Insurance Events Among Top Twitter Trends Of 2010

The Gulf oil spill and the Haiti earthquake are among the top overall Twitter trends of 2010, according to analysis from the social network.

Social media blog Mashable reports that Twitter analyzed some 25 billion tweets sent in 2010 to come up with the top 10 list.

Twitter also analyzed the top 10 trending topics in eight categories: news events, people, movies, television, technology, World Cup, sports and hashtags.

Natural and man-made catastrophes, many of which impact insurers, feature even more prominently in the news events category.

The top three news events are the Gulf oil spill, the Haiti earthquake and the Pakistan floods. Hurricane Earl also ranked eighth on the list.

Twitter’s findings also indicate the increasing use of social media in disasters.

Terms + Conditions tweeted on all of the above catastrophes, as did other I.I.I. Twitter feeds (@iiiorg @Bob_Hartwig @JeanneSalvatore @LWorters @III_Research @InsuringFLA).

Check out I.I.I. facts and stats on global catastrophes.

Peering Into the 2011 Atlantic Hurricane Season

With the 2010 Atlantic hurricane season closed, it’s already time to look ahead to next year’s hurricane season.

Forecasters at the Colorado State University’s (CSU) Tropical Meteorology Project and London-based consortium Tropical Storm Risk (TSR) have just released their extended range forecasts for the 2011 season.

Both are forecasting that another above-average or very active season is likely.

The team at CSU is predicting 17 named storms, with 9 hurricanes and 5 major hurricanes (Category 3-4-5). They are also calling for above-average chance that a major hurricane will make U.S. and Caribbean landfall.

Similarly, TSR is forecasting 15.6 named storms, 8.4 hurricanes and 4.0 intense hurricanes. TSR says there is 66 percent chance that activity in 2011 will be in the top one-third of years historically.

Now for the caveats. Both teams acknowledge that this far out their forecast skill is low.

TSR says:

It is clear that the skill of the extended range hurricane forecasts issued in early December, while positive, is low. Skill climbs slowly as the hurricane season approaches. Moderate skill levels are achieved in early June and good skill levels in early August.†

CSU also comments:

Everyone should realize that it is impossible to precisely predict next season’s hurricane activity at such an extended range†¦we advise the readers to use these forecasts with caution.†

Dr. Jeff Masters’ Wunderblog has  further analysis of the December forecasts.

Check back for our coverage of  next year’s  forecasts as hurricane season gets closer.

Check out I.I.I. hurricane facts and stats.

Clarity Sought On Class Actions In Wal-Mart Case

So the U.S. Supreme Court has agreed to review whether a massive employment discrimination lawsuit against Wal-Mart involving thousands of women can proceed as a class action.

The Wall Street Journal reports that the decision could clarify federal rules on class-action suits and perhaps establish a national standard.

National Underwriter observes that the future of class actions hinges on review of the Wal-Mart case.

What are the potential  insurance implications?

The Huffington Post  notes that insurance underwriters are keeping a close eye on the case (Dukes v Wal-Mart).

As quoted in National Underwriter, I.I.I. president Dr. Robert Hartwig spells out the key issues for insurers:

This could be a dream come true for trial lawyers. It could be detrimental to any corporation subject to any case that may involve claims that can be assembled into a class. This would lower the bar on what constitutes a class.†

In a statement issued in response to the Supreme Court decision, Wal-Mart noted that the current confusion in class action law is harmful for everyone – employers, employees, businesses of all types and sizes, and the civil justice system.

Check out I.I.I. information on the liability system and a recent I.I.I. paper Tort Inflation 2010.

MarketScout: Property/Casualty Rates Down 5%

The composite rate for U.S. property and casualty insurance was down five percent in November 2010, following a decline of four percent in October, according to online insurance exchange MarketScout.

MarketScout’s latest analysis appears to confirm its warning last month that the current pricing environment may be around for several more years.

By coverage, general liability was down the most with an average rate reduction of minus six percent followed by commercial property at minus five percent.

Workers’ compensation, professional liability, D&O liability, fiduciary and surety were the coverage classes experiencing the smallest decreases (minus 1 percent).

By account size, MarketScout said accounts ranging in premium size from $250,000 to $1 million were priced most aggressively at minus six percent.

Industry sectors experiencing the largest decreases were manufacturing, contracting and service – down five percent.

Check out I.I.I. information on the industry’s financial results and market conditions.

Cyberbullying: Prevention and Response

The problem of school bullying was the subject of a recent post  here at Terms + Conditions. In it we noted that with increased access to and use of technology, cyberbullying is a growing concern.

An article in the New York Times over the weekend reports that as bullies go digital, parents are struggling to know the best way to respond. As the NYT states:

It is difficult enough to support one’s child through a siege of schoolyard bullying. But the lawlessness of the Internet, its potential for casual, breathtaking cruelty, and its capacity to cloak a bully’s identity all present slippery new challenges to this transitional generation of analog parents.†

According to the NYT, it’s not just about parents being technologically a step behind or failing to acknowledge the issue. Many struggle with how to supervise their children’s’ Internet activities, and how to proceed in the event their child is the victim of an attack.

Part of the problem is also that schools may be reluctant to get involved when the behavior occurs off-campus, and going the law enforcement route may involve a protracted process.

What about the legal environment? According to the Cyberbullying Research Center, at last count 44 states had laws regarding bullying, and 30 of those included some mention of electronic forms of harassment. Almost all of these laws direct school districts to have a bullying and harassment policy, though few delineate the actual content of such policies.

The Center advises educators, parents and law enforcement officers to carefully review and understand the statutes in their own state to understand the formal legal implications of participating in cyberbullying.

Check out  the Center’s  fact sheet on cyberbullying: identification, prevention and response.

Bumper To Bumper

This just in from the Insurance Institute for Highway Safety (IIHS): bumpers on cars and SUVs don’t line up leading to huge repair bills in what should be minor collisions in stop-and-go traffic.

The Institute’s crash test results show that in fender-benders with SUVs, cars often end up with excessive damage to hoods, engine cooling systems, fenders, bumper covers, and safety equipment like lights. SUVs don’t always come out unscathed either, often needing extensive work.

Hat tip to the New York Times Wheels blog for more on this story.

The Institute conducted 10mph front-into-rear crash tests involving seven pairs of 2010-11 models, each composed of a small car and small SUV from the same automaker.

In the tests, an SUV going 10mph struck the back of its paired car, and then the test was reversed with the car striking the back of its paired SUV.

Damage repair costs in the tests varied widely, but ran into the thousands of dollars, even for the best performers.

Total damage estimates ranged from $2,995 to $7,444 in the SUV into car tests, and from $3,601 to $9,867 in the car into SUV tests. It’s worth noting that the SUV didn’t always have the lower damage estimate either.

In the words of Joe Nolan, the Institute’s chief administrative officer:

“In the real world that money comes straight out of consumers’ wallets through deductibles and insurance premiums.†

So what’s the solution?

According to the Institute, regulating SUV bumpers would ease the burden.

While bumpers on cars are designed to match up with each other in collisions (a federal standard requires all cars to have bumpers that protect within a zone of 16 to 20 inches from the ground), a long-standing gap in federal regulations exempts SUVs from the same rules.

The Institute is calling on regulators to require bumpers on SUVs and pickups to match up in the same way as cars, shielding both from costly damage.

Check out I.I.I. facts and stats on auto insurance and info on auto crashes.

Defraying The Costs Of Disasters

Even if insurers haven’t been paying out for U.S. hurricane losses in 2010, it’s important to recognize that the industry continues to play a vital role in helping individuals and businesses recover from other costly catastrophes, such as earthquakes.

A preliminary analysis of 2010 global catastrophe losses by Swiss Re puts the cost to the global insurance industry from natural catastrophes and man-made disasters at $36 billion this year.

This represents an increase of 34 percent over the previous year, despite the lack of U.S. hurricane losses. The first 11 months of 2010 saw eight $1 billion-plus insured loss events, Swiss Re noted.

Worldwide economic losses from catastrophes were $222 billion in 2010, more than triple the 2009 figure of $63 billion, further underscoring the need for insurance.

The costliest event in 2010 was the Chile earthquake in February which cost insurers $8 billion, according to Swiss Re estimates.

However, the deadliest event in 2010 was the Haiti earthquake which claimed more than 222,000 lives, and along with the deadly floods in China and Pakistan, was barely insured.

Note: global catastrophes this year resulted in the highest number of fatalities since 1976 (260,000 killed, compared to just 15,000 in 2009).

As Thomas Hess, chief economist at Swiss Re, comments:

The humanitarian catastrophes again showed how important prevention and post disaster management are for protecting the lives and health of people affected by natural hazards. They also revealed large differences in how developed insurance systems are in the affected countries and how important insurance is in coping with the financial consequences of disasters.†

Natural catastrophes cost the global insurance industry roughly $31 billion in 2010, while man-made disasters triggered additional claims of around $5 billion, according to Swiss Re.

The earthquake that struck New Zealand in September resulted in insured losses of roughly $2.7 billion.

Winter storm Xynthia in Western Europe led to insured losses of $2.8 billion, while property claims from the BP Deepwater Horizon explosion are estimated at $1 billion, though that figure is still subject to substantial uncertainty and does not include liability losses.

Check out I.I.I. facts and stats on global catastrophes  and I.I.I. info on how insurers defray the economic costs of disasters.