Insurable Interest Canadian Insurance Blog

New SMA Blog by Mark Breading, Partner, Strategy Meets Action Boston, MA (Aug. 1, 2019) – Many commercial lines insurers recognize that there are great opportunities for growth in the small commercial segment. There is no question that the segment is hot and that the potential is there for increased business. So, many are rushing into the space or redoubling their efforts and focusing on small commercial. Thus, it is hyper-competitive, and success is not guaranteed. This raises the question, “What does it take to win in the small commercial segment?” A new SMA research report, Ten Guidelines for Success in the Small Commercial Market, answers this question. Senior leaders intent on small commercial face many questions. Are our existing distribution channel partners adequate to support our growth? Should we establish a new digital brand? Do new InsurTech distribution firms present good partnership options? Do we need to modernize our products by adding new coverages? How can we simplify the submission and underwriting processes? The list of questions could go on. In order to develop a winning strategy that can be effectively operationalized, insurers should consider the ten guidelines in the SMA report. These guidelines can serve as a type...

New SMA Blog by Karen Pauli, Principal, Strategy Meets Action — It is always exciting to see industry results – particularly those that rank insurers by premium size. It is probably the competitive nature that lies within most of us that gets a bit of a thrill out of seeing which insurer is gaining position and which is losing position. In my career, I have taken downright joy out of seeing a major competitor lose ground to the insurer I worked for. High five and fist pump time! In most instances, when A.M. Best issues their Top 200 U.S. Property/Casualty Writers results, there is some jockeying for position – up or down a position or two. However, the 2018 results issued in July 2019 revealed something that literally flew off the page. One insurer moved up 28 positions, another 29, and a third jumped a staggering 121 positions. While the upward movement is interesting in and of itself, it was who the insurers are that really caught my attention – reinsurers! Swiss Re, Everest Re, and Arch, respective to the numbers above. And they join Munich Re at number 18. Now, it is easy to rationalize these position changes –...

Manulife has reported net income of $1.5 billion for the second quarter of 2019. This is an increase of $0.2 billion over the same quarter last year. Manulife says this increase was primarily driven by the non-recurrence of a $200 million restructuring charge taken in 2Q18. Core earnings were also $1.5 billion for the second quarter, in line with Q2 2018. Return on common shareholders’ equity (ROE) for Q2 2019 was 12.9 per cent compared to 12.3 per cent for Q2 2018. The company reported a LICAT ratio of 144 per cent. In an Aug. 7 statement, Roy Gori, Manulife President & Chief Executive Officer, highlighted the company’s double digit core earnings growth in Asia. He also underlined that Manulife has continued to focus on executing its strategy, with capital released from portfolio optimization increasing to $3.7 billion. “We have also taken steps to further strengthen Manulife’s long-term growth opportunity in Asia, including entering into an asset management joint venture agreement in India,” Gori added. New business value For the second quarter of 2019, Manulife reported new business value (NBV) of $479 million – an increase of 14 per cent compared with Q2 2018. For Canada in particular, NBV of $65...

Canadians often take pride in their health-care system, but a new study finds that more than two million Canadians over the age of 55 find substantial barriers to health-care services in their province. The study, by the Angus Reid Institute, notes the problems stem from a number of different services, including the inability to find a family doctor, lengthy wait-times for surgery, diagnostic tests or specialist visits. The perception that health care in their home province has “deteriorated” over the last 10 to 15 years outpaces the view that it has improved. This was the finding in every region of the country except Saskatchewan. The health care issue is most acute in Atlantic Canada. Still, most Canadians 55 and over say they have either “easy” (31%) or “acceptable” (40%) access to primary care. One-in-four (25%) say it is difficult to get an appointment with their doctors in a timely manner. Wait times for specialist visits, advanced diagnostic tests and surgeries follow a similar pattern, with most in this age group receiving the care they need in less than six months, but significant minorities waiting longer than that. One-in-three who needed surgery waited longer than six months (the federal benchmark for hip...

Partnership gives P&C insurance carriers in the U.S., U.K., and Canada additional tools and resources to process claims faster, facilitate total losses, and more Boston, MA (Aug. 6, 2019) – Duck Creek Technologies has announced that it has expanded its Partner Ecosystem program through a new relationship with WeGoLook®, LLC. WeGoLook combines technology with an on-demand workforce of more than 45,000 on-demand resources, called “Lookers,” to help businesses gather and validate information relevant to the insurance claims process. An integration with Duck Creek Claims gives carriers access to WeGoLook’s network of Lookers from directly within the Duck Creek Platform. “From Standard Looks to self-service to fully custom solutions, WeGoLook offers an infinitely-expandable array of solutions for the insurance industry,” said Ben Brammer, Director of Product at WeGoLook. “Partnering with Duck Creek and leveraging the Duck Creek Anywhere API is a natural fit for us, and we are excited to help even more insurers leverage our technology and resources to navigate one of the fastest possible paths to claims resolution.” By dispatching a Looker, Duck Creek Claims users are able to obtain data, photos, videos, and measurements–anytime, anywhere, for a fixed rate. This information can be used to perform damage and...

Insurance-linked securities market declined year-on-year in Q2 2019 Arlington, VA (Aug. 7, 2019) – The insurance-linked securities (ILS) market declined year-on-year in the second quarter of 2019, with just below $1.7 billion of non-life ILS capacity issued through 11 cat bonds, down from $6.2 billion and $4.0 billion in Q2 2017 and 2018 respectively. That made the recent quarter the second-lowest second-quarter for issuance by volume in the past eight years (after 2016). The number of transactions declined less than total transaction value, according to the new ILS Market Update from Willis Re Securities, the reinsurance division of Willis Towers Watson, the leading global advisory, broking and solutions company. As in Q1, U.S. wind-focused deals dominated, including $650 million of pure coverage for the peril issued across three cat bonds, and $1.04 billion for peak multiperil protection. Notably, the U.S. Federal Emergency Management Agency again reinsured the National Flood Insurance Program through Floodsmart Re, which covers named-storm-related U.S. flood events with $300 million of capacity. In addition, four cat bonds were issued to provide more than $1.8 billion in cover for mortgage insurance risks. Reported loss creep continued to affect the ILS market but at a substantially reduced rate. At...

New York, NY (Aug. 7, 2019) – Marsh has released its Global Insurance Market Index for the second quarter of 2019. Key findings include: Average commercial insurance pricing increased nearly 6% in second quarter 2019, the largest increase since the survey began in 2012, and the seventh consecutive quarter of average pricing increases. Globally, on average, pricing for property risks increased 8%; financial and professional lines rose almost 10%; and casualty increased nearly 1%. In general, pricing increases were more pronounced in large accounts, particularly in property and D&O. Composite pricing in the second quarter increased in all geographic regions for the third consecutive quarter, largely driven by rates in property and directors and officers (D&O) coverages. The Pacific region had the largest composite pricing increase in the index (18%), a quarterly trend that has continued for two years. Pacific composite pricing was driven by increases in D&O rates (many organizations experienced high double-digit increases), as well as increases in both CAT and non-CAT property. The US, UK and Asia all reported average pricing increases of 3% or higher. Commenting on the findings, Dean Klisura, President, Global Placement at Marsh, said: “Global insurance pricing increased 6% in Q2 2019, double...

Decision support and artificial intelligence augmentation to surpass all other types of AI initiatives: Gartner Stamford, CT (Aug. 5, 2019) – In 2021, artificial intelligence (AI) augmentation will create $2.9 trillion of business value and 6.2 billion hours of worker productivity globally, according to Gartner, Inc. Gartner defines augmented intelligence as a human-centered partnership model of people and AI working together to enhance cognitive performance. This includes learning, decision making and new experiences. “Augmented intelligence is all about people taking advantage of AI,” said Svetlana Sicular, research vice president at Gartner. “As AI technology evolves, the combined human and AI capabilities that augmented intelligence allows will deliver the greatest benefits to enterprises.” Business Value of Augmented Intelligence Gartner’s AI business value forecast highlights decision support/augmentation as the largest type of AI by business value-add with the fewest early barriers to adoption (see Figure 1). By 2030, decision support/augmentation will surpass all other types of AI initiatives to account for 44% of the global AI-derived business value. Figure 1: Worldwide Business Value by AI Type (Millions of Dollars) Augmented Intelligence Enhances Customer Experience Customer experience is the primary source of AI-derived business value, according to the Gartner AI business value forecast....

Acquisition of a national restoration firm with an outstanding reputation for customer service will enhance Intact’s customer experience and deepen claims expertise Residential and commercial customers will benefit from simpler, faster and superior service Strategically aligned: combination delivers operational efficiencies, deeper claims expertise and risk diversification Financially compelling: attractive internal rate of return and immediate low single digit accretion to NOIPS Toronto, ON (Aug. 6, 2019) – Intact Financial Corporation and On Side Developments Ltd., the parent company of On Side Restoration (“On Side Restoration”), have announced that they are joining forces to strengthen repair and restoration services for personal and commercial property claims customers across Canada. With this acquisition IFC will deepen its claims expertise and strengthen its supply chain network. The transaction is expected to close on or before October 1, 2019 subject to certain conditions, including regulatory approval. On Side Restoration is a national restoration firm, based in Vancouver, with more than 1,200 employees and 35 branches coast to coast. Its reputation for excellent customer service along with 40 years of claims experience makes it a strong strategic fit for IFC. “Our claims service is a key differentiator and is at the heart of what we promise....

Marcus Ryu transitions to chairman role Momentum for InsuranceSuite via Guidewire Cloud grows with six new deals in Q4 and a total of nine for fiscal 2019 San Mateo, CA (Feb. 19, 2019) – Guidewire Software, Inc. is pleased to announce the appointment of Mike Rosenbaum, former EVP Product at Salesforce, as Chief Executive Officer and to the Board of Directors. Marcus Ryu has transitioned to become Chairman of Guidewire’s Board of Directors. Former Chairman Peter Gassner will continue to serve as an independent director. Since joining Salesforce more than a decade ago, Mr. Rosenbaum has held several leadership positions and driven many of Salesforce’s most notable product achievements. Most recently, he served as EVP Product, with responsibility for customer success, vision, and product development for the world’s #1 CRM platform. He was appointed by Guidewire’s Board of Directors after an extensive selection process. Mr. Rosenbaum’s priorities will include building upon Guidewire’s position as the leading software provider to the global P&C industry, ensuring the success of the Guidewire customer community, and further advancing Guidewire’s cloud offerings. “Guidewire is building on its market leadership position in mission-critical applications for P&C insurers to now deliver the leading cloud-based platform for the...