Insolvency: What was the actuary’s role?

Time Flies Department: The Reliance Insurance insolvency turned 10 this year, and Best’s Review (sub. req., I think) was all over it. Reliance was one of three big insurers that went under in a 10-month span ending in March 2002, the others being Legion Insurance and Phico. The accompanying chart, which ranks the largest insolvencies [...]

Citizens Property and investment income

Actuarial Outpost has picked up my post about how Florida’s state HO insurer, Citizens Property, can’t remain solvent through a substantial storm. The very sensible Outpost question  – what about the investment income? Unfortunately, as this snip from the 2011 budget (around page 12 of this pdf) shows, Citizens posts net investment losses: That line [...]

In UK, auto premiums rise 40%

Jaw-dropping increases in auto insurance in Britain, as News-insurance.com reports: Over the first quarter of 2011 – a period when premiums usually show little movement – the typical Shoparound premium for a comprehensive car insurance policy rose by 5.9% to £892.08; and by 40.1% for the 12 months ending 31 March 2011. $1.62 buys a [...]

Commercial rates flat, Towers says

It’s the eighth consecutive quarter (actually a 1% decline). Five lines – commercial property, professional liability, D&O liability and EPLI all showed declines for the fifth quarter in a row. Small and mid-market accounts were flat; large and specialty accounts showed declines. The survey also indicated AY10 loss ratios are 5 points higher than in [...]

Allstate’s actuarial astrology

So today I prove that actuaries can ruin any joke. Last week, Allstate tapped its mighty database to figure out which sign of the Zodiac had the best drivers. The results, according to a company press release: Virgos, known to be critical, meticulous and reserved, are also more likely to get into a car accident, [...]

Another win for predictive modeling

Towers Watson again hails predictive modeling. National Underwriter summarizes: Nearly 90 percent of U.S. insurance companies said the use of predictive modeling enhanced rate accuracy in 2010, according to the results of a survey conducted by Towers Watson. The global professional services company reported that 70 percent of companies said the same in 2009. The [...]

Attention, sports fans: When they’re not winning, NY teams lose

Today’s New York Times laments the woeful situation in New York sports: ¶The Knicks were founding members of the N.B.A. They play in Madison Square Garden — the world’s most famous arena, or so the slogan goes. But their record goes like this: two titles in 64 seasons, the last in 1973. So much for [...]

WC experience rating passes test

Wonky, but this is a blog for actuaries: In 2009, California approved new ballast weights (B and W) for workers compensation to improve the rating plan. So far it seems to be working. I’d describe the study more, but Insurance Journal, channeling the Workers Compensation Insurance Rating Board, does just fine: [A WCIRB analysis] shows [...]

Medmal results could get real nasty real fast

Writing in National Underwriter, Milliman actuaries Richard Lord and Stephen Koca look at the how much current medmal results are propped up by releases of prior year reserves. As the accompanying bar graph indicates, reserve releases in each of 2008 and 2009 accounted for an almost 25 percentage point reduction in the MPL industry aggregate [...]

NCCI: WC frequency keeps dropping

The frequency of claims per 100,000 workers fell 4.0% in 2009 and likely kept falling this year, though claim size keeps growing. Business Insurance passes along the highlights of NCCI’s analysis (pdf). Since 1991, frequency is down nearly 55%. Check this table of frequency change by year: NCCI has plenty of reasons, which I crib [...]