Insurance News January 2019
AMWins Group Launches New Product
AMWins Group speciality insurance provider has partnered with AXIS Group, launching a new solution against social engineering fraud. Social Engineering Fraud or shorter SEF is a fraud in which a party is deceived to give away CC data or bank account number. Losses covered under the policy of new solution product are when the person gets fraudulent emails, phone calls about instructions where to transfer the funds and he is doing so in good faith. AMWins also provides free training about SEF trhough partner KnowBe4, the largest security training awareness provider. The soltion is currently available in 47 US States.
Raising Interest Rates and The Impact on Insurers
Guy Carpenter recently reported that in between 2014 and 2017 that PC (Property and Casuality) grew its capital by almost 4% in the US. Reinsurer reports that the expansion of industry balance sheets may be a sign that insurers expect favorable conditions – improved pricing or organic growth opportunities – and they want their capital ready to on those opportunities. Building up capital cushions could be a sign that carriers are wary of challenges on the future horizon, such as rising interest rates or increases in loss severity and frequency.
According to Guy Carpenter’s 2018 “Risk Benchmark Research”, the largest asset class held by most carriers are securities and fixed income investments . When interest rates experience a spike, this adversely impact the value of those assets. Interest rates normally track alongside inflation. If inflation rises, this could pose challenges for long-tail liability reserves, making it prudent for carriers to save additional capital and liquidity. \
Progressive’s Group Impressive Growth
In the last decade there was an impressive growth driven by direct-to-consumer providers and now Progressive heads into 2019 with great growth momentum. The company’s recent Q4 earnings showed an year over year (YoY) gain in net premium insurance, with personal auto policies in force (PIF) up by almost 15%. Progressive’s commercial lines business records equally impressive profits,since growth in both direct and agency sectors contributed to these gains. One of the company’s highlights has been Progressive’s resurgence in the agency channel. January was the 38th consecutive month in which Progressive’s agency channel has achieved year over year profits, while its direct business continues to realize double-digit yearly growth.