What Makes Auto Insurance Expensive?

LOS ANGELESOct. 10, 2017 / PRNewswire-iReach/ — Carrinsurancehints.com (http://www.carinsurancehints.com/) has released a new blog post explaining what makes auto insurance expensive.

An insurance agency will rate applicants based on their insurability risk. Every driver will have to pay a premium based on the type of car they drive and on how they drive. A driver’s history s carefully analyzed by every agency to determine if the applicant is safe driver or a high risk one. The vehicle will also play an important role in determining coverage costs. The applicant’s age, gender and financial situation can also have an impact. In short, there are numerous factors that determine coverage costs.

A list of things that increase car insurance costs:

  • A past DUI arrest
  • Multiple fines and tickets on the driving record
  • A high-cost vehicle with a low safety rating
  • A bad credit record
  • Being under 25 years old

High risk drivers should not give up on purchasing auto insurance. Driving without the minimum required vehicle insurance is illegal. High risk drivers should shop around for vehicle coverage. They can compare multiple auto insurance quotes on a single website: http://www.carinsurancehints.com/. Comparing different prices helps drivers save more than 25% on their premiums.

“Always compare car insurance quotes and you are bound to find the right plan for your vehicle,” said Russell Rabichev, Marketing Director of Internet Marketing Company.

Carrinsurancehints.com is an online provider of life, home, health, and auto insurance quotes. This website is unique because it does not simply stick to one kind of insurance provider, but brings the clients the best deals from many different online insurance carriers. In this way, clients have access to  offers from multiple carriers all in one place: this website. On this site, customers have access to quotes for insurance plans from various agencies, such as local or nationwide agencies, brand names insurance companies, etc.

For more information, please visit http://www.carinsurancehints.com/.

Media Contact:Russell Rabichev, Internet Marketing Company, 800.475.3410, rel=”nofollow”>russell@internetmarketingcompany.biz

News distributed by PR Newswire iReach: https://ireach.prnewswire.com

Five of the biggest new innovations in the insurance industry

Allianz

Insurance has changed little since the first fire insurance companies were established following the Great Fire of London in 1666.

The purpose of insurance ‒ to protect people from financial loss ‒ remains but the latest innovations are set to change the way the market works for the benefit of insurers, brokers and customers.

Big data

Big data, where insurers use more and more sources of information to gain a deeper insight into the risk they’re covering, has huge benefits.

As well as more accurate underwriting and pricing, a deeper understanding of customers can also drive more personalised product development and marketing.

Customers are enjoying a much smoother insurance application process. Instead of customers supplying lots of data themselves, insurers can pull details in from other sources, which saves time and reduces hassle, which allows brokers to spend more time with their customers.

But there are challenges to overcome. Insurers need to be confident in the accuracy and appropriateness of the data they use. And, with the General Data Protection Regulation coming into effect in May 2018, there could be challenges on data consent.

Blockchain

Flagged up by the Financial Conduct Authority as having the potential to provide innovative solutions in financial services, blockchain is a mutual distributed ledger system. This enables multiple parties to share the same information, without the need for validation from an intermediary. Another key benefit is that it is virtually impossible to hack

Some of the first examples of its application in the sector include providing insurance to sharing economy platforms but it also has the potential to streamline paperwork and deliver efficiencies in the claims process.

To explore the potential of distributed ledger technologies, Allianz together with other insurers and reinsurers have launched the Blockchain Insurance Industry Initiative B3i. Now with 15 members, this is looking at the efficiencies this could drive in the insurance value chain.

Internet of things

With everything from phones to cars and kettles linking to the internet, the insurance sector is set to benefit from this connectivity. As well as enabling the provision of new services, in many areas this will shift the focus from repair to prevention.

In the motor space, telematics is already helping insurers understand more about the risks they’re covering, while also encouraging better driving habits and improving road safety.

Similarly, connected homes, where a building can be monitored with devices such as leak detectors and temperature gauges, will enable the cause of a potential claim to be identified  and dealt with before there’s any damage.

And rather than taking out traditional annual policies, by constantly monitoring usage and risk, cover could become much more fluid too.

Drones

Drones are delivering huge benefits in claims management. In situations such as fires or floods where it’s not possible for a claims adjustor to gain immediate access, a drone can be flown over the property to determine the extent of the damage. As well as resulting in improvements in customer service due to the speed at which this service can be delivered, repairs can also get started much sooner.

Drones can also be used for risk assessments, either where elements of a property are inaccessible, for instance the roof, or to provide underwriters with a view of the area so they can assess a range of risk factors.

Similarly, drones can be deployed for engineering inspections. Flying a drone around a building removes the need for scaffolding and ladders, which improves safety and can also increase the scope of the inspection.

Artificial intelligence

The volume of data available within the insurance sector makes it a prime candidate for artificial intelligence (AI). Already there are examples of insurers using more sophisticated machine learning analytics to support their staff in areas ranging from social media analysis to pricing and claims ‒ and this trend is certain to continue.

As an example, take Allianz-backed US insurer Lemonade. In December, thanks to one of its chatbots AI Jim, it was able to settle a claim in just three seconds. This included cross-referencing it with the policy details, running 18 anti-fraud algorithms and transferring the settlement into the policyholder’s bank account.

White House seeks $29B for disaster aid, flood insurance

By Andrew Taylor

THE ASSOCIATED PRESS

WASHINGTON _ The Trump administration on Wednesday asked Congress for $29 billion in disaster aid to cover ongoing hurricane relief and recovery efforts and to pay federal flood insurance claims.

The request comes as the government is spending almost $200 million a day for emergency hurricane response and faces a surge in flood claims for federally insured homes and businesses slammed by hurricanes Harvey, Irma, and Maria.

White House budget director Mick Mulvaney told lawmakers in officially submitting the request that the federal flood insurance program “is not designed to handle catastrophic losses like those caused by Harvey, Irma, and Maria. The NFIP is simply not fiscally sustainable in its current form.”

Mulvaney proposed a package of changes to the flood insurance program that, among others, would protect low-income policyholders from big rate hikes, allow the government to drop from the program properties that have been repeatedly flooded, and phasing out policies on new homes in flood zones.

In the meantime, Wednesday’s request proposal would provide $16 billion to pay those flood claims, along with $13 billion for Federal Emergency Management Agency disaster relief efforts. Federal firefighting accounts would receive $577 million as well to replenish them after a disastrous season of Western wildfires.

The Senate’s top Democrat quickly backed the aid request but signalled opposition to the administration’s proposed restrictions on flood insurance.

‘This funding request is a good start, but those affected by Maria, Harvey, Irma and wildfires still have a long and difficult road ahead,” said Minority Leader Chuck Schumer, D-N.Y.  “We should act on this supplemental quickly, but it should be just the beginning of Congress’ efforts to aid in rebuilding.”

Congress last month approved a $15.3 billion aid package that combined community development block grant rebuilding funds with emergency money for cleanup, repair and housing.

The federal flood insurance program is on track to run out of money to pay claims during the week of Oct. 23. Mulvaney said more than 20,000 federal workers have been deployed by various agencies to help in the hurricane recovery effort. The “burn rate” of almost $200 million a day is requiring an infusion of cash into FEMA coffers.

The request would bring the price tag for this year’s costly hurricane season to about $44 billion and that’s before rebuilding efforts get under way in earnest. A final estimate is a ways away since damage assessments of Puerto Rico may take some time, but Mulvaney said the administration will submit assessments in time for a budget hoped-for budget agreement later this year.

The year-end package would rebuild infrastructure, help people without insurance restore their homes, and, perhaps, help Puerto Rico reconstitute its shattered electrical grid.

‘The hundreds of thousands of people affected by Hurricanes Harvey, Irma, and Maria have suffered enough. Congress must provide whatever is necessary to get these families back on their feet and to rebuild their communities,” said House Appropriations Committee Chairman Rodney Frelinghuysen, R-N.J. “This will be a long process, and this next round of funds certainly won’t be all that is needed.”

Congress is in the midst of an effort to reauthorize the flood insurance program, which critics say makes taxpayers subsidize properties that have repeatedly flooded. A bipartisan effort to reform the program was enacted in 2012. It was significantly watered down just two years later after complaints of huge premium increases and resulting disruptions in coastal real estate markets. But there’s sure to be bipartisan opposition to Mulvaney’s extensive roster of changes to the program, which has strong backing from Republicans in coastal states.

Trump raised eyebrows in a Tuesday interview with Fox News when he said the Puerto Rican government’s debt would have to be “wiped out.”

“They owe a lot of money to your friends on Wall Street and we’re going to have to wipe that out,” Trump said.

But on Wednesday, Mulvaney told reporters that “we are not going to be offering a bailout for Puerto Rico or for its current bondholders.”

Trump surveyed hurricane damage in Puerto Rico on Tuesday. He praised his administration’s response, even as lawmakers returning from the island say the president is painting far too rosy a picture.

Rep. Luis Gutierrez, D-Ill., the situation there presents more difficult challenges than disasters in the continental U.S. For instance, without power or internet service, victims of Maria can’t go online to register for aid. Housing vouchers are largely useless since the entire Island is devastated. He said many thousands of Puerto Ricans will need to be evacuated to the U.S. mainland.

The World Insurance Report 2017 from Capgemini and Efma:

Read more

Lloyd’s of London expects $4.5 billion losses from Harvey, Irma

By Emma Rumney and Carolyn Cohn

LONDON (Reuters) – Lloyd’s of London expects net losses of $4.5 billion (£3.3 billion) from hurricanes Harvey and Irma, which analysts said would eat into the insurer’s capital and hit its profitability.

Although losses from natural catastrophes have been low in recent years, including in the first half, that is set to change in the second half of the year, Lloyd’s chief executive Inga Beale said following Thursday’s results.

“There was limited major claim activity in the first half. There’s a very different second half emerging – it’s not only the hurricanes but we’ve got the Mexican earthquakes, floods in Asia, typhoons in Asia,” Beale told Reuters.

“The hurricane season is still in play, earthquakes can happen at any time,” Beale said as Lloyd’s reported a 16 percent profit fall in the first half of 2017.

Lloyd’s 80-plus syndicates have already paid out more than $160 million in claims from Harvey and more than $240 million from Irma, Beale said. The $4.5 billion net loss estimate was based on modelling of “known exposures”, she added.

“Given that the Lloyd’s of London market typically produces earnings of 2.1-3.5 billion pounds, it is highly likely that the market faces a capital loss,” Jefferies analysts said in a note.

Modelling firm RMS estimates total insured losses from Harvey and Irma of up to $80 billion.

Meanwhile, Beale said it was too early to assess losses from Hurricane Maria, which devastated Puerto Rico last week and which some analysts have predicted will lead to greater insurance losses than Harvey and Irma.

Lloyd’s made 1.22 billion pounds ($1.63 billion) in profit before tax in the six months to the end of June, down from 1.46 billion pounds a year earlier, although Beale said part of the drop in profit was related to currency fluctuations.

Insurance rates have been falling for the world’s largest specialist insurance market and other insurers for several years due to strong competition.

Lloyd’s return on capital worsened to 8.9 pct from 11.7 pct, due to pressure on returns from low interest rates.

Gross premiums rose to 18.9 billion pounds from 16.3 billion pounds last year, and its combined ratio improved to 96.9 pct from 98 pct in 2016. A combined ratio is a measure of underwriting profitability, with a level below 100 percent indicating a profit.

Jefferies said recent natural catastrophes meant that a combined ratio for the year of 112.5 percent for Lloyd’s “is now a possibility”, indicating higher underwriting losses than 2011, which it said was “the last major catastrophe year”.

Lloyd’s was on track to open its planned EU subsidiary in Brussels by the middle of next year, Beale said, adding the new hub would employ “tens” of people and the firm would be submitting its formal license application “very shortly”.

More than 20 insurers have announced plans for EU hubs in the event that Britain loses access to the single market as a result of its departure from the European Union.

For insurers, accounting for meteorological violence begins

By Damian J. Troise

THE ASSOCIATED PRESS

NEW YORK _ Allstate expects insurance losses of about $593 million in August after Hurricane Harvey left a path of destruction along the Gulf Coast.

The initial accounting Thursday follows warnings from other insurers that are tallying the damages from a hurricane season that is nowhere near being over.

Allstate’s monthly losses, which likely have not been fully accounted for, are more than three times the $181 million recorded in July before hurricanes devastated islands in the Atlantic and began to strike the U.S.

Harvey made landfall in Texas on August 25. More than half the losses from that storm are related to vehicle damage.

The insurer, based just outside of Chicago, says that because of widespread damage and the inability of people to get to their homes or cars, its estimated losses may grow. Hurricane Irma slammed into Florida this month and Allstate has not released its estimates for that storm.

Last week, German reinsurer Munich Re, which covers losses from insurers, was the first to warn that it may not meet previous financial goals following the one-two punch of Harvey and Irma, which made landfall in Florida September 8.

The Insurance Council of Texas, the nation’s largest state insurance trade association, estimates overall insured losses from Harvey at nearly $19 billion. That includes an estimate from the Federal Emergency Management Agency in which Harvey’s flooding will result in $11 billion in payments to homeowners with flood insurance. Those flood losses would be the second highest on record, trailing only Hurricane Katrina’s $16 billion.

Harvey flooded a vast area stretching from Houston to the Louisiana border. The storm caused 70-plus deaths and damaged or destroyed more than 250,000 homes and hundreds of thousands of automobiles. Irma carved a path of destruction through the Caribbean and then enveloped Florida.

CoreLogic, a property data company, expects damage to commercial and residential property from Irma to range from $42.5 billion to $65 billion. That estimate includes insured and uninsured losses.

The damage, particularly from Irma, was expected to be much worse and stock in insurance companies, while down, has remained fairly flat over the past month, and many are up sharply for the year.

Yet the hurricane season runs through November and on Thursday, the entirety of Puerto Rico was without power and besieged by landslides and floods after Hurricane Marie slammed into the island as the third-strongest recorded storm to make landfall in the U.S.

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