Latest Studies

This survey by industry employment website GreatInsuranceJobs.com indicates that insurers are on a hiring spree, but have difficulty finding new talent. In the 64 companies surveyed, there were 8,454 jobs openings combined. Companies are trying to keep up with new job requisitions and replace retirees as well as short-term millennial workers, who stay only for 12 to 18 months. According to the survey, more than 13,300 additional jobs will open in the last three quarters of 2018. The top five areas insurance companies are looking to fill are sales, underwriting, customer service/administration, technology and claims. The survey found that the top challenges to hiring include a lack of skilled talent, uncompetitive salaries and small recruiting budgets. Some companies may also be hindered by relying on outdated recruiting strategies. Full report

This study found that despite general concerns about the possibility that artificial intelligence (AI) could wipe out jobs, most executives and employees in the insurance industry strongly support the development of AI. Approximately two-thirds of executives and 68 percent of the workers who responded to the survey said that they expected AI to completely transform the industry and lead to additional jobs in their companies over the next three years. Most executives said that only 25 percent of their workers have the skills to work with AI, and 43 percent of executives noted a widening skills gap as the primary factor. However, only 4 percent of these executives say that plans are in place to increase spending on programs to expand the skills of their staff. Accenture expects AI to make some jobs redundant and unnecessary, but identifies new job categories that will need to be filled as AI becomes more prevalent. Full report

This analysis of 2017 global M&A (mergers and acquisitions) focuses solely on the insurance distribution and services marketplace. A separate Conning report covers global M&A activity among insurance underwriters. While 2017 global mergers and acquisitions transactions for insurance distribution set new records, insurance services were down from the prior year, despite a strong technology focus. This study reviews the characteristics of the record-setting year and what factors contributed to the high level of transaction activity, with major transaction details and exploration of private equity’s growing presence. The report is available for purchase from Conning by calling (888) 707-1177 or by visiting Conning Research.

This report from JLT Re shows that the insurance industry has made progress in strengthening the market for terrorism insurance, but that more needs to be done to help businesses and members of the industry manage increasingly complex terrorism risks. Western nations are confronting a risk landscape comprised of individuals, international groups and online threats, and businesses are increasingly looking to the terrorism insurance market to mitigate the broad range of potential attacks they face. With property damage no longer necessarily the primary loss driver, comprehensive terrorism products require a physical damage trigger to pay out claims. In response, specialty insurers have developed new, broader coverages that include loss of attraction, active shooter and cyber. Long-held definitions have also come under review as some recent attacks have blurred the distinctions between terrorism, malicious acts and workplace violence. Reinsurers are broadening risk appetites and adopting new approaches to account for the complexities that the new threat landscape brings. The global economic impact of terrorism has averaged $79 billion over the last five years, with very little of that amount insured. The bulk of the estimated $84 billion economic impact in 2016, was suffered in Iraq, Nigeria and several other countries experiencing a spectrum of violence from terrorism and insurgencies to war. Full report

This report from Fitch Ratings found that cyber insurance coverage continues to be one of the most rapidly expanding segments of the industry and provides significant growth opportunities for property/casualty insurers in the U.S. Approximately 75 insurers now participate in the market, which is dominated by AXIS Capital Holdings Ltd., Chubb Ltd. and American International Group Inc. According to aggregate statutory data for the property/casualty industry, stand-alone cyber direct written premiums rose to $986 million in 2017, as stand-alone and package cyber premiums together rose to $2.0 billion for the year.. Allianz SE predicts that the cyber insurance market could total as much as $20 billion by 2025. The statutory direct loss ratio for stand-alone cyber insurance fell to 35 percent in 2017 from 43 percent the previous year, an indication of the strong underlying profitability in the cyber market so far, according to Fitch. James Auden, managing director, said that profitable results in the new cyber market are attracting competition, and that approximately 75 distinct insurers each wrote more than $1 million in annual cyber premiums in 2017 alone. News release

The study gathered data about Hurricane Harvey, including the storm’s energy, moisture and the conditions of the ocean before and after. The data indicate that the amount of energy Harvey pulled from the ocean, in the form of rising water vapor, equaled the amount of energy it dropped over land in the form of rain. This is the first time such an equivalence has been documented. This revelation supports assertions that climate change is likely to make Atlantic hurricanes larger, more intense, and longer-lasting than in the past. The authors estimate that climate change likely caused Harvey’s rainfall to be 15 percent to 38 percent greater than it would have been otherwise. Full text

This news release contains highlights from the NCCI's 2018 State of the Line report, an overview of the health of the workers compensation system, presented at the association's Annual Issues Symposium. In 38 states, workers' compensation lines saw their combined ratio drop to 89 percent in 2017 from 110 percent in 2011, the lowest in 50 years. Workers' compensation insurers are enjoying their highest profits in decades as the number of claims from injured workers continues to decline, even with increases in employment. Opioid use has declined, which may be due to the adoption of drug formularies imposed in 10 states. Overall for NCCI states, prescribed opioids dropped from 55 percent of workers' compensation claimants in 2012 to about 45 percent in 2016. News release

This comprehensive report tracks the performance of 18 different state workers compensation systems, compares them with each other, and discusses the changes that have been made to the systems. The reports are intended to inform policymakers and other interested parties about the performance of these state systems and to allow them to measure the effectiveness of a company’s workers compensation program, and to identify important trends. The benchmarks show changes in income benefits, overall medical payments, costs, use of benefits, duration of disability, litigiousness, benefit delivery expenses, timeliness of payment and other metrics of system performance during the period of 2011 through 2016 and claims experience through 2017. The 18 states included in the report are: Arkansas, California, Florida, Georgia, Illinois, Indiana, Iowa, Louisiana, Massachusetts, Michigan, Minnesota, New Jersey, North Carolina, Pennsylvania, Tennessee, Texas, Virginia and Wisconsin. To learn more or purchase copies, please click here.

This study by Verisk Analytics found that for one in five addresses, the nearest fire station is not the one responding in an emergency. The paper says that measuring distance alone could put property insurers on the wrong road when assessing fire protection. The research paper states that insurers need a better way to measure how local fire protection affects the risk of property loss. The paper says that significant differences were found between a purely distanced-based measure for fire protection and the more holistic approach employed by ISO’s Public Protection Classification (PPC) model. The analysis concludes the PPC model is 9 times more effective in gauging a community’s fire risk. The PPC model considers a variety of characteristics that distinguish each community’s fire protection, and its relative ability to prevent and fight fires. Full report

More than one hit-and-run crash happens somewhere in the U.S. every minute. The 2,049 fatalities that resulted from hit-and-run crashes in 2016 were the highest number ever recorded, with pedestrians and bicyclists accounting for close to 70 percent of all hit-and-run crash deaths in 2016. The report analyzes recent crash data; reviews existing literature; discusses the characteristics of the victims, drivers and road conditions; and discusses existing countermeasures. Full report

Pedestrian fatalities in the U.S. have risen by 46 percent since 2009, an increase so rapid that it represents a public health crisis that authorities are struggling to understand. Approximately 6,000 pedestrians were killed by motor vehicles on or along the nation’s roads in 2016, the latest year for which data is available. The rate of increase is far greater than those for all other traffic-related deaths. This study by the Insurance Institute for Highway Safety looked at pedestrian crash trends during 2009 to 2016 to identify the circumstances under which the largest increases occurred. The researchers looked at roadway, environmental, personal and vehicle factors to see how they changed over the study period. One of the factors leading to more pedestrian deaths is the increasing presence of SUVs on roads in the U.S. The study found that the number of SUVs involved in single-vehicle pedestrian deaths increased 81 percent between 2009 and 2016. Some of the improvements the report recommends include: adding safe and convenient crossing locations to roads; reducing speed limits; and adding better headlights and street lights. Full report

The author, who runs the Connected Autonomous Vehicles Lab at the University of Surrey, predicts that driverless cars will be commercially available by 2025, and that the entire United Kingdom transportation system will be automated by 2070. To meet the bandwidth demands that the traffic management system for autonomous vehicles will require, the next generation of wireless technology must be implemented. Cities and towns should begin investing in the number of radio antennae and roadside units that will be necessary to support the infrastructure for the driverless vehicles and at the same time, security and privacy must be considered. The author notes that the Netherlands is currently furthest along in preparation, thanks mainly to its outstanding road infrastructure. Full text