Insurance agencies that adopt digital methods to interact with customers have seen their revenues grow faster than their less digitally sophisticated competitors, according to new research by Liberty Mutual and Safeco Insurance. However, the research also indicates that digital adoption by agencies has slowed in recent years.
The study, The State of Digital in Independent Insurance Agencies, found that “highly digital adopter” agencies — based on a 10-point scale related to the number and complexity of the tools the agency uses — experienced a 70 percent growth rate, as opposed to 17 percent for “high digital adopters”, and a mere 10 percent for “low” and “medium” digital adopters.
But while digital adoption has gained traction, it has declined as a priority in agencies’ plans. In the latter part of 2020, 58 percent of agencies said improving digital capabilities was part of their five-year growth plans, according to the Liberty Mutual/Safeco study. However, by late 2021, this had decreased to 47 percent, approximately the same as in 2017.
The digital tools that have seen a decrease in use range from social media to live online chats. Additionally, many agencies said they are not tracking which digital tools are driving growth.
The survey found that 60 percent of digitally focused agencies said they planned to invest in new digital capabilities within their five-year agency growth plans. Only 42 percent of slow and steady growth agencies said the same. Growth-focused agencies have used several tools to increase their reach and revenue. Self-service portals, video calls, live online chats, video quotes, and policy reviews have all driven significant improvement among these agencies.
These, however, are not the only tools being recommended and used. Artificial intelligence, machine learning, Internet of Things, and big data analytics are all being considered and used to increase engagement with customers and prospects.
Agents remain alert to cyber threats. The Liberty Mutual/Safeco study found that 57 percent of survey respondents anticipated that cyber liability would have a major impact on their agencies by 2025, an increase from 46 percent in 2017.
Uncertainty spawned by the debt ceiling debate will likely exacerbate the replacement cost inflation that has been putting upward pressure on property/casualty insurers’ loss ratios – and, ultimately, consumers’ premium rates, according to Triple-I’s chief economist.
“Whether or not we go to five, 10, 20 days – or if we don’t have a shutdown at all – this signals to the market a dysfunction in terms of government operations,” said Dr. Michel Léonard, Triple-I chief economist and data scientist in an interview with Triple-I CEO Sean Kevelighan. “That leads to higher interest rates…which fuels inflation and reduces growth.”
As material and labor costs rise, home and vehicle repairs become more expensive, pushing up insurers’ losses and putting upward pressure on premium rates. For a P/C industry already struggling with high replacement costs and trying to grow with the rest of the economy, Léonard said, “This [debt limit debate] adds to those challenges.”
Kevelighan – whose background includes having worked in the U.S. Treasury Department during the George W. Bush administration – called high replacement costs a “new normal.”
“You have to look at year-over-three-years replacement costs, and they’re high,” Kevelighan said. “Personal homeowners replacement costs are up 55 percent. We’ve got personal auto replacement costs up 45 percent. And if inflation goes to a negative, we’re in an even worse place.”
Léonard pointed out that the federal government has shut down 21 times since 1976, with the shutdowns lasting as long as 35 days or as little as a few hours. In the interview above, he explains how these have typically played out and what types of scenarios might lie ahead.
The first in-person international event in the conference series since the 2019 Women in Insurance Global Conference, it will bring together hundreds of insurance professionals, C-suite executives, and experts on leadership and diversity, equity, and inclusion (DEI), along with sustainability, wellness, and business leaders for sessions dedicated to advancing ideas into action and providing actionable take-aways and strategies.
What makes any conference strong is the quality of the content and its speakers. IICF’s planning committee, which changes from year to year, is made up of industry professionals who are closest to the issues of the day, representing all areas of the United States and the United Kingdom in the planning. It’s an industry working together that makes this conference particularly powerful.
This year’s conference will feature emerging topics in leadership, personal and professional growth, the business of insurance, and the future of work.
Leadership topics include:
Personal Finance, with Jean Chatzky — financial editor of the Today Show for 25 years and founder and CEO of HerMoney.com and the coaching programs FinanceFixx and InvestingFixx;
Building the Public Voice of Women, with Emily Donahoe, founder/principal, WOMENSPEAK Training; and
Navigating Intergenerational Differences, with Chris Desantis, author, speaker and podcast host of Cubicle Confidential.
“IICF is thrilled to welcome such an accomplished field of speakers for the eleventh year of what was formerly known as the IICF Women in Insurance Conference Series,” said Elizabeth Myatt, vice president, chief program officer, and executive director of the IICF Northeast Division. “This event serves as a powerful catalyst for our industry as we bring together insurance professionals of all ages and career stages to discuss, learn and propel critical strategies.”
Myatt, who has led the conference since its inception, noted that it’s her favorite part of the job. “It has been wonderful to see the evolution of the conference series,” she said. “It is not just gender-focused — it is all kinds of diversity, leadership, and innovation and it’s the business of the industry itself, which has made it so valuable and meaningful to attendees.”
Myatt recognizes the importance of advancing DEI, which must be embedded in everything in the business, and everyone needs to see the shared value. She said a Congressional report this year spelled out some of the ways where the insurance industry has made an impact.
“There has been progress in gender diversity and for African-Americans, though we have not made as much progress within the Hispanic community as we’d like,” she said. “Through our conferences and the IDEA Council’s development of the IICF Talent Hub – an online resource center for non-traditional job seekers to learn about insurance industry jobs and career opportunities – and the Mentoring Alliance, which will prepare, inspire, and empower diverse talent by pairing them with role models and allies from leading companies across the industry, we are starting to see results.”
The theme for the last four years of the global conference has been advancing ideas into action, Myatt said.
“We want to provide tools, as well as new thinking. We don’t want the ideas that are shared here to stay in the room,” she said. “We plan to arm our audience with ways to make change, whether it’s personal, professional, or cultural.”
By Loretta L. Worters, Vice President, Media Relations, Triple-I
In celebration of International Day for Women in Maritime – observed every May 18 – Triple-I interviews women who have made a difference in the maritime field. Last year, the Triple-I focused on Isabelle Therrien, SVP-Canada, Falvey Cargo Underwriting.
For as long as Anne Marie Elder could remember, she loved the sea. Being the niece of a Merchant Marine officer, she heard her uncle’s stories about the Merchant Marine’s role in World War II. She imagined what it felt like to stand on deck and watch the sun reflect on the water’s surface, breathe in the salty air, and listen to the ocean waves. When she was in sixth grade, her Aunt Margaret told her about the first class with women graduating from the US Merchant Marine Academy (USMMA or Kings Point) and encouraged her to consider USMMA as an option for college.
It was the only college Elder applied to. She entered in 1984, in a class of about 211 men and 28 women. When she graduated, there were only 16 women – a 43 percent dropout rate.
As part of her education, she was required to serve two six-month terms as a midshipman aboard commercial U.S. Merchant ships. A 20-year-old woman aboard a Merchant ship with 25 men was not always well received. Within the first few hours on board one ship, the ship’s captain bluntly informed her that women did not belong at sea and that he did not want her on his ship.
“I was given specific orders to leave the bridge any time the captain was there,” she recalls. “I also wasn’t allowed to eat in the mess hall at the same time he ate his meals. This went on the entire time I worked aboard that ship.”
“The captain’s reaction was so ludicrous and unprofessional,” she said, “I decided to take the high road and refused to let him rob me of a great learning and life experience.”
Elder noted that the first month aboard ship could be challenging. “Some men gave me a hard time, but once they realized I was there to work and learn, they became more like brothers, looking out for me, making sure I was safe and watched over on the ship and when at a port.” For the first six months, Elder was the only woman aboard the ship.
“I went there to get an education, and nothing would dissuade me,” she said. “I was very serious, on the straight and narrow.”
By the age of 21, she had seen more of the world than anyone she knew.
“They were some of the greatest times of my life,” she said.
And that ship’s captain? He gave her one of the best evaluations she got during her year at sea.
“He didn’t want me on his ship, but he clearly respected the job that I did.”
Swallowing the Anchor
Elder thought that she would spend a few years at sea, but there weren’t many sailing jobs at the time of her graduation. She thought about going to law school. But she had a wonderful mentor and teacher at Kings Point: Rich Roenbeck, who was also a former Kings Pointer who taught her about marine insurance.
“He was so good, such a great teacher, and it was pretty interesting, so I decided to swallow the anchor – give up the sea life – and try marine insurance,” she said.
Elder’s Aunt was again encouraging. “A teacher in NYC and also a nurse at the VA hospital, she was an inspiration to me,” Elder said. “She was the number one reason I went to Kings Point and got ahead. When I started work, she took me out and bought me an entire wardrobe, so I’d look and feel confident when going to my new job.”
Her first job was with Continental Insurance/MOAC, which hired six marine trainees in their New York office – five men and Elder — where she started writing hull and cargo insurance. She also became very involved with the American Institute of Marine Underwriters (AIMU).
“AIMU is a hugely important part of marine insurance,” she said. “They are a wonderful organization that has been around 125 years this year! They provide education in our industry and are involved with issues that are important to our industry.”
Elder lives by King Point’s motto she learned years ago – Acta Non Verba! – Deeds, Not Words! Today, as a result of her deeds, she is Global Chief Underwriting Officer, Marine at AXA XL, a division of AXA, where her job is to develop the strategy and manage the portfolio of the company’s $1.1 billion book of marine business, one of the largest marine insurers in the world.
One of her greatest concerns is the talent gap the industry faces. Not just in the United States, but the rest of the world as well.
“Companies need to be more creative about bringing people into this industry,” she said. “They need to think differently, to assess the skillset, not necessarily the knowledge of insurance, but the overall skillset. Companies should compensate them appropriately for those skills and develop them quickly as underwriters.”
What brings Elder the greatest joy is developing people.
“You must be the captain of your own ship,” she said. “You can take that ship anywhere you want, but you must have a plan and develop the skills you need to know where you’re going. If you’re not going in the direction of your dreams, you need to change the course of your ship.”
She noted that women can sometimes be less vocal about their aspirations.
“Women think that if they work hard, they will be given a fair salary and chances to advance, but that’s not necessarily the case. Women need to work hard and develop the skills for advancement, but they also need to make sure that their managers know their short- and long-term career aspirations,” she said.
“I spent three years in London in marine treaty reinsurance and would never have had that opportunity if I hadn’t spoken up. It put me on people’s radar,” she explained. “You must be positioned and ready for the opportunities. You have to network and vocalize what you want. It also takes a good sponsor which is different from a mentor. A mentor guides and helps you strategize, but a sponsor promotes you to other people to help you advance in your career. You need both. I had someone early on who was looking out for me. It was a man. There were few women leaders when I started,” she said. “There still aren’t a lot of women in senior positions in marine insurance, but men are doing a better job of recognizing women’s assets.”
Elder noted that women and men can have very different leadership styles.
“We don’t always think the same way or manage the same way,” she said. “Having that diversity of thought makes a stronger company. Studies have shown that more diverse companies have higher profits.”
“It’s a great time for women to be in this industry because of all the opportunities out there,” she said. “I tell women, ‘Take the helm and be that leader.’ I tell them, ‘Full speed ahead, ladies, full speed ahead!’ ”
The U.S. property/casualty insurance industry ended 2022 with a net combined ratio of 102.4 – representing an overall underwriting loss that would have been significantly worse if not for an underwriting profit in commercial lines that partially offset a loss in personal lines, according to the latest underwriting projections by actuaries at Triple-I and Milliman
Combined ratio is the difference between claims and expenses paid and premiums collected by insurers. A combined ratio below 100 represents an underwriting profit, and one above 100 represents a loss.
The report, Insurance Economics and Underwriting Projections: A Forward View, presented at a members-only event on May 15, showed the divergence in performance between product lines was stark, with personal lines logging a combined ratio of 109.9 vs. 94.8 for commercial lines, the largest difference in at least 15 years. Looking ahead, the 2023 net combined ratio is forecast to be 101.5.
Dr. Michel Léonard, chief economist and data scientist at Triple-I, discussed key macroeconomic trends impacting the property/casualty industry results, including inflation, rising interest rates and overall P&C underlying growth. He noted that P&C underlying growth continues to be constrained by monetary policy.
“U.S. growth dropped over the last six months as rising interest rates depressed new housing starts, corporate capital investments and spending on vehicles,” Léonard said.
Léonard added that this trend is likely to continue, with the P&C industry contracting by -1.5 percent year to date, compared with U.S. gross domestic product (GDP), which grew at 1.3 percent. GDP is forecast to grow slightly above Fed expectations between 2023 and 2025, but to remain below the Fed’s long term growth expectation for the foreseeable future.
Looking at personal auto, Triple-I Chief Insurance Officer Dale Porfilio, said the 2022 net combined ratio came in at 112.2 — 10.7 points worse than 2021 and 19.7 points worse than 2020.
“The industry has not had this poor of a full year underwriting performance for personal auto in decades,” Porfilio said, adding, “Unless replacement cost trends begin to decrease materially – which is not currently forecast — it will take the industry into at least 2025 to restore personal auto results to underwriting profitability.”
For homeowners, Porfilio commented that the 2022 net combined ratio came in at an unprofitable 104.6. Porfilio added, “Hurricane Ian, the second-costliest insured loss after Hurricane Katrina, was a significant driver of underwriting losses for the industry.”
On the commercial side, Jason B. Kurtz, a principal and consulting actuary at Milliman, said commercial property, general liability, and workers compensation were bright spots for the industry, each logging underwriting gains in 2022. On the other hand, commercial auto and the commercial multi-peril lines were sources of weakness in 2022, with each seeing combined ratios of about 105.
“Commercial auto performed surprisingly well in 2021, but this appears to have been short-lived, as underwriting losses driven in part by material prior-year adverse development returned in 2022,” Kurtz said. “We expect further rate increases will be needed to offset loss pressures affecting this line.”
Turning to cyber, Dave Moore, president of Moore Actuarial Consulting, said cyber insurance direct written premium grew 50 percent in 2022. He added, “The cumulative growth over the last seven years has been 620 percent.” The direct incurred loss & DCC ratios for the last eight years have averaged “49 percent with 2022 coming in slightly below average at 45 percent.”
Overall, the P&C industry underwriting projections are experiencing the benefits from improved efficiency to significantly reduce both operating and loss adjustment expense ratios, as evidenced by the industry expense ratios for 2022.
“Commercial lines achieved lower net combined ratios than personal lines in both 2021 and 2022, and we forecast that to continue through at least 2025,” Porfilio said.
By Dr. Michel Léonard, Chief Economist and Data Scientist,and Riley Conlon, Research Analyst, Triple-I
U.S. employment remains more resilient than expected given monetary tightening, adding 253,000 jobs in April, and pushing the unemployment down to 3.4 percent in April compared to 3.5 percent in March.
Jobs growth has been positive for the last 26 months, with the U.S. economy now having replaced most of the jobs lost at the beginning of the pandemic. Employment for the Insurance Carriers and Related Activities subsector specifically continues to outperform wider U.S. employment. The unemployment rate for the insurance industry was 1.6 percent in April, up from 1.5 percent in March.
Employment’s resilience and the historically low current unemployment rate are likely to add to pressure from inflation hawks on the Fed to not only continue increasing rates but to make each rate hike bigger. Based on Triple-I’s model, the spread between actual employment and the pre-COVID forward trend, which has been narrowing since the end of the pandemic, is likely to stabilize at its current level.
Aligned with this forecast and our conversations with policy makers, our view is that it is unlikely that the stronger-than-expected April jobs performance will lead the Fed to aggressively accelerate the pace of current monetary tightening; it may, however, expand the duration of the current tightening cycle.
U.S. employment has been steadily heading back to its pre-COVID growth trend. This shows great resilience, given monetary tightening. Expect the Fed to continue with “Slow and steady wins the race,” even though calls for “Monetary shock and awe” will likely grow stronger.
The cost of claims per insured home in the United States has increased at a rate outpacing inflation over the past 20 years, according the Insurance Research Council (IRC) — like Triple-I, an affiliate of The Institutes.
Insurers also continue to wrestle with insurance fraud and claim abuse following disastrous events. These trends have cut into profits and led several major insurers to reduce their capacity in some U.S. states or leave the homeowners market entirely.
Other findings include:
Countrywide average loss costs (average claim payment per insured home) increased throughout the past two decades and rose nine percent in 2021.
Claim severity is increasing, while frequency is declining—in part because of widespread adoption of higher policyholder deductibles, including percentage deductibles for specified perils, and premium surcharge programs designed to reduce the number of lower-cost claims.
Catastrophe losses play an increasing role because of natural disaster trends and the methods used to define and categorize catastrophe claims.
Average loss costs for claims vary widely by state. States with the highest loss costs are Louisiana and Mississippi; states with the lowest are Hawaii and Maine.
States with the highest claim frequency over the period include Louisiana, Mississippi, and Oklahoma. States with the highest severity include California, Alaska, and Florida.
“During the two decades of the study period, the U.S. homeowners market has experienced a surge in volatility, mainly driven by a barrage of disasters, such as hurricanes Katrina, Ike, Michael, Rita, Sandy and Wilma and California fires,” said Dale Porfilio, IRC president and chief insurance officer for Triple-I.
Porfilio also noted that another challenge facing the homeowners insurance market is the continued threat of insurance fraud and claim abuse, especially after natural disasters.
“Industry and government organizations have increased efforts to inform consumers about potential scams, to investigate and prosecute the perpetrators, and to enact legislative changes to make systems less vulnerable to abuse,” Porfilio added.
The legislation – signed into law by Gov. Eric Holcomb on April 20 – requires that each party in a civil proceeding and each insurer that has a duty to defend a party in court be notified of any litigation funding agreement before the case begins.
The U.S. Government Accountability Office defines third-party litigation funding as “an arrangement in which a funder who is not a party to the lawsuit agrees to help fund it.” Global multi-billion-dollar investing firms have made third-party litigation funding their sole or primary business and are experiencing strong growth.
As the market lacks transparency, estimates on its size can vary but, according to Swiss Re, more than half of the $17 billion invested into litigation funding globally in 2020 was deployed in the United States. Swiss Re estimates the market will be as big as $30 billion by 2028. Meanwhile, affordability of insurance coverage – especially for commercial auto products – has come under threat from increases in litigation and claim costs.
Several states have preceded Indiana in seeking to increase transparency around third-party litigation funding. In 2018, New York enacted legislation that added Section 489 to the New York Judiciary Law. This law mandates the disclosure of litigation financing agreements in class action lawsuits and certain aggregate settlement cases. In the same year, Wisconsin instituted a statutory provision requiring the disclosure of litigation funding arrangements. West Virginia followed suit in 2019.
In 2021, the U.S. District Court for the District of New Jersey amended its rules to require disclosures about third-party litigation funding in cases before the court. The Northern District of California imposed a similar rule in 2017 for class, mass, and collective actions throughout the district.
In 2022, Illinois passed the Consumer Legal Funding Act (S.B. 1099), which implemented several statutory provisions regulating aspects of third-party litigation funding, but it doesn’t address disclosure of these arrangements or information about the existence of a funding arrangement to defendants as part of claim litigation.
Litigation funding not only drives up costs – it introduces motives beyond achieving just results to the judicial process. This is why the practice was once widely prohibited in the United States. As these bans have been eroded in recent decades, litigation funding has grown, spread, and morphed into forms that can cost plaintiffs more in interest than they might otherwise gain in a settlement. In fact, it can encourage lengthier litigation to the detriment of all involved – except for the funders and the plaintiff attorneys.Top of Form
“Litigation funding is a multi-billion-dollar industry that for years has driven up the length and cost of civil cases,” said Neil Alldredge, president and chief executive officer of NAMIC. “While there is much more that needs to be done to address this issue, this law represents important progress.”
Revealing litigation funding from a third party before commencement of a lawsuit “will help thwart opportunistic investors from promoting return on investment over client interests and siphoning value from clients away from policyholders, claimants and insurers,” Alldredge said.
By Matthew Scarfone, Esq., Triple-I blog contributor, and shareholder at Colodny Fass
Florida presents property insurers with a unique set of factors that affect the availability and affordability of insurance coverage. The state boasts the third-largest population in America while simultaneously enduring a higher-than-average volume of natural disasters. It’s fair to say that operating a residential insurance company in the Sunshine State isn’t for the faint of heart.
What’s behind the mounting catastrophe in the Florida legal system?
But as damaging as the hurricanes can be, there is a man-made disaster that has contributed significantly to destabilizing the market to concerning levels: legal system abuse. In practice, some people are misusing tools of the justice system to manipulate outcomes and obtain windfalls. Insurance carriers have paid a heavy price in recent years due to the increased abuse of one-way attorney fees, bad faith claims, and other unsustainable litigation trends.
Exploitation of one-way attorney fees and bad faith law has been especially prevalent. Until recently, if a policyholder or third party sued an insurer and obtained any monetary award, they were entitled to recover all attorney fees incurred in the litigation. This practice may have incentivized people to dispute insurance claims, regardless of whether they were justified.
The problem was further exacerbated by the abuse of assignment of benefits (AOB) agreements, which created an opportunity for contractors to inflate costs. As a result, a modest homeowners insurance claim could lead to multiple lawsuits by different assignees, each asserting a separate claim for attorney fees. Manipulating this loophole encouraged excessive claims and unreasonable demands, forcing insurers to choose between paying the inflated bill or risking a lengthy trial where the attorney fees alone could exceed the claim amount. On top of that, courts have had broad discretion to apply fee multipliers and can award 1.5-3 times the reasonable attorney fee.
Cases involving allegations of bad faith further compound an insurer’s exposure because these cases can be costly to defend and involve intrusive discovery, amorphous damages, and unpredictable juries. Bad faith cases are not ripe (i.e., ready to potentially warrant judicial intervention) until there has been a final determination regarding coverage and the damage amount. Therefore, insurers regularly face the prospect of defending a bad faith case even after resolving the underlying dispute.
Florida’s courts did not help matters by ruling that appraisal awards—tools designed to help resolve disputes—could lay the procedural groundwork for bad faith actions. In other words, after resolving a claim through appraisal, insurers could still be left to defend a lawsuit for bad faith. Some attorneys used this caselaw as a playbook to fast-track claims into bad faith litigation by misusing the appraisal process.
The problem looks even worse when you quantify it. According to the Florida Office of Insurance Regulation (OIR), as of 2020, despite Florida only accounting for 9% of all homeowners insurance claims in the country, it accounted for 79% of all homeowner insurance litigation nationwide. Additionally, over the last decade, only 8% of the $51 billion paid out by insurers went to claimants, yet plaintiffs’ attorneys took home 71%. Meanwhile, eleven Florida property insurers fell into liquidation since 2017—five of those occurring last year alone.
Legislators recognized need for urgent action to help curb costs of insurance claims.
The Florida Legislature has responded to the growing crisis by passing multiple pieces of significant insurance reform, primarily tackling the problems with AOBs, bad faith claims, and excessive fees. For example, the new laws eliminate one-way attorney fees in property insurance litigation, forbids using appraisal awards to file a bad faith lawsuit, and prohibits vendors from taking AOBs under new policies. Despite criticism from the plaintiffs’ bar, these reforms are not all “one-sided.” Recently passed legislation also ensures transparency and efficiency in the claims process and encourages a more efficient and less costly alternative to litigation.
While it’s too soon to know exactly how recent reforms will improve the state’s insurance market, there is a sense of hope that these measures will decrease the volume of property insurance litigation and foster a more viable and stable residential insurance market that enables greater consumer access to affordable coverage.
It may take time for these reforms to have a measurable impact on Florida’s property insurance market. Still, insurers and policyholders alike should be optimistic that the market is headed in a more sustainable direction.
Lightning is a more complex peril than it is often given credit for being, according to Tim Harger, executive director of the Lightning Protection Institute (LPI). In a recent interview with Triple-I CEO Sean Kevelighan, Harger discussed the importance of preparing for and preventing damage from this risk, which is second only to flooding when it comes to costly weather events.
People typically think about fire damage when they think about lightning. But Harger said, “Beyond the fire is the destruction of electrical wires and infrastructure that supports everything we do to communicate and to conduct business.”
If lighting strikes any of these structures, he said, “Activity is stopped.”
Harger cited the case of an East Coast furniture manufacturer that was struck.
“That one lightning strike cost them just over a million dollars in damage,” he said. “Yes, there was the typical fire that caused structural damage, but what was impacted on the ‘inside’ was even more costly. They had damaged inventory, production downtime, and loss of revenue during the repairs.”
Investment in a lightning protection system could have saved this business owner – and his insurer – the million dollars lost and prevented business interruption. Nearly $1 billion in lightning claims was paid out in 2018 to almost 78,000 policy holders, according to LPI.
“Lightning strikes about a 100 times every second,” Harger said. “When installed properly, lightning protection systems are scientifically proven to mitigate the risks of a lightning strike.”
A lightning protection system consists of six parts:
Strike termination device,
Potential equalization, and
Architects and engineers play an important role in specifying and designing these systems, and installation is completed by certified lightning protection contractors. When properly installed lightning is intercepted by the strike termination device and energy is routed through the conductors and into the grounding system, preventing impact to the structure or electrical infrastructure.
“Businesses already install fire alarms and sprinkler systems to mitigate greater risks of fires,” Harger said. “Lightning protection systems prevent a lightning strike from causing any damage. So the investment in a lightning protection system prevents personal injury and the costly impact of even one strike.”
Several insurers offer premium discounts for policyholders who invest in lightning protection systems. LPI invites insurance providers who are interested in sharing their customer incentives to contact them at email@example.com.