Weekly Dispatch: March 14, 2024

March 14, 2024

News

Avoid client misrepresentation and insurance fraud

Insurance agents act as mediators between insureds and insurers, which leaves them the responsibility of reporting misrepresentations when they occur. Whether its intentional or accidental, statements by a client that paint a false or misleading picture can leave professional insurance agents open to insurance fraud accusations. This shouldn’t be taken lightly. According to The Coalition Against Insurance Fraud, fraud costs businesses and consumers around $308.6 billion a year. What do agents have to do to prevent this from happening to them?

FEMA transfers $575 million in flood risk to capital markets for reinsurance

The Federal Emergency Management Agency obtained reinsurance coverage through Insurance-Linked Securities reinsurance for a seventh time on March 7, 2024. FEMA entered into three-year reinsurance agreements with its transformer reinsurer, Hannover Re (Ireland) Designated Activity Company. In turn, Hannover, transferred $575 million of the program’s financial flood risk to qualified capital market investors through a special purpose insurer, FloodSmart Re Ltd., for sponsoring catastrophe bonds. As part of these agreements, FEMA will pay about $85.7 million in premiums, excluding initial expenses, for the first year of reinsurance coverage.

N.H.: Gov. Chris Sununu signs consumer data protection bill

Gov. Chris Sununu signed S.B.255, relative to the expectation of privacy, into law earlier this month. Under the new law, New Hampshire becomes the 14th state to enact comprehensive consumer privacy protections ensuring that Granite State consumers can view what personal data is collected by companies and how it is held. They also will have the ability to have the information deleted upon their request. Previously, New Hampshire citizens did not have a right to control personal data held by private entities. Not only does this legislation provide this control, but it also assigns a responsibility and framework to businesses in handling, controlling and protecting personal data.

N.Y.: E-bike legislation proposed by NYC-based legislators

E-bikes and e-scooters have surged in popularity as efficient, eco-friendly and fun alternatives to traditional vehicles—offering a compelling solution to urban congestion and contributing to the reduction of greenhouse gas emissions. However, despite their benefits, the widespread adoption of e-bikes and e-scooters have raised concerns regarding safe storage, dangerous battery life and operator accountability. In response to these challenges, several New York City-based members of the New York state Legislature have introduced bills that would establish a regulatory framework for e-bikes and e-scooters unique to the city.

Vt.: Disaster declaration approved for December floods

On March 2, 2024, President Joe Biden declared that Vermont was experiencing a major disaster and federal assistance has been approved for storms and flooding from Dec. 18-19. Specifically, this is to cover the damages to the following seven counties; Essex, Lamoille, Orange, Orleans, Rutland, Windham and Windsor. This funding is available for state, tribal and eligible local governments and nonprofit organizations on a cost-sharing basis.

Compliance

N.Y.: Cyber series: compliance for limited exempt entities

In previous cyber series entries, we have discussed what covered entities in the context of New York’s cyber security regulation (23 NYCRR 500). To understand what limited exempt covered entities must to do follow this regulation, read our latest cyber series installment. Remember: You need to prove you were in compliance with New York state’s cyber security regulations for 2023 by Monday, April 15, 2024. If you are licensed in New York state, this compliance needs to be completed each year. Do you need help? PIA Northeast members can contact the PIA Industry Resource Center, which can offer step-by-step directions to make this process easier. Call (800) 424-4244 or email resourcecenter@pia.org.

Vt.: DFR issues bulletin on AI

On March 12, the Vermont Department of Financial Regulation announced the issuance of Bulletin 229, which principally adopts the National Association of Insurance Commissioners Model on the Use of Artificial Intelligence Systems by Insurers. This approach balances important consumer protection and market integrity concerns with the advancements that AI may offer for insurance. The bulletin emphasizes transparency and accountability, and addresses issues related to the use of AI such as potential inaccuracies or unfair bias. Insurers are reminded that any decisions or actions impacting consumers that are made or supported by AI systems must comply with all applicable insurance laws, including those addressing unfair trade practices and prohibiting unfair discrimination.

Advocacy

FIO cancels climate data collection plan, defers to NAIC

The Federal Insurance Office announced on March 8 that it was abandoning its efforts to collect climate risk data from property/casualty insurance carriers nationwide. This data call began in 2021 with an executive order asking for the FIO to assess climate risks: PIA was critical of the plan as it was asking for granular information, putting an undue amount of stress on the state and regional insurers. Now, the NAIC will lead this effort in the FIO’s stead. PIA believes that the NAIC is better fit for the task and celebrates this victory.

Technical

AM Best: Cat losses greatly impact p/c insurance industry’s underwriting for 2023

Industry rating agency AM Best released a report on the U.S. property/casualty insurance industry’s underwriting loss for 2023, and how it reached a 10-year high of $38 billion. This phenomenon is attributable to severe weather-related losses, stubborn inflation, and upward reinsurance pricing. Analysts in AM Best Report found that roughly $65 billion in catastrophe losses—mainly from secondary perils—impacted the 2023 underwriting results.

Remind your clients about the OSHA reporting deadline

One aspect of the Occupational Safety & Health Administration record-keeping requirements is the 300 log form. Many employers with more than 10 employees are required to keep a record of serious work-related injuries and illnesses. However, certain low-risk industries are exempt. Each Feb. 1-April 30, 2024, employers must post a 300A summary form of the injuries and illnesses recorded the previous year. The records must be maintained at the worksite for at least five years. Employers must report any worker fatality within eight hours and any amputation, loss of an eye, or hospitalization of a worker within 24 hours (this also applies to otherwise exempt employers). Minor injuries requiring first aid only do not need to be recorded.

Make searching for motor vehicle reports easy

When writing a car insurance policy, you are going to need an accurate record of your insureds’ driving history to determine their rates. A motor vehicle report does just that, keeping track of a driver’s traffic citations, accidents, points on a license, and more. If you need a quick and easy way to find these reports, then PIA members can access Motor vehicle report vendors in the PIA QuickSource library.

Educating insurance agents

Conn./N.J./N.Y.: Learn about the essentials of life & health

Understanding the basics of a given subject can enhance your conversations in other areas: learning the essentials of life & health insurance can give you an edge even in conversations about p/c insurance. The 2024 CISR LHE: Life & Health Essentials course, taught by Richard Goolsby, CIC, will teach you about the important basics for this kind of insurance. This course will be held on Wednesday, March 20, 2024, from 8 a.m.-3:45 p.m. This course has been approved for CE credits in the following states: Connecticut (7 LH), New Jersey (7 GEN; NJDOBI will award 12 CRE credits for each full year in good standing), and New York (7 BR, LA, LB, LSB, PC; 1 additional NYCE credit with passing grade on exam).

Events

Conn.: Meet your legislators at the 2024 Legislative Reception

If you’re looking for the opportunity to speak with Connecticut’s state legislators in an informal setting, then be sure to attend PIACT/CTYIP’s Legislative Reception. This reception will be held Tuesday, March 19, 2024, at the Legislative Office Building in Hartford, from 5-7 p.m. There, you and the state legislators will be able to discuss some of the most pressing issues facing the insurance industry over appetizers and cocktails. Register for the reception here.

Conn.: Bowl a perfect game at the CTYIP Welcome Reception

Before the Connecticut Convention gets underway, meet up with the CTYIP on Tuesday, March 26, 2024, from 5:30-8 p.m., at the Foxwoods Resort Casino High Rollers Luxury Lanes. Go head-to-head in friendly competition with fellow industry professionals for two hours of bowling and networking. Also remember to enjoy the light appetizers and open bar. Register for the CTYIP Welcome Reception today.

The discount for the Connecticut Convention has ended—register now to avoid door prices!

While our 15% discount for the Connecticut Convention at Foxwoods Resort Casino has ended, you can still pre-register for the event: the convention will be held on March 27-28, 2024. Registering gives you peace of mind by securing your ticket now at a lower price and avoiding higher prices at the door. Once you register for your ticket, you can look forward to meeting different professionals from diverse backgrounds, attending insightful education courses, and finding innovative solutions to industry challenges at the trade show: register today.

PIANJ dives into personal-lines and small commercial-lines

PIANJ hosted another Deep Dive session: Selling/Servicing Personal Lines and Small Commercial Policies on March 7. Those who missed the session can view a recording of the program, which can be shared with colleagues. Moderated by PIANJ’s Director of Government & Industry Affairs Bradford J. Lachut, Esq., the discussion included insights from multiple panelists, including Connie Mahoney, PIANJ president and agency manager for Mark Anthony Associates. The session offered viewers tips on how to protect themselves from E&O exposures when handling personal-lines and small commercial-lines policies.

ICYMI

NFIP extended out to March 22

The National Flood Insurance Program has received its 29th short-term extension since 2017 on March 4, as part of a continuing resolution to fund parts of the government until March 22. Government funding has been split into two-tiered continuing resolutions since November; government programs, including agriculture, housing and veterans have been funded out to the end of the fiscal year on Monday, Sept. 30, 2024. PIA urges Congress to issue a long-term reauthorization of the program.