Weekly Dispatch: Sept. 8, 2022

September 8, 2022

News

Record-high, direct premiums written for the E&S segment

Total U.S. surplus-lines direct premiums written reached a record $82.6 billion in 2021, with momentum continuing through mid-year 2022, according to a new AM Best report. The Best’s Market Segment Report, titled, “Record-High Direct Premiums Written for the U.S. Surplus Lines Segment in 2021,” states that the U.S. surplus-lines companies reported vastly improved underwriting and operating results, and notched their largest year-over-year premium growth since 2003. The report notes that in the first quarter of 2020 through mid-2022, U.S. property/casualty companies and their distribution partners have dealt with myriad of challenges, including the wide-ranging effects of a pandemic, a supply-chain crisis and rising inflation, while withstanding above average losses from natural catastrophes and substantial investment market volatility. As a result, loss costs continue to rise and price adequacy remains a serious concern for several lines of coverage. Despite these challenges, the p/c industry has been able to limit underwriting losses and generate surplus growth. In particular, nonadmitted companies have been able to generate net underwriting and operating gains. The surplus-lines insurers’ market share of total p/c direct premiums written has more than doubled over the last 20 years, to 10.1% at the end of 2021, up from 4.3% in 2001. The surplus-lines insurers’ share of the commercial lines’ direct premiums written grew to 20.4% at the end of 2021, from 8.3% at the end of 2001—further demonstrating the segment’s resilience in seemingly adverse market conditions.

N.J.: New investments in resilient communities

Gov. Phil Murphy last week highlighted state investments toward building resilient local communities. In addition to the more than $650 million devoted to expansive response and recovery efforts to date, the administration is supporting recently established Ida recovery funding programs with $283 million. Through its comprehensive short-term recovery approach, New Jersey distributed state and federal funding for the following programs: Federal Emergency Management Agency Household & Individual Assistance; Small Business Administration Disaster Loans; FEMA Public Assistance through New Jersey Office of Emergency Management to State and Local Governments; New Jersey Department of Environmental Protection Buyout Program; DEP Elevation Program; New Jersey Economic Development Authority Small Business Grants; and DEP community stormwater assistance grants.

N.Y.: Governor announces $6.5M to support insurance innovation for climate-technology solutions

Gov. Kathy Hochul last week announced $6.5 million to support Insurance Innovation for Climate-Technology Solutions, a new program focused on the research and development of new insurance policies and products that will promote the adoption of clean technologies across New York state. The program will provide funding for products that manage the financial risk associated with climate change, supporting the state’s nation-leading Climate Leadership and Community Protection Act goal of reducing carbon emissions 85% by 2050.

Advocacy

N.Y.: Auto theft investigator refuted

A letter ran recently in the Albany-based Times Union titled “Commentary: A repeal that would help fraudsters and hurt consumers.” The letter is an opinion piece written by Tod Neifert, an auto theft investigator, which calls for New York Gov. Kathy Hochul to veto legislation that would make the photo inspections currently required by New York Insurance Law Section 3411 and Regulation 79 optional. PIANY has long supported the legislation and the efforts to reform the photo inspection process. The letter contains several inaccuracies and partial truths. PIANY Director of Government & Industry Affairs Bradford J. Lachut, Esq., refutes the article’s statements and reiterates PIANY’s long support for this legislation.

Technical

Items in storage units may not be covered by a HO policy

It used to be that if clients asked you if their homeowners insurance policy covered their property anywhere in the world, you could reply: “Yes. However, if they are in another one of your residences, then coverage is limited to 10% of the limit shown in your primary homeowners policy.” Then, you would ask them which property they were discussing, so you could make sure it wasn’t listed in the homeowners insurance policy’s exclusions or limitations, and needed an umbrella policy. Now you need to ask an additional question: “Is your property stored in a self-storage facility?” According to the 5/11 edition of homeowners (HO3) form, there is a paragraph that addresses limitations for “self-storage facilities” for new homeowners insurance policies. This change only provides 10% of the personal property limit for items in self-storage facilities.

Educating insurance agents

N.Y.: New classes that meet the New York State Department of Financial Services’ new CE requirements are available online and in private on-site sessions.

CIC: Insurance Company Operations Institute

PIANY will host the 2022 CIC ICO: Insurance Company Operations Institute, Sept. 14-15, 2022, at the PIA Northeast Headquarters in Glenmont, N.Y. The class also is available as a webinar. This institute will describe how insurance companies function and why having this knowledge is important to all insurance and risk management professionals. Participants will learn about the important strategic decisions and tactics used in product development, underwriting, distribution, claims, and other vital company departments. This institute has been approved for NYCE and NJCE credits: 15 BR, C1, C3, LA, LB, LSB, PA, PC, and 16 GEN, respectively.

Events

N.H.: PIA Symposium & Wine Tasting

Back by popular demand! Don’t miss PIANH’s premier insurance networking event—Symposium & Wine Tasting. Join PIANH for its Symposium & Wine Tasting Thursday, Sept. 29, 2022, at The One Hundred Club–Portsmouth, starting at 1 p.m. The event will feature networking opportunities, cybersecurity and condominium education classes, and wine and food pairings. PIANH’s Director of Government & Industry Affairs Bradford J. Lachut, Esq., will lead a class on cybersecurity, and popular PIA instructor Mishell K. Magnusson, CIC, CISR, CPIA, AAI, FIPC, will teach a class on condominium exposures. Both classes have been submitted for continuing-education credits. Register today.

NY-YIP Golf Open raises $1,500 for St. Jude

The NY-YIP held its 29th annual Golf Open earlier this month at the Mill River Golf Club, Oyster Bay, N.Y. The event raised more than $1,500 for St. Jude Children’s Research Hospital. Congratulations to all the golfers who took part in the golf event. A complete list of the day’s winners can be found here. Thank you to all of attendees and sponsors who made this year’s event a great success.

Register now

Monday, Sept. 12, 2022: PIANJ Golf Classic

Thursday, Sept. 29, 2022: PIANH Symposium

Wednesday, Oct. 19, 2022: PIANJ Women’s Leadership Alliance Golf Clinic

Tuesday, Oct. 25, 2022: Save the date: Capital RAP—Interested in sponsoring, exhibiting or advertising?—Early-bird pricing expires after Friday, Sept. 9, 2022.

Thursday, Oct. 27, 2022: NJYIP Halloween Spooktacular

Celebrating 40 Years with Berkshire Hathaway GUARD Insurance Companies.
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