Generative artificial intelligence, geopolitical tension, punishing climate events—the list of headaches for businesses’ risk managers can seem to be in a perpetual state of growth.

Experts see a deteriorating risk landscape, with most reporting a negative outlook that is expected to worsen over the next decade, according to the World Economic Forum’s Global Risks Report 2024.

The problems, though vexing, aren’t intractable. About 10,000 risk managers and experts met this week in San Diego for the annual Riskworld conference put on by trade association RIMS to discuss the industry’s most pressing issues. The Wall Street Journal’s Risk & Compliance Journal caught up with some top experts to learn what they are advising businesses. Some responses have been edited for clarity.

Generative AI

Many businesses, if not committing to generative AI, are at least flirting with it. But in the rush to adopt, they likely are missing some of the less obvious risks that the technology poses, including models that might push out biased information or be inadvertently built with copyrighted intellectual property.

“AI is dominating the landscape. Where we are right now is the automobile before the seat belt. This is a new dimension that I don’t think a lot of our clients have had thought about.

“The questions that are really coming up with our clients right now that we weren’t hearing a year ago on this are on truly appreciating the liability associated with AI. Whether that’s IP infringement because the training data is from a third party, or whether the training data might be bad and you’re making bad decisions off of that. I don’t think there’s enough discussion about those sets of risks.” —Reid Sawyer, head of U.S. cyber risk consulting for insurance broker and risk adviser Marsh

“Gen AI is topical right now. But at the same time, it’s a risk like any other risks and so our same principles apply. Our CEO once joked, ‘There was a day where the wheel was an emerging risk.’ There are unique risks that gen AI causes and represents, but there are so many benefits that it’s not going away. Organizations need to manage that.

“A lot of organizations are in various states of transitioning to cloud computing and various sources of how they structure their data. To really maximize the impact of gen AI, you need to have quality data in large quantities that’s easily accessible. For many organizations, that is a risk because they are trying to do all these applications while also trying to navigate a data journey.” —Lauren Finnis, head of commercial lines insurance consulting and technology for North America at insurance broker WTW

Geopolitical tension

The combination of China-U. S. friction, the Ukraine-Russia war and conflict in the Middle East has kept multinational businesses on their toes. Persistent Houthi attacks in the Red Sea have raised supply-chain worries. Some businesses are finding political risk insurance more difficult to obtain. Insurance policies that cover cyberattacks might not pay if the attack occurs in the context of a war, one expert warned.

“We saw how vulnerable supply chains can be to a shock. That is causing companies to rethink that and to make them more resilient and less dependent on China. Supply chains generally are a topic of discussion that they haven’t been for a while.

“Insurers are being more careful about the size of political risk they’ll take in and around China and Taiwan. Political risk insurance can be written for up to 10 years. Writing an insurance policy for 10 years in Taiwan is a slightly different matter than it might have been a decade ago when the geopolitical situation didn’t seem quite as precarious.” —Adrian Cox, chief executive for London-based specialty insurer and reinsurer Beazley

“One of the biggest problems we’ve had this past year in the cyber insurance community has been the war exclusion. There were several sovereign states that actively promoted hacking, ransomware, all that bad stuff. There is a war exclusion in cyber policies, but that doesn’t mean that they’re not going to cover the nation-state action.

“But it does add a wrinkle. What’s going on in Ukraine, what’s going on in the Middle East certainly could ripple back into cyber insurance and create an interesting discussion.” —Bob Parisi, head of cyber solutions (North America) for German insurer Munich Re

Climate risk

More organizations are beginning to appreciate the risks posed by climate change, and working to adapt. Climate scientists have long pushed changes in building and site design as a way to grapple with the physical risks of climate events, a message some experts are taking to businesses. In addition to protecting facilities from loss, resilient businesses can also avoid losing market share during down times.

“We are definitely seeing an uptick in organizations recognizing that climate risks are here to stay and they’re becoming more intense. They really want to do what they can to keep their business resilient, their infrastructure resilient and just keep operating.

“Organizations are looking to build their sustainability strategies. They’re using different construction materials and different construction methods. They realize that they can’t insure their way out of some of this risk. There’s a physical risk, there’s the business continuity risk—it’s also a reputational risk. If you’re not able to ride through, your customers are going to go somewhere else.

“We’re also starting to use AI to understand risks: Identify which locations are exposed, identify what the risk is and quantify that risk using technology.” —Jessica Waters, manager of climate and structural resilience at commercial insurer FM Global

Pfizer has agreed to settle more than 10,000 lawsuits about cancer risks related to the now discontinued heartburn drug Zantac, Bloomberg News reported on Wednesday, citing people familiar with the deal. The agreements cover cases in U.S. state courts but don't completely resolve the company's exposure to Zantac claims, the report said, adding that financial details of the deals were not immediately available. Pfizer did not immediately respond to a Reuters request for comment. In 2020, the U.S. Food and Drug Administration asked drugmakers to pull Zantac and its generic versions off the market after a cancer-causing substance called NDMA was found in samples of the drug. Thousands of lawsuits began piling up in federal and state courts against Pfizer, GSK, Sanofi, and Boehringer Ingelheim.

The Louisiana governor signed four bills into law on Tuesday, which would tackle the state's insurance crisis. Gov. Jeff Landy signed the bills to focus on reform to create a competitive and stable insurance marketplace for Louisiana. “Our hope is that this package of bills will start to create more balance in the law and in the market such that we can drive the cost of property insurance down so it’s more affordable for our citizens,” Landry said. Senate Bill 323 established a tighter deadline for insurers to initiate loss adjustments. That includes 14 days for non-catastrophic, and 30 days post-catastrophe. This bill includes potential extensions by state officials. House Bill 611 would remove the three-year rule for new policies and allow insurers to more effectively manage their risk by allowing nonrenewing up to 5% of the three-year policies. Senate Bill 295, increases the speed to market for insurance products and rare changes while maintaining regulatory oversight. The last bill, House Bill 120, strengthens the Louisiana Fortify Homes program, which offers incentives to homeowners who enhance their homes to better withstand severe storms.      

The National Association of Mutual Insurance Companies welcomed the announcement today that government-sponsored enterprises Fannie Mae and Freddie Mac are delaying implementation of changes to guidance that would have drastically increased costs for millions of Americans. “Today’s decision creates an opportunity for the GSEs and the Federal Housing Finance Agency to speak with insurers and other stakeholders to gather more information about the problem of underinsurance, what they can do to help, and how they can best go about it,” said Jimi Grande, senior vice president of federal and political affairs for NAMIC. “NAMIC has been sounding the alarm that these changes, if implemented, would lead to higher costs and less insurance availability for homeowners. The GSEs made the right call in taking a step back to consider the consequences.” The GSEs announced in February changes to their Selling Guide that would have significantly impacted every mortgage backed by Fannie Mae or Freddie Mac. While not directly aimed at insurers, which are regulated by the states, the updated guidance required that all mortgage holders with a GSE-backed loan purchase full replacement insurance coverage and the value of those replacement costs be verified annually by insurers. “It may have sounded like a simple fix, but requiring full replacement coverage and an annual verification would come at a higher cost and may not always be the best choice for homeowners,” Grande said. “Addressing changes in the economy, growing risks due to a variety of factors, and overcoming the barriers to homeownership are not so simple as trying to force every homeowner to just buy more – and more expensive – coverage.” With the additional time, Grande said NAMIC is ready, willing, and able to help FHFA and the GSEs develop a more appropriate policy. “We all have the same goal, reducing the number of underinsured properties,” he added. “Bringing additional voices into that conversation can only help produce a more practical and effective solution.”      

Munich Reinsurance Co. saw lower catastrophe losses, even as man-made losses rose due to the Baltimore bridge disaster, as first-quarter profit soared 68.4% on high rates and strong April 1 renewals. "Every line of business played a role in this impressive performance," Chief Financial Officer Christoph Jurecka said in a statement. "In addition, we got a boost from the treaty renewals at 1 April, where we tapped into attractive growth opportunities against a backdrop of continuing high rates."

First-quarter net result rose to €2.14 billion ($2.30 billion) from €1.27 billion a year ago. Insurance revenue from insurance contracts issued rose to €15.06 billion from €14.27 billion, attributed mainly to organic growth in the reinsurance segment and at primary insurer Ergo International.

"We still expect to generate a profit of €5 billion in 2024," Jurecka said. "In fact, it has become more likely that we will surpass that target."

The group earlier reported a preliminary first-quarter net profit of about €2.1 billion, ahead of expectations. Operational performance in all lines of business is better than expected for the full year in 2024, the reinsurer said at the time.

The property/casualty reinsurance combined ratio improved to 75.3 from 86.5. The segment's net result nearly doubled, Munich Re said.

Major losses in excess of €30 million fell to €650 million from €1.04 billion a year ago, including gains and losses from the runoff of major losses from previous years, the group said. Major-loss expenditure corresponded to 9.9% of net insurance revenue, down from 16.4% and "far below the expected average of 14%," Munich Re said.

Man-made major losses rose to €418 million from €165 million. The largest individual loss was the collapse of the Francis Scott Key Bridge in Baltimore.

The group doesn't give specific figures for either its own loss or that of the market from the Baltimore disaster due to the complicated assessment of the event, a spokesperson told BestWire.

Major losses from natural catastrophes fell to €232 million from €870 million, taking into account the effects of discounting and risk adjustment, Munich Re said.

In April 1 reinsurance renewals, Munich Re said it increased the volume of business written 6.1% to €2.6 billion.

"The company selectively exploited the ongoing favorable market conditions to expand attractive business, with growth opportunities being realized particularly in India, Latin America and Europe," Munich Re said. "These involved both strengthening existing client relationships and establishing new ones." The group said price development was stable overall and mostly compensated for higher loss estimates in some areas, that were mainly attributable to inflation and other loss trends. Primary insurance prices rose in many markets and Munich Re said it benefited from proportional reinsurance contracts. Market pressure rose slightly but Munich Re said it expects the environment to remain positive for July renewals. Life/health reinsurance generated a higher technical result on strong growth new business and revenue, Munich Re said. For the Ergo primary insurance segment, the net result and insurance revenue rose as revenue was driven by the international segment, Munich Re said. Ergo International's profit gained on profitable growth, good major-loss experience and strong P/C performance, the group said. The segment also saw good underwriting performance in its L/H business. Underwriting entities of Munich Reinsurance Co. have current Best's Financial Strength Ratings of A++ (Superior) and A+ (Superior).  

Surging insurance premiums in regions vulnerable to climate change make sense, and government efforts to hold back those increases won’t work in the long term, Chubb Chief Executive Evan Greenberg said.

U.S. states themselves are driving a crisis of insurance availability by blocking insurers from pricing climate change into policies, Greenberg said on Tuesday in San Diego at the RIMS Riskworld conference, an annual gathering of about 10,000 risk and insurance professionals.

“Climate change is sending price signals. Society will not adjust its behavior to the change of climate just because people talk about it,” Greenberg said. “We’re sending price signals very rationally. That starts driving behaviors.”

Americans and businesses across the country have seen insurance become far more expensive—in some cases nearly impossible to obtain—particularly in areas exposed to wildfire, floods and other damaging weather. Zurich-based Chubb, one of the most important insurers in the U.S., has been on the front lines of the issue.

California and other jurisdictions are trying to “deny” the ability to charge the “right price” for risk, said Greenberg. Several large carriers have stopped writing new policies in California, with the industry blaming state policies that block insurers from using forward-looking climate-risk models to set prices.

The state is working on changing its regulations. California Insurance Commissioner Ricardo Lara didn’t immediately respond to a request for comment.

Insurers have shelled out billions of dollars in recent years as losses from wildfires and other climate-related events have piled up. The industry isn’t ultimately to blame for affordability problems, Greenberg stated.

“We haven’t told people to live in a high-wildfire zone, and we haven’t told them to build magnificent homes in a wildfire zone,” Greenberg said. “I’m willing to insure them if I can charge the right price for the risk.”

In trying to keep rates down, states are effectively attempting to blunt price signals, Greenberg said. But the net effect is that insurers will stop writing policies—leaving taxpayers on the hook for the risk, he added. Florida, California and Louisiana have all seen policyholders flock to state-backed insurance plans that are meant to be a last resort.

Many jurisdictions are adopting policies that aren’t sustainable, Greenberg said.

“The cost of climate change, to state the obvious: Going up,” he said. “This is not a short-term thing that’s going to go away.”

Channel Harvest Research has completed its 17th annual national survey of independent agents and brokers, with a focus on how they’ve been managing the hard market in property-casualty insurance. More than 1,600 agency owners, producers and customer service representatives responded to this year’s survey conducted by Channel Harvest, a division of Aartrijk.

Developed in collaboration with partner insurance carriers, the 2024 Channel Harvest study asks agents what they need in a carrier relationship and why they prefer to work with certain companies. Respondents also rank specific carriers on a variety of performance metrics.

This year’s findings also include insights on the following:

• Hard market challenges: How is the hard market affecting agencies? Many respondents say this is the toughest market they have experienced, particularly in personal lines, with rising prices and limited coverage availability. Top reasons for customer loss include new carrier restrictions, non-renewals and customers finding lower premiums elsewhere.

• Revenue growth versus policies in force: Three-quarters of respondents reported revenue growth in the past year; however, only 50% saw growth in policies in force. Alarmingly, one in five agencies experienced a net loss of policies in force.

• Digital adoption: While half of the surveyed agencies enable customers to text them directly, the adoption of self-service portals, apps and real-time quoting or binding remains relatively low.

• Importance of in-person visits: Although in-person visits from carrier field representatives remain important to nearly half of agents, there is a notable increase in those who do not consider such visits essential.

Channel Harvest provides insurers with a unique, third-party, objective lens. Carriers use the detail to benchmark what they already may believe about their agent distribution and to gather insight into relevant subject areas. Insurers interested in participating in this survey may contact Dave Evans, Aartrijk strategist and senior associate, at dave.evans@Aartrijk.com or 703.304.3540.

About Aartrijk Aartrijk is a branding and marketing-communications firm dedicated to the insurance industry, with a specialty in the independent agent channel. Its partners include carriers and managing general agencies, insurtechs, service providers, trade associations, user groups, educators and media companies. Celebrating its 25th year in 2024, the firm offers customer and business partner research, brand strategy, visual identity development, digital marketing, advertising and sponsorship programs, media relations and content development. Visit Aartrijk.com.

The start of what is forecast to be a “very active” 2024 Atlantic hurricane season is just four weeks away and the Insurance Information Institute (Triple-I) is recommending homeowners, condo owners, renters and business owners prepare now. Led by Colorado State University (CSU) senior research scientist Phil Klotzbach, Ph.D., also a non-resident scholar at Triple-I, the CSU Tropical Meteorology Project forecasts 23 named storms, 11 hurricanes and five major hurricanes during the 2024 season, which starts on June 1 and continues through Nov. 30. A typical Atlantic hurricane season has 14 named storms, seven hurricanes and three major hurricanes. “During National Hurricane Preparedness Week, everyone who lives in a hurricane-prone community should take a few moments to ensure they have adequate financial protection for their property and possessions, while also taking steps to make their home or business more resilient to the impacts of wind and water,” said Triple-I CEO Sean Kevelighan. “History has proven states along the Gulf and East coasts face the prospect of catastrophic, hurricane-caused property damage. With more Americans living in harm’s way than ever before, it is critical for everyone residing in a hurricane-prone community to make preparedness a priority for the upcoming season,” Kevelighan added. National Hurricane Preparedness Week, spearheaded by the National Oceanic and Atmospheric Administration (NOAA), starts on Sunday, May 5, and continues through Saturday, May 11. The Triple-I’s four key hurricane preparedness tips for the 2024 season include: Review Your Insurance Coverage. Make sure you have the right type – and amount – of property insurance. The Triple-I recommends you conduct an annual insurance review of your policy(ies) with your insurance professional. “With home replacement costs escalating more than 55% since 2019 due to the higher costs of construction materials and labor, you should ask your insurance professional if you have the right amount of coverage to rebuild or repair your home, to replace its contents, and to cover temporary living expenses if your property is uninhabitable,” Kevelighan said. “You should also ask about flood insurance, which is an additional coverage to standard homeowners, condo and renters policies, as well as a small business insurance policy. Nearly 90% of U.S. natural disasters involve flooding so most areas of the country are prone to flooding.” The best place to start the insurance review process is by reading the declarations page of your policy. It offers details on how much coverage you have, your deductibles, and how a claim will be paid. Standard homeowners insurance covers the structure of your house for disasters such as hurricanes and windstorms, along with a host of other perils, such as fire. It is important to understand the elements that might affect your insurance payout after a hurricane and adjust your policies accordingly. Flood insurance, which is a separate policy from your property coverage, is offered through FEMA’s National Flood Insurance Program (NFIP) and several private insurers. Protect Your Vehicles. Comprehensive auto, which is an optional coverage, protects your vehicle against theft and damage caused by an incident other than a collision, including fire, flood, vandalism, hail, falling rocks or trees, and other hazards. Nearly 80 percent of U.S. drivers opt to purchase comprehensive coverage. Make Sure Your Possessions are Adequately Protected.  Residents need to imagine the out-of-pocket cost of repurchasing their wind-damaged furniture, electronics, clothing, and other personal possessions after a hurricane. Whether you have homeowners insurance, condo insurance or renters insurance, your policy provides protection against loss or damage to personal property due to a hurricane. Creating an inventory of your belongings and their value will make it easier to see if you are sufficiently insured for either the replacement cost or the actual cash value of the items situated at your residence. When you create a photo or video catalog of your home’s possessions, it expedites the insurance claims process if you sustain damage from a storm. Make Your Property More Resilient. Invest in items that will harden your property against wind damage, such as roof tie-downs, a wind-rated garage door, and storm shutters. Triple-I also recommends you have your roof inspected annually by a licensed and bonded contractor to make sure it will withstand high winds and torrential rains.            

Southwest Florida residents may get to keep their discount flood insurance rates after all, as discussions between local governments and FEMA revealed a series of “miscommunications.” In March, the federal agency informed five communities in Lee County, including the county itself, that their shoddy rebuilding practices after Hurricane Ian’s catastrophic hit in September 2023 meant the communities were at risk of losing their discounts on federal flood insurance — as much as 25% in annual premiums. The communities protested, calling it a “late, devastating blow” and casting FEMA as a “villain.” Both of Florida’s senators wrote letters admonishing the agency. In a series of meetings that followed, FEMA and the governments appeared to realize the situation was not as black and white as either had initially imagined. FEMA may actually already have many of the documents it requested from the communities, and the communities seem to have misunderstood the terminology FEMA staffers used to request certain documents. The result, so far, has been a handful of 30-day extensions before FEMA makes its final call on whether the communities get to keep their flood insurance discounts. The discounts in question affect about 115,000 policyholders, who could pay around $300 extra for their annual premiums starting Oct. 1 if the punishment stands. FEMA did not respond to requests for comment. Lee County, Estero, Cape Coral, Bonita Springs and Fort Myers Beach all have until June 10 to submit all requested documents. Dave Harner, Lee County’s manager, told the Herald that weekly meetings between FEMA representatives and the five communities have helped everyone understand the issues and work together to solve them. “FEMA said that may have been a gap that happened and now we’re rectifying that gap through the meetings we’re having,” he said. “We ultimately believe we have the documentation.” FEMA also provided extra staff to help Lee County find and share the documents the agency asked for, which Harner cited as one of the major problems that may have led to the mix-up in the first place. “The big issue is you’re dealing with the third biggest storm in the country’s history and you’re dealing with a massive manpower issue,” he said. “We need upwards of 600 people to do an evaluation across the county. We don’t have that, the state didn’t have that.” Lee County has a list of 414 properties that FEMA had questions about; Cape Coral has 207; Bonita Springs has 106; Fort Myers Beach has 105. The other communities in FEMA’s crosshairs said they were “working hard” to comply with all the agency’s requests ahead of the deadline. However, none of the other communities would confirm whether or not they thought they could retain their flood insurance discounts. “It’s not appropriate for me to speculate on FEMA’s decision,” wrote Melissa Mickey, spokesperson for the city of Cape Coral.    

One of California’s largest home insurers is raising rates for hundreds of thousands of state policyholders by an average of 15.3%, the latest move by a major insurer to boost homeowners’ premiums in the face of growing wildfire risk. Travelers Insurance, the state’s sixth-largest home insurer as of 2022, plans to update rates for roughly 320,320 homeowners, with some seeing hikes of more than 25% on an annual basis, according to filings with the California Department of Insurance. It was not immediately clear where in the state homeowners will see the largest increases, which could take effect as soon as June 24. On average, California homeowners pay $1,452 a year for coverage, according to Bankrate.com, a personal finance website. The rate hikes could raise annual premiums by hundreds of dollars. California’s insurance rates are tightly regulated and, as a result, far lower than in many other states. The insurance industry, citing a series of destructive wildfire seasons and rising building costs, has for years argued the rate regulations are untenable. Many of California’s biggest insurers, including State Farm and Allstate, have ended coverage for tens of thousands of homeowners in fire-risk areas, including the Santa Cruz Mountains and Wine Country, and last year paused writing new policies anywhere in the state, even as companies have won approval from regulators for double-digit rate hikes. “Nobody wants prices to go up, but anybody who’s not a climate change denier knows that the risks are going up,” said Edan Cassidy, an insurance broker in Scotts Valley in Santa Cruz County. In a filing with the state insurance department explaining the need for a rate increase, New York-based Travelers cited “inflationary pressures” on construction costs and argued that current pricing models don’t account for the damage expected from “changing climate conditions.” “The approved adjustments to our California homeowners insurance rates are necessary to align pricing to the risks that our customers are facing,” the company said in a statement. In a similar move, PG&E has repeatedly raised electric and gas rates in recent years as part of a bid to modernize equipment and reduce wildfire risk. Last November, the state Public Utilities Commission that oversees the utility authorized a 13% increase in customers’ monthly bills. To calm California’s imploding home insurance market, state regulators have embarked on a yearlong overhaul of home insurance rules and pricing. The goal is to give insurers additional latitude to raise premiums to account for more frequent catastrophic fires while extracting commitments to extend coverage in fire-risk areas. “Under outdated rules, the growth of climate-driven mega fires has supercharged insurance costs for many Californians while making insurance harder to find,” Insurance Commissioner Ricardo Lara said in a statement announcing some of the planned reforms in March. Initially, Travelers had asked the state to raise homeowners’ rates by an average of 21.7%. But earlier this month, the nonprofit Consumer Watchdog reached an agreement with the company to slash the hikes by more than 6%. According to the consumer advocacy group, that should save policyholders an average of $118 on their premiums, or $37.8 million in total. Despite the settlement, Cassidy expects the company to continue asking for rate adjustments to offset the increased risk across the state. However, he said the company insures relatively few properties in the wildfire-prone Santa Cruz Mountains, where his agency is based. Kami Cady, who works with Edan Cassidy at Cassidy Insurance Agency, added that while Travelers hasn’t stopped writing new policies in California, she’s noticed the company, like many other insurers, has become more picky about the homes it covers. She said homeowners shouldn’t be surprised to see more rate hikes in the months ahead. “This is going to be a recurring trend in California across the board with all insurance companies,” she said. In 2022, state regulators announced a requirement that insurers provide discounts to consumers for wildfire mitigation and clarify the basis for their homes’ wildfire risk rating. But amid an accelerating California insurance market meltdown, some homeowners are frustrated that they aren’t getting much if any credit for undertaking often costly measures to make their properties more resistant to wildfires as state officials have urged.      

The Midwest Division of the Insurance Industry Charitable Foundation (IICF), a unique nonprofit organization dedicated to helping communities and enriching lives, raised $560,000 at its thirteenth annual Blazing the Trail Gala in Chicago last week. With 375 insurance professionals and nonprofit leaders in attendance, IICF hosted this Midwest insurance tradition in celebration of philanthropic giving and volunteerism, and honored Jodie Kaufman Davis, Executive Vice President of H.W. Kaufman Group, with its prestigious IICF Midwest Trailblazer award. Kaufman Davis was recognized by IICF for trailblazing charitable efforts in the community and championing company culture along with her leadership in advancing inclusion initiatives across Kaufman’s global team. She serves as the executive sponsor for Kaufman’s employee resource groups (ERGs) worldwide and also currently chairs the IICF 30^th Anniversary Committee, leading this industrywide campaign to fight childhood hunger. “Through IICF’s 30^th Celebration we are creating stronger connections in the communities where we live and work and with industrywide support, we aim to help our most vulnerable community members – children who are struggling with food insecurity,” said Jodie Kaufman Davis. “By working together through IICF, we are also enhancing our industry by attracting talent who value philanthropic impact and who make it a priority to work with companies who are giving back. I am honored to represent these initiatives as the 2024 IICF Midwest Trailblazer.” In 2020, Kaufman Davis was named to the Insurance Business Global 100 and received the Business Insurance Women to Watch Award the year prior. Outside the workplace, she is an active Board Member of the Young Presidents’ Organization (YPO) Motor City Chapter, a Director on the Insurance Supper Club (ISC) Group Global Advisory Board and serves on the IICF International Board of Governors. Proceeds from the 2024 Blazing the Trail Gala benefit the IICF Midwest Community Grants Program, which supports regional charities focused on education, safety and health. IICF’s Midwest Division has granted more than $5 million to hundreds of nonprofits since its 2011 founding. “It is our privilege to bring together the Midwest insurance community each year in celebration of giving, and we were honored to celebrate the inspiring philanthropic excellence of Jodie Kaufman Davis this year,” said Marcie Stephan, Chair of the IICF Midwest Division Board of Directors and Senior Vice President at Berkshire Hathaway Specialty Insurance. “The $560,000 we raised helps us to ‘empower brighter futures’ –this year’s Blazing the Trail theme.” Marcie Stephan assumed the role of IICF Midwest Board Chair this month, succeeding Jeff Kroeger, President of Insureon. “I’m excited about what’s ahead for the IICF Midwest, as we continue to grow our board leadership and increase our impact throughout the region with greater grant funding and volunteer participation. I know I speak for the entire IICF Midwest in thanking Jeff for his leadership and his continued involvement,” Stephan said. “I look forward to collaborating with the dedicated leaders we have serving on the IICF Midwest Division Board and on IICF boards in the Heartland and Ohio Chapters.” Communities throughout the Midwest are served by the IICF Midwest Division and Associate Boards based in the Chicago area as well the Ohio and Heartland (Kansas and Missouri) Chapters. The IICF Midwest is one of five divisions, four based in the US and one in the UK, of the Insurance Industry Charitable Foundation, which has granted more than $48 million globally since its inception in 1994. This year’s Blazing the Trail Benefit was made possible through generous insurance industry support including Presenting Sponsor: Burns & Wilcox; Platinum Sponsors: AIG, Aon, CNA, CRC Group, RT Specialty and Zurich; Gold Sponsors: Amwins, Applied Systems, Berkshire Hathaway Specialty Insurance and The Hartford, along with many other event sponsors. For more information regarding IICF’s Midwest Division and how to become a board company, please visit IICF Midwest Division at IICF.org or contact IICF Midwest Executive Director Kelly Hartweg at (773) 991-2149 or khartweg@iicf.org. About the Insurance Industry Charitable Foundation (IICF) The Insurance Industry Charitable Foundation (IICF) is a unique nonprofit that unites the collective strengths of the insurance industry to help communities and enrich lives through grants, volunteer service and leadership. Established in 1994, IICF is celebrating the thirtieth anniversary of serving as the philanthropic voice and foundation of the insurance industry throughout 2024, having contributed $48 million in community grants along with over 337,000 volunteer hours by more than 125,000 industry professionals. IICF reinvests locally where funds are raised for maximum community impact, serving hundreds of charities and nonprofit organizations across the US and UK. IICF is a registered nonprofit organization under section 501(c)(3) of the IRS code. Learn more at www.iicf.org or follow us on social media at: LinkedIn and Instagram    

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.