An April report by the New York Civil Justice Institute finds in most cases, the insurances costs in the state are higher than anywhere else in the country. Scott Hobson, of Big I New York, an industry advocacy group, said while high premiums are always an issue, the report lays out an even bigger concern. "We are seeing signs of things happening that indicate to us that we may be headed for a crisis of availability," Hobson said. He said across the board, but especially with auto insurance, despite skyrocketing premiums, companies are still paying out more in claims, verdicts and settlements than they are making from customers. "For every dollar you take in as an insurance company, you're paying out $1.12 in claims," Hobson said. "So I didn't go to business school but that seems like a very unsustainable way to do business." As companies leave the market, Hobson said more customers are struggling to get any coverage from private insurers. That has led to a significant uptick in applications to the Assigned Risk Plan which is state coordinated coverage intended for high-risk and otherwise uninsurable individuals. Similar surges in California and Florida assigned risk enrollments for homeowners insurance have created major problems in those states. "The assigned risk plans are not set up to do that and they're collapsing under their own weight, rates are going through the roof and it's an absolute mess and we desperately want to avoid that here in New York," Hobson said. State Assembly Insurance Committee Chair David Weprin, D-Queens, said lawmakers are aware of the issues and the findings of the report are disturbing. "We're doing everything we can to try to keep these insurance companies in New York and to try to keep premium's reasonable," Weprin said. He said the committee is having discussions with the superintendent of the state Department of Financial Services and the industry about potential options. "I'm hoping that this latest study that came out will make this something that we should be looking at very carefully before the end of session to deal with the issue and I'm hoping we're going to find ways to address it," Weprin said. Hobson believes the biggest issue is the state's unique and challenging liability structure which makes it a prime target for fraud and abuse. He said the proliferation of lawsuit loans at often predatory rates exacerbates the issue while hurting both the consumer and the insurance companies simultaneously. The industry said the state's scaffold law, which imposes absolute liability for falls to property owners and contractors, is also driving up the cost of homeowners insurance and housing in general. Weprin is sponsoring legislation he believes could address the issue. It would establish that staging a construction site accident is a felony, similar to a bill the Legislature passed five years ago with regards to fraudulent automobile accident claims.

USI Insurance Services (“USI”), a world leader in risk management, employee benefit and retirement plan consulting, today announced the acquisition of Odessa, Texas-based Hignojos Insurance Agency. Founded in 2009, Hignojos Insurance Agency is an independent brokerage firm specializing in commercial and personal risk insurance programs. Terms of the transaction were not disclosed. “We are thrilled to be joining forces with USI, an established industry leader in the insurance brokerage and consulting market,” stated Hignojos Insurance Agency Principal, Louis Hignojos Sr. “Our valued clients throughout western Texas and beyond will continue to benefit from the local, personalized services they have come to expect from our team of experts, and we look forward to introducing them to USI’s expanded suite of innovative solutions and expertise with a continued focus on helping them grow and protect their businesses and personal interests.” USI’s Regional CEO, John Collado added: “We are excited to expand our Texas-based presence and expertise by welcoming the entire team of professionals from Hignojos Insurance Agency to the USI family. By partnering together, we look forward to leveraging the USI ONE Advantage^® to provide clients access to our proprietary and innovative solutions and network of local and national resources and expertise.”

The average cost of auto insurance in the United States is up 22.2% year over year through the end of February, more than any other category of household expenses measured in the U.S. Department of Labor Statistics Consumer Price Index. According to the J.D. Power 2024 U.S. Insurance Shopping Study,^SM released today, that notable increase in premium—combined with lackluster customer satisfaction scores this year—is putting more insurance customers into the market for a new policy than ever before. Nearly half (49%) of U.S. auto insurance customers say they are actively shopping for a new plan. “After the past few years of steady auto insurance premium increases, customers are no longer passively keeping an eye out for a better deal,” said Stephen Crewdson, senior director, insurance business intelligence at J.D. Power. “Instead, they are actively seeking new carriers to offset these rising costs. However, with rising premiums across the country and fewer insurers explicitly offering usage-based insurance—or UBI plans—during the quoting process, insurance shoppers are not finding many alternatives.” Following are some key findings of the 2024 study:

• Auto insurance shopping and switch rates increase: Nearly half (49%) of auto insurance customers have actively shopped for a new policy in the past year. Of those, 29% have switched carriers. Switch rates are highest among members of Generation Z.² Average overall satisfaction among auto insurance shoppers is 676 (on a 1,000-point scale).
• EV owners confront insurance sticker shock:  Electric vehicle (EV) owners are less satisfied with the auto insurance purchase experience than are customers insuring gasoline-powered vehicles. The average purchase experience satisfaction score among EV owners is 663, which is 16 points lower than the average score among owners of gas-powered vehicles. This gap is attributable to lower satisfaction with the quote process and price of the policy because EVs are typically more expensive to insure than comparable gas-powered vehicles.
• Insurers pull back on offering UBI when quoting: UBI programs, which use telematics software to monitor an insured’s driving style and assign rates based on safety and mileage metrics, were only offered to 15% of insurance shoppers this year, down from 22% a year ago and 20% in 2022. Customers enrolling in UBI programs show just a 6-point increase in price satisfaction in 2024, which is down considerably from a 32-point difference in 2023.
• Growing interest in dealer- and manufacturer-provided insurance: More than one-third (35%) of auto insurance customers say they are interested in embedded insurance, a form of auto insurance that is provided directly through the automobile dealer or manufacturer.
• Customer acquisition funnels play key role in market share: State Farm and Progressive show increases in customer yield through the customer acquisition funnel while GEICO’s acquisition funnel narrowed this year. Accordingly, State Farm and Progressive show gains in market share in this year’s study, while GEICO’s share is down.

Study Ranking

Erie Insurance ranks highest among large auto insurers in providing a satisfying purchase experience, with a score of 730. Automobile Club of Southern California (AAA) (705) ranks second and American Family (702) ranks third. The J.D. Power U.S. Insurance Shopping Study was redesigned for 2024. Now in its 18^th year, the study captures advanced insight into each stage of the shopping funnel and is based on responses from 10,003 insurance customers who requested an auto insurance price quote from at least one competitive insurer in the previous six months. The study was fielded from March 2023 through January 2024. For more information about the U.S. Insurance Shopping Study, visit https://www.jdpower.com/business/resource/jd-power-us-insurance-shopping-study. About J.D. Power J.D. Power is a global leader in consumer insights, advisory services, and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, J.D. Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 55 years. The world's leading businesses across major industries rely on J.D. Power to guide their customer-facing strategies. J.D. Power has offices in North America, Europe, and Asia Pacific. To learn more about the company's business offerings, visit JDPower.com/business. The J.D. Power auto-shopping tool can be found at JDPower.com.

Amwins, a global distributor of specialty insurance products and services, launched Amwins InstantQuote (Amwins IQ), an online marketplace enabling access to firm, bindable quotes from multiple carriers within minutes. This digital platform combines the ease and convenience of online quoting with the scale and capabilities of the nation's largest P&C wholesaler. Amwins IQ provides instant quotes, and with one application retailers can quote and compare multiple markets, gaining quick access to A-rated carriers while retaining the opportunity to benefit from the support and expertise of Amwins specialists. Amwins IQ marketplace users are given the choice to select from quality markets with pre-negotiated amendatory endorsements automatically added, ideal for middle market and personal lines accounts. "Amwins IQ represents the next evolution of digital capabilities in the specialty space, empowering retail clients by giving them choice and speed of execution," said Ben Sloop, Chief Operating Officer. "Our digital marketplace is the only seamless experience in the market, powered by our expert underwriters and technology, and is backed by our firm's investment in data and analytics – providing our customers a high level of confidence in the quality of coverage they can procure for their small to mid-sized accounts." "Our online marketplace connects our retailer and carrier partners in an intuitive and flexible way, providing transparency and choice to our retailers, and efficiency and underwriting rigor to our carriers," said Tom Parsons, Head of Digital Strategy. "We will continue to invest in providing retail facing technology, tied directly to our underwriting and brokerage specialists." In addition, Amwins IQ provides carriers with opportunities that have historically been challenging to access. Amwins' digital technology leverages data for additional predictive insights, underwriting control, and portfolio management. For risks that do not fit a carrier's appetite for straight through processing, there is a built-in referral system that enables manual underwriting. And Amwins brokers are always standing by to assist with more complicated placements. Amwins InstantQuote marketplace currently provides Homeowners, Dwelling, Condo and Wind coverage, with Flood coverage to be offered soon. Retailers have the ability to seamlessly flow between Personal Lines and Professional Lines offerings. Amwins IQ currently offers multiline quoting on the following Professional Lines coverages:

• Cyber Liability
• Misc. E&O
• D&O (Private and Non-Profit)
• EPL
• Tech E&O with Cyber

Crime, Fiduciary, and Registered Investment Advisors are expected to launch in the coming months. For more information, visit: https://www.amwins.com/quote-online or call your Amwins Broker or Amwins Access Underwriter.

President Joe Biden vetoed a Congressional Review Act measure to overturn the National Labor Relations Board rule broadening joint employer liability, fulfilling a promise made in January, the White House announced Friday. The CRA measure passed the Senate in a nearly party-line vote in April, and passed the House of Representatives in a largely, but somewhat less, polarized vote in January. The veto saves the NLRB’s rule legislatively, but the regulation was vacated by a federal judge in Texas in March, though it may yet be appealed. The NLRB’s rule expands the bargaining obligations and liabilities of employers that reserve control of essential conditions of employment or exercises such control indirectly. Matthew Haller, CEO of the International Franchise Association, which has made the overthrow of the NLRB’s expanded joint employer rule a political priority, denounced the veto in a statement emailed to Restaurant Dive. “President Biden claims to be a champion for small businesses, but today he turned his back on franchising,” Haller said. Haller said the rule was part of a “regulatory assault” on business. Sean Kennedy, EVP of public affairs for the National Restaurant Association, said the veto was disappointing but not an immediate threat to franchisors, in a statement emailed to Restaurant Dive. “A recent court decision rolling the Joint Employer Standard back to the 2020 rule means that today’s action won’t negatively impact restaurant owners,” Kennedy said. “There’s still uncertainty every day that another wrenching change to the Standard is just around the corner.” Biden used the announcement as a tool of pro-labor party discipline, implicitly chiding Sen. Joseph Manchin (D, WV) and the several representatives who crossed the aisle to back the CRA measure. “By hampering the NLRB’s efforts to promote the practice and procedure of collective bargaining, Republicans are siding with union-busting corporations over the needs of workers and their unions,” the president wrote in his message accompanying the veto. “If multiple companies control the terms and conditions of employment, then the right to organize is rendered futile whenever the workers cannot bargain collectively with each of those employers.” Labor issues have emerged as a point of campaign strategy for the embattled president. Since Biden walked a United Auto Workers picket line during the union’s Stand Up Strike last fall, the president has sought to align himself more publicly with organized labor — as the labor movement experiences a surge in popular support. Biden appeared at the UAW’s community action program conference in January, where the union endorsed him, and within the last month spoke at conferences hosted by the International Brotherhood of Electrical Workers and North America’s Building Trades Unions. Unions like UNITE HERE and the Service Employees International Union, which both have a significant presence in industries where the NLRB joint employer standard could change labor relations, are likely key to Biden’s re-election chances. The SEIU already pledged $200 million to back the Democrats, while UNITE HERE endorsed the president in 2023 after mobilizing significant resources in battleground states during the 2022 midterms.

Clear Blue Insurance Co. and Aon plc will have until June 21 to present motions in Clear Blue's lawsuit again the broker in a case related to the bankruptcy of insurtech Vesttoo Ltd. Defendants Aon plc and Aon Insurance Managers (Bermuda) Ltd. have an extended May 6 deadline to move to dismiss or respond to an amended complaint filed by plaintiffs Clear Blue Insurance Co., Clear Blue Specialty Insurance Co. Highlander Specialty Insurance Co. and Rock Ridge Insurance Co. in the New York state Supreme Court, according to a court document. Plaintiffs’ deadline to respond to any motion to dismiss filed by the defendants is extended to June 6, the document said. Defendants’ deadline to reply to plaintiffs’ opposition is extended to June 21. Clear Blue sued Aon in New York state court for alleged damages connected with letters of credit issued by Vesttoo involving Aon and its White Rock entity. In a New York Supreme Court complaint, Clear Blue and related entities allege Aon and its Bermuda-based segregated cell entity White Rock are liable for damages in the Vesttoo case. Clear Blue seeks to recover damages from Aon for “hosting a rogue operation on its Bermuda-based platform in clear violation of law, regulation, contract and standard market practice,” Clear Blue said in its complaint. “Clear Blue entered into a series of reinsurance transactions with and/or involving Aon, its wholly owned subsidiaries Aon Insurance Managers, White Rock and White Rock’s various segregated accounts, causing material financial, regulatory and reputational damage to Clear Blue.” Aon and its entities could have stopped the Vesttoo fraud “dead in its tracks,” but “facilitated it by removing all the statutory, regulatory and contractual safeguards and ignoring standard market practice,” the complaint said. “This complaint is meritless,” an Aon spokesperson said in an email to BestWire at the time. “Vesttoo has publicly admitted that its executives conspired with third parties in a highly sophisticated and elaborate fraud. As one of the victims of that fraud, Aon is focused on continuing our work to develop a path forward for all affected parties.” The Supreme Court of Bermuda recently sanctioned a bankruptcy plan filed by Vesttoo creditors and approved the joint provisional liquidators of Aon's White Rock Insurance SAC to remove objections to the Chapter 11 plan involving White Rock and other parties. The Bermuda court's decision, filed with the U.S. Bankruptcy Court for the District of Delaware, allows the JPLs to unconditionally withdraw their objections to previously proposed versions of the bankruptcy settlement plan and cedent settlements with the Official Committee of Unsecured Creditors of Vesttoo, appointed in the Vesttoo Chapter 11 case involving White Rock. The liquidators are also authorized to consent to confirmation of the plan. The liquidators are also allowed to consent to cedent settlements with the committee and JPLs for White Rock involving insurers Clear Blue, Chaucer, Beazley plc., Markel Corp. and Porch, according to the Bermuda court ruling. Underwriting entities of Clear Blue parent Pine Brook Capital Partners II (Cayman) have current Best’s Financial Strength Ratings of A- (Excellent).  

The Securities and Exchange Commission is preparing to sue Robinhood Markets’ crypto unit, ramping up its crackdown on digital-currency trading to target one of the most popular U.S. brokerage firms, the company said Monday.

Robinhood disclosed that its crypto unit received a so-called “Wells Notice” from SEC staff over the weekend, which said the staff had made a “preliminary determination” to recommend an enforcement action against the unit, called Robinhood Crypto, over alleged violations of securities laws.

Insurance giant Prudential is shutting down Assurance IQ, five years after spending $2.35 billion to acquire the under-the-radar tech startup based in the Seattle region. “As we look to the future, we believe that directly investing in our core businesses and capabilities will help us become a higher growth, more capital efficient company,” Caroline Feeney, head of Prudential’s U.S. businesses, wrote in an email to employees obtained by GeekWire. “After a careful review of our businesses and strategic initiatives, we have made the difficult decision to wind down our Assurance business.” Prudential noted in its first quarter earnings report on Tuesday that it “decided to exit” the Assurance business. The company confirmed the shutdown in a statement to GeekWire. Assurance uses technology to match consumers with insurance plans that are purchased online or through an agent. Its acquisition to Prudential was one of the largest in Seattle tech history, and the largest insurance tech exit in history, according to Financial Technology Partners. The startup, founded in 2016 by Michael Rowell and Michael Paulus, never raised any outside capital and quietly reached unicorn status as a $1 billion company. At the time of the deal, Prudential said Assurance’s “rapid-growth model offers compelling economic advantages with low fixed costs and low capital requirements that produce high margins and high degree of scalability.” “Assurance accelerates the strategy and growth potential of Prudential’s financial wellness businesses, bringing us closer to more people across the entire socio-economic spectrum to better serve the full picture of their needs,” Prudential CEO Charles Lowrey said in 2019. But just a few years later there were signs of trouble. A story by The Wall Street Journal in 2022, “How Prudential’s Big Tech Bet Went Sour,” cited missed financial targets and government inquiries over regulatory matters. Many insurance technology companies struggled amid the broader tech downturn that started in 2022. Prudential stopped reporting Assurance financial data in January 2023, in part because “its financial results and operations are not considered significant,” the company said at the time. Assurance reported adjusted operating income of $29 million in the fourth quarter of 2022, compared to a net operating loss of $10 million a year prior. Prudential took goodwill impairment charges, used when a company’s value decreases following an acquisition, of $177 million, $903 million and $1.06 billion in the fourth quarters of 2023, 2022 and 2021, respectively. Assurance had around 1,700 employees as of December 2022 and now has 1,000 employees, in addition to contract workers who help customers find insurance plans. Update: A filing with the Washington state Employment Security Department shows 112 workers in Seattle being laid off, starting July 3. In an email to employees on Tuesday, Assurance CEO Allison Arzeno wrote that “I realize this news comes as a shock and creates uncertainty.” She said a majority of the company’s employees will be laid off. “Together, we built something special here,” wrote Arzeno, who took over as CEO in 2020. “Our work made a difference. We helped hundreds of thousands of people navigate complex insurance tradeoffs and secure coverage that improved and protected their personal and financial well-being.” Prudential reported first quarter net income of $1.1 billion, down from $1.46 billion in the year-ago period. Asked about M&A deals on the company’s earnings call with analysts Wednesday, Lowrey said Prudential “anticipated a different outcome when we purchased Assurance.” “As we look forward we will focus on acquisitions of more established businesses that present opportunities to expand our capabilities and scale in our existing market-leading businesses,” he said. The company’s stock is up nearly 30% in the past 12 months. It has a market capitalization above $39 billion. Read the full memo from Feeney below. “As we look to the future, we believe that directly investing in our core businesses and capabilities will help us become a higher growth, more capital efficient company. After a careful review of our businesses and strategic initiatives, we have made the difficult decision to wind down our Assurance business. Assurance was acquired by Prudential in 2019 to expand the company’s direct-to-consumer access to the U.S. mass market. Since then, the team has made meaningful progress in realizing Assurance’s vision to help people improve and protect their personal and financial well-being, while navigating a challenging business environment for the broader insurtech industry. However, as we sharpen our focus as an enterprise on growth, it is critical that we prioritize core businesses and capabilities where we have a competitive advantage. Business decisions like this are never easy, and we are working with the Assurance leadership team to support our employees, customers, and partners throughout this process. I want to thank all of our employees and other partners at Assurance for their dedication over the past five years. And more broadly to our teams across the U.S., thank you for always keeping our customers, clients, and each other top of mind.”

At least one company asked state regulators for permission to raise rates by 93.4%, according to data obtained from the New Jersey Department of Banking and Insurance (DOBI).

Insurance companies are asking for the increases because of a combination of inflation, increasing home replacement value, higher building costs and “increased frequency of catastrophic events” such as severe weather events. It’s a national problem, said Dawn Thomas, the agency’s spokeswoman.

She said the agency has received “significantly” more rate increase requests in recent years.

Under state law, property and casualty insurers are permitted to file requests with the department to amend their rates or rating systems, Thomas said.

“The Department takes seriously its responsibility to regulate the insurance industry in a manner that promotes consumer protection and the stability of the industry,” she said. “All rate changes must be reasonable, adequate and not unfairly discriminatory.”

If the request is “unreasonable, inadequate or unfairly discriminatory,” it will not be approved, she said, noting that it blocked $68 million in homeowner premium increases since 2023.

But for the more than 120 hikes that were approved since 2023, homeowners’ pocketbooks are hurting.

The highest hike request came from Clear Blue Insurance, which is licensed to offer policies in all states except Alaska. After requesting a hike of 93.9%, it was granted a 20% increase. The company did not respond to requests for comment.

The second highest request was for a 34% increase from Palisades Property & Casualty, which is part of Plymouth Rock Assurance. It received a 14% jump. Next was Kingstone Insurance, which asked for a 28.4% hike and received permission to raise rates by 18.7%.

The pain probably isn’t over yet. More homeowner insurance companies have filed requests to hike their rates, including a dozen that asked for double-digit hikes.

The highest pending request is for Allstate New Jersey Property & Casualty, which asked for a 36.9% increase. MIC General requested a 36% hike and Palisades Property & Casualty is seeking a 30.3% increase.

If Allstate Corp.’s customers “quit getting sued every time they have an accident” the company could ease back on some rate increases, according to Chairman, Chief Executive Officer and President Tom Wilson. Medical treatments, medical consumption, inflation and higher legal costs on increased attorney involvement are all pushing claims severity higher and ultimately increasing rates, Property-Liability President Mario Rizzo added during the multiline insurer's first-quarter earnings conference call. Personal automobile physical damage claims are also still rising on higher parts and labor costs, but the rate of increase is moderating on factors such as lower used car prices, said Rizzo. Auto claims frequency was down in the quarter, helped by favorable weather, but it was more than offset by higher claims severity, he said. Allstate fully reopened to personal auto business in California in February, feeling comfortable with business there after a rate hike was approved. Regulators in New York and New Jersey also approved rate hikes, but it’s not enough to lift underwriting restrictions, said Rizzo. In New York, he said Allstate is in discussions with regulators. In New Jersey, a second rate hike, for 13.95%, was approved to take effect in the second half of the year but still more is needed, said Rizzo. Wilson said the company will continue to raise rates in additional geographies due to higher severity. Allstate has worked the past several years to reduce expenses and will keep doing so to remain competitive, he said. “It’s difficult to determine where one’s competitive position is, given how rapidly rates are moving,” across the industry, he said. State Farm increased its market share in recent years but has run “very large underwriting losses,” said Wilson. “That won’t be us.” Allstate seeks growth by significantly increasing advertising, unwinding underwriting restrictions in states accounting for about 75% of its auto brand premium and expanding new products across channels, according to Rizzo. While Allstate brand auto policies in force declined 5.2% from the prior-year quarter, National General auto policies in force rose 12.6% as its nonstandard business grew and the company continued to roll out a new middle-market standard and preferred product called Custom360. The company can adjust pricing more quickly in its nonstandard auto business, Rizzo pointed out, because of high turnover in the line. A new connected auto product is available direct in nine states and is being expanded to the agent channel this year, with more states and an expansion to homeowners planned in coming years, Rizzo said. Allstate brand auto net written premiums rose 8.4% from the prior-year quarter on a 13.4% increase in average gross written premium on rate increases, partially offset by the decrease in policies in force. Allstate brand new auto business was up 7% from a year earlier, Rizzo said, on a combination of advertising, direct sales and more productivity by Allstate agents.

Allstate Corp. applicable net income soared in the first quarter to $1.19 billion, rebounding from a $346 million net loss a year earlier.

Allstate brand homeowners implemented average 11.7% rate increases in 15 locations in the quarter. National General implemented homeowners rate increases averaged 14% across 12 locations. The carrier sees additional growth opportunities in the independent agent channel in homeowners, said Rizzo.

Allstate is pursuing the sale of its health and benefits businesses rather than invest in more complementary distribution, a broader set of products and capabilities such as management of a health network, Wilson said earlier. The businesses generate about $240 million of adjusted net income annually.

The potential sale is progressing as expected, with “robust interest from a large group of quality potential buyers, both strategic and financial,” Chief Financial Officer Jess Merten said during the first-quarter earnings call. “Diligence on a large, complex business takes some time, so does selecting the right potential buyers to stay involved in the process,” he said. “We believe this is a great business” but someone else can do more with it, said Wilson, adding Allstate anticipates selling the health and benefits business in 2024. While the divestiture will free up additional capital, Wilson continued to stress that Allstate is already “very well capitalized.”    

As claims poured in from Hurricane Ida, executives of Lighthouse Insurance Co. scrambled to land an infusion of cash from investors, both to assuage concerns from regulators and in hopes of keeping the firm afloat. Now, the people who poured more than $60 million into the company just before it went belly-up are suing the firm and its executives, alleging a complex web of fraud involving a family trust, affiliated companies and a Florida bank. The allegations, made in a lawsuit filed by New York-based hedge-fund managers who claim Lighthouse bilked them, shed new light on the questionable business practices of one of the 12 insurers in Louisiana that failed after Ida. The Times-Picayune | The Advocate detailed Lighthouse’s poor financial condition in a series of stories that found most of the companies that failed had also sent hundreds of millions of dollars to less-regulated affiliates, even as the main companies grew quickly and took on extreme levels of risk that put them in a precarious position. The failures have forced tens of thousands of Louisianans to try to get their claims paid by the state-backed guaranty association, which is funded by taxpayers. Many of their policyholders landed on the rolls of Louisiana Citizens, the state insurer of last resort, forcing them to pay higher premiums. Fortinbras, the New York investment adviser for HT Investments, and Silver Rock, a Cayman Islands partnership, filed the lawsuit in Florida court last week, naming as defendants former Lighthouse CEO Patrick White; his father, Lawrence White; and their family trust. The suit centers on the several months leading up to Lighthouse’s collapse in 2022. In the summer of 2021, the lawsuit said, a contractor reported that a check from Lighthouse bounced, and the Louisiana Department of Insurance put the company into a confidential state-supervised supervision proceeding. To satisfy regulators, Lighthouse, working closely with a reinsurance broker called TigerRisk, approached the investors about injecting capital into the firm to put it on a more solid footing. But the investors allege that Lighthouse, and TigerRisk, which is not named as a defendant, misled them by not disclosing the scrutiny by regulators, and by misrepresenting the amount of claims it expected to pay out to victims of Hurricane Ida, which hit in August. The deal with the investors closed in December, at which point the firm was already at “imminent risk of liquidation due to financial distress,” the lawsuit says. The state put the firm in receivership in April and eventually liquidated it. “Patrick White and his agents painted a false picture that prevented plaintiffs from adequately assessing their risk,” the suit said. “In truth, Patrick White and his agents knew or had reason to believe that the losses suffered by the (companies) from Hurricane Ida claims had already exceeded, and would far exceed, the $265 million projected losses” that the plaintiffs were warned of. The investors have already sued One Florida Bank, which has ties to the White family and Lighthouse, alleging the executives used the capital infusion to repay debts to the bank even as the insurer was going under. Former Lighthouse CEO Patrick White declined to comment. In an earlier statement to the Insurance Journal about the dispute with One Florida Bank, he said “many carriers, the state itself, and the industry as a whole, had the early estimates wrong.” “Fortinbras was aware that the hurricane had occurred and even hired experts of their own to review the numbers throughout the due diligence process,” White said. “The outcome is unfortunate for all.” Lighthouse was one of many smaller, regional insurers that wrote policies in south Louisiana and other hurricane-prone places and that grew rapidly in the years after Hurricane Katrina. Jim Donelon, Louisiana’s former insurance commissioner, wooed such small firms with state grants and encouraged policyholders to do business with them. Donelon himself took out a policy with one of the new arrivals. The raft of failures in 2022 and 2023 raised questions about whether Louisiana had allowed the companies to grow too quickly without proper oversight. The Times-Picayune analysis found 11 of the companies used a model where it farmed out all the work, and a significant share of the premium dollars, to less-regulated affiliates, making it difficult to know if the companies were spending wisely. The state Department of Insurance has since beefed up its review of companies’ reinsurance and concentration of policies in risky areas. And a bill that would bolster reporting requirements for less-regulated affiliates is making its way through the Legislature. The LDI is suing one of the failed companies, Americas Insurance Company, alleging it misled regulators about its debt load. Another, Southern Fidelity, is under fire from Florida regulators for using company cash to buy a sprawling hunting lodge that its executive used as a personal residence. The investors suing Lighthouse allege the company’s executives misled them to raise capital to avoid a collapse that could endanger the White family’s assets. And they say Lighthouse told them the company’s losses from Ida were significantly lower than they actually were. And the suit claims Lawrence White, a former owner of the parent company, deleted key documents, and that the White family used investors’ money to make improper transfers to an affiliated reinsurer.

The Lone Star Summit, a groundbreaking event uniting the four Texas Master Agencies of SIAA - The Agent Alliance, concluded its first gathering on May 1, 2024, at the picturesque Hyatt Regency Hill Country Resort and Spa. Representing a milestone in the insurance industry, this unprecedented collaboration brought together independent insurance agents from across Texas, representing more than $1.1 Billion in total written premium, for three days of intensive workshops, strategic discussions, and networking opportunities. From April 29 to May 1, nearly 400 attendees immersed themselves in tailored sessions aimed at expanding their businesses, enhancing market value, and navigating the evolving insurance landscape. The summit provided actionable insights for agency growth, fostering an environment where like-minded professionals and industry leaders could connect, share ideas, and uncover opportunities. The event kicked off with the Lone Star Scramble Charity Golf Tournament, a spirited day on the links that raised funds for four local non-profits selected by each of SIAA's four Texas master agencies. Additionally, the event hosted a Travelers Insurance sponsored SHE Golfs clinic, created to empower women in the industry to feel comfortable and confident on the golf course, furthering the spirit of inclusion and philanthropy. Keynote speaker Joan Woodward, Executive Vice President of Public Policy at Travelers, delivered an insightful presentation on economic, policy, and political outlooks, setting the tone for the conference's engaging sessions. The summit featured a diverse lineup of speakers, panels and workshops, covering topics ranging from commercial lines strategies and agency perpetuation to digital marketing and innovation in insurance. Attendees had the opportunity to participate in roundtable discussions with strategic partners, fostering collaboration and exploring new opportunities within the industry. A highlight of the event was the recognition of Myrna Estrada, Senior Vice President and Field Executive of Liberty Mutual Insurance, with the inaugural Lone Star Community Star Award, celebrating her outstanding contributions to the industry and the Texas community. "We are thrilled with the success of the first Lone Star Summit," said Ian Exelbert, SIAA’s Central/West Regional President. "This event represents a pivotal moment for growth and innovation in the Texas insurance landscape. We are grateful to all our attendees, speakers, sponsors, and partners for their contributions in making this event a resounding success." The Lone Star Summit concluded with an awards ceremony honoring outstanding achievements and a vision for the future of Texas independent agents. Attendees departed with renewed inspiration, valuable insights, and a strengthened sense of community. About SIAA – The Agent Alliance SIAA – The Agent Alliance is the leading national insurance agency network, with approximately 5,200 members collectively writing more than $14 Billion in total written premium. For more information about SIAA, visit siaa.com. The master agencies affiliated with SIAA in the great state of Texas are: Texas Agency Alliance (TAA), Abilene, siaatx.com CoVerica Agency Alliance, (CoVerica), Dallas, covericaaa.com Insurance Agents Alliance of Texas (IAAT), Mineola, iaatx.com South Texas Agency Alliance (STAA), Katy, staa.com