Canadian Underwriter


May 1, 2014   by Canadian Underwriter

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Quindell, U.K. firm to partner on car offering

Insurance technology firm Quindell has partnered with RAC, an auto services and insurance firm in the United Kingdom, to create a new business to distribute Quindell’s telematics technology.

Including a £30-million investment split fairly equally between the firms, Connected Car Solutions Limited will market and distribute the combined telematics capabilities of the two companies throughout the U.K., Europe and Canada. Quindell reports that an additional £70 million will be invested in the longer term, “subject to key milestones.”

The roll out of the telematics proposition to 2.1 million RAC individual members will begin in July; the overall medium- to longer-term target is a subscriber base of 12 million, each paying between $5 to $15 a month. 

New cat loss index provider in Canada

A new independent catastrophic loss index provider has launched in Canada to provide detailed analytical and meteorological information on Canadian natural and man-made catastrophes to both the insurance and reinsurance industries.

Catastrophe Indices and Quantification Inc. (CatIQ) has an online subscription-based application that provides comprehensive insured loss indices, granular industry-wide loss estimates, Geographic Information System (GIS) mapping and other related information.

CatIQ’s loss indices have access to exclusive market share information provided by insurance analytics firm MSA Research Inc., a sister company. “It is essential that insurers have access to reliable, detailed and complete catastrophe data in order to better understand, underwrite, manage, price, reserve, monitor, quantify and transfer catastrophe risk,” says Joel Baker, chief executive officer of CatIQ.

GPL Assurance acquires JLT Canada’s Quebec arm

GPL Assurance Inc. has acquired the Quebec business of Jardine Lloyd Thompson Canada, making it JLT’s exclusive broker in Quebec and a member of the JLT International Network.

“This transaction cements GPL’s position as a growing force in the Quebec general insurance and risk management solutions market,” says Louis-Thomas Labbé, president and chief executive officer of GPL.

The transaction was scheduled to close April 30. 


No weather cats in Canada in 2014 Q1: PCS

2014 represents the third consecutive year in which PCS has not declared any weather catastrophes in Canada for the first quarter of the year, considerably different than the six catastrophe events south of the border that produced US$2.2 billion in insured losses.

“Catastrophe 25, a winter storm designation from December 22 through December 26, 2013, was the last catastrophe designated for Canada, with nearly 28,000 claims and approximately $194.1 million in losses,” Insurance Services Office Inc.’s (ISO) PCS notes in a new report.

PCS, a subsidiary of Verisk Analytics Inc., collects data on weather disasters in Canada and the United States. The review notes that in 2009, 2010 and 2011, Canada witnessed one weather catastrophe event in the first quarter of the year, but none in 2012 or 2013.

In the U.S., the “polar vortex” caused more than US$1.5 billion in insured losses in 17 states, the three hardest hit being Georgia (US$318 million), New York (US$296 million) and Pennsylvania (US$219 million). Of the total polar vortex insured losses, 73% was personal, 26.7% was commercial and 0.3% was auto.

Value of fraudulent household content claims highest in decade

The value of the average fraudulent household content claim in the last quarter of 2013 stood at $2,255, its highest level since records began in 2004, notes the latest counter-fraud index from VFM Services Ltd.

The figures suggest people are becoming more sophisticated in their approach to fraudulent claims, says Sally Griffiths, services director for VFM, which operates in the United Kingdom, Australia and Canada.

The peak in the value the average fraudster is claiming on his or her household insurance “is largely because claims values for opportunistic fraud are historically quite low and people are realizing that any gain to be made by getting away with a fraudulent claim on their household policy is being negated by the cost of the excess on their policy,” Griffiths says. 


IBC supports Ontario’s draft towing bill

The Insurance Bureau of Canada (IBC) has lent its support to draft Ontario legislation meant to combat auto insurance fraud by aiding disclosure and enhancing transparency for consumers requiring towing services.

Characterizing the Roadside Assistance Protection Act, tabled in mid-April, as long overdue, IBC reports that such

proposed changes would bring clarity to consumers with their interaction with tow truck operators.

Ontario’s Ministry of Consumer Services noted at the time the draft legislation and supporting regulations, if given the green light, would require tow truck operators and storage providers to have permission from a consumer or someone acting on his or her behalf before charging for towing and storage services; publicly post prices and other information, such as operator’s name and contact information; accept credit card payments; and provide an itemized invoice listing the services provided and the total cost.

SGI seeks input on auto injury program

SGI is seeking feedback as part of a review of its auto injury program, designed to ensure the “program is still effectively meeting the needs of Saskatchewan residents,” says SGI president and chief executive officer Andrew Cartmell.

The last full review was done more than a decade ago.

For the first stage of the review, SGI is contacting customers with a current or former auto injury claim, health care and other service providers, the legal community, and other stakeholders. Recommendations made by the Motorcycle Review Committee pertaining to injury coverage options will also be incorporated.

In the second stage of the review, planned to begin in late summer, options will be developed and put forward to the public for feedback.

Once all feedback is gathered, a report will be prepared by the end of 2014.

Alberta supports “voluntary discount” program for telematics

Before carriers can roll out telematics-based auto insurance in Alberta, the issue of “informed consent” from consumers will need to be addressed, the Automobile Insurance Rate Board notes in its annual report.

“A number of insurers and other stakeholders have approached the board about introducing their version of (usage-based insurance) to Alberta,” the report states.

“The board is supportive of UBI as a voluntary discount program. However, entry into the Alberta market will require the approval of the Superintendent of Insurance as this product introduces new rating factors. The issue of informed consent by Alberta consumers must be satisfactorily addressed prior to the introduction of any programs.”

The ability of insurers to monitor driving behaviour “can work to reduce claim costs by providing incentive to modify driving behaviour.”


Quebec insurer launches mobile app for reporting auto, home claims

Quebec insurer SSQauto has launched a new smartphone app for submitting auto and home insurance claims.

The free app includes three modules: joint report (for an accident scene involving two vehicles); auto insurance claim (one vehicle involved); and home insurance claim. The app is also available to the general public.

A user can enter basic information, take a photo of his or her driver’s licence and proof of insurance, and use geolocation to find the exact location of the accident, as well as record a statement
of events. Information is then sent to the parties involved.

For SSQauto insureds, the claims adjuster will receive all the information required to begin processing the claim; people who are not insured with SSQauto will receive the same accident information, which they can then forward to their insurers. 


Cyber threats a “big focus” for reinsurance industry: Dickson

Reinsurance companies must pay “significant attention” to ongoing cyber threats, Julie Dickson, head of the federal Office of the Superintendent of Financial Services (OSFI), noted in a recent speech.

“The reinsurance industry, like many others, faces ongoing cyber threats, including challenges with data administration and other technology issues,” state prepared remarks by Dickson.

“Adequately addressing and mitigating these risks requires an active and dynamic approach that many institutions have already adopted or are planning to in the near future.” 

Mega breach cyber attack more common

A new report from IT security firm Symantec Corporation indicates cybercriminals are plotting for several months to pull off major breaches for larger rewards, rather than “executing quick hits.”

“One mega breach can be worth 50 smaller attacks,” says Kevin Haley, director of Symantec Security Response.

The company’s latest Internet Security Threat Report shows 2013 saw a 62% increase in the number of data breaches over the previous year. 


Reinsurers see improved results in 2013: Fitch

Global reinsurers cited solid underwriting gains last year, as “catastrophe-related losses were manageable and loss reserve development remained favourable,” notes a recent Fitch Ratings report.

Among the global reinsurers that Fitch tracks, the underwriting combined ratio improved to 85.5% in 2013, from 89.3% in 2012. The improvement is, in part, the result of lower than average catastrophe losses in 2013 ($31 billion compared to $65 billion in 2012).

Solid underwriting profitability, however, was “offset by an adverse change in unrealized investment gain/loss position on fixed maturities and capital market activity,” the report adds.

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