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Terrorism Risk: A Continuing Threat – 2012

September 12, 2012 Comments off

Terrorism Risk: A Continuing Threat – 2012

Source: Insurance Information Institute

This report, by Robert Hartwig, president of the Insurance Information Institute, and Claire Wilkinson, analyzes the evolving nature of international terrorism. For property/casualty insurers and reinsurers, the impact of the terrorist attack of September 11, 2001, was substantial, producing insured losses of about $32.5 billion, or $40.0 billion in 2011 dollars. Following the attack, insurers moved to exclude coverage. Only when the Terrorism Risk Insurance Act (TRIA) was enacted by Congress in November 2002 did coverage for terrorist attacks resume. Since its initial enactment in 2002 the terrorism risk insurance program has been revised and extended twice. The report, replete with charts, includes sections on: how insurers treat terrorism risk today; estimating potential terrorism losses; the cyber terrorism threat; the structure and coverage of the terrorism risk insurance program; aviation insurance for terrorism risks; and liability factors. The report concludes that over a decade later, 9/11 remains the worst terrorist act in terms of fatalities and insured property losses. A number of converging factors point to the fact that, while the risk is changing, terrorism is an evolving and ongoing threat for the foreseeable future. Failure to focus on and prepare for this threat will come at an enormous cost to the millions of individuals and businesses who rely on insurance contracts to offset the overall economic impact of a terrorist attack. For property/casualty insurers, the increasing share of losses that they would have to fund in the event of a major terrorist attack on U.S. soil suggests that now is the time to take stock of their terrorism exposures.

NICB Reports 20 Percent Rise in Mid-Year 2012 Questionable Claims

September 2, 2012 Comments off

NICB Reports 20 Percent Rise in Mid-Year 2012 Questionable Claims

 Source:  National Insurance Crime Bureau
The National Insurance Crime Bureau today released its first half 2012 questionable claims (QC) referral reason analysis. The report examines six referral reason categories of claims—property, casualty, commercial, workers’ compensation, vehicle and miscellaneous—for the first half of 2010, 2011 and 2012.
Questionable claims are claims that NICB member insurance companies refer to NICB for closer review and investigation based on one or more indicators of possible fraud. A single claim may contain up to seven referral reasons.
During the first half of 2010, a total of 46,766 QCs were referred. That number increased to 48,887 in the first half of 2011 and to 58,523 in the first half of 2012. There was a 20 percent increase in QCs during the first half of 2012 compared with 2011, and a 25 percent increase when compared with the first half of 2010.
Suspicious theft/loss (non-vehicle) generated the largest increase in volume for a single referral reason in property QCs (5,255) and contributed to the property category’s 40 percent rise in QCs compared to the first half of 2011. The miscellaneous QC category posted the smallest increase—10 percent—compared with the first half of 2011.

Residual Market Property Plans: From Markets of Last Resort to Markets of First Choice – 2012

September 1, 2012 Comments off

Residual Market Property Plans: From Markets of Last Resort to Markets of First Choice – 2012
Source: Insurance Information Institute

This report by Robert Hartwig, president of the Insurance Information Institute, and Claire Wilkinson analyzes the changes taking place within the residual property market, which consists 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. So called residual, shared or involuntary market programs make basic insurance coverage more readily available. The report notes the still-burgeoning growth of the market, which now has a massive total exposure to loss that is approaching $900 billion. Despite attempts by certain states to reduce the size of their plans the fact of the matter is that this market of last resort remains the market of first choice for many vulnerable, high-risk coastal properties. The report focuses on the plans in Alabama, Florida, Louisiana, Massachusetts, Mississippi, New York, North and South Carolina, and Texas.

NICB Names 10 Most-Stolen Vehicles for 2011

August 31, 2012 Comments off

NICB Names 10 Most-Stolen Vehicles for 2011Source: National Insurance Crime Bureau

The National Insurance Crime Bureau (NICB) today released Hot Wheels − its list of the 10 most-stolen vehicles in the United States. The report examines vehicle theft data submitted by law enforcement to the National Crime Information Center (NCIC) and determines the vehicle make, model and model year most reported stolen in 2011.

For 2011, the most-stolen vehicles* in the nation were:

1. 1994 Honda Accord
2. 1998 Honda Civic
3. 2006 Ford Pickup (Full Size)
4. 1991 Toyota Camry
5. 2000 Dodge Caravan
6. 1994 Acura Integra
7. 1999 Chevrolet Pickup (Full Size)
8. 2004 Dodge Pickup (Full Size)
9. 2002 Ford Explorer
10. 1994 Nissan Sentra

Top 10 back-to-school trends for 2012

August 15, 2012 Comments off

Top 10 back-to-school trends for 2012

Source: National Retail Federation

The tardy bell will be ringing sooner than we know it. Parents, kids and retailers have one thing on their minds: back-to-school shopping. According to the National Retail Federation, combined K-12 and college spending will reach a record $83.8 billion. That’s quite a few colored pencils and new backpacks.

See also: NRF Back to School Headquarters

Hurricane Andrew and Insurance: The Enduring Impact of an Historic Storm

August 10, 2012 Comments off

Hurricane Andrew and Insurance: The Enduring Impact of an Historic Storm
Source: Insurance Information Institute

Hurricane Andrew struck Florida on August 24, 1992, and the tumult it created for the property insurance market in the state has not ceased in the 20 years since, according to an analysis by the Insurance Information Institute (.I.I.). The I.I.I. white paper outlines six key insurance market changes attributed to the costliest Florida disaster. Insurance claims payouts for Andrew totaled $15.5 billion at the time ($25 billion in 2011 dollars), and it remains the second costliest U.S. natural disaster, after Hurricane Katrina, which hit in 2005. Hurricane Andrew forced individuals, insurers, legislators, insurance regulators and state governments to come to grips with the necessity of preparing both financially and physically for unprecedented natural disaster.

The Economic Impact of the Budget Control Act of 2011 on DOD & non-DOD Agencies

August 1, 2012 Comments off

The Economic Impact of the Budget Control Act of 2011 on DOD & non-DOD Agencies (PDF)
Source: Aerospace Industries Association
From press release:

A new economic impact analysis concludes that 2.14 million American jobs could be lost if the Budget Control Act’s sequestration mandate takes effect on January 2, 2013. That is the date that budget cuts of $1.2 trillion start throughout government unless Congress and the administration agree on a solution.

Dr. Stephen S. Fuller, Dwight Schar Faculty Chair and University Professor and Director for Regional Analysis at George Mason University, in conjunction with Chmura Economics and Analytics, conducted the study on behalf of the Aerospace Industries Association.

“The results are bleak but clear-cut,” said Fuller. “The unemployment rate will climb above 9 percent, pushing the economy toward recession and reducing projected growth in 2013 by two-thirds. An already weak economy will be undercut as the paychecks of thousands of workers across the economy will be affected from teachers, nurses, construction workers to key federal employees such as border patrol and FBI agents, food inspectors and others.”

The analysis concludes that the automatic spending cuts mandated in the Budget Control Act of 2011 affecting defense and non-defense discretionary spending in just the first year of implementation will reduce the nation’s GDP by $215 billion; decrease personal earnings of the workforce by $109.4 billion and cost the U.S. economy 2.14 million jobs.

Residual Market Property Plans: From Markets of Last Resort to Markets of First Choice – 2012

July 11, 2012 Comments off

Residual Market Property Plans: From Markets of Last Resort to Markets of First Choice – 2012
Source: Insurance Information Institute

This report by Robert Hartwig, president of the Insurance Information Institute, and Claire Wilkinson analyzes the changes taking place within the residual property market, which consists 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. So called residual, shared or involuntary market programs make basic insurance coverage more readily available. The report notes the still-burgeoning growth of the market, which now has a massive total exposure to loss that is approaching $900 billion. Despite attempts by certain states to reduce the size of their plans the fact of the matter is that this market of last resort remains the market of first choice for many vulnerable, high-risk coastal properties. The report focuses on the plans in Alabama, Florida, Louisiana, Massachusetts, Mississippi, New York, North and South Carolina, and Texas.

NRF Report Finds No Retailer Immune To Organized Retail Crime

June 24, 2012 Comments off

NRF Report Finds No Retailer Immune To Organized Retail Crime
Source: National Retail Federation

Growing in severity, number and type, retailers are reporting organized retail crime (ORC) has become more troublesome than ever before. Of the 125 retail companies surveyed for NRF’s eighth annual Organized Retail Crime Survey, a record-setting (96.0%) say their company has been the victim of organized retail crime in the past year, up from 94.5 percent last year, and another 87.7 percent say ORC activity in the United States has grown over the past three years.

“What this tells us is that as retailers and law enforcement become more aware of and more proactive in pursuing organized retail crime gangs, criminals have become more desperate and brazen in their efforts, stopping at nothing to get their hands on large quantities of merchandise,” said NRF Vice President of Loss Prevention, Rich Mellor. “Selling this stolen merchandise is a growing criminal enterprise and retailers must remain vigilant as this is an issue that involves everyone’s cooperation when it comes to protecting retailer’s assets, including their valued store associates and customers.”

The silver lining: more companies this year believe law enforcement is aware of and understands the severity and complexity of the issue (40.0% vs. 32.3% in 2011). More than half (54.4%) say top management at their company is aware of the problems associated with organized retail crime.

Celebrate safely – ABI publishes guide on organising street parties and other events

June 22, 2012 Comments off

Celebrate safely – ABI publishes guide on organising street parties and other events
Source: Association of British Insurers

With over 3,500 applications made so far to local authorities alone for street parties to celebrate the Queen’s Diamond Jubilee, this year looks set to be a bumper year for celebrations. To help party organisers ensure that events run smoothly, whether on public or private land or in your own home, the ABI has produced a guide.

‘Celebrate – An ABI guide to planning an event’ sets out what party organisers need to know, including:

  • Things to consider about your venue, such as is it safe for the number of people you expect, are outdoor activities involved, such as bouncy castles, and what fire aid will be available.
  • If planning a street party, steps you need to take, including contacting your local council.
  • Any requirements for public liability insurance and how this cover can help party organisers protect against things that could go wrong.

Public Transportation Protects Americans From Gas Price Volatility

June 10, 2012 Comments off
Source:  American Public Transportation Association

Improving transportation options saves consumers money, increases affordability, reduces exposure to price volatility and is good for the economy. In fact, investments in public transit provide a large direct financial return to consumers: increased public expenditures are more than repaid, on average, in transportation cost savings. The predictability of these savings becomes even more important during periods of price volatility. Families cannot plan household budgets when faced with high volatility—they need stable alternatives. This paper highlights the role that public transit plays in protecting Americans from price volatility, as well as strategies that can buffer Americans from future gas price shocks.

2012 “Travel Like a Local” Summer Travel Survey

June 1, 2012 Comments off

2012 “Travel Like a Local” Summer Travel Survey (PDF)Source: American Public Transportation Association
From press release:

As flip flops and shorts replace suits and ties, you know summer is here. And while many flock to beaches and cabins in the woods, 104 million people are planning a trip to the city. That is one third of Americans who will be hitting the streets of a city near you. Of those who plan to visit a city, nearly 60 percent (57 percent) or 62 million people nationwide plan to use local public transportation on their vacation this summer, according to the American Public Transportation Association’s (APTA) 2012 “Travel like a Local” Summer Travel Survey.

The survey, conducted in mid-May, shows that cost and convenience are two strong factors that will motivate city visitors to use public transportation. Among those travelers who will be using public transportation during their city trips, 71 percent said using public transportation relieves them from the worry of finding parking for their vehicle, while 68 percent believe that it is less expensive than taxis and rental cars. Sixty-seven percent will use public transportation to save money on parking and 52 percent responded they can save money on gas for their vehicle.

Travel experts at AAA note that this year Americans will be staying closer to home and the APTA survey reveals that heading to a city this summer will be a prime destination. The survey also notes the top ten city destinations.

2012 Investment Company Fact Book

May 11, 2012 Comments off
Source:  Investment Company Institute

ICI’s annual compilation—our fifty-second edition—reports on retirement assets, characteristics of mutual fund owners, use of index funds, and other trends.

Newspaper Multiplatform Usage

April 30, 2012 Comments off

Newspaper Multiplatform Usage
Source: Newspaper Association of America
From press release:

A new study shows that in an average week, 74 percent of all Internet users rely on local newspaper media – digital as well as print – as key sources of news and information, and are engaging with their local newspaper across multiple platforms.

Major findings of the survey show that among the large base of Internet users who engage with newspaper media, 54 percent are using more than one platform to access newspaper content in an average week. Sixty-seven percent use at least one of three common digital platforms – computers, smartphones or tablets – and they use each at multiple times over the course of the day for newspaper content. The study was conducted for the Newspaper Association of America by Frank N. Magid Associates of Minneapolis.

The research, presented last week at NAA mediaXchange 2012 in Washington, D.C., also looks at what motivates consumers to turn to newspaper media for their news needs. Top answers to the question “Why Newspapers?” illustrate core newspaper brand values, including convenience, the extensive range and depth of news and information, and the amount of local news…

+ Full Report (PDF)

Study: Technologies That Recover Energy From Waste Could Offer Environmental Benefits and Cost Savings for Communities

April 26, 2012 Comments off

Study: Technologies That Recover Energy From Waste Could Offer Environmental Benefits and Cost Savings for Communities
Source: American Chemistry Council

The American Chemistry Council (ACC) today released a new study showing that emerging new technologies designed to convert waste into fuels or raw materials offer environmental benefits and cost savings over landfill disposal. The release coincides with the North American Waste-to-Energy Conference or NAWTEC.

The study, “Environmental and Economic Analysis of Emerging Plastics Conversion Technologies,” sponsored by ACC’s Plastics Division and conducted by RTI International, examined two types of advanced conversion technologies: gasification and pyrolysis. Although both technologies are capable of processing a wide range of wastes, this study looked at gasification technology that accepts all municipal solid waste (MSW), including non-recycled plastics; and pyrolysis that handles non-recycled plastics only.

When compared to landfill disposal, RTI found that gasification of MSW saves 6.5 to 13 million Btu per ton and 0.3 to 0.6 tons of carbon equivalent emissions per ton. Similarly, pyrolysis, which converts plastics to oil or gas, saves 1.8 to 3.6 million Btu per ton and 0.15 to 0.25 tons of carbon equivalent per ton over landfill disposal.

“This study is the latest in a growing body of information showing that many of the things we’ve viewed as waste actually have tremendous potential as energy resources,” said Steve Russell, Vice President of Plastics for ACC. “As a complement to a robust recycling infrastructure, conversion technologies offer environmental benefits and cost savings over traditional waste disposal processes.”

+ Full Report (PDF)

Gas Prices No Match When it Comes to Mom, According to NRF Survey

April 26, 2012 Comments off

Gas Prices No Match When it Comes to Mom, According to NRF Survey
Source: National Retail Federation

Riding the coattails of a spring where they spent freely on everything from garden supplies and home décor to colorful fashions, consumers will stretch their dollars a little further this Mother’s Day to make sure mom has the perfect day. According to NRF’s 2012 Mother’s Day consumer spending survey conducted by BIGinsight, the average person celebrating the holiday is expected to spend $152.52 on gifts, up from $140.73 last year. Total spending is expected to reach $18.6 billion.

According to the survey, consumers will spoil mom with special meals and/or outings, clothing, electronics, flowers and more. Two-thirds (66.4%) will buy flowers, spending a total of $2.2 billion, and nearly one-third (32.8%) will treat mom to a new blouse or sweater, spending $1.6 billion on clothing and accessories. Those buying electronics (12.7%) will shell out a total of $1.6 billion on tablets, digital cameras and more, and over half (54.3%) of all celebrants will treat mom to a nice dinner or brunch, spending $3.4 billion. Additionally, consumers will shell out $1.8 billion on gift cards and $1.3 billion on personal services such as a trip to a day spa.

When it comes to where people will shop, the survey found nearly two-thirds (35.6%) of gift buyers will shop at a department store, the most in the survey’s history. Adults ages 18-24 also prefer to shop at department stores where more than half (55.7%) will look for the perfect gift for mom. Other shoppers will head to discount stores (30.2%), specialty stores including jewelers, florists and electronics stores (36.3%) and specialty clothing stores (8.2%). One-quarter (25.6%) of shoppers will buy their gifts online, up from 21.5 percent last year.

+ Complete survey results (PDF)

Social Media, Liability and Insurance

April 2, 2012 Comments off

Social Media, Liability and Insurance
Source: Insurance Information Institute

Hundreds of millions of people interact on social networks like Facebook, Twitter, YouTube, MySpace and LinkedIn every day. Like any other new technology, social media brings enormous opportunities and benefits. The ability to communicate and interact instantaneously on a global scale 24/7 enables businesses to reach their customers directly and individuals to voice opinions on any topic they see fit.

Yet as the opportunity to tweet, message, share and “like” grows, so do the risks. As businesses and individuals navigate this shifting online risk landscape, they face a range of evolving social media related liabilities including privacy, security, intellectual property and employment practices liability.

Meanwhile, amid a rising number of high profile data breaches, government is stepping up its scrutiny of cyber security. This is leading to increased calls for legislation and regulation, placing the burden on companies to demonstrate that the information provided by customers and clients is properly safeguarded online.

Despite the fact that cyber risks and cyber security are widely acknowledged to be a serious threat, a majority of companies today still do not purchase cyber liability insurance. However, research indicates that this is changing. Insurance has a key role to play as companies and individuals look to better manage and reduce their potential financial losses from social media and cyber risks in future.

+ Full Document (PDF)

Model Energy Codes Could Add Thousands To The Cost Of New Apartment Construction, Seriously Exacerbating Nation’s Affordable Housing Shortage

March 30, 2012 Comments off

Model Energy Codes Could Add Thousands To The Cost Of New Apartment Construction, Seriously Exacerbating Nation’s Affordable Housing Shortage
Source: National Multi Housing Council (NMHC) and the National Apartment Association (NAA)

New energy codes could add thousands of dollars to the construction costs of each individual apartment residence in a multifamily building, according to new research commissioned by the National Multi Housing Council (NMHC) and the National Apartment Association (NAA). The research examines the costs of adopting the 2009 and just released 2012 International Energy Conservation Code (IECC). View the full report online at www.nmhc.org/goto/IECC-Study.

The latest IECC versions represent a significant departure from the 2006 IECC code, adding upwards of hundreds of thousands in additional costs to new construction. These new burdens come at a time when the U.S. is already suffering from a shortage of affordable housing.

API, Joint Industry Task Forces release final reports on offshore safety

March 30, 2012 Comments off

API, Joint Industry Task Forces release final reports on offshore safety
Source: American Petroleum Institute

API and the Joint Industry Task Forces released the final of three reports and a progress report of the fourth. Collectively, these documents provide positive recommendations to the government on how to improve offshore safety.

“These four Joint Industry Task Forces brought together the world’s best experts and these recommendations are part of a comprehensive effort by the industry to strengthen all aspects of offshore safety, while continuing to produce energy and create jobs for Americans,” said Upstream Senior Policy Advisor Holly Hopkins.

The task forces were assembled to focus on critical areas of Gulf of Mexico offshore activity following the Gulf spill: the Joint Industry Offshore Operating Procedures Task Force, the Joint Industry Offshore Equipment Task Force, the Joint Industry Subsea Well Control and Containment Task Force, and the Joint Industry Oil Spill Preparedness and Response Task Force.

“The task force recommendations added to industry programs that lead the way in implementing the strongest safety standards for offshore operations,” said Hopkins. “This process draws on the collective knowledge and experience of the industry and we will continue to promote the use of the best safety practices.”

+ Task Force Reports (PDFs)

10.4 Billion Trips Taken On U.S. Public Transportation In 2011

March 12, 2012 Comments off

10.4 Billion Trips Taken On U.S. Public Transportation In 2011
Source: American Public Transportation Association

According to a report released today by the American Public Transportation Association (APTA), Americans took 10.4 billion trips on public transportation in 2011, the second highest annual ridership since 1957. Only ridership in 2008, when gas rose to more than $4 a gallon, surpassed last year’s ridership. With an increase of 2.3 percent over the 2010 ridership, this was the sixth year in a row that more than 10 billion trips were taken on public transportation systems nationwide. During 2011, vehicle miles of travel (VMTs) declined by 1.2 percent.

“U.S. public transportation ridership in 2011 is now the second highest ridership since 1957,” said APTA President and CEO Michael Melaniphy. “What is exciting is that the uptick in ridership occurred in large, medium and small communities, showing the broad support that public transportation has nationwide. In fact, the largest rate of growth was in rural communities with populations under 100,000 where public transit use increased by 5.4 percent.”

+ Full Report (PDF)

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