Weekly Articles
Commercial Lines: Climate, Catastrophes, and LA Fires
Aon, in collaboration with Floodbase and Swiss Re, has introduced a parametric insurance solution to address commercial losses from hurricane-induced storm surges in the U.S. This product offers fast, flexible payouts based on storm surge water height, aiming to fill gaps left by traditional insurance policies with high deductibles or exclusions.
LA Wildfire Losses Seen as High as $164 Billion, UCLA Says- Claims Journal
Economic losses from the January wildfires in Los Angeles County are estimated between $95 billion and $164 billion, potentially making them the second-costliest natural disaster in U.S. history. The fires destroyed 16,000 structures, caused at least 29 deaths, and exacerbated California’s insurance crisis, with insured losses estimated at $75 billion.
Inside the LA Fire Cleanup’s Rush to Remove Tons of Toxic Rubble - Claims Journal
The cleanup effort following the Los Angeles wildfires is facing immense challenges, with the EPA ordered to complete hazardous material removal within 30 days under the Trump administration’s directive. The process involves handling toxic debris, hazardous waste, and lithium-ion batteries from thousands of destroyed homes, sparking concerns about rushed cleanup efforts and environmental safety
Proposed Federal Act Seeks to Reduce Wildfires - Carrier Management
The proposed Wildfire Prevention Act, introduced by U.S. Senator John Barrasso, aims to reduce wildfire destruction by directing the U.S. Forest Service and Bureau of Land Management to increase mitigation projects on public lands. The bill seeks to cut regulatory red tape, promote forest restoration efforts, and enhance transparency while addressing wildfire risks that have already caused $250 billion in damages in Southern California this year.
Commercial Lines: Cyber
AI, Cybercrime Perceived as Top Insurance Risks: Kennedys - Insurance Journal
According to a new risk forecast by global law firm Kennedys, the top risks impacting the insurance industry in the coming year include the adoption of artificial intelligence, cyberattacks, and extreme weather events. The survey highlights growing concerns about AI regulation, the increased use of AI in cybercrime, and regional issues like social inflation in the U.S., while sustainability concerns have declined in priority.
Third-Party Attack Vectors Responsible for 59% of Insurance Breaches - Insurance Journal
A new report by SecurityScorecard reveals that 59% of insurance breaches in 2024 stemmed from third-party attack vectors, more than double the global average of 29%, with IT vendors and brokers being key vulnerabilities. The findings highlight systemic cybersecurity risks in the insurance industry, emphasizing the need for stronger third-party risk management, vendor oversight, and resistance to ransomware payments.
Risk Matters: Cyber Risk and AI – The Changing Landscape - Claims Journal
The article discusses the evolving landscape of cyber risk, highlighting how AI is both enhancing cybersecurity defenses and enabling more sophisticated cyberattacks, such as AI-driven phishing and ransomware. It explores the strategic and economic considerations of cybersecurity investments, referencing the Gordon-Loeb Model to determine optimal spending, and emphasizes the increasing complexity of cyber risk due to AI-driven automation and game-theoretic interactions between attackers and defenders.
Commercial Lines: Excess & Surplus
Surplus Lines Premium Growth Slowed to 12% in 2024 – Carrier Management
The U.S. excess and surplus (E&S) lines market grew to over $81 billion in premium in 2024, a 12.1% increase from 2023, driven by rising demand for commercial liability and property coverage. Auto liability surged 61.1%, while personal property increased 31.8%, reflecting ongoing admitted market dislocations, particularly in California and Texas.
Commercial Lines: Workers’ Compensation
Viewpoint: Early Executive Actions by Trump Portend a Major Contraction at OSHA - Claims Journal
President Trump's early executive actions signal a significant reduction in OSHA’s regulatory and enforcement capabilities, including a hiring freeze, budget cuts, and a return-to-office mandate that could lead to workforce reductions. These measures align with Trump's broader effort to shrink federal agencies, potentially resulting in fewer inspections, weakened enforcement, and stalled workplace safety regulations.
PFAS
Farmers Ruined by PFAS Face Key Moment in Fight Against Pentagon - Insurance Journal
Farmers in Curry County, New Mexico, are fighting the Pentagon over PFAS contamination from Cannon Air Force Base, which has devastated dairy farms and raised concerns about water safety. A key court hearing on Feb. 7 will determine whether the government can be held liable, impacting thousands of similar lawsuits nationwide.
Litigation & Mass Torts
Insurer Seeks to Exit $30 Million Wrongful Death Lawsuit Over Boy’s Fatal Shooting – Claims Journal
Kinsale Insurance Co. is seeking a federal court ruling that it has no duty to defend or indemnify the owners and managers of a Memphis apartment complex in a $30 million wrongful death lawsuit. Kinsale argues that its policy’s Assault and Battery Exclusion bars coverage for the fatal 2023 shooting.
LinkedIn Lawsuit Over Use of Customer Data for AI Models Is Dismissed - Insurance Journal
A proposed class action lawsuit accusing LinkedIn of improperly using private messages from Premium customers to train AI models has been dismissed after the plaintiff voluntarily withdrew the case. LinkedIn maintained that it never used private messages for AI training, and the plaintiff’s legal team acknowledged the company provided evidence supporting this claim.
Securities Class Actions Increase Again in 2024; AI-Related Filings Double - Insurance Journal
Securities class action filings rose for the second consecutive year in 2024, reaching 225 cases, with AI-related filings more than doubling from 7 in 2023 to 15. While federal and state Securities Act filings declined, there was a surge in cases under federal Section 10(b), and the size of core filings, measured by the Disclosure Dollar Loss Index, grew by 23% to $438 billion.
Man Charged With Filing $50K in Fraudulent iPhone Insurance Claims - Claims Journal
A Connecticut man, Esmaylin Delacruz, has been arrested and charged with insurance fraud and larceny for allegedly orchestrating a $50,000 iPhone insurance scam. Authorities say he used “mules” to open accounts with wireless carriers and file fraudulent claims to obtain replacement iPhones, which were later seized as evidence.
Lawsuit Blames Deaths on Ohio Train Derailment- Claims Journal
A newly filed lawsuit alleges that the 2023 East Palestine train derailment caused multiple deaths, including a 1-week-old baby, marking the first wrongful death claims against Norfolk Southern. The suit accuses the railroad and federal agencies of mishandling the cleanup and failing to properly warn residents about health risks, while protests and legal battles over compensation continue.
Startup Accused of Gouging LA Fire Victims on Rent- Claims Journal
A lawsuit alleges that Blueground US Inc., a venture capital-backed rental startup, engaged in illegal price gouging by raising rents on furnished apartments by over 50% following the devastating Los Angeles wildfires. The Los Angeles city attorney claims the company violated California’s anti-gouging law, while Blueground denies the allegations, arguing its pricing complied with emergency regulations.
Insurer Seeks to Exit $30 Million Wrongful Death Lawsuit Over Boy’s Fatal Shooting - Claims Journal
Kinsale Insurance Co. is seeking to exit a $30 million wrongful death lawsuit over the fatal shooting of a 14-year-old boy at a Memphis apartment complex, arguing that its commercial general liability policy excludes coverage for bodily injury related to assault and battery. The insurer had initially provided a defense under a reservation of rights but is now asking a Tennessee federal court to confirm it has no duty to defend or indemnify the property owners and managers.
Uber Alleges Fraud Scheme by New York Groups Faking Car-Crash Injuries - Carrier Management
Uber has filed a racketeering lawsuit against a group of New York law firms, doctors, and pain-management clinics, accusing them of staging fake car accidents and performing unnecessary surgeries to exploit the state’s no-fault insurance system. The lawsuit highlights broader concerns about insurance fraud in the rideshare industry, as Uber pushes for insurance and tort reforms to address rising costs.
Insurance Market
$AFG American Financial Reports Fourth Quarter Earnings
American Financial Group, Inc. reported strong 2024 results in its Specialty P&C business, with a combined ratio of 89% in Q4 and 91.2% for the full year. Net written premiums grew 7%, driven by new business, increased exposures, and an 8% overall renewal rate increase, excluding workers’ compensation.
$ALL Allstate Q4 Income Up 30% Despite High Hurricane-Related Losses
Allstate reported strong Q4 2024 results, with total revenues up 11.3% to $16.5 billion and net income increasing 30.1% to $1.9 billion. Adjusted net income for the quarter was $2.1 billion, reflecting a 26.8% return on equity. Property-Liability premiums rose 10.6%, driven by higher premiums and improved underwriting results.
Allstate to ‘Lean Into’ Turnaround in Auto Business, and Grow – Insurance Journal
Allstate’s auto business rebounded in 2024 with a $1.8 billion underwriting profit, following a $1.1 billion loss in 2023. Auto rate hikes exceeded 40% over several years, restoring margins and positioning for growth. Combined ratios improved to 93.5% in Q4, while expansion in 31 states signals competitive pricing.
Arthur J. Gallagher Acquires Claims-Management Provider W.K. Webster
Arthur J. Gallagher & Co.’s subsidiary, Gallagher Bassett, has acquired W K Webster & Co Ltd, a global leader in marine and transit claims management. W K Webster, headquartered in London, enhances Gallagher Bassett’s specialty claims capabilities worldwide. Anthony Smith and his team will report to Manan Sagar, expanding operations across Europe, Asia, and the U.S.
Crest Acquires Texas’ Horizon Insurance Services – Insurance Journal
Crest Insurance has acquired Horizon Insurance Services, a full-service agency in Houston, Texas, marking Crest’s 20th office and second in Texas. Led by Ramon Canlas, Horizon specializes in trucking and transportation insurance, expanding Crest’s expertise and nationwide footprint in commercial insurance solutions.
Hub International has acquired Mayfield Insurance, an independent agency in Mooresville, Indiana, offering commercial, personal, and life insurance. Dean Mayfield and his team will join Hub Midwest East, expanding Hub’s footprint and strengthening its expertise. Terms of the deal were not disclosed.
$KMPR Kemper Reports Fourth Quarter 2024 Operating Results
Kemper Corporation reported Q4 2024 net income of $97.4M, up from $51.4M in Q4 2023. Adjusted net operating income reached $115.1M. Specialty P&C grew policies by 5.1% with a 91.5% combined ratio. Strong capital management included a $450M debt reduction, $14M stock buyback, and a 12% rise in book value.
$LNC Lincoln Financial Reports 2024 Fourth Quarter and Full Year Results
Lincoln Financial Group reported a Q4 2024 net income of $1.7 billion, driven by record annuity sales and strong group protection performance, with its risk-based capital ratio exceeding 430%. The company's annuity sales hit $3.7 billion, life insurance faced a $15 million operating loss, and group protection doubled its operating income, reflecting improved margins and favorable market conditions.
$MKL Markel Group reports 2024 financial results
Markel Group reported strong financial results for 2024, with total operating revenue rising to $16.62 billion and net income per share increasing to $199.32, driven by investment gains and premium growth. Despite underwriting losses of $90-$130 million from the January LA wildfires, Markel improved its combined ratio and saw revenue growth in its Ventures division, particularly in consumer and building products.
$THG The Hanover Reports Record Fourth Quarter Net Income and Operating Income
The Hanover Insurance Group posted record Q4 net income of $167.9 million and operating income of $194.6 million. Full-year net income reached $426.0 million. Premiums rose 7.4% in Q4. The combined ratio improved to 89.2%, driven by reduced catastrophe losses, strong investment income, and favorable pricing across all segments.
USAA Becomes 3rd Insurer to Report $1B-Plus in Claims So Far for LA Wildfires- Claims Journal
USAA has become the third insurer to report over $1 billion in claims from the Los Angeles wildfires, with total projected payouts expected to reach $1.8 billion. Overall insured losses from the January fires are estimated to be as high as $30 billion, contributing to rising insurance costs and rate hike requests in California.
$WTM White Mountains Reports Fourth Quarter Results
White Mountains Insurance Group, Ltd. reported Q4 2024 adjusted book value per share of $1,834, down 3% for the quarter but up 8% for the year. Full-year growth was driven by operating results and strong investments. Ark achieved a 77% combined ratio, with gross written premiums up 14%.
$WTW WTW Reports Fourth Quarter and Full Year 2024 Earnings
WTW’s Q4 2024 revenue rose 4% to $3.0 billion, with organic growth of 5%. Adjusted diluted EPS increased 9% to $8.13, while operating margin expanded 300 basis points to 29.7%. For the year, revenue grew 5% to $9.93 billion, with adjusted operating margin reaching 23.9%.
Aon's Q4 2024 Global Insurance Market Insights report highlights a shift toward easing rates and increased capacity in multiple insurance lines, while U.S. casualty and natural catastrophe-exposed risks remain challenging. Key trends include a more segmented insurance market, rising litigation costs, continued cyber insurance competition, and the growing role of alternative risk transfer solutions like captives and parametric products
Reinsurance Market
$EG Everest Re reports fourth quarter and full year 2024 results
Everest Group reported full-year 2024 net income of $1.4 billion and net operating income of $1.3 billion, with gross written premiums of $18.2 billion (9.1% growth). Decisive reserve strengthening in U.S. casualty lines impacted Q4, resulting in a $780 million operating loss. Investment income reached a record $2 billion.
Hannover Re sees book grow 7.6% at Jan 1 as 2024 net income reaches €2.3bn - Reinsurance News
Hannover Re reported a 7.6% increase in premium income during the January 2025 treaty renewals and a 2024 net income rise to €2.3 billion, driven by strong demand for reinsurance capacity. Despite a slight 2.1% decline in inflation- and risk-adjusted prices, the reinsurer expanded its market presence, particularly in structured reinsurance and catastrophe coverage, while maintaining prudent underwriting in response to climate risks and competitive pressures.
Hannover Re CEO reflects on market condition and 1/1 renewals | Insurance Business America
Hannover Re reported a €2.3 billion profit for 2024, with a 7.6% increase in premium growth during the January 1 treaty renewals, despite a 2.1% decline in inflation- and risk-adjusted prices. CEO Jean-Jacques Henchoz noted that while competition led to slight price reductions in some areas, stable retention levels and strong capitalization allowed Hannover Re to maintain profitability and expand its structured reinsurance business.
Howden reports revenue of £3bn in 2024 with 30% organic reinsurance growth Reinsurance News
Howden reported 23% revenue growth to £3.01 billion in 2024, with 30% organic growth in its reinsurance segment, driven by Treaty business and Howden Re Programs. The firm expanded its global footprint through 65 strategic acquisitions, new talent hires, and strong growth across retail, specialty, and underwriting in Europe and Asia Pacific.
French reinsurer SCOR achieved 9.6% growth in estimated gross premium income at January 1, 2025, renewals. Growth was driven by specialty lines and alternative solutions. SCOR renewed 64% of its P&C premiums, focusing on disciplined underwriting and cost optimization while maintaining stable technical profitability and favorable market conditions.
Why the LA Wildfires Should Not Have Been a Surprise Loss - Carrier Management
The January 2025 LA wildfires caused unprecedented losses, but experts argue insurers should have anticipated them using catastrophe models. The article explains how favorable weather conditions fueled the disaster, why future wildfires could be even worse, and the long-term impacts on the insurance industry.
A new Moody’s report highlights growing concerns over the increasing use of offshore reinsurance by U.S. life insurers, particularly in Bermuda and the Cayman Islands, due to counterparty risk and regulatory transparency issues. While this trend enhances capital efficiency and attracts investment, Moody’s views it as a credit-negative development, prompting regulators to call for stronger governance and disclosure measures.
Keeping high attachment points is key: Vickers, Gallagher Re - Reinsurance News
James Vickers, Chairman of Gallagher Re’s International division, emphasized the critical role of attachment points for reinsurers amid rising non-peak catastrophe events, such as floods and hailstorms. He noted that reinsurers have mitigated exposure by raising retentions, prioritizing attachment points over pricing and other terms, even as 2024’s catastrophe losses are estimated at $154 billion.
Risks
Climate Risks Again Top List of Risk Manager Worries - Insurance Journal
A joint survey by the Casualty Actuarial Society and the Society of Actuaries found that climate risks remain the top concern for risk managers, alongside geopolitical instability, disruptive technology, and cyber threats. The study underscores growing concerns about financial risks from climate change, real estate vulnerabilities, and the need for enhanced flood defenses and regulatory responses.
Technology and Innovation
Palm Beach launches BDIC in Bermuda to revolutionise crypto insurance - Reinsurance News
Palm Beach has launched the Blockchain Deposit Insurance Corporation (BDIC) in Bermuda to enhance cryptocurrency security, with plans to apply for Lloyd’s Coverholder status to underwrite crypto risks. BDIC aims to revolutionize crypto insurance by offering digital wallet coverage and fostering trust in financial transactions, positioning itself as a key player in the growing digital asset market.
People Moves and Industry News
Alexander Moczarski joins Arch’s Board of Directors - Reinsurance News
Arch Capital Group has appointed Alexander Moczarski to its Board of Directors, bringing over 45 years of global insurance experience, including leadership roles at Marsh McLennan, Guy Carpenter, and AIG. Company leaders praised Moczarski’s industry expertise and international perspective, emphasizing his value in supporting Arch’s long-term growth and market leadership.
Arthur J. Gallagher Acquires Claims-Management Provider W.K. Webster - Claims Journal
Arthur J. Gallagher & Co. has acquired W.K. Webster & Co. Ltd., a London-based marine claims and recovery services provider, to strengthen its position in the marine insurance sector. W.K. Webster, established in 1931, specializes in managing cargo recovery, hull and machinery claims, and marine liability cases, serving insurers and reinsurers globally.
Jason Bolding to succeed Bill Dubinsky as CEO of Gallagher Securities - Reinsurance News
Gallagher Securities has appointed Jason Bolding as its new CEO, while Bill Dubinsky transitions to Chairman, focusing on expanding the ILS product suite and strategic growth. Bolding, who joined in 2022 and previously led sales and distribution, brings extensive experience from Credit Suisse and Aon to drive Gallagher Securities’ ILS and capital markets initiatives.
Hiscox appoints Karen Baldwin as Media Practice Leader in the US
Hiscox USA appoints Karen Baldwin as VP, Media Practice Leader. With 30+ years of experience, including roles at AXIS, Chubb, and One Beacon, Baldwin will lead Hiscox’s media liability practice, enhancing coverage for evolving media risks. Baldwin will report to Tyler Peterson, SVP of Underwriting Management.
Sompo appoints Lily Claydon as Chief Risk Officer APAC - Reinsurance News
Sompo has appointed Lily Claydon as Chief Risk Officer for Asia Pacific (APAC), effective March 3, 2025, where she will lead risk management, governance, and analytics while fostering regional talent development. Reporting to Emmanuel Brule and Kenneth Reilly, Claydon’s appointment is seen as a strategic move to strengthen Sompo’s risk management capabilities amid its growth in the APAC region.
Willis appoints Stephen Kyriacou Head of Litigation and Contingent Risk Solutions in North America
WTW has appointed Stephen Kyriacou as Head of Litigation and Contingent Risk Solutions for North America. Kyriacou, a pioneer in litigation risk insurance, will expand WTW’s practice, developing bespoke solutions for corporate, private equity, and law firm clients. He joins from Aon’s Litigation Risk Group with extensive expertise in complex risk strategies.
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