The Economy/Inflation, Talent Acquisition and Litigation Top Concerns; Integrity, Security and Accuracy Lead Priorities for Data/Technology

Throughout 2022, AAIS conducted several surveys from a cross-section of insurance professionals, many associated with insurance industry events. What emerged from these various surveys was a view of the top issues and concerns facing the industry as well as the priorities placed on data and technology initiatives. This summary presents the aggregated results of those surveys. We trust this information is useful for AAIS Members and other industry stakeholders as a catalyst for discussions surrounding the development of solutions for the most pressing issues that lie ahead.

Litigation Tops Capital and Nat CAT Concerns

AAIS, a sponsor of the 2022 Florida Insurance Market Summit held March 21st to 23rd, polled attendees pre-event to understand what they perceive as the most pressing issues affecting the Florida market and the overall insurance industry.

Personal lines insurance is more diverse than ever before. During a Personal Lines Product Council in 2022 hosted by AAIS, Member carriers and other key stakeholders discussed several key issues affecting the market, from cryptocurrency and solar panels to container homes, “swimply”, and e-bikes and scooters.

AAIS established Product Advisory Councils to bring Member carriers and other industry stakeholders together to identify the burgeoning issues concerning insurers and the broader insurance industry today. While not all issues raised can be solved through product or program developments, we believe discussing emerging issues as well as working together within the AAIS Community can spawn new ideas and usher resources to meet today’s challenges. A general overview of several emerging issues is discussed below.

Dr. Phil Klotzbach, Ph. D., from the Department of Atmospheric Science at Colorado State University, says climate change is real. In a recent interview he explained that “if you go back to the late 1800s, parts-per-million of carbon dioxide was about 280; now we're sitting at about 420. We've gone up by about 50 percent of what we were about 140 years ago. With that, we've seen a global temperature rise of about eight- or nine-tenths of a degree Celsius … about 1.5 degrees Fahrenheit.”

Regulation plays an outsized role in the development of the auto insurance sector. Since the beginning of the pandemic, we have seen an even higher than usual impact from wild fluctuations in rates, claims, premiums, and consumer reimbursements, to activities impacting the industry itself.

Dr. Matt Hinds-Aldrich, Senior Risk Strategy Lead at AAIS and fire peril subject matter expert, recently joined Tom Louis from First Due to discuss why the National Fire Incident Reporting System (NFIRS) still matters and why it needs to improve to meets the needs of the 21^st century fire service. Watch the entire discussion here:

Ransomware is a type of malicious software designed to block access to a computer system until a sum of money is paid and can target both individuals and businesses. The U.S. House Committee on Oversight and Reform shared that “in 2020, ransomware attacks on both public and private institutions in the U.S cost an estimated $19.5 billion. … in the first six months of 2021, financial institutions reported $590 million in ransomware-related transactions. Current trends indicate that ransomware transactions in 2021 alone will exceed the previous 10 years combined.”

As part of our commitment to delivering innovative, unique, and valuable products and solutions, we have established product councils to engage with Members and gather feedback to inform the strategic direction of AAIS programs. Currently, AAIS has Advisory Councils in the following areas: Auto, Farm, Agribusiness, Inland Marine/Commercial Output, Commercial Lines, Personal Lines and most recently Cannabis and Fire.

With the holidays and the end of the year upon us, it is the time to reflect upon the past year. And it is the time of year we tend to think about coming together, as a community, to share our experiences. In our case, I’m referring to AAIS’s product-focused advisory councils.

As the pandemic rolls on, with the omicron variant providing the latest wrinkle, the auto market continues to be reshaped by COVID-19. Aside from the overall financial impact, now increasing claims, severity of claims and higher losses, and worsening consumer behavior are all leaving a mark. Here is the latest from around the industry: