Latest news with #NationalAssociationofInsuranceCommissioners
Yahoo
28-05-2025
- Business
- Yahoo
Why isn't Gen Z buying insurance?
As Gen Z comes of age, it is quickly becoming one of the most influential consumer groups in the global economy. Born between 1997 and 2012, this digital-native generation is known for its tech savviness, pragmatic approach to money, and social consciousness. But one sector that is still struggling to capture its attention is insurance. A 2024 study by the National Association of Insurance Commissioners (NAIC) found that fewer than 21% of Gen Z adults carry renters insurance. Life insurance rates are even lower. A study conducted by Smart Money People in March 2024 revealed that Gen Z falls behind other generations when it comes to key insurance products. Only 5% have contents insurance, 24% have life insurance, and 30% have travel insurance. This disengagement stems from more than just apathy. Gen Z is navigating an unstable job market and a challenging economic reality, from rising housing costs to student debt. In this environment, insurance can seem like a luxury or merely something to think about later. Gen Z-ers are sceptical of traditional financial institutions. They are digital natives who have grown up amid economic instability and online misinformation. Many see insurance companies as opaque, profit-driven entities that make it hard to understand coverage and even harder to file a claim. There is also a common belief among young people that insurance is only necessary when you are older or have a family. The mindsets of 'I am healthy and don't need life insurance' or 'I'll worry about contents insurance if something happens' help contribute to underinsurance. Many Gen Z individuals do not fully understand the value of insurance or trust insurance providers. A poll indicated that two-thirds of respondents from this age group believe that a lack of understanding or trust is a significant barrier to purchasing insurance. More worryingly, a considerable portion of Gen Z (48.1%) reported not thinking about insurance at all or assuming it was covered by other platforms they use. The current disconnect represents a unique opportunity for the insurance industry to reinvent itself and meet Gen Z's needs. Insurers can start by teaming up with content creators on TikTok, Instagram, and YouTube to break down insurance myths in relatable ways. Bite-sized videos explaining renters' insurance or how deductibles work would make a big impact. Gen Z has grown up in a digital environment where easy payments and streamlined processes are expected. They demand simple payment options such as mobile-first channels and digital wallets when considering any insurance purchases. Insurers should create flexible insurance products in the form of micro-policies, such as insuring a phone for a week, bundling lifestyle-specific coverage, or covering gig income for a month. Subscription-style pricing and the ability to turn coverage on and off digitally will appeal to Gen Z's needs and flexibility. The combination of low homeownership rates, financial constraints, a lack of understanding about insurance, a demand for digital solutions, and a perception that insurance is a low priority contributes to Gen Z's hesitance to purchase. Insurance providers must adapt to these dynamics to effectively engage this new generation. Gen Z is not anti-insurance, they just do not see themselves reflected in how it is traditionally sold. To earn their trust and loyalty, the industry needs to simplify, digitize, and humanise its offerings. This should be more than a marketing shift but a total transformation of its business mindset. "Why isn't Gen Z buying insurance?" was originally created and published by Life Insurance International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
09-05-2025
- Business
- Bloomberg
Disaster spending hits new highs
Costs rise to 3.3% of GDP, with Carolinas hardest hit Climate-related costs have risen to a record in dollar terms over the past year, but as a percent of GDP the 3.3% is still slightly less than in 2017 (Hurricanes Harvey, Irma) and 2005 (Hurricane Katrina). At the state level, North and South Carolina were particularly hard hit by Hurricane Helene, which caused over $78 billion in economic losses, equivalent to around 8-9% in local GDP terms, according to BI's Climate Damages Tracker. Peril premiums hit $310 billion, but cushion eroding The rise in fires, floods and storms has forced insurers to reprice risk over the past several years, raising rates by as much as 22% in 2023 and pushing total multi-peril premiums (home, fire, commercial, farmer and allied lines) above $300 billion, according to the National Association of Insurance Commissioners. S&P Global expects premiums to rise 6.2% in 2025. The P&C industry has struggled to price these risks in a way that secures a stable stream of returns. Net premium after loss (total premiums less insured payouts) fell below zero in 2017 and approached zero three times in the past few years. The big 2023 rate hikes helped create a buffer for Allstate and other P&C insurers, but the cushion has been eroded in recent months by developments including an estimated $40 billion bill for the LA wildfires. Government spending starting to fade from sight Federal and state governments have provided nearly $1.3 trillion over the past 20 years to local communities to help them recover sooner from fires, floods and storms. Stimulus measures like the IRA and the infrastructure law have provided the most support ($600 billion), followed by FEMA ($320 billion) and the Department of Housing and Urban Development ($180 billion). States contributed $132 billion, largely in the form of matching funds. Though these funds have provided a needed lifeline to states, most of the programs are winding down, with President Donald Trump signaling that he wants states to take more responsibility for recovery efforts. Texas hardest hit by climate followed by California Total climate-related costs in the US have totaled $10 trillion over the past 20 years, according to the BI Climate Damages Tracker. At the state level, Texas has been hardest hit in dollar terms, with$1.1 trillion in costs, followed by California ($938 billion) and Florida ($763 billion). Though these costs are substantial, the overall size of these states' economies ($10.4 trillion combined) means the impacts on a GDP basis are generally lower than for lower-GDP states like Louisiana ($425 billion in damages, with a $327 billion GDP in 2024). How does BI's damages tracker calculate spending? In an effort to capture how climate-related costs flow back into the economy, the BI Damages Tracker assigns different spending curves to different types of costs. For example, insured losses, which are generally paid out over one year, with the majority paid in the first six month, are calculated using a 12-month gamma curve, which skews spending toward the first few months following the event. In this same way, uninsured losses are calculated using a 24-month gamma curve, and government spending is assessed with a 36-month gamma curve, which is based on distributions reviewed in federal spending reports.
Yahoo
10-04-2025
- Business
- Yahoo
Investigation finds homeowners left in limbo after insurance companies drag their feet on claims: 'Just feel completely ignored'
A Florida law aimed at stabilizing the insurance market may have created an even worse situation for policyholders, leaving them with limited recourse as insurers keep them in limbo. An investigation by WPTV revealed that insurance companies in the Sunshine State have been dragging their feet for months before addressing claims. For Brittani Littlejohn, whose home was ravaged by an EF-3 tornado, that meant months of reaching out to her insurance company, only to be ghosted after filing a claim before WPTV's investigative team stepped in. Littlejohn isn't alone in this experience. "We're hearing these stories all the time of people who just feel completely ignored by their insurance companies," said West Palm Beach insurance attorney Aaron Bass. Attorney intervention often helps move the needle, but Bass explained that a 2022 Florida law preventing policyholders from recouping attorney fees has created a "lose-lose" situation for consumers making claims. Jimmy Patronis, Florida's chief financial officer, supported that assessment, telling WPTV that the state had seen abuse in the system, with "some attorneys claiming absolutely ludicrous fees." As insurers pull out or reduce coverage in many areas of the country, premiums are also increasing where they remain, making homeownership a distant dream for many and increasing the period of economic upheaval in communities recovering from natural disasters. As the National Association of Insurance Commissioners explains, the exorbitant premium hikes are linked in part to more frequent and severe extreme weather. This is true even in places such as Iowa, not traditionally considered as high risk as states such as Florida, which deals with hurricanes. "Insurance companies do not make money from your premium dollars," Bass explained to WPTV. "They make money by taking your premium dollars and investing it. The longer they hold onto those dollars, the more money they make. The longer they can stretch these things out in litigation, that's their tactic so that people just give up." State officials have taken emergency action to help protect residents from post-storm insurance fraud. For example, before Hurricane Milton made landfall in October, they issued a decree requiring adjusters to provide line-by-line written breakdowns of estimated losses, helping ensure transparency in a system with strict regulations about changes to initial estimates. Do you think America is in a housing crisis? Definitely Not sure No way Only in some cities Click your choice to see results and speak your mind. More recently, when WPTV investigative reporter Kate Hussey asked Patronis if the insurance market could find a "middle ground," Patronis conceded that 2022's legislation may have been an "overcorrection of the system" and expressed optimism that there could be improvement. He pointed to pending legislation that would mandate mediation between policyholders and property insurance companies for claim disputes before being eligible for court. This is meant to prevent clients from being left without answers for months on end. If you want to make your voice heard on these matters, you can contact your representatives and raise awareness about the issue in conversations with family and friends. Join our free newsletter for good news and useful tips, and don't miss this cool list of easy ways to help yourself while helping the planet.
Yahoo
18-03-2025
- Business
- Yahoo
Florida Home Insurers Shifted $2.1 Billion off Their Books in 2023
PALM BEACH GARDENS, Fla., March 18, 2025 /PRNewswire/ -- While Florida legislators launch an investigation of Florida-domiciled insurers that moved billions of dollars off their books between 2017 and 2019, Weiss Ratings has just completed a landmark study showing the practice has accelerated in recent years. In 2023, the last year for which complete data is available, Florida-domiciled insurers that wrote homeowners policies transferred $1.8 billion to affiliates for expenses plus another $335 million to investors via dividends, or a total of $2.1 billion that was unavailable to pay claims.* "If they're moving billions, it makes you wonder how they can do right for policyholders" said Dr. Martin D. Weiss, founder of Weiss Ratings. "So, it should come as no surprise that the data we're revealing today dovetails with our report that Florida insurers closed nearly half of hurricane and other damage claims with no payment whatsoever to policyholders, also in 2023." There's nothing fundamentally wrong with doing business with affiliates or paying dividends to investors, even if the vast majority are out of state. However, Florida-domiciled insurers have pursued both avenues far beyond the national average. In 2023, Florida-domiciled companies paid 20.4% of their expenses to affiliates, a rate that's the highest since 2014 and four times higher than companies outside of Florida. Florida-domiciled companies have also broken from the national norm with their dividend payments to investors. While almost all companies in other states pay dividends out of profits, many Florida companies have continually paid large dividends despite losses. In 2021, Florida-domiciled companies reported an aggregate loss of $522 million, but paid dividends of $295 million. In 2022, they lost $778 million, while still paying out $213 million in dividends despite the flood of red ink. And in 2023, with a meager profit of $160 million, they paid out $335 million in dividends, or more than double their profits. "This pattern of behavior is unfortunate for homeowners," Weiss concluded. "Strangely, companies often question the source of our information, but it's from their own official statements they file with the states and the National Association of Insurance Commissioners. It's damning data, and I trust it will be thoroughly investigated by the legislature." About Weiss Ratings: Weiss covers 53,000 institutions and investments, including safety ratings on insurers, banks and credit unions as well as investment ratings on stocks, ETFs, mutual funds and cryptocurrencies. Since its founding in 1971, Weiss Ratings has never accepted any form of payment from rated entities for its ratings. All Weiss ratings are available at The U.S. Government Accountability Office (GAO) reported that the Weiss ratings of U.S. life and health insurers outperformed those of A.M. Best by 3-to-1 in warning of future financial difficulties, while also greatly outperforming those of Moody's and Standard & Poor's. The New York Times reported that Weiss "was the first to warn of the dangers and say so unambiguously." Barron's called Weiss Ratings "the leader in identifying vulnerable companies." * Florida's state-run Citizens Insurance, which does not report fees to affiliates or pay dividends, is not included in this study. For media inquiries contact Nicole Brown, 561-291-9625 or nbrown@ View original content to download multimedia: SOURCE Weiss Ratings Sign in to access your portfolio
Washington Post
17-02-2025
- Business
- Washington Post
When's the last time you looked at your home insurance policy?
A rise in your home's value is cause for celebration, but it should also give you pause. Odds are you might need to upgrade your homeowners insurance to cover your now more expensive home. 'Lots of people fall into the trap of getting their mortgage and home insurance and then it's out of sight, out of mind,' says Chris Schafer, the Minneapolis-based senior editor for home insurance at Insurify, an insurance marketplace. If a similar home in your neighborhood sells for more than you expected, or you receive a tax assessment with a big boost in property value, it's a good time to check in with your insurance agent to avoid getting burned by a big out-of-pocket cost in an emergency. We spoke with experts on how to make sure you have enough coverage — and what to do if you don't. Here's what they had to say. 'We've all seen a run-up in home values in recent years, along with inflation that has increased the cost of materials and labor,' says Jon Godfread, the insurance commissioner for the North Dakota Insurance Department and president of the National Association of Insurance Commissioners. 'That means the cost to repair or replace your house is likely to be more expensive than when you first purchased your homeowner's insurance.' Unfortunately, many people don't think about their insurance until a hurricane, a fire, a flood or an intense hailstorm happens. But that's a mistake, because you could be caught up short in an emergency. 'People put a lot of trust in their insurance agent and assume they can get homeowner's insurance and forget it,' says Sean Kent, senior vice president of property and casualty insurance at FirstService Financial in Fort Washington, Pennsylvania. 'If you haven't looked at your policy in five years, you're probably woefully underinsured,' he adds. Kent recommends reviewing your insurance coverage at least every two or three years; Godfread suggests checking it annually, when your insurance policy renews, to look for potential gaps. Start by comparing your coverage amount with an estimate of your home's value but remember that you don't need to include the land value — your lot will still be there even if your house is destroyed. Read the list of perils you're insured for, along with optional available coverage for things such as floods, earthquakes or wildfires that aren't typically included in a policy. Ask your agent to help you estimate the replacement cost of your home and what additional coverage you might need. And don't let fear of increased premiums keep you from checking, he adds. 'Not having the right insurance or enough coverage could be financially devastating,' Godfread says. 'And policy upgrades don't always raise your premiums as much as people think.' Reach out to your insurance company any time you remodel or renovate your home, Schafer says, particularly if you add square footage. 'If the insurance company doesn't know you have a new sunroom or an extra bedroom, you don't have any insurance coverage for that space,' Schafer says. 'Same if you upgrade your kitchen. If you don't let them know, you might find that your insurance claim will pay $300,000 but it will cost you $450,000 to replace your home. In that case, you'd have to pay the $150,000 out of pocket.' You also need to consider updates after making large purchases. If you haven't done it already, record a narrated inventory of everything in your home on your cellphone. You can share the video with your insurance agent to help determine how much coverage you need for possessions, Godfread says. Adding safety features could also affect your rate. 'You should always let your insurance company know if you've taken steps to protect your property, such as getting a doorbell camera, adding dead bolts or trimming trees around your house,' Kent says. 'They may give you a discount because it lowers the risk of a claim.' Most insurance companies offer standard coverage for 'perils' such as fire, theft and storm damage, but all policies are not the same. 'It's important to think about the perils that are most common where you live and discuss them with your insurance agent to see if you have the protection you need,' Godfread says. To figure out what special coverage you may need, Kent suggests talking to neighbors about problems they've had. 'Some of my neighbors have had problems with underground pipes leaking, so I asked my insurance agent to make sure I have coverage for that,' he says. Two big coverages many homeowners lack are flood insurance and earthquake insurance, Schafer says. Your lender will tell you if your property is in a designated flood zone, but you don't have to live in one to get flood insurance from FEMA or a private insurance company, he says. 'As we've seen in the last few years, floods can occur far from coastlines or other places that typically flood,' Schafer adds. Flood insurance premiums vary by your location and risk factors and are typically lower if your area is less prone to flooding. Many real estate listings now include information about floods and other risks, or you can ask your insurance agent about potential issues in your area. Earthquake coverage typically requires a separate policy and often includes 'earth movement' incidents, including landslides and sinkholes, Schafer says. Also check your fire coverage. 'Some policies cover wildfire, and some don't, so you need to check your policy and add optional coverage if you live in an area where wildfires may occur,' he says. Many people have mistaken ideas about how their coverage works. Here are some of the biggest myths: Insurance companies have raised premiums, declined to renew policies for customers and raised deductibles for specific issues such as hail or hurricane damage in the wake of more frequent and severe natural disasters, Kent says. If your rate has gone up, consider getting estimates from other companies. 'Even if you decide to stick with your company, you may learn about coverage options that you need or that you should increase the amount of your insurance,' Kent says. Yes, you might end up spending more money: The cost to upgrade your coverage from $300,000 to $400,000 averages $400 annually, Schafer says. But, he adds, it is well worth the money to have financial protection — and peace of mind — in a disaster.
