Risk & Business

Unfortunately, storms are continuing across the country. A record number of tornados are touching down and causing the property and casualty insurance market to be alarmed. The pace of disasters occuring will most likely hit insurers bottom lines this year, and may also erode some surplus. Rates have been extremely soft over the last 5 years and these weather patterns may cause a turn in the market. Though the losses mount up, the insurance industry will be there to help people rebuild their lives. This is what makes this industry vital to our country. It keeps the economy solid and allows people and businesses to re-build and continue to succeed. Regardless of rate changes or profitability, the insurance industry does its job when the time comes. This is what makes what we do rewarding. Until next time be careful out there and know your risks.  K

When I first read the article in the Insurance Journal about using  Facebook and Twitter to communicate during disasters, I thought what a great idea. I think this would work well and should become the norm. It is  very common to use smart phones and portable computers to warn people of severe weather or tracking potential catastrophes. I think that FEMA and many State emergency management systems should include this type of technology in their plans. it only makes sense as the world uses more and more mobile computing and wireless access to run their lives. A great idea !   Until next time be careful out there and know your risks. K

In Maryland a Baltimore county councilwomen is suing a blogger for 21 million for blogging about her residence. The issue arose from the blogger's posts that the councilwomen did not live in the district she was running for. This political tactic may have back fired as the councilwomen brought suit. This shows the increasing risks that cyber writers face. Right or wrong the blogger must defend themselves from the suit. In order to risk manage the internet,  bloggers and companies that use bloggers should buy insurance.Cyber insurance would pay for this defense and would also pay for any judgements. This product is still new and as claims arise and court cases are determined the coverage will get better defined. No matter how untested this type of insurance is,  companies and bloggers should look to purchase this coverage. Until next time be careful out there and know your risks. K

Risk is changing in the US. The insurance industry must adapt. This is the view of a lot of insurance professionals and has become self evident with recent events. As the world dishes out catastrophe after catastrophe the effects of interdependency and globalization are making these events more expensive. This is how risk is changing. Ten years ago a catastrophes that happened on the other side of the world did not affect the US insurance market that greatly. However today, the costs of dealing with catastrophes across the globe are coming home to rest on the American doorstep. The insurance industry must develop rates that will allow for growth and profits and still pay the claims that come with interdependent global risks. I hope the industry is ready. Until next time be careful out there and know your risks. K

Currently , Congress is debating an overhaul of the National Flood program. No matter what the terms of this overhaul become it is clear that it is needed. Flooding continues to plague the nation as rivers swell and destroy farm land and towns. And don't forget about the hurricanes that cause major flooding along the coastal areas. The NFIP needs to understand that this peril is going to continue to happen and fund the program accordingly. Also towns and cities need to put the flood risk in top priority and build and zone appropriately. Flooding will continue to happen but collectively the risk can be substantially reduced by a strong NFIP and a knowledgable community. Until next time be careful out there and know your risks.  K             

It seems that one good thing has come out of gas prices being over $4 a gallon. The NTSB has reported less auto accidents over the last few months. This is an interesting development in the risk and insurance world and I have a prediction. For the remainder of the year gas prices will continue to rise. As less people drive on the roads the accident rates will continue to fall. Insurance companies will have to reduce rates because the actuaries will give them numbers with less claims. As auto insurance rates fall, the insurance consumer will have some relief of their gas bills by paying less in premiums. Interesting thought right?  Lets see how it plays out. Until next time be careful out there and know your risks.  K