Archive for February, 2012

P&C market outlook for 2012

Partly sunny with clouds mixed in and intermittent periods of rain; heaviest near the coast. This may sound like the weather forecast for today in New England, but it also served as the outlook for commercial buyers of Property & Casualty (P&C) insurance.

When researching this year’s market report, we discovered that Reinsurers have become much better at analyzing data from the many different lines of coverage to determine which are unprofitable. This, in turn, has Insurers taking more proactive measures to address those specific situations. The general result is a push for higher rates in 2012 in most areas.

WGA coverage experts take a look at each Property, Casualty and Management Liability line of business in the 2012 Market Forecast. We encourage a review of the full report, please click here to view. Read more…

Massachusetts Data Security Regulations March 1st deadline approaches

February 23, 2012 Leave a comment

Massachusetts has some of the nation’s most extensive requirements for the protection of personally identifiable information (PII), and on March 1, 2012, an additional provision will become effective. By that date, all companies subject to the Massachusetts Data Security Regulations must make sure that all of their service providers who have access to PII of Massachusetts residents are contractually obligated to comply with the Regulations by implementing appropriate security practices and procedures.

Many companies have been surprised to learn that they are even subject to Massachusetts’ Data Security Regulations. No matter where they are located, entities must comply with the Regulations if, in connection with employment or the provision of goods or services, they receive, process, store, maintain or otherwise have access to PII Read more…

Youth at risk and managing the exposure to your institution

February 21, 2012 1 comment

A recent rush of errors and bad judgment brought to light in public schools, universities, town services and youth organizations, have shown that even with proper protocols in place, bad hires can be made and can result in allegations of sexual assault.  First and most importantly, what can we do to protect our youth?  And secondly, what can we do to protect our valued institutions?

Following proper protocol for hiring is the best prevention mechanism to implement and can assist in managing the potential risks.  This process needs to be followed precisely for both prospective hires and any volunteers.  As part of the screening process, criminal (CORI) and motor vehicle (MVR) checks as well as references should be obtained and reviewed without exception.  CORI and MVR checks can be outsourced Read more…

“Big Data” poses new risks

February 14, 2012 Leave a comment

Recently, I watched the movie Moneyball about the use of statistical data by baseball’s Oakland A’s in order to determine the most effective players. Many of you  probably know the story of how the A’s became a powerhouse with a relatively small baseball payroll.  But the story is also one of the most well-known example s of “Big Data”, a term that is increasingly being used to describe the use of the mastery of large amounts of data, usually taken from the internet, in order to drive business tactics and strategies.

Steve Lohr’s recent article in The New York Times provides an in-depth look at the growing of the use of  this type of data, particularly from proprietary sources such as internet behemoths Google, Facebook, and LinkedIn, as well as government Read more…

Massachusetts Safe Driver Insurance Plan explained

February 13, 2012 Leave a comment

The Massachusetts Safe Driver Insurance Plan (SDIP) can be extremely complicated and confusing to understand. This is our basic introduction to how SDIP works, and how it will impact your insurance premiums.

The SDIP is a program created by state law that encourages safe driving with lower auto insurance premiums for drivers who do not cause accidents or commit traffic violations. It also ensures that high-risk drivers who do cause at fault accidents and have traffic violations pay a greater premium.

Types of surchargeable incidents:

  • Accidents – You receive surcharge points if you are more than 50% at-fault for a motor vehicle accident that results in damage to property or bodily injury of more than $500. Read more…

Law firms load up on insurance to combat expensive claims

Today’s Wall Street Journal features an article suggesting that the increase in lawsuits against law firms is directly related to the economy. It points out that, in recent years, not only has there been an increase in suits being brought by clients, but that suits are coming from internal sources as well. Suits alleging employment discrimination and firm mismanagement are on the rise as law firms undertake measures to increase profitability.

Professional Liability, Employment Practices Liability and Management Liability are all areas where law firms find themselves exposed. Most firms purchase at least one of these valuable insurance coverages. Given the current climate, as pointed out in the afore-mentioned article, we would suggest that firms look seriously at each and give careful consideration to employing such transfer mechanisms. Read more…

From tool to the new rule – looking at the basics of CAT modeling

February 3, 2012 Leave a comment

For over two decades, Catastrophe (CAT) Models have served as tools for insurance companies to manage their exposures from an aggregation of risks in a catastrophic event. Since their launch in 1987, these models have gone through many updates to further reduce the uncertainty from the previous version’s modeling results. As a result, what was originally developed as an underwriting tool has now become a substantial rule critical to the rating process.

The subject of CAT Modeling has received a fair amount of attention in the world of property insurance, thanks to the release of RMS version 11 last year. The influence it has made to the market via increased rates and increased underwriting discipline has been substantial. Having an understanding of CAT modeling Read more…