the increase according to a November 20 online article at Lawyers USA by staff writer Sylvia Hsieh. The article cites Centers for Disease Control and Prevention (CDC) data estimating that over two million hospital-acquired infections occur annually, resulting in 90,000 fatalities. In long-term care facilities the CDC estimates an additional 1.5 million health-care associated infections occur annually. The article notes that 26 states have passed laws that require reporting of hospital-acquired infections. Meanwhile, the Committee to Reduce Infection Deaths (RID) says that hospital infections add an estimated $30.5 billion to the nationÃ¢â‚¬â„¢s hospital costs each year. A recent Aon analysis noted that hospital-acquired conditions (sometimes referred to as Ã¢â‚¬Å“never eventsÃ¢â‚¬ ) Ã¢â‚¬“ including hospital-acquired infections, hospital-acquired injuries, objects left in surgery and pressure ulcers account for one out of every six med mal liability claims. AonÃ¢â‚¬â„¢s 2008 Hospital Professional Liability and Physician Liability Benchmark Analysis also pointed to a potential rise in the frequency of related hospital professional liability claims. Check out I.I.I. background information on medical malpractice.
If youÃ¢â‚¬â„¢re looking for more information on the credit crisis and its impact on insurance, look no further than a new dedicated section on the Geneva Association Web site. The online section includes articles, papers and background materials from a variety of sources including insurers, trade associations and other partners. Geneva Association contributions include 10 Frequently Asked Questions on the Credit Crisis and Insurance. In the Q&A the Association notes that the direct impact of the crisis on insurance was limited, not least due to the wide diversification in insurersÃ¢â‚¬â„¢ investment portfolios. It also makes the point that the credit crisis has not questioned the basic business model of the industry, i.e. insurance risk underwriting. These are all important considerations. Check out an I.I.I. report on the impact of the financial crisis by Dr Robert Hartwig, I.I.I. president, plus background info on theÃ‚ insurance guaranty funds.
Five major U.S. corporations have teamed up with investor coalition Ceres to launch a new business alliance calling for strong U.S. climate and energy legislation in early 2009. The groupÃ¢â‚¬â„¢s key principles include stimulating renewable energy, promoting energy efficiency and green jobs, requiring 100 percent auction of carbon allowances and limiting new coal-fired power plants to those that capture and store carbon emissions. The founding members of theÃ‚ Business for Innovative Climate and Energy Policy (BICEP) include such household names as Starbucks and Nike. The group says it will push the Federal government to enact legislative changes to spur a clean energy economy and reduce global warming pollution. Check out the I.I.I. background paper on climate change and insurance issues.
After a temporary hiatus, tort costs in the United States are rising again. The 2008 Update on U.S. Tort Costs by Towers Perrin finds that U.S. tort costs rose by 2.1 percent or $5.1 billion in 2007, fueled by the first increase in auto accident frequency since 1999. It follows a 5.6 percent decline in tort costs in 2006. Further, due to the current financial crisis and a bunch of other factors such as the potential for increased activity in the area of employment practices liability, Towers Perrin predicts that tort costs will increase by 4 percent in 2008 and an additional 5 percent in both 2009 and 2010. The 2.1 percent increase in tort costs in 2007 compares with an overall gross domestic product (GDP) growth rate of 4.8 percent. Since 1950 growth in tort costs has exceeded growth in GDP by an average of two percentage points. The upshot is that the U.S. tort system cost $252 billion in 2007, which translates to $835 per personÃ‚ Ã¢â‚¬“ $9 per person more than in 2006. Everywhere we look the call is for more litigation. Check out further I.I.I. info on the liability system.Ã‚
Despite current economic conditions, nearly three in five (58 percent) women business owners predict their organizationsÃ¢â‚¬â„¢ revenues will grow in 2009 and nearly one-half (44 percent) do not expect difficulty in obtaining access to credit, according to a survey conducted by Chubb and the Women PresidentsÃ¢â‚¬â„¢ Organization (WPO). However, the same activities that will help grow their businesses may also increase their companiesÃ¢â‚¬â„¢ exposure to liability risk. Small to medium-size firms with more limited resources may be particularly vulnerable to the costs associated with a liability lawsuit, Chubb said. It highlighted product liability, errors and omissions (E&O) and employment practices liability (EPL) as areas to watch. For example, economic conditions can have a negative impact on employment-related claims and lawsuits. Even though the majority of survey respondents (89 percent) indicated they are not concerned about EPL risk increasing in 2009, Chubb noted that when companies lay off employees or reduce employee benefits there is generally a resulting spike in EPL lawsuits as well as incidents of workplace violence.Ã‚ Greater exposure to liability risks is probably a factor for all businesses right now. Check out the I.I.I. small businessownersÃ¢â‚¬â„¢ guide to insurance and I.I.I. facts & stats on litigiousness for more information.
As three major wildfires (known as the Triangle Complex fire, the Sayre fire and the Tea fire) continue to burn in Southern California, homeowners and businesses that need evacuation preparation or claims filing tips should check out information from the Insurance Information Network of California. I.I.I. research shows that most of the large fires with significant property damage have occurred in California where some of the fastest developing counties are in forest areas.Ã‚ In fact eight of the 10 most costly wildfires in United StatesÃ‚ historyÃ‚ occurred in California. Check out I.I.I. wildfire statistics.Ã‚ Ã‚
We look across the Pond todayÃ‚ to a posting on the LloydÃ¢â‚¬â„¢s risk blog by Trevor Maynard, head of the emerging risks team. It highlights the findings of a new report by the UKÃ¢â‚¬â„¢s Royal Commission on the challenges and benefits arising from nanotechnology. The report points to areas of concern about governance and regulation of nanomaterials, such as Ã¢â‚¬Å“the profound ignorance and uncertainty about the behavior of some types of nanomaterial in the environment or the risks they pose for human health.Ã¢â‚¬ The Commission suggests that existing regulatory frameworks will need to be adapted to deal with nanomaterials. Here in the United States, the FDAÃ¢â‚¬â„¢s Nanotechnology TaskForce report last year recommended the agency consider developing guidance to address the benefits and risks of drugs and medical devices using nanotechnology. As weÃ¢â‚¬â„¢ve noted before, new technologies bring with them inherent benefits as well as risks. More than $1.1 trillion of products across a broad range of sectors incorporated nanotechnology in 2007, and this impact could extend to nearly $4 trillion by 2015, according to market research firm Lux Research. Food, drugs, medical devices and cosmetics are just some of the products that may incorporate nanomaterials. On both sides of the Atlantic, the regulation of nanotechnology is an evolving area that insurers will be monitoring.Ã‚
We all recognize what a valuable source of data the Internet can be. Whether itÃ¢â‚¬â„¢s a Web site or social media such as message boards and blogs, thereÃ¢â‚¬â„¢s an infinite wealth of data that can be extracted online. A new Web tool from Google written about in the New York Times yesterday is one with potentially useful applications for our industry. According to the article, the tool — known as Google Flu Trends — may be able to detect regional outbreaks of the flu up to 10 days before they are reported by the Centers for Disease Control and Prevention (CDC). How? Well, Google has found a correlation between how many people search for flu-related topics and how many people actually have flu symptoms. It says a pattern emerges when all the flu-related search queries from each state and region are added together. When compared with data from a surveillance system managed by the CDC, Google discovered that some search queries tend to be popular exactly when flu season is happening. By counting how often it sees these search queries, it can estimate how much flu is circulating in various regions of the United States. What this amounts to is an early warning system forÃ‚ influenza outbreaks. WeÃ¢â‚¬â„¢re wondering what other applications this tool might have for insurers managing pandemic risksÃ¢â‚¬ ¦Ã‚