Dog Bite Claims on the Rise

Posted by Benji Riggins on June 1, 2012 under Claims | Be the First to Comment

Dog bite claims increased 16 percent in 2011 compared to 2010, and have grown close to 48 percent since 2003, according to figures released by the insurance industry.

On the eve of National Dog Bite Prevention Week, the Insurance Information Institute and State Farm Mutual Automobile Insurance Co. released figures indicating that dog bites are costing the insurance industry hundreds of millions of dollars each year.

I.I.I. says that, in 2011, dog bite claims amounted to close to $479 million with a total of 16,292 claims filed.

I.I.I. says the increase can be attributed to “increased medical costs as well as the size of settlements, judgments and jury awards given to plaintiffs, which have risen well above the rate of inflation in recent years.”

According to Bloomington, Ill.-based State Farm, the company paid more than $109 million in claims resulting from 3,800 dog bite claims in 2011.

California was number one on State Farm’s list for dog bite claims and money paid out, with 527 claims for an estimated $20 million. Illinois was second with 309 claims and $10 million.

In conjunction with National Dog Bite Prevention Week, which runs May 20-26, the U.S. Postal Service released its list of the top 25 dog-attack city rankings.

Los Angeles was number one with 83 attacks, followed by San Diego with 68 and Houston with 47.

The Postal Service says that, nationwide, there were more than 5,577 postal workers attacked in 1,400 cities. The attacks on workers cost the Postal Service close to $1.2 million last year.

According to the center for Disease Control and Prevention, there are more than 4.7 million people bitten by a dog each year and 800,000 seek medical attention for their bites. Of those bitten, more than half are children.

As part of a campaign, the participants in National Dog Bite Prevention Week have issued a series of tips to reduce the risk of dog bites.

Among the steps:
•Socialize your dog so it know how to act with other people and animals.
•Discouraging children from disturbing a dog that is eating or sleeping.
•Avoid exposing your dog to new situations in which you are unsure of its response.
•Never approach a strange dog and always avoid eye contact with a dog that appears threatening.

By Mark E. Ruquet, PropertyCasualty360.com

NAIC: 59% Homeowners at Risk of Property Loss

Posted by Benji Riggins on May 29, 2012 under Insurance News | Be the First to Comment

According to a NAIC report, thousands of homeowners are cleaning up and filing insurance claims following an outbreak of devastating tornadoes across the U.S., but are those possessions properly protected to the fullest extent?

According to the February 2012 survey included in the report identified above from the National Association of Insurance Commissioners (NAIC), more than half (59%) of Americans don’t have a home inventory of their possessions, putting them at risk for inadequate home insurance coverage, should severe weather strike.

The recent survey showed that 59 percent of consumers have not made a list or inventory of their possessions. After a tornado or hurricane strikes, water and wind damage can destroy any conventional shoebox system of storing receipts and owner’s manuals.

But even for those individuals with a home possessions inventory some do not have a comprehensive enough system to be reimbursed for storm losses. The survey showed that 48 percent do not have receipts; 27 percent do not have photos of their property; and 28 percent do not have a back-up copy of the inventory outside the home. These are essential to claiming client’s entire losses. Furthermore, 59 percent of people with inventories have not updated their inventories in more than a year, meaning new purchases and gifts may not be covered.

“Violent weather events affected approximately 80 percent of the nation’s population over the past six years. These storms have left widespread destruction in their wake,” says Kevin M. McCarty, NAIC President and Florida Insurance Commissioner. “Creating a detailed inventory of your possessions is one the best ways to ensure you have the right amount of homeowners or renters insurance for you and your family, he continued.”

Coverage for Storm Losses

Before severe weather strikes, consumers can use their inventory to evaluate their coverage and determine if they need to update their policies. It’s important to know that how much is reimbursed varies greatly from policy to policy. On average, home contents are reimbursed only up to 50 percent of the home’s insured value, i.e., $50,000 to replace the contents of a home insured for $100,000. Of course, home inventories also help in the case of home burglaries losses when items are stolen.

Contents coverage includes replacing a home’s furnishings and the insureds clothing and other possessions. The standard homeowners policy would cover the purchase price less depreciation applied to those items. Under a policy with replacement cost coverage insured’s are covered for the cost to replace items.
Contents replacement coverage includes:
•Clothing, furniture, and electronic equipment,
•Curtains,
•Portable and window air conditioners,
•Portable microwaves and dishwashers,
•Carpeting that is not already included in property coverage, and
•Clothing washers and dryers.

Home Inventory Process Assistance

So who can your clients turn to in accomplishing this important documentation? They can set up their own database and make a home video recording but for many this process seems time-consuming. Here are a list of entities available for collaboration with agents and brokers to help make this process easy for their clients:
•Docuhome
•KC Home Inventory
•ServPro
•Hobson Inventory

These documentation service providers prepare complete and thorough documentation of your personal property to equip clients in the event they need to file an insurance claim. The documentation is designed to maximize claim reimbursement, make the claim process less difficult, and expedite the settlement.

In addition the NAIC has an app available for smart phone users. The NAIC myHOME Scr.APP.book application makes it easier for consumers to document their valuables, update their inventories and store the information for easy access after a disaster. The app is free and available for both iPhone® and Android® smart phone users.

By Michael Meulemans, About.com Guide

Home Insurance Goes Through the Roof

Posted by Benji Riggins on May 25, 2012 under Insurance News | Be the First to Comment

Faced with falling home prices and climbing maintenance costs, struggling homeowners may soon face another setback: higher insurance premiums.

After rising steadily for the past few years, homeowner insurance premiums are expected to jump another 5% this year to $1,004, according to the Insurance Information Institute. That’s the biggest yearly increase since the market downturn and will mark the first time the national average premium is above $1,000.

Premiums will rise even higher in some states. In Georgia, GuideOne Insurance will raise rates by 12% on average starting this month. Farmers Insurance is increasing rates in Texas by 10% on average. Last month, Allstate started raising rates by 15% in Pennsylvania. And Florida insurer Citizens Property Insurance Corp. and North Carolina Farm Bureau are raising rates on some condo and homeowners by 21% and 6%, respectively.

The higher premiums come at a challenging time for American homeowners, as millions are behind on their mortgage payments and many owe more on their home than it’s worth. Insurers say the higher premiums are partly to cover their rising costs: Insured catastrophe losses in the U.S. totaled $35.9 billion in 2011, compared to a 2000 to 2010 average of $23.8 billion, according to the III. The companies are also paying more in premiums to so-called reinsurers, which provide insurers coverage for widespread catastrophic events, says Steven Weisbart, senior vice president and chief economist at the III.

Meanwhile, insurers’ returns on their investments — roughly 70% of their assets are in bonds – have been low, he says, and they’re looking for other ways to make up that lost revenue. “The only other place insurance companies can get money from is premiums,” he says.

Typically, when policyholders are informed of premium increases they shop around for better prices, but experts say that’s become harder to do. As insurers exit some markets altogether, homeowners are left with fewer companies to choose from. For instance, starting in May, State Farm will not renew roughly 11,000 homeowner policies in five coastal counties in Texas. The company says it’s trying to lessen its exposure to future losses.

To lower premiums, some homeowners increase their deductible, which means they’ll have to pay more out of pocket if disaster strikes before their insurance kicks in. But this strategy might not be as helpful this time around, since some insurers are dropping other types of coverage that were previously part of basic homeowner insurance policies. When coupled with a high deductible, a homeowner’s expenses could soar.

Allstate, for instance, recently introduced a new homeowner’s policy in Kansas and Oklahoma that doesn’t pay out the full cost of replacing all roofs that incur windstorm or hail damage. Kevin Smith, a company spokesman, says Allstate will determine which roofs qualify based in part on their age and condition. If Allstate declines to pay the full cost, it will pay the current value of that roof and the homeowner will be on the hook for the difference. The company says the homeowner’s other option is to purchase so-called replacement cost coverage for roof losses in addition to their basic policy.

Even if homeowners find a lower premium, it might not stay low for long. Experts say many insurers filed requests with states to raise rates this year. (When states approve higher rates, that leads to higher premiums for policyholders.) For instance, last month, Pennsylvania received requests from Erie Insurance and Travelers to increase premiums by roughly 9% by June and July, respectively, according to the state’s insurance department. (The companies didn’t respond to requests for comment.) In Georgia, most of the major companies filed requests to raise rates from 18% to 22%, says Steve Manders, director of insurance product review at the state’s department of insurance. The states say they don’t usually approve requests for increases by the exact amount insurers ask for.

By AnnaMaria Andriotis

Top 10 Claimed Items

Posted by Benji Riggins on May 24, 2012 under Insurance News | Be the First to Comment

Electronics is bumped out of the No. 1 position in value and volume for property insurance claims made in 2011. Find out what takes its place.

Jewelry claims bumped electronics out of the No. 1 ranking position in value and volume for property insurance claims made in 2011, according to new data.

The annual Contents Claims Index (CCI) by property insurance software and service provider Enservio found that the number of jewelry items claimed grew 57 percent compared to 15 percent growth in the electronics category for the same year. The average price per piece of jewelry claimed increased by 11 percent with jewelry claims more prevalent on the West Coast of the United States.

“Jewelry is a high-dollar item, very small and you don’t have to substantiate it when you lose it as long as it’s not scheduled,” said Keith Pequeno, SVP of market place and corporate marking with Enservio. “It’s a high-value, easy-to-claim item depending on an insurance policy. It’s also an item that is the most claimed and the least replaced. So this should lead to more scrutiny of these types of claims and the items they contain.”

Jewelry topped the list at 17 percent of replacement cost value (RCV) followed closely by electronics at 13 percent, according to the 2011 CCI. Apparel and furniture tied for the number three spot at 11 percent, followed by home goods at 9 percent.

“The economy is playing a part here as well,” Pequeno told Insurance Networking News. “People are hesitant about going out and splurging on the big screen TV. Even though we see the sticker prices on these big ticket items actually lowering, it seems that consumer confidence is still a bit stuck in neutral. We could see this shift as we look at next year’s index. Remember it may look like a decrease but it really is a 15-percent increase year over year.”

The full CCI list and each item’s RCV is as follows:

1. Jewelry – 17 percent

2. Electronics – 13 percent

3. Apparel – 11 percent

4. Furniture – 11 percent

5. Home goods – 9 percent

6. Tools – 4 percent

7. Appliances – 4 percent

8. Sporting goods – 3 percent

9. Books and magazines – 3 percent

10. Bed and mattress – 2 percent

Within the electronics category, TV, laptops and desktop computers have maintained their top ranking as the most claimed items year-over-year.

“Going into 2013, we know we will see similarities but we should also start to see newer subcategories rising like tablets, e-readers and smart phones being claimed,” Pequeno said.

Insurance Networking News

Juliette Fairley

Tropical storm forecast kick-starts the 2012 hurricane season

Posted by Benji Riggins on May 18, 2012 under Interesting Info | Be the First to Comment

The 2012 hurricane season might get an early start, with the possibility of a tropical depression or storm in the western Caribbean some time next week, according to a cutting-edge forecast Tuesday by federal scientists.

The Climate Prediction Center predicted moderate chances that a tropical depression or a storm will form in the Caribbean during the last week of May.

Even if no storm develops, the prediction signals that the Atlantic is becoming primed for tropical activity as June 1, the official start of the six-month hurricane season, nears.

“It’s something to pay attention to. It might be a little earlier than normal,” said Eric Blake, a specialist with the National Hurricane Center.

While the two-week tropical hazard forecasts by the Climate Prediction Center are not very accurate now, meteorologists there are working with the National Hurricane Center to improve them. Within a few years, the two agencies plan to start making a joint two-week forecast, with the hurricane center taking the lead on the first week and the climate center handling the second, said Blake, who gave a presentation about the project at the Governor’s Hurricane Conference here on Tuesday.

He said the hurricane center began working with the climate center on the two-week outlook shortly after the busy 2005 hurricane season.

“The challenge has really been eliminating the false alarms,” Blake said.

The two-week outlook mostly relies on thunderstorm activity around the global tropics to predict where chances are increased for a tropical storm or depression to form. Clusters of thunderstorms occasionally move around the globe in a weather pattern called the Madden-Julian Oscillation or MJO. When the thunderstorms are over the Caribbean and Africa, the chances for tropical storms to develop in the Atlantic increase, Blake said.

But because weather is so variable, forecasts that extend beyond a week tend to have a large margin of error. The five-day forecast for tropical activity, however, is getting much better.

Blake said the hurricane center will experiment this year, in-house, with predicting the formation of tropical storms five days in advance. If the forecasts pan out, weather buffs, fishermen, shipping businesses, emergency planners and those in the oil and gas extraction industries could benefit from those forecasts beginning next year.

By Kate Spinner

Fewer Storms Forecast for 2012 Hurricane Season

Posted by Benji Riggins on May 5, 2012 under Insurance News | Be the First to Comment

The 2012 Atlantic hurricane season is projected to be less active than in recent years with 11 tropical storms, six of which will intensify into hurricanes, U.S. private forecaster Weather Services International said on Wednesday.
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Once Again, Flood Insurance Program to Expire Unless Congress Acts

Posted by Benji Riggins on May 3, 2012 under Flood | Be the First to Comment

Federal officials are putting fresh pressure on Congress to take action on the National Flood Insurance Program, whose authorization expires at the end of this month, one day before hurricane season begins.
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Severe Weather Has Home Insurers Rethinking Coverages

Posted by Benji Riggins on April 23, 2012 under Insurance News | Be the First to Comment

As weather disasters strike with more frequency, U.S. homeowners first get hit with the destruction or total loss of property. Many are then hit with the unexpected loss of homeowners insurance policies as insurance companies re-evaluate their financial liabilities.
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Colo. Forecasters Call For 10 Named Storms for 2012

Posted by Benji Riggins on April 9, 2012 under Insurance News | Be the First to Comment

An early hurricane forecast is calling a below-average hurricane season with 10 named storms for the Atlantic basin.
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Odds Are High for Another Active Hurricane Season in 2012

Posted by Benji Riggins on March 29, 2012 under Insurance News, Uncategorized | Read the First Comment

Chances are next year will be another active hurricane season in the Atlantic if an El Niño does not develop, say forecasters at Colorado State University.

The forecast team of Philip Klotzbach and William Gray released its early hurricane season forecast for 2012, saying that it is dispensing with the usual numerical forecast for the number of storms. Instead, Klotzbach and Gray issued their forecast in terms of the probabilities “of the key factors influencing the hurricane season.”

The reason for the change, they say, is the difficulty forecasters have in determining whether an El Niño will occur in the Pacific, which impacts the Atlantic hurricane season.

The team says there is a 45 percent chance that climate conditions that have persisted since 1995 will continue along with no El Niño development in the Pacific. These conditions include warmer water temperatures in the tropical Atlantic and reduced vertical wind shear—conducive conditions for hurricane formation.

Should that be the case, hurricane activity would be 140 percent of the average season, which would be characterized as 12 to 15 named storms, seven to nine hurricanes and up to four major hurricanes (Category 3, 4 or 5 with sustained winds of 111 mph and greater), the forecasters say.

The team says there is a 30 percent chance that Atlantic wind circulation remains unchanged and a significant El Niño occurs, which would reduce the tropical-cyclone season to approximately 75 percent of the average season. That would be 8 to 11 named storms, three to five hurricanes and one or two major hurricanes.

There is a 15 percent chance that current Atlantic wind conditions could become unusually strong, and no El Niño occurs, which would lead tropical-cyclone activity of up to 180 percent of average hurricane season—about 14 to 17 storms, 9 to 11 hurricanes and four to five major hurricanes.

And the forecasters say there is a 10 percent chance that current Atlantic wind conditions weaken and a significant El Niño develops, which would reduce the tropical-cyclone activity to 40 percent of the average season—five to seven storms, two to three hurricanes and possibly one major hurricane.

For 2011, the CSU forecast team had predicted that the hurricane season would be well above average. In June the team called for 16 named storms, nine hurricanes and five major hurricanes. The season produced 19 named storms, seven hurricanes and three major hurricanes.

By Mark E. Ruquet, PropertyCasualty360.com