Spring 2015

Now, and perhaps more than ever in history, rapid advances in technology are shaking our worldview and leading to new practices in business and science. Drones are changing the way that insurers handle claims, survey properties, and assess remote risks. Social media and the flood of data that it provides are signaling similar sea changes. In the auto sector, the advent of ridesharing is giving connected drivers and passengers uncounted opportunities, just as it presents challenges for their insurers. As more drivers, homeowners, and consumers connect to what is being described as the “Internet of Things,” the issues related to safety, risk, and insurance become astonishingly complex. For the prepared, the upside for enterprise can be staggering, but those not repositioning for this new technology may regret their lack of preparedness.

For insurers as well as law enforcement officials, drones carrying remote sensing technology are raising further questions as they transform both underwriting and claims handling. These tools are providing detailed information that can bring greater speed and precision, reduce underwriting and claims-handling costs, and enhance customer service. As remote sensing devices become more sophisticated and ubiquitous, property insurers and repair professionals are working to establish ethical guidelines and make sure the technology is deployed responsibly.

Urban zoning can shift to reflect changes in demographics, redevelopment strategy, political leadership, or other emerging realities. In these unexpected revisions, zoning maps can often be redrawn to introduce tangible opportunities for investors and developers that previously could only be imagined. New zoning rules can change market conditions, create submarkets, and affect areas not subject directly to the new rules. Understanding the details can potentially help anticipate risks and opportunities associated with growing markets, saturated markets, and alternative uses.

Should a supplier know where the gold in a microchip was mined? And can it be verified that biocide in the shampoo just shipped abroad meets European Union standards for chemicals? In 2015, increased regulation is headed down the entire supply chain and imposes obligations on companies to engage their networks in new ways. Not only are firms with global chains expected to gather data about products and chemicals used to produce them, but rules coming into effect are demanding deeper insight into suppliers’ operations, due diligence, and credibility.

TRIPRA 2015 has paved the way for insurance and commercial real estate companies to operate their businesses as usual, although not without lasting impact from the scare that took place at the year’s outset. After seven years in a legislative freeze, the federal government has begun the gradual process of reducing taxpayers’ liability with respect to potential terrorism losses. Risk managers and investors need to start strategizing for a market that may gradually move to the private provider side, with greater fluctuations in prices and product structure. The worst and most devastating effects from 9/11 may have passed, but the specter of terrorism will continue to move markets.

After an interlude of Western business dominance, Asia is once again assuming its historical place as a powerhouse of world commerce. Trade and investment have grown exponentially over the past two decades, to the point where the region now occupies a crucial space in the global marketplace. With Asia’s growing economic clout come potential pitfalls for businesses that choose to operate in the region. Events as far-ranging as the rise of Communism to the recent financial crisis serve as examples of tumultuous risks that companies operating in Asia may have to navigate. This article examines five key risks in Asia that hold potential to change the business environment in the coming year.

With property and casualty (P&C) policyholders employing big data analytics, insurers whose decision-making processes fail to include insights derived from social media may risk making a poorly researched decision. Fortunately, a variety of tools are emerging to help insurers incorporate insights obtained from social media sources into decisions across their organizations at every point of the value chain — from the initial reporting to the settlement of a claim. So why aren’t all insurers putting the pedal to the metal on these analytics when policyholders themselves are doing so for decisions as simple as where to eat dinner?

More, Better, Faster, Stronger

By Zack Schmiesing

Commercial property carriers today are seeing fresh faces and renewed vigor on the playing field. And those players aren’t just looking to participate — they want to dominate. More companies are investing and actively integrating sophisticated analytics and automated data analysis and are making better use of seasoned underwriting talent. The best-equipped insurers have the ability to surge past opponents through competitive pricing and precise risk segmentation to build strong agency relationships and win the speed-to-market race. With investments and innovation using ADS strategies, the game is definitely on.



Personal Lines Coverage Gap for Ridesharing Drivers

Sandee Perfetto, director of personal auto product development at ISO, recently spoke to Insurance Journal about two new endorsements to help personal lines insurers address the commercial exposures faced by insureds who are using their vehicles for ridesharing purposes.