Florida InsurersCan Weather AnotherBig Storm This Season
Despite warnings from two leading insurance rating agencies that Hurricane Milton weakened or threatened Florida’s recovering home insurance market, the market “can manage losses” from the Category 4 storm “and are ready to cover yet another hurricane,” if one should come this season, according to industry experts who spoke with the South Florida Sun Sentinel. AM Best and Fitch Ratings each issued reports last week warning that Milton could stretch liquidity of Florida-based residential insurers that are primarily focused on protecting in-state homeowners. But experts closer to Florida’s insurance industry cast doubt on those assertions. One reason is the two companies don’t rate most of the domestic Florida insurers whose…
Removing Incentivesfor Development From High-Risk Areas Boosts Flood Resilience
(Photo by Jonathan Sloane/Getty Images) By Lewis Nibbelin, Contributing Writer, Triple-I Withdrawing federal subsidies in climate-vulnerable areas can deter development and promote disaster resilience, according to a recent Nature Climate Change study. The study found that these benefits extend beyond the targeted areas. These findings underscore the utility of land conservation as hazard protection, as well as the critical role financial incentives play in driving – or obstructing – resilience. A natural experiment “Empirical research into this question is limited because few policy experiments exist where a clear comparison can be made of ‘treatment’ settings, where incentives for development have been removed, and ‘control’ settings, similar areas where such incentives…
Louisiana Is Least Affordable State for Personal Auto Coverage Across the South and U.S.
Despite strong income growth that has helped improve personal auto insurance affordability in Louisiana, the state remains the least affordable among its Southern neighbors and the rest of the United States, according to the Insurance Research Council (IRC). In 2022, the average annual premium expenditure per vehicle for auto insurance in Louisiana was $1,588, which is nearly 40 percent above the national average and nearly double that of the lowest-cost Southern state of North Carolina ($840), the IRC report says. Louisiana’s spending accounted for 2.67 percent of the median household income in the state. Florida’s average annual premium expenditures, at $1,625, exceed Louisiana’s, but the state is slightly more…
Personal Lines Underwriting Results Improve, Reducing Gap With Commercial Lines
The U.S. property and casualty insurance industry experienced better-than-expected economic and underwriting results in the first half of 2024, according to the latest forecasting report by Triple-I and Milliman. The report was released during a members-only webinar on Oct. 10. The industry’s estimated net combined ratio of 99.4 represented a 2.3-points year-over-year improvement, with commercial lines continuing to outperform personal lines. Combined ratio is a standard measure of underwriting profitability, in which a result below 100 represents a profit and one above 100 represents a loss. Much of the overall underwriting gain was due to growth in personal lines net premiums written. Commercial lines underwriting profitability remained mostly flat. “The ongoing…
CSU: Post-Helene, 2 More “Above Normal” Weeks Of Storm Activity Expected
(Photo by Joe Raedle/Getty Images) As work continues to address the harm inflicted by Hurricane Helene, researchers at Colorado State University (CSU) warn that the next two weeks “will be characterized by [tropical storm] activity at above normal levels.” The CSU researchers define “above normal” by accumulated cyclone energy (ACE) of more than 10. This level of hurricane intensity has been reached in less than one-third of two-week periods in early October since records have been kept. Hurricane Kirk, they wrote, is “extremely likely” to generate more than 10 ACE during its lifetime in the eastern/central Atlantic. Tropical Depression 13 has just formed and is likely to generate considerable ACE…