Enjoy complimentary access to top ideas and insights — selected by our editors.

For 2024, the top news across the insurance industry included the likes of high-level appointments at Tesla and Allstate, competitive state insurance commissioner races, what President-elect Donald Trump’s return to the White House could mean for Medicare and more. 

California governor’s office

California governor hits the gas pedal on property insurance changes

Article by Keeley Webster

California Gov. Gavin Newsom is seeking to halt the trend of property insurers exiting the state, citing losses, by expediting how quickly they can increase rates.

Newsom announced plans to draft a trailer bill to speed up work done by the state’s Insurance Commissioner Ricardo Lara during Friday’s briefing on May revisions to his proposed budget. A trailer bill is late-session legislation that codifies an aspect of the state budget agreed to by the governor and lawmakers.

The bill would cut the current property insurance rate-approval process to 60 days with the aim of ending the exodus of insurers and calming residents’ fears of canceled policies.

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Insurance commissioner election results

Article by Michael Shashoua

Four U.S. states had competitive insurance commissioner races in November’s election, with three of the races lacking challengers until recent months.

North Carolina had the most high-profile, closely contested race, where incumbent Republican insurance commissioner Mike Causey defeated Democratic challenger Natasha Marcus 52% to 48%, with over 5.4 million votes cast, according to Ballotpedia.

In a concession statement, Marcus said, “We ran a strong, honest, grassroots campaign and brought the concerns of many North Carolinians to light. We came close to a win. I am proud of that work and hope it will prompt positive changes at the Department of Insurance because the people of our state deserve reliable, affordable insurance coverage.”

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California FAIR insurance plan changes burden on policyholders, advocate says

Article by Michael Shashoua

The California Insurance Commission’s “modernization” of the California FAIR Plan Association (FAIR plan), the state’s insurer of last resort, announced July 26, will transfer the burden to homeowners, according to Carmen Balber, executive director of Los Angeles-based consumer advocacy non-profit Consumer Watchdog.

The commissioner’s proposal, part of its Sustainable Insurance Strategy, according to Consumer Watchdog, relieves insurers of the need to cover the largest FAIR Plan claims and requires policyholders to pay a surcharge of hundreds or even thousands of dollars to cover this expense. 

“If this FAIR plan gets into financial trouble, it will be because the private insurance market dumps all of their riskiest homeowners on the FAIR Plan,” Balber said. “And if that happens, the insurance companies should be responsible, not every homeowners insurance policyholder in the state.” 

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SOUTHWORKSCREATIVE/Southworks – stock.adobe.com

Gen Z and Millennials want embedded insurance options

Article by Grace Crane

The 2024 Embedded Car Insurance Study by Polly indicates that Millennials and Gen Z consumers prefer embedded insurance options at the car dealership and highlights their preference for convenience. According to respondents, 79% of Millennials and Gen Z think that auto insurance should be an integral part of the process when purchasing a vehicle and 81% would prefer to purchase their insurance while buying a car. 

Polly conducted an online survey August 22 – 26, 2023, of over 1,000 American adults who had purchased a car within the last 12 months. The results show that 76% of Millennials and Gen Z think that buying auto insurance and their vehicle together would be easier and more convenient, compared to just 63% of all respondents who agreed.

“Our embedded auto insurance study reveals that Millennials and Gen Z aren’t just looking for vehicles; they’re seeking a holistic buying experience that includes insurance. The research is clear, consumer demand for integrated solutions is not a passing trend. It’s a new norm,” said chief marketing officer Mike Burgiss in a press release statement.

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Marsh McLennan Agency: Commercial property trends of 2024

Article by Grace Crane

Marsh McLennan Agency’s 2024 Commercial Property Insurance Trends highlights the significant factors influencing the commercial property industry and outlines strategies for navigating these challenges.

One of the key insights from the report is the identification of three major factors driving fluctuations in commercial property insurance rates. Firstly, there has been a noticeable uptick in losses attributed to historically non-modeled secondary perils. The report cites AM Best, which shares that secondary perils account for higher total losses than primary perils. Tornadoes, hailstorms, flooding and wildfires are among the secondary perils posing significant risks, with floods ranking as the highest loss leader in the United States. 

Individual secondary peril events can result in losses upwards of $10 billion, according to Marsh McLennan Agency. Despite this, only a small fraction of global flood losses are insured, highlighting a significant protection gap in the market.

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Honeycomb Insurance introduces new property qualification program for agents and brokers

Article by Patricia L. Harman

There was no shortage of fresh ideas and new technologies at this year’s Insurtech Insights conference in New York City.  With over 5000 attendees from around the globe and approximately 400 speakers, every aspect of the insurance ecosystem was explored.

Identifying pain points for insurers, agents and brokers, and offering solutions has become the hallmark of the conference. U.S.-based Honeycomb Insurance, which focuses on providing coverage for landlords, condo associations, homeowners associations, and apartment buildings announced a new service at the event as part of their enterprise – address qualification.

The service allows agents and brokers to bulk quote commercial properties like condominiums and helps to identify a variety of risks associated with a property in mere minutes. Their technology synthesizes data from multiple sources and can provide details related to roof damage/repairs, possible problems as well as general maintenance from first-party data, and can scrape third-party data for other details related to the property.

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Tasos Katopodis/Bloomberg

What will Trump’s return mean for Medicare?

Article by Nathan Place

On January 20, Donald Trump will begin his second term as president after four years away from the White House. During those four years, Medicare underwent major changes — changes that Trump has fiercely opposed. What will happen to the program now?

As with Social Security, Trump has repeatedly vowed to keep his hands off Medicare. His campaign website promises, in all capital letters, to “FIGHT FOR AND PROTECT SOCIAL SECURITY AND MEDICARE WITH NO CUTS, INCLUDING NO CHANGES TO THE RETIREMENT AGE.”

What complicates that promise is the Inflation Reduction Act. That multifaceted law, which Democrats passed in 2022, took aim at both climate change and health care costs for seniors. For Medicare recipients, the IRA sets a cap on out-of-pocket expenses, limits the price of insulin, makes vaccines free and — most significantly — allows Medicare itself to negotiate the prices of drugs. 

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Christopher Dilts/Bloomberg

Allstate hires new chief claims officer

Article by Kaitlyn Mattson

Allstate announced that Mike Fiato joined the company as executive vice president and chief claims officer in January.

Fiato leads strategy and operations for the claims organization, which includes 16,000 employees and over 6.5 million claims annually.

He joins the company from Liberty Mutual where he was executive vice president and chief claims and service officer. Prior to joining Liberty Mutual in 2017, Fiato worked at Progressive.

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Tesla hires former GEICO exec

Article by Kaitlyn Mattson

Allen Laben, who was most recently director of claims specialty operations at GEICO, announced on LinkedIn in June that he accepted a new role as head of insurance partnerships at Tesla in April. 

“Here’s my goal in this role: Make Tesla vehicles easy and economical to insure,” he writes in the post. “By partnering with insurance companies, teams across Tesla and collision shops in the USA and Canada, we’ll lower the total cost of Tesla ownership and accelerate the world’s transition to sustainable energy.”

Laben was at GEICO for nearly 20 years in various leadership roles including director of liability claims and director of claims applications, process and systems. 

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NY insurance regulator makes carriers accountable for third-party AI systems

Article by Michael Shashoua

New York State’s new regulatory guidance for insurers using AI states that carriers should be responsible for using the technology for underwriting and pricing.

“If you’re using third-party systems, you cannot punt the accountability to the third party,” said Karthik Ramakrishnan, co-founder and CEO of Armilla, an AI model and verification technology company that serves the insurance, financial services, healthcare, retail and other industries. “The insurer is still accountable for the end outcomes and that’s what the circular really tries to emphasize.” 

New York’s guidance came from its Department of Financial Services, which regulates insurance, in the form of a circular related to Insurance Law Article 26. This is state law that addresses unfair claim settlement practices, discrimination and other misconduct, including making false statements. The circular specifies that the elements the law addresses should not be violated by the misuse of AI and consumer data and information systems.

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