SYNOPSIS – ALL INDUSTRY CONFERENCE CALL August 28, 2013

To recap the issues raised during today’s conference call, here are the key media stories we discussed, and the messages we’re conveying.

 

If there is a subject you would like to see addressed on Wednesday, September 4, please email Mike Barry at michaelb@iii.org.

This updated report by Bob Hartwig and Claire Wilkinson, analyzes the changes taking place within the residual property market.  These changes consist of a myriad of different programs in place across the United States to provide insurance to high-risk policyholders who may have difficulty obtaining coverage from the standard market. The report focuses on the plans in Alabama, Florida, Louisiana, Massachusetts, Mississippi, New York, North and South Carolina, and Texas. 

On Tuesday, Aug. 27, the I.I.I. issuedPeak Of Hurricane Season Is Here; Has Preparation For Storms Plateaued? Past 7 Storm-Free Years in Florida May Cause Faded Memories and Increase the Odds of Being Unprepared.  On Wednesday, Aug. 28, the I.I.I. issued anews release on car rental insurance for the upcoming Labor Day weekend, which was immediately tweeted by Becky Yerak of the Chicago Tribune. 

 

The I.I.I.’s Bob Hartwig spoke with Evan Lehmann at ClimateWire contesting an NAIC view (based on AIR data) that insurers could be overwhelmed by a confluence of low probability, high severity events.

Overall satisfaction with the property claims experience remains stable, although customer dissatisfaction with the handling of some Superstorm Sandy claims were detected, according to the J.D. Power 2014 Property Claims Satisfaction Study, which came out on Thursday, Aug.  22. 

MERILL LYNCH SETTLES RACIAL DISCRIMINATION SUIT FOR $160 MILLION Merrill Lynch, one of the largest brokerage firms in the U.S. financial industry, has agreed to pay $160 million to settle a racial discrimination lawsuit filed eight years ago on behalf of 700 black employees, it was reported in the Wednesday, Aug. 28 New York Times. The payout would be the largest ever made by a U.S. company to settle charges of racial discrimination in employment practices.

An editorial in the Wednesday, Aug. 28 Wall Street Journal titled, In Washington, Every Problem is a Bank,  argues that John Huff, director of Missouri's insurance department, who serves on the new Financial Stability Oversight Council (FSOC) in an advisory capacity on behalf of all state insurance commissioners, has an expertise in insurance regulation that other members may not have. The editorial cites his remarks at a conference of state regulators, where Huff expressed his concern over the reasons that the insurance company AIG was designated as "systemically important" and questioned whether some of his fellow FSOC members might not fully grasp the insurance business model or the nature of its regulation. The editors agree, explaining how the AIG analysis that led to the designation may apply to banks but not insurers. The editorial concludes with Huff’s remarks urging his colleagues to continue trying to educate government officials, members of the FSOC and others, on these differences.

 

The pledge was made during a presentation in Southern California on Tuesday, Aug. 27 by Andy Palmer, executive vice president of Nissan Motor Co., who said the company plans to begin selling cars with self-driving technology by 2020, according to this Wednesday, Aug. 28 Wall Street Journal article. 

The Wall Street Journal has reviewed in advance a study appearing in the online edition of the journal Earth and Planetary Science Letters, which concludes that such a large volume of oil and water is being removed from the Eagle Ford shale formation in South Texas through hydraulic fracturing, or fracking, and that the drilling technique is probably the cause of a recent series of small earthquakes, according to this Tuesday, Aug. 27 article. The study does not provide evidence that fracking is causing earthquakes all by itself, but suggests that the drilling is indirectly linked to seismic activity.

The I.I.I.’s Hartwig continues to work with Lisa Gibbs, a senior writer with Money magazine, for a story about what’s driving homeowners insurance rates up.  He provided data on historic and projected average HO expenditures for a graphic this week.  The story is likely to be published within the next two weeks….Loretta Worters and IINC’s Tully Lehman have been working with Leslie Scism of the Wall Street Journal for a story on the Rim Fire in terms of the residual market…The I.I.I.’s Worters spoke with Samantha Sharaf, the personal finance writer for Forbes online who is doing a story on auto liability limits and uninsured motorists…. Lori Chardis with AM Best and Ed Leefeldt from Insure.com are doing stories on driverless cars….M.P. McQueen, formerly with the Wall Street Journal, is now freelancing and is going to pitch a story to a new online publication on liability for peer to peer car sharing….Insurance Business America, a new online insurance publication (a subsidiary of Insurance Business Australia) is doing something on the importance of liability insurance for small businesses…Judy Ausuebel, a news researcher with the Associated Press said the newswire was preparing for an upcoming story on the one-year anniversary of Sandy. I.I.I. provided her with stats and asked that I.I.I. be contacted by the reporter when they are ready to write the story.

 

No news from Washington, DC this week

Pete Moraga did live interviews on KTLA-TV’s morning news show on Wednesday, Aug. 28. He will be doing multiple segments along with Frank Scafidi of the National Insurance Crime Bureau, talking about auto theft.

The wildfire still raging in the northwest part of Yosemite National Park is expected to advance farther into the park, according to this Wednesday, Aug. 28 CBS story.  The Rim Fire has burned more than 160,000 acres, most of that in the Stanislaus National Forest west of Yosemite. The fire is dangerously close to the Hetch Hetchy Reservoir that supplies water to San Francisco and its surrounding areas.

 

Citizens Property Insurance Corporation recently announced it was creating a policy comparison clearinghouse to allow consumers "more and better choices to insure their homes." The clearinghouse should be online by the beginning of next year, according to this Monday, Aug. 26 article in the Tampa Tribune.

 

John Zarrella of CNN is prepping a story on sinkholes, building codes and insurance in Florida. The I.I.I.’s Lynne McChristian provided him with background information. He has also talked with FLASH. The I.I.I.’s McChristian is being interviewed on Wednesday, Aug. 28, on how your HO/renters policy covers your personal possessions no matter where they are situated.

 

Volunteer Florida is expecting to receive a grant from the Florida Division of Emergency Management to give about 60 workshops throughout Florida on mitigation and hurricane preparedness. They want insurance to be part of the educational messages. The group also intends to reach out to FLASH and IBHS. The first organizational conference call was held Tuesday, Aug. 27.

 

The Press-Register reported on Sunday, Aug. 25, that homeowners are still waiting for clarity on insurance costs.  State legislators recently passed a bundle of laws that are supposed to help lighten the burden property owners carry.

 

The Baton Rouge Advocate’s Ted Griggs reported on Wednesday, Aug. 28 that Louisiana’s building codes took a step backward this year when the state adopted only part of the recommendations for high-wind design for construction put forth by an international building code council, an insurance-related organization says in a report.

 

Mississippi Insurance Commissioner Mike Chaney said he'll announce a plan within 10 days to stop indefinitely the "draconian" increases in flood insurance rates that will hit in the next few years, according to a story in the Wednesday, Aug. 21 issue of the Biloxi Sun-Herald.

This week the big story continues to be college students heading back to school and making sure their belongings are properly insured. People are also very interested in making sure their home is properly covered for a disaster.An I.I.I. article on this topic is getting great pick up on twitter.

 

Reminder: The I.I.I.’s Andréa Basora, along with the American Red Cross, the National Weather Service, and FLASH, has submitted a panel on technology and disaster response for the digital innovation conference, SXSW 2014. If you are interested in knowing more, or want to show your support for this panel, click here.

Bryant Rousseau is leaving Summit Media.  Formerly Group editor and then Director of Digital Product Innovation, Rousseau is joining The Economist Group in their events department.  National Underwriter will also be moving to its new headquarters at 469 7^th Ave, (near Herald Square) most likely within the next two weeks.

WPIX-TV New York morning anchor Frances Rivera is no longer with the station, effective Aug. 30.  She was named to this role in July 2011 after a 10-year stint with WHDH-TV in Boston.

 

The I.I.I. is cited regularly in the media as an authoritative source of insurance information. To access the current I.I.I. press clips, click here