Top Causes of Loss for Global Businesses: Allianz

The top causes of global corporate insurance losses as compiled by Allianz

This analysis encompasses over 470,000 claims from over 200 countries and territories.

Fire/Explosion: 24%

Aviation collision/crash: 14%

Faulty workmanship/maintenance: 8%

Storm: 7%

Defective products: 6%

Damaged goods (including handling/storage): 5%

Machinery breakdown (including engine failure): 5%

Water damage: 3%

Ship sinking/collision: 2%

Professional Indemnity (e.g. negligence/misadvice): 2%

U.S. and Britain to Sign Pact After Brexit to Bring Stability to Insurance Industry

Members of the U.S. Trade Representative’s Office and the U.S. Treasury Department made a statement on December 11, 2018 that they have intentions to sign a post-Brexit bilateral insurance agreement with Britain that will bring regulatory stability and continuity to the industry.

According to officials the Agreement will be consistent with a similar one signed with the EU back in 2017.

Unless Brexit is somehow reversed, Britain is scheduled to leave the EU on March 29, 2019.

The timing of the announcement is not a coincidence. The U.S. Congress requires a 90-day notification period before it can be signed and officially put into effect.

U.S. officials say the pending agreement will affirm the U.S. state-based system of insurance regulation and should help in the competitiveness of U.S. insurance and reinsurance firms.

Antony Philliopson, Britain’s Trade Commissioner for North America, welcomed the announcement and said it’s an example of the work the British government is doing to ensure business continuity with the U.S. and said they will continue studying and looking into further bilateral trade ties.

Calif. police use Tesla system to halt sleeping man’s car

By Tom Krisher

THE ASSOCIATED PRESS

DETROIT _ The Autopilot system on a Telsa Model S may have helped the California Highway Patrol stop the car after its driver fell asleep on a freeway.

Similar systems, now offered by nearly all automakers, use cameras and radar to detect objects in front of them and automatically keep a safe distance or even stop or slow the vehicles before a crash. The systems also can keep cars in their lanes. Tesla’s Autopilot feature allows the vehicle to change lanes automatically when prompted by the driver, navigate interchanges and exit freeways.

In the case of the driver who fell asleep, California Highway Patrol officers spotted him Friday afternoon as they were looking for drunken drivers. They pulled alongside the grey Model S on U.S. 101 and saw that the driver was asleep. When the driver didn’t respond to their lights and siren, they slowed traffic behind him and tried to figure out if Autopilot or other driver-assist systems were engaged, according to Officer Art Montiel, a CHP spokesman. They then pulled in front of the car and slowed down, and the car eventually stopped.

No one was hurt and the car didn’t crash. The 45-year-old driver was arrested on suspicion of driving under the influence.

Systems like Tesla’s semi-autonomous Autopilot are the building blocks of self-driving vehicles, but humans still must be ready to take control. Here are answers to questions about how the systems work and the incident in the San Francisco suburb of Redwood City:

Q: Was the driver using Autopilot system?

A: Maybe. Montiel said officers believe it was on but they haven’t confirmed that yet. Telsa won’t comment. The car’s automatic cruise control system, which keeps it a safe distance from vehicles in front of it, could have been operating without Autopilot being engaged, as could its automatic emergency braking system. Authorities are investigating which systems were in use.

Q: Isn’t the system supposed to stop the car if the driver is not paying attention?

A: Telsa’s Autopilot is designed to safely pull over if a driver doesn’t put force on the steering wheel. But some drivers have been able to fool the system. It’s unclear whether that happened in the case of the sleeping driver. A similar system from General Motors called Super Cruise monitors the driver’s eyes and will stop the car if they are not paying attention. Tesla CEO Elon Musk wrote on Twitter that it is  “default Autopilot behaviour” to gradually slow to a stop and turn on the hazard lights. “Looking into what happened here,” Musk wrote.

Q: Can’t these cars drive themselves?

A: No, they can’t. All manufacturers, including Tesla, warn drivers that the systems are for assistance only and they must pay attention and be ready to take over driving. Tests by AAA and theInsurance Institute for Highway Safety both found that the systems can’t handle every situation they encounter on the roads. Safety advocates criticized Tesla for naming its system Autopilot, especially after an Ohio man died in a crash while using it in Florida two years ago. The National Transportation Safety Board is investigating several other crashes in which the drivers appeared to place too much confidence in Autopilot, including one fatality earlier this year near Mountain View, California.

Earthquake weary Alaskans still grappling with damage

By Rachel D’Oro

THE ASSOCIATED PRESS

ANCHORAGE, Alaska _ Life was beginning to return to normal Monday in Alaska following the powerful earthquake near Anchorage, but people nervous about aftershocks were still grappling with damage that closed public buildings and schools, clogged roads and knocked homes off foundations.

Some residents went back to work. But state transportation officials again urged people who live north and south of Anchorage to take the day off or work from home to reduce traffic.

Rockfalls were still occurring along cliff-lined Seward Highway, while major repairs were underway on hard-hit Glenn Highway, the main road leading north of the city, Department of Transportation spokeswoman Meadow Bailey said.

“We don’t want the commute to be frustrating because people will experience delays,” she said.

Residents still jittery from the 7.0 quake on Friday have been rattled even further by more than 1,700 aftershocks. A dozen have had magnitudes of 4.5 or greater.

“Anything that moves, you’re on your last nerve,” said Anchorage resident Lyn Matthews, whose home sustained substantial structural damage, including a sunken foundation.

Matthews, who was back at work at a chiropractor’s office, and her husband have no earthquake insurance.

“I’m scared to death,” she said.

The earthquake struck 7 miles (11 kilometres) north of Anchorage, swaying buildings, disrupting power and causing heavy damage to Glenn Highway.

There were no reports of deaths, serious injuries or widespread catastrophic damage in the state with strict building codes implemented after a 1964 earthquake with a magnitude of 9.2 _ the second most powerful of any quake ever recorded.

No outbreaks of disease or other major health problems have been reported.

Still, federal officials declared a public health emergency on Monday, saying the action will ensure that Medicaid funds continue to be issued despite the temporary closure of offices. Mental health aid is also available for people being stressed by the disaster.

“Remember, whatever you’re feeling right now is valid,” Anchorage Health and Human Services director Natasha Pineda said at a weekend briefing.

Earthquake forecasts cited a 4 per cent chance of another earthquake with a magnitude of 7.0 or greater in the first week after the first quake.

“The chance is very small, but it’s not impossible,” U.S. Geological Survey Geophysicist Paul Caruso said.

The federal courthouse in Anchorage was among structures that remained closed. Officials said the U.S. District Court and the attached federal building in Anchorage will be closed at least through Thursday following a preliminary evaluation by the General Services Administration.

GSA spokesman Chad Hutson said boilers in the federal building were leaking, leaving it without heat.

The nearby Historic Federal Building, where the bankruptcy court is located, also remained closed. Officials said it will be ready to reopen once minor cleanup is complete.

Schools have been closed until Dec. 10, which should also reduce traffic. An elementary school in the Anchorage suburb of Eagle River has been deemed unsafe to occupy, while multiple other campuses in the region are undergoing repairs and cleanup, according to the Anchorage School District.

A middle school in the small town of Houston north of Anchorage likely will remain closed through the year.

The supply chain of food and other goods delivered to the Port of Anchorage from the Lower 48 has not been disrupted.

About 90 per cent of all the goods sold in Alaska are delivered to the Port of Anchorage, where officials have completed a preliminary damage assessment. There were some structural issues with some trestles, but nothing that should impede operations, according to Municipal Manager Bill Falsey.

___

Associated Press Mark Thiessen in Anchorage, Alaska, contributed to this report.

Fire weary California homeowners face long road to recovery

By Sarah Skidmore Sell

THE ASSOCIATED PRESS

Californians who lost a home to the state’s wildfires could face a nightmarish recovery as they try to rebuild.

It’s always a challenge to recuperate after any disaster, but California residents face a unique problem. Experts say the seemingly endless series of devastating wildfires in recent years has increased costs and limited the available pool of workers needed to rebuild.

Homeowners can also find themselves confused by the insurance system and even underinsured, leaving them to bear more of the costs of rebuilding than they might have expected.

Blazes have been so frequent that the state government recently passed a spate of laws intended to help victims of wildfires, but experts say it can still sometimes take years for a home to be rebuilt.

California is currently fighting three fires the Camp Fire in the northern part of the state and the Woolsey and Hill fires just outside of Los Angeles in the south. Statewide, thousands of people have been evacuated, more than 225,000 acres have burned and 44 people have died.

The Camp Fire is now deemed the most deadly in the state’s history killing at least 42 people and burning more than 125,000 acres. That follows this summer’s Mendocino Complex fire, which burned more than 459,000 acres and led to more than $56 million in insured losses, and a particularly brutal fire season in 2017.

Credit rating agency Moody’s on Monday estimated that insured losses for the three current fires will be between $3 billion and $6 billion. The staggering price tag is due in part to the size of the fires but also the costs of rebuilding  both materials and labour.

Dan Dunmoyer, president and CEO of the California Building Industry Association, said builders were having trouble finding enough workers prior to the fires because of high demand for housing in the state. The spate of fires has only worsened the problem and that adds to the delay for consumers.

“If your home burns down by itself, you have no problem rebuilding, but if it burns down with 2,000 others, you have to wait,” Dunmoyer said.

Homeowners also sometimes find themselves struggling to navigate the insurance system.

United Policyholders, a non-profit that aims to help consumers with insurance issues, said that it regularly hears from policyholders struggling with their insurer following a disaster. Policies may not have been updated in some time or estimates of rebuilding costs were too low, so homeowners find themselves on the hook for large expenses. The group estimates, based on polls of communities affected by disasters, that roughly two-thirds of insured households are underinsured. Or, they simply are struggling to jump through the hoops.

“The insurance piece really gets people because they felt like it was the rug getting pulled out from under them,” said Amy Bach, executive director of United Policyholders. “OK, I lost everything, but at least I have insurance. But then insurance is a fight.”

While it can be a smooth process for some, others feel like “mother nature just took my house, now insurance took my sanity,” she said.

The process became so problematic that a series of laws were passed to help protect homeowners.

Under the new rules, homeowners have three years to rebuild and a six-month extension if the delays are out of their control. Insurance companies must also now provide an updated cost for rebuilding every time a policyholder renews, to help prevent the sticker shock some victims suffered. Other changes allow more time to sue their insurer following a declared disaster, given that it now takes longer to rebuild.

All the same, Insurance Commissioner Dave Jones has expressed disappointment the state couldn’t do more. Californians are still able to find property and casualty insurance, although Jones has previously warned that the increasing number and severity of wildfires will limit availability and increase costs in the future.

Amazon may start selling insurance after IRDA approval

Amazon India will soon offer life, health, and general insurance products as a corporate agent, according to a Registrar of Companies (RoC) filing, reports BloombergQuint. According to both, BloombergQunit and Economic Times, the company is yet to seek an approval from the Insurance Regulatory and Development Authority (IRDA).

A company spokesperson told MediaNama that “Amazon Pay is looking to serve the needs of customers around Insurance. Stay tuned in.”

Amazon is not the only company to expand its offerings in the financial services sector as its arch rival, Flipkart has already applied for a license to start selling insurance products. According to industry sources that MediaNama spoke to, many payments companies are keen on tapping into the insurance sector, given that insurance penetration in India is extremely low.

Competition in the online insurance space

In the online insurance ecosystem, Amazon will be competing with a host of other players including Paytm, EasyPolicy, Bankbazaar and PolicyBazaar. In terms of payment wallets, MobiKwik also plans to venture into newer domains of personal and consumer finance with a focus on lending and insurance. We reported last year that Flipkart would start selling insurance products on its platform. While these companies are aggregators, Narayan Murthy’s Catamaran Ventures-backed digital insurance company Acko General Insurance is the first insurance company with an online-only policy, which also received the final license from IRDAI in September last year.

Amazon Pay launches EMI facility

This week, Amazon Pay also launched a service which will enable users, who neither have access to credit services nor credit cards, to make purchases via EMIs for up to Rs 60,000. The service, currently an invite only program, will require users to complete a two-step registration process to get an assigned credit limit, according to a press release. Amazon has tied up with Capital Float to offer the instalment service. Amazon claims to offer zero cost EMIs for customers taking loans for a duration of 3 and 6 months, while an interest rate of 18% will be levied on customers opting for a duration of 9 and 12 months.

Amazon India’s payment journey so far

  • In December 2016, Amazon launched ‘Pay’ in India
  • In April 2017, it received a wallet license from the RBI
  • In February this year, the company added a UPI based payments option to its website
  • Last month, Amazon Pay acquired ‘all-in-one app’ Tapzo to strengthen its payments offerings
  • In August, Amazon India launched a bill payment service across 100 utility providers
  • In the same month we also reported that its plan to launch a Unified Payments Interface (UPI)-based payments service had been hampered owing to RBI’s concerns regarding the storage of user data in India.

Source: Medianama

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