Category: Insurance

A climate nonprofit plans to revive a key federal database tracking billion-dollar weather and climate disasters that the Trump Administration stopped updating in May, Bloomberg reported.

The database captures the financial toll of increasingly intense weather events and was used by insurers and others to understand, model, and predict weather perils across the United States. Dr. Adam B. Smith, the former NOAA climatologist who spearheaded the database for more than a decade, has been hired to manage it for the nonprofit, Climate Central.

NOAA in May announced it would stop tracking the cost of the country’s most expensive disasters, those which cause at least $1 billion in damage – a move that would leave insurers, researchers, and government policymakers with less reliable information to help understand the patterns of major disasters like hurricanes, drought or wildfires, and their economic consequences.

Climate Central plans to expand beyond the database’s original scope by tracking disasters as small as $100 million and calculating losses from individual wildfires, rather than simply reporting seasonal regional totals.

A record 28 billion-dollar disasters hit the United States in 2023, including a drought that caused $14.8 billion in damages. In 2024, 27 incidents of that scale occurred. Since 1980, an average of nine such events have struck in the United States annually.

This summer – amid deadly wildfires and floods – the Trump Administration has appeared to be rolling back some of its DOGE-driven NOAA funding cuts. NOAA recently announced that it would be hiring 450 meteorologists, hydrologists, and radar technicians for the National Weather Service (NWS), after having terminated over 550 such positions in the already-understaffed agency in the spring.

In addition, the administration’s announced termination of the Building Resilient Infrastructure and Communities (BRIC) program — run by the  Federal Emergency Management Agency (FEMA) — has been held up by a court injunction while legislators debate its future.  Congress established BRIC through the Disaster Recovery Reform Act of 2018 to ensure a stable funding source to support mitigation projects annually. The program has allocated more than $5 billion for investment in mitigation projects to alleviate human suffering and avoid economic losses from floods, wildfires, and other disasters.

Regarding the rescue of the NOAA dataset, Colorado State University researcher and Triple-I non-resident scholar Dr. Phil Klotzbach said, “The billion-dollar disaster dataset is important for those of us working to better understand the impacts of tropical cyclones. It uses a consistent methodology to estimate damage caused by natural disasters from 1980 to the present and was a critical input to our papers investigating the relationship between landfalling wind, pressure and damage. I’m very happy to hear that this dataset will continue!”

Learn More:

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2025 Cat Losses to Date Are 2nd-Costliest Since Records Have Been Kept

CSU Sticks to Hurricane Season Forecast, Warns About Near-Term Activity

Russia Quake Highlights Unpredictability of Natural Catastrophes

Texas: A Microcosm of U.S. Climate Perils

Louisiana Senator Seeks Resumption of Resilience Investment Program

BRIC Funding Loss Underscores Need for Collective Action on Climate Resilience

JIF 2025: Federal Cuts Imperil Resilience Efforts

For at least the last half-decade, financial concerns have topped the list of concerns for nearly all industries. Rising costs, revenue pressures, and financial sustainability dominated risk conversations across law firms, tech companies, healthcare, and more. But 2025 marked a major shift in the legal profession’s risk landscape specifically, with a dramatic reordering of priorities that reveals an industry operating from a different foundation.

According to our 2025 Legal Risk Index, reputational risks and employment-related claims have tied for the top internal challenges facing legal professionals at 47% each, completely displacing the financial pressures that ranked #1 in previous years. This may not be just a statistical shuffle, but represent a transformation in how legal professionals think about vulnerability, success, and business sustainability.

The great reordering

The shift from financial concerns to reputational and employment challenges tells a story about an industry that has stabilized economically and can now focus on more complex operational risks. Where 58% of legal professionals cited “trouble with rising cost of business” as their primary internal risk in 2023, that concern has been replaced by fundamentally different challenges.

Reputational risks from public controversies, client disputes, or social issues now share the top spot with employment-related claims including harassment, wrongful termination, and discrimination cases. This dramatic reordering suggests that legal professionals have moved beyond survival-mode financial planning to strategic risk management focused on long-term sustainability and growth.

The implications extend far beyond simple priority shifts. Legal professionals are now operating in an environment where a single reputational incident or employment dispute can have consequences that dwarf traditional financial pressures. This new risk hierarchy reflects the reality of practicing law in an interconnected, socially conscious marketplace where public perception and workplace culture carry unprecedented weight.

Reputational risk: The new factor

Reputational challenges have evolved from occasional concerns to constant considerations for modern law firms. The ever-present nature of social media, online reviews, and instant news cycles means that reputational incidents can escalate quickly and have lasting impacts on client relationships, recruitment efforts, and business development opportunities.

Some examples of real-world reputational damage for law firms are still fresh in our recent memory:

• Cyber Attacks
• AI Malpractice & Misuse
• Compliance Concerns
• Employee Misconduct

Legal professionals are increasingly aware that reputation management isn’t just about avoiding scandals—it’s about proactively building and maintaining trust in an environment where public perception can shift rapidly. The 47% of legal professionals citing reputational risks as their top concern understand that reputation is both their most valuable asset and their most vulnerable point.

This focus on reputation reflects broader changes in how clients select and evaluate legal services. Increasingly, clients are more likely to research firms extensively, read reviews, and consider a firm’s public stance on various issues. Legal professionals have recognized that technical competence alone isn’t sufficient—they must also maintain positive public profiles and demonstrate alignment with client values.

If they can’t, the consequences can be dire. While insurance policies will cover financial damages from initial events such as cyber attacks, they often do not cover the fallout resulting from reputational damage and social inflation.

AI-related reputational vulnerabilities

The surge in AI adoption, from 22% to 80% among legal professionals, has introduced new dimensions to reputational risk that may be contributing to its prominence in the current risk hierarchy. AI-related malpractice incidents carry unique reputational risks due to heightened public interest and media attention surrounding artificial intelligence, creating what insurance and legal professionals call “social inflation.”

This social inflation effect occurs when certain incidents, such as AI-related malpractice, generate disproportionate public scrutiny, particularly around concerns that technology is replacing human judgment or that firms are prioritizing efficiency over quality. As a result, costs surrounding such an incident, mostly relating to lawsuits, balloon beyond traditional circumstances. A firm facing allegations that it relied too heavily on AI doesn’t just face a malpractice claim—it faces questions about its fundamental approach to practicing law, potentially explaining why 43% of legal professionals identify “over-reliance leading to professional liability risks” as their top AI concern while reputational risks have simultaneously risen to become the #1 internal challenge.

The financial foundation shift

Perhaps most significantly, the displacement of financial pressures suggests that the legal profession has achieved a level of economic stability that allows focus on higher-level strategic challenges. This doesn’t mean financial concerns have disappeared, but rather that they’ve been incorporated into broader business planning rather than dominating immediate risk considerations.

The normalization of economic uncertainty is evident in other data points as well. Inflation concerns, which worried 52% of legal professionals in previous surveys, dropped to just 28% in 2024. This suggests that persistent economic volatility has become a known quantity that firms have learned to manage, rather than an existential threat requiring constant attention.

This economic foundation has freed legal professionals to address more nuanced business risks that require strategic thinking rather than reactive management. The ability to focus on reputational risk and employment challenges indicates a profession that has moved beyond crisis management to strategic risk planning.

Navigating the new landscape

The shift to employment and reputational risk as primary concerns requires different risk management approaches than traditional financial pressures. These challenges require proactive planning, cultural development, and ongoing relationship management.

Successful navigation of reputational risks involves developing comprehensive communication strategies, monitoring online presence, and building positive community relationships before challenges arise. It requires understanding that reputation management is everyone’s responsibility, not just a marketing function.

Employment-related risk management demands equally sophisticated approaches, including regular policy updates, comprehensive training programs, and cultural assessments that go beyond compliance requirements. Legal professionals must create workplaces that not only meet legal standards but also foster positive employee experiences and align with contemporary workplace expectations.

Of course, these risks are incredibly nuanced and cannot be solved-for in two paragraphs. For more information on how to assess risk in your law practice, check out our Law Firm Risk Assessment Guide.

The road ahead

The elevation of employment and reputational risk signals a legal profession that has matured beyond basic financial sustainability to focus on sustainable excellence. This shift represents both challenge and opportunity—legal professionals must develop new competencies while leveraging their improved economic position.

Understanding and adapting to this new risk hierarchy will be essential for legal professionals seeking to thrive in an increasingly complex business environment. The firms that recognize reputational risk and employment management as strategic priorities, rather than peripheral concerns, will be best positioned for long-term success.

The complete picture of how legal professionals are navigating this transformation, along with detailed strategies for managing these new primary risks, is available in our comprehensive 2025 Legal Risk Index.

Risk used to be relatively simple.  If a local bakery wanted insurance, you would worry about the structure, the location, how it operated and could have a pretty good view of its risk profile.  Today that same business is far more complicated and interconnected:

• Third party Point of Sale systems are used to process transactions
• Businesses have a web presence and do a lot of online and even cross state sales
• They manage payroll, benefits, and accounting using software-as-a-service providers
• They have supplies for special boxes, ingredients, and favors that are sourced globally

Each of these additional connections and interconnectedness increases potential business interruption, liability, and sometimes even the property risk of the company.

A spider’s web of risk

As this demonstrates, risk is everywhere these days and growing all the time. The annual Accenture Pulse of Change Index found the rate of change affecting businesses has risen steadily since 2019 – 183% over the past 4 years. Never before has the risk landscape been so complex – a veritable spider’s web of interconnected disruption. This is born out in our annual Accenture Risk Survey where nearly nine in ten (88%) insurance respondents say complex, interconnected risks are emerging at a more rapid pace than ever before. Insurers identified financial, regulatory and compliance, and operational risks as the top rising risks, all having a knock-on effect on each other. Additionally, 84% of insurers say risks from other sectors are now impacting their business as companies and industries become more interconnected. Underlining the severity of risk interdependencies, our global study participants flag that individual risks can rapidly morph into strategic and existential threats.

When the business of risk is a risky business

When it comes to critical risks like cyber or NatCat, there is a lack of certainty when it comes to accurate forecasting on whether the losses will outpace premium charges, leading insurers to increasingly choose to pull back and restrict coverage. One extreme example of this new risk landscape would be to examine the potential consequences to the cyber insurance industry were one of the major cloud providers to have  an outage. This could be worse than a NatCat 5. Given insurers are impacted by risk from three different angles: 1) as risk-takers providing risk transference to insured, 2) as investors with large amounts of premium invested in these sectors and 3) as enterprises with their own operational risks, risk management capabilities that can evaluate, balance and respond to this complex landscape become even more decisive for success.

To exemplify this, consider an event such as a port fire shutting down a major pier.  The carrier may be on that core risk and have an insured claim.  They could also have other insureds that are impacted due to the delay in goods.  The carrier may also have investments in some of these companies that are impacted because of the financial impact.  And the carrier might have equipment or supplies delayed that also impact operation.

Risk management capabilities behind the curve

Despite their efforts, insurers are not properly prepared to address this situation for multiple reasons.  First, they lack the consolidated data to be able to evaluate the risks.  72% of our insurance respondents say their risk management capabilities and processes have not kept pace with the rapidly changing landscape. At 30%, the use of cloud to derive value from data is low but this is likely due to the fact that insurers don’t have enough risk data in the cloud. The core data is not captured with risk characteristics locked away in PDFs and manuscript endorsements not readily accessible. 22% cite data quality as the top challenge they face when it comes to generating insights from data. 18% cite even more fundamental data availability.

Second, even when they have the data, they don’t have the right access or tools to assess it. 17% of the executives say they still do not get satisfactory results in eliminating data silos. Therefore despite the data existing, it is still not readily available for practical use, not to mind interpreting and gaining insights from it.

And third, they lack the skills and technology to make use of it. 22% cite lack of relevant skillsets as the top challenge while 17% cite legacy technology as the biggest hindrance.

Risk management leaders are emerging

There is hope for better risk management in the future to meet these needs. 28% of insurers are already starting to use generative AI to process and derive value from data which at this early stage is promising. Plus our study did identify a group of risk leaders (14.5%) across our global respondent base with advanced risk capabilities. The difference between leaders and laggards when it comes to risk comes down to both the speed of identification and more importantly, the speed to action. These risk leaders are better at detecting and mitigating threats than peers with less mature capabilities. They are also more likely to take actions that strengthen their risk capabilities and are far more satisfied with those actions.

In support of those leaders, our Fuel the future of insurance through technology report cites technology and platform modernization and predictive analytics as the main drivers to deliver profitable growth for insurers.  The eradication of tech debt could yet be the defining KPI of generative AI.

Connect the dots to empower the business

How far does risk management percolate through the entire insurance company? How well do you know what the exposures are? And once detected, what is the speed of response?

This is dependent on integration of risk processes, resources and capabilities. To give just one example, ensuring guidelines and renewal profiles are updated appropriately. Although 75% of the study’s insurance participants say the business outside the risk function is becoming more aware of the impact of new and interconnected risks, much more needs to be done to create an organizational risk culture and mindset. The same percentage (75%) say the risk function is struggling to support the wider business in developing a risk mindset and just 36% are very satisfied with the wider business strengthening its risk capabilities to improve business resilience.

Spinning risk into opportunity

In response to a demanding risk environment, insurance risk functions are prioritizing multiple initiatives. Top among these are implementing technologies to improve decision making (36%), bringing new skills into the risk function (36%) and keeping the board and C-suite informed on emerging risks (36%). While this is all good, superior risk management activities need to focus on bringing the identification and response to risk issues to the frontline underwriting and claims processes to have the most impact in order to have the risk function better contribute to business success.

However, insurance risk functions may be juggling too many priorities. Further symptomatic of this is that the majority (78%) of insurance respondents want their teams to devote more time to value creation and innovation, which would be the next frontier, but there are roadblocks. Over seven in ten (73%) say risk professionals are not sufficiently connected with the business to do so and 80% say balancing existing duties with value-adding activities is a major challenge.

A ‘Back to the future’ model is no longer fit for purpose

We can no longer let the past predict the future. Traditionally, insurers have set their rates based on past prediction models. This alone is no longer viable.

The importance of data cannot be over-emphasized – both in the detection and mitigation of risk and to inform decision-making when it comes to an action plan both at the enterprise and the individual transaction level. According to our Transforming Claims and Underwriting with AI report, insurers have access to an underutilized asset in the massive volumes of structured and unstructured data they collect from items such as vehicle telematics devices, Internet of Things devices, interactions with customers, third party databases and more.  ​

Having the right data lake architecture in place can allow for elimination of silos, faster data ingestion and cross-pollination of data across departments required to fuel predictive analytics. The ideal state is to be able to provide the front line underwriters, claims analysts, and decision makers with the risk-aligned insights to make more informed decisions.  In this way, we can equip the company to truly manage these interconnected risks. Without it, the web of interconnected exposure is only going to grow and we will be blinded by the true exposures we are assuming. This isn’t a risk that can be easily avoided or transferred. It only can get better with action. 

Disclaimer: This content is provided for general information purposes and is not intended to be used in place of consultation with our professional advisors. Copyright© 2024 Accenture. All rights reserved. Accenture and its logo are registered trademarks of Accenture.

Colorado State University researchers are standing by their prediction for a “slightly above-average” 2025 Atlantic hurricane season, while warning of heightened tropical activity over the next two weeks.

 Led by Dr. Phil Klotzbach, senior research scientist at CSU and Triple-I non-resident scholar, the team maintains their forecast of 16 named storms, eight hurricanes, and three major hurricanes through November 30. The forecast calls for 115 percent of average hurricane activity compared to the 1991-2020 baseline, a decrease from 2024’s 130 percent. However, the immediate outlook is more concerning, with a 55 percent chance of above-normal activity through August 19.

Current activity includes Tropical Storm Dexter, which formed off North Carolina on August 3 and may strengthen to Category 1 status as it moves into the Central Atlantic. The National Hurricane Center is also monitoring a new system labeled Invest 96L in the Eastern Atlantic. The term “invest” is a naming convention used by the National Hurricane Center to identify a system that could develop into a tropical depression or tropical storm within the next seven days. The designation allows the agency to run specialized computer forecast models to track the area’s potential storm development.

The heightened forecast stems from unusually warm tropical Atlantic waters.

“Weaker winds over the past few weeks have reduced evaporation and ocean mixing, leading to faster warming,” Klotzbach explained. These warmer waters provide more fuel for hurricane development and create atmospheric conditions that favor storm formation.

Major hurricane landfall probabilities remain elevated: 48 percent for the entire continental U.S. coastline, 24 percent for the East Coast, and 31 percent for the Gulf Coast — all above historical averages.

Learn More:

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BRIC Funding Loss Underscores Need for Collective Action on Climate Resilience

JIF 2025: Federal Cuts Imperil Resilience Efforts

Louisiana Senator Seeks Resumption of Resilience Investment Program

Study Touts Payoffs From Alabama Wind Resilience Program

Resilience Investments Paid Off in Florida During Hurricane Milton

Hurricane Helene Highlights Inland Flood Protection Gap

Weather Balloons’ Role in Readiness, Resilience

Why Roof Resilience Matters More Than Ever

FEMA Highlights Role of Modern Roofs in Preventing Hurricane Damage

ClimateTech Connect Confronts Climate Peril From Washington Stage

A range of factors are impacting the decisions and strategies of the leading insurance program administrators and carriers.

1. Technology and digital transformation

• AI and automation: Over 75 percent of US insurers have implemented generative AI in at least one business function. AI is widely used for claims processing, risk assessment, fraud detection, and customer service, driving efficiency and reducing costs. AI-driven anti-fraud solutions are expected to save the industry tens of billions by 2032.
  
   

• Cloud adoption: Cloud-based platforms now account for half of all third-party administrator (TPA) deployments, enabling scalability, integration, and real-time data access.
  
   

• Embedded insurance: The distribution of insurance at the point of sale (e.g., via real estate or automotive platforms) is rapidly growing and projected to exceed $722 billion globally by 2030.
  
   

• Deloitte research suggests that AI can provide US$4.7 billion in annual growth, demonstrating the immense opportunities to be capitalized by US providers and carriers.
  
   

• Deloitte also suggests that between $80 billion and $160 billion in fraudulent losses could be avoided by insurance carriers adopting preventative anti-fraud technologies by 2032.
  
   

2. Customer expectations and personalization

• Digital-first experiences: Customers expect seamless, digital-first experiences, self-service options, and highly personalized products. Insurers are investing in modern platforms to meet these demands and improve loyalty.
  
   

• Personalized products: Usage-based and behavior-based insurance models are on the rise, enabled by AI and real-time data analytics.
  
   

3. Regulatory and compliance pressures

• Climate risk and transparency: Regulatory focus is intensifying on climate risk, cost transparency, and value-based administration, especially in property and health lines.
  
   

• Data privacy: Evolving data privacy regulations and new global and US tax rules (e.g., Pillar Two, CAMT) are increasing compliance complexity for program administrators.
  
   

4. Climate and catastrophe risk

• Rising claims: Natural disasters and climate-related events are driving up claims and premiums, especially in property insurance. Insurers are under pressure to develop new risk models, incentivize resilience, and collaborate with governments and communities.
  
   

• Climate risks – A 2024 report by Conning shows 91 percent of insurance executives view climate change as a major risk to the insurance industry, with 60 percent of respondents planning on implementing climate risk analysis tools into their business to address the increasing threats of losses from climate-related events.
  
   

• Insurance executives expressed grave concern over the transitional effects of climate change, with 96 percent of respondents agreeing that these risks will have an impact on their business decisions over the next decade.

5. Cybersecurity and data governance

• Cyber threats: Cyber risks are a top concern, both as a direct threat to insurers and as a coverage area for clients. Investments in cybersecurity, data governance, and compliance are critical. The rise in ransomware and third-party breaches is leading to stricter security regulations and more robust cyber insurance offerings.
  
   

6. Market growth and dynamics

• TPA market growth: The US TPA market is projected to reach $519.65 billion in 2025, growing at a 5.7 percent CAGR through 2030, driven by self-funded health plans, private equity investment, and rapid digitalization.
  
   

• Profitability and competition: The property and casualty sector rebounded with a $9.3 billion underwriting gain in Q1 2024, with profitability expected to improve further in 2025. However, affordability and access remain challenges due to rising premiums and climate-related losses.
  
   

7. M&A and market consolidation

• Private equity and consolidators: M&A activity is robust, especially in property and casualty and distribution. Larger platforms are emerging, able to negotiate better provider discounts and navigate complex regulations.
  
   

8. Sustainability and ESG (environmental, social, governance)

• ESG integration: Insurers are increasingly integrating ESG factors into underwriting, operations, and product development. Climate change mitigation and sustainability reporting are becoming standard practice.
  
   

9. Talent and workforce transformation

• Skills gap: The industry faces a talent crunch, especially in digital and AI skills. Upskilling, flexible work arrangements, and talent retention are strategic imperatives.
  
   

10. Emerging risks

• New risk types: Risks such as PFAs (“forever chemicals”), AI liability, and geopolitical instability are gaining prominence. Insurers are developing new products and risk models to address these emerging threats.
  
   

Insights

• Risk and reliability factors (financial stability, claims specialization, carrier reputation, exclusivity) have become significantly more important in 2025.
  
   

• Operational and relationship factors (relationship management, underwriting guidelines, compensation, innovation) also increased in importance, but to a lesser degree.
  
   

• Marketing support is the only factor to see a notable decline, suggesting a shift away from marketing toward core operational and risk management priorities.
  
   

• Overall, program administrators are prioritizing stability, expertise, and trusted relationships with carriers more than ever in 2025.

Insights

• The largest improvements were in areas previously rated lower (marketing support, claims specialization, innovation), indicating carriers responded to prior weaknesses.
  
   

• Core strengths (financial stability, reputation) remained strong and improved slightly.
  
   

• The gap between the highest and lowest scores narrowed, suggesting more consistent carrier performance across all criteria.
  
   

IBA’s 5-Star Program Administrators & Carriers 2025

Largest programs: primary, commercial general liability

• Proactive anti-fraud action
  
   

• Significant claims savings: Closed nearly 650 fraudulent claims with zero payouts, saving insureds millions of dollars.
  
   

• Meticulous investigations: Over two years, each claim was thoroughly investigated, uncovering inconsistencies such as exaggerated symptoms and hospital records showing no injuries.
  
   

• Collaborative approach
  
   

• Data-driven insights: Detected patterns like plaintiffs sharing addresses, repeat claimants, staged accidents, and suspicious medical billing, enabling both defense of current claims and prevention of future fraud.
  
   

• National recognition
  
   

• Industry leadership
  
   

• Strengthened client trust

 

Roosevelt Road Specialty has spent the past two years investigating the endemic problem of fraud in construction insurance.

CEO Dan Hickey Jr. claims that over 60 percent of labor law claims being unwitnessed, unreported events are meant to dupe contractors and their insurers. 

After dedicating large amounts of time, resources, and staff to sniff out fraud, Roosevelt’s results have led to a profile and contractors seeking the firm’s services. 

“Any time you have to spend the time and money on anti-fraud like we have, that’s an investment you make up front with a return on the other side,” Hickey says. “We’re very confident in the way that’s proceeding and quite honestly all of the notoriety that’s come out of that has really increased our submission flow and contractors wanting to do business with us.”

 

 

Contractors have praised the firm for stepping up and defending them, as they often struggle to purchase liability insurance due to the amount of incidents on worksites. Hickey and his team deliver by often removing obstacles that contractors face in accessing liability insurance.

Hickey explains, “With these fraudulent cases, it eventually can make a qualified contractor uninsurable. They’re aware of that, and they know when it comes to putting a flag in the ground and deciding to fight it. Nobody’s doing it with the intensity and the capability we are.”

The firm went so far as to send undercover workers to identify fraud, leading to the filing of RICO lawsuits, while plaintiffs have been withdrawing large volumes of cases due to the known diligence of Roosevelt.  

“We saw illegal OSHA classes being run to teach illegal immigrants on the recruitment and deploying these people into work sites,” Hickey explains. “We’ve had over 700 labor law cases withdrawn prior to getting in a courtroom.” 

Roosevelt’s aggressive moves to combat fraud are rooted in Hickey’s conviction that fraudulent activity must be rooted out for insurance markets to continue moving forward. He says, “It’s not sustainable for markets to absorb these illegal losses.” 

With the reputation Roosevelt has built to combat fraud, clients remain confident in their deep commitment across the board. Hickey says, “Pricing is within a bandwidth of your filings and your schedule credits and merit credits. We know where we want to price. The real value comes in avoiding fraudulent claims and keeping losses down for an insured to improve pricing in the long run.”

 

According to Hickey, Roosevelt’s relative lack of bureaucracy allows the firm to adopt AI and other technologies swiftly. 

“We’re not going to put it through a bureaucracy to get it in motion. If we believe in it, we’re going to use it,” he says.

One example of Roosevelt’s forward thinking has been its adoption of AI mandatory dashcam technology in its auto policy. It has made proving claims infinitely easier, further dismissing potential fraudulent issues. 

Hickey explains, “We’ve already had death claims that were completely able to show that the individual ran a red light and we’re not at fault. Without that technology, we’d be in there defending what would be a bogus claim.”

Roosevelt’s use of innovative technology extends to the assisted living sphere, where staff can be aware of potentially dangerous incidents for senior residents.

“We can monitor patient movement and help prevent those patients from getting injured. At night is typically when they get most confused.” 

Hickey also emphasizes Roosevelt’s flat structure, which makes cooperation between underwriting and claims and loss control departments. 

“There are no silos between underwriting, claims, and loss control. We’re integrated and communication is high,” he explains. “The underwriting team works very closely with the other teams to get the granular information they need on an account to make a better decision on how to price it.”

Largest programs: Residential real estate, investment property program, GCGuard for artisans and general contractors, InkShopGuard for tattoo shops and artists

• Custom technology platform: Enables agents to propose, bind, issue documents, and service investor clients directly, unless flagged for underwriting review.
  
   

• Agent empowerment: Agents can manage portfolios, process endorsements, add subagents, and access commission reports through the platform.
  
   

• Integrated billing and payments: System tracks and applies prepaid and escrow funds, managing all billing and payment processes.
  
   

• Automated underwriting: Each location is fully underwritten before quoting, eliminating post-bind inspections, cancellations, or rate changes.
  
   

• Internal dashboards: Robust dashboards help internal teams manage contract capacity, risk profiles, and geographic growth, supporting fast decision-making and business growth.
  
   

• Unique monthly reporting
  
   

• Flexible controls: Technology enforces underwriting guidelines across multiple carrier contracts while allowing agents to respond quickly to investor needs.
  
   

• Innovative investor solutions
  
   

Remaining vigilant by assessing climate disaster risks is a priority for REInsurePro, which uses information from websites, such as Frontline Fire and Watch Duty, enabling the company to determine how many clients are at risk of being impacted. 

“Being able to understand what’s actually going on and using technology to identify and then try to pre-emptively protect everyone have been really important,” SVP for risk management Jason Jones explains. “We use different resources to identify whether a wildfire has spread, whether it’s contained, how much that may affect some of our clients. We then give our marketing group an opportunity to then reach out to some of those clients.”

The firm also uses underwriting tool HazardHub, which gives users a location-based score on risks such as wildfires and crime, providing REInsurePro’s underwriting team with the data needed to compile a complete assessment.

 

 

“We identify what particular area may be affected, then we create the different type of information that we feel is useful for them, then use that to hopefully allow them a better opportunity to get through that unscathed,” says Jones. 

The volatility in the US market during 2025 prompted REInsurePro to pivot away from saturated markets in search of underserved regions, including Montana, South Dakota, and Utah. Its wide network of carriers along with a reputation for excellence has allowed the firm to grow into these untapped regions.

Jones explains, “We’ve tried to create a larger footprint in the northwest and some of those areas that may be underserved.”

A high client retention rate demonstrates reliability that sets REInsurePro apart. Its wide range of services holds large appeal, as the firm is comfortable taking on large-scale and smaller-scale tasks.

“We’re a unique product,” says Jones. “We serve tens of thousands of different accounts daily for things as simple as EOI requests all the way up to adding a new location, so we use all of that to then give the clients comfort to say, ‘We’re here for you.’”

There is an emphasis on “a la carte” services where clients manually choose specific coverage. This approach has been successful, particularly as economic concerns have elevated across the country.

Meeting market needs with innovation

IBA’s 5-Star Program Administrators and Carriers 2025 winners stand out for their ingenuity and responding to demand.

For the past three years, RPS has established and staffed a new Product and Business Development department with the aim of identifying mutually beneficial opportunities for RPS Signature Programs among carriers, clients, and insured individuals. The organic growth initiatives concentrate on capitalizing on market opportunities and addressing market needs by aligning business strategies, financial plans, and new program submissions with the objectives and appetite of the firm’s (re)insurance partners. 

The product function incorporates three key components:

• Market research: Both primary and secondary research to gain insights into the dynamic market conditions, needs, and trends.
  
   

• Product strategy: Working closely with subject matter experts, we develop comprehensive go-to-market strategies and program submissions.
  
   

• Product implementation: The team oversees the organization of RPS resources and ensures the successful delivery of new solutions to the market. 
  
   

The RPS Business & Product Development function reports to the RPS Programs Division leader for the sole purpose of driving innovation and growth in new and expanded programs. This is accomplished through consistent interaction with a broad set of producers, clients, carriers, reinsurers, technology providers, and other industry thought leaders. In terms of resident insights, RPS is an expert-driven organization that interacts with more than 25,000 agents on a daily basis to meet the needs of insureds.

This knowledge is collected, triaged, summarized, and communicated in regular line of business meetings, project-specific primary market research, white papers, interviews, and articles. RPS collects, mines, and analyzes production data to understand buyer behavior and detect new areas of opportunity. The firm makes a concerted effort to access external industry thought leaders through participation in conferences, panels, and the like. 

In 2024, these methods identified and advanced multiple new program opportunities as well as enhancements within established programs. Achievements include new solutions to address the changing market for property insurance through the development of an in-house facility, private commercial flood insurance solution, and the adoption of alternative sources of capital. Future initiatives continue to focus on other solutions to address the impact of climate change/extreme weather volatility: wind, wildfire, and earthquake.

 

RPS also continues to emphasize the development of digital insurance programs. New digital programs for small business, contractors, transportation companies, and more leverage the ability of RPS’s in-house platform to employ application/data ingestion, algorithm-driven underwriting, automated rating and issuance to efficiently deliver insurance solutions and subject matter expertise to its clients. To date, the platform has transacted more than $400 million.

The firm launched a unique program offering a monthly reporting schedule across a broad range of property types and occupancy statuses with seamless changes. REInsure’s technology platform allows it to put the appropriate controls in place to manage underwriting guidelines across multiple carrier contracts, while also giving appointed agents the ability to quickly respond to the unique needs of their real estate investor clients.

The newest program for investors is FlipShield, which responds similarly to a General Contractor’s liability coverage for house flippers that are not licensed contractors but may be performing some or all of the renovation work. This protects the DIY investor in case of property damage or injury that may arise as a result of the renovation process, including Products and Completed Operations for up to one year after the policy’s expiration. This helps fill a coverage gap for house flippers that Premises Liability does not cover. 

SCIS has demonstrated expertise in underwriting and pricing temporary staffing accounts, which currently represents about half of the firm’s in-force business. In 2024, SCIS launched a program to provide workers’ compensation coverage to the underserved security guard marketplace for both armed and unarmed guards.

Program Administrators

 

• Great Lakes General Agency
• McNaire Underwriters
• MiniCo Insurance Agency
• US Assure
• Venture Insurance Programs
• Veracity Insurance Solutions

Carriers

 

• Allied World
• Clear Blue
• EAIC
• Great American Insurance Company
• GuideOne
• Liberty Mutual
• Munich Re
• QBE North America
• SCOR SE Insurance
• Third Coast Insurance Company

Smart, structured protection for AI-built businesses now included on every Tech E&O / Cyber quote

As artificial intelligence rapidly becomes a core part of how technology companies operate and deliver value, traditional insurance policies are falling behind. The language in most standard Tech E&O / Cyber policies simply wasn’t designed to address risks that arise from machine learning models, autonomous decision systems, or algorithmic service delivery. That disconnect results in vague coverage that doesn’t address critical risks—right when liability, regulatory pressure, and public scrutiny are on the rise.

AI Coverage That’s Built to Last

Embroker’s AI insurance coverage is clear, protects tech companies against real risks, and is built for the way businesses actually use AI.

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Embroker’s new Artificial Intelligence Coverage Endorsement changes that. Effective August 5, 2025, this endorsement will be included automatically on every eligible Technology E&O / Cyber quote: a structural upgrade to our Technology E&O / Cyber coverage that protects against the AI risks tech companies are actually facing.

We designed this endorsement to explicitly define how your policy responds to the most urgent AI-related exposures—without limiting coverage effectiveness. For growing tech companies, that means you can scale your business with more confidence, not more risk.

Why this endorsement matters

Clearer coverage. Less ambiguity.
Our endorsement makes it crystal clear that services delivered via AI, as well as AI-integrated products, are within the scope of your policy. That means fewer gray areas when claims arise.

Real risk protection, not just fine print.
From biased outputs and discriminatory algorithms to flawed logic and takedown demands, our endorsement is designed to address the actual issues tech companies face—not hypothetical edge cases.

Coverage that aligns with how AI is built and used.
The definition of Artificial Intelligence in our policy was developed by technologists, not underwriters. It is broad, functionally grounded, and future-focused. Whether you’re developing foundational models, embedding AI into client-facing services, or using third-party tools internally, the coverage keeps pace with innovation.

What’s included

AI professional services
Affirms that services provided through the use of AI are clearly included in your Technology E&O coverage.

AI discrimination coverage
Explicitly addresses claims tied to unlawful bias or harmful outputs stemming from flawed data or algorithms.

Regulatory investigation defense
Includes defense costs for regulatory investigations into how your AI systems are created, marketed, or used.

Algorithm removal expenses
Provides up to $150,000 for costs tied to fixing, modifying, or removing flawed AI systems at a client’s request—even before a formal claim is filed.

Full limit access
Unlike some competitors that sublimit AI-related coverage, Embroker’s endorsement provides full coverage as outlined in your Technology E&O policy.

More than coverage: It’s credibility

AI is no longer niche. It’s a core competency, and your customers, investors, and partners expect you to treat it that way. This endorsement shows your stakeholders that you’re actively managing AI risk with modern, purpose-built protection.

As AI regulation intensifies globally and buyers become more sophisticated, having a policy that speaks the language of AI—and provides clear, structured protection—is a competitive advantage.

Available now

The Artificial Intelligence Coverage Endorsement is available immediately for qualifying technology companies seeking Technology E&O / Cyber in the Embroker Startup Program.

To learn more or request a quote, you can get started here or contact us.

Strategic claims segmentation diverges from the traditional ways of managing claims, promoting a more detailed, data-driven approach.  Traditional segmentation only considers the monetary value and data points such as the cause of loss and the exposure. Strategic segmentation considers the individual merits of each claim, ensuring more accurate and efficient adjudication, a major priority in today’s environment marked by increasing loss costs and expenses. By taking a data-driven approach carriers can harness a deeper understanding of ‘claims like this’ to enable proactive decisions and handling strategies to influence the trajectory of the claim effectively.

Carriers can employ claims segmentation  to shape strategic direction and business priorities, identifying focus areas ripe for the investment of advanced capabilities, either as a standalone initiative or as a precursor to any significant transformation.

The value proposition of strategic claims segmentation

Strategic segmentation can drive several benefits for claims organizations.

• First, as a quick win, it serves as a catalyst for controlling operational costs by allowing more efficient allocation of resources and promoting a leaner operating model.
• Secondly, it enhances customer satisfaction by ensuring claims are managed by the right claims handler, and that claims that do not require human touch as certain touchpoints can follow a dedicated route.
• Thirdly, carriers using strategic segmentation can better manage their loss exposure and payment accuracy, aligning highly skilled claims handlers to claims that have a propensity for adverse development or that are contentious.

Carriers that leverage this approach effectively can impact their loss ratio by 1-3 points  based on business mix and foster a more robust feedback mechanism with Underwriting and Actuarial informing risk selection and pricing strategies.

Navigating business adoption and implementation

Implementing a strategic segmentation approach involves several steps. It begins with data discovery, where risk and claims data is analyzed to understand the book’s demographics and underlying perils more holistically through a severity and complexity assessment. Next, segmentation scenario models are developed with claims experts, and the hypotheses are validated in a test environment to ensure that the carrier’s risk appetite is successfully met. A key objective is to ensure that claims not only at FNOL, but also throughout the life cycle, can be segmented and re-segmented based on any development that may occur on an individual claim or portfolio level.

Technology and data science play a crucial role in the design and implementation. Many carriers have found success in blending third-party data sources with their operational data to create more sophisticated approaches to segmentation, although it is not a requirement for getting started and depends on the quality of a carrier’s internal data.

Building a cross-functional team is also important, encouraging collaboration and diverse insights blending quantitative skills with qualitative insights from managers and claim experts on the front line. Continuous improvements and maintenance of the segmentation strategy is a key component, ensuring the strategies used remain effective and up to date on an annual or semi-annual basis to remain in line with the trends in the market. Leading carriers leverage AI technologies instead of rule-based coding for the deployment, which means that the segmentation model learns over time and can be amended more easily.

Typical roadblocks carriers experience

Carriers that struggle with implementation typically have less mature capabilities, but recognize that segmentation represents a foundation to advance other capabilities by making them more effective. Issues such as data quality and resistance to change can arise. To address these, carriers can invest in improving their data infrastructure, cleaning up their business processes to focus on data quality, and communicating the benefits of the strategy. Carriers that have invested in moving their data to the cloud have an advantage in allowing the business to consume data at scale and deepen the quality of their segmentation and related insights.

Measuring the ongoing success

Success in strategic claims segmentation can be measured using various key performance indicators, such as reduced claims costs, increased customer retention, and improved risk management. Continuous monitoring and adjustment are necessary to maintain the strategies’ effectiveness. Please reach out to Matthew Madsen if you’d like to discuss further.

 

Disclaimer: This content is provided for general information purposes and is not intended to be used in place of consultation with our professional advisors. Copyright© 2024 Accenture. All rights reserved. Accenture and its logo are registered trademarks of Accenture.

Parents are increasingly open to using technology to keep their teen drivers safe on the road, a recent survey from Nationwide finds.

The survey found 4 out of 5 parents would enroll their teens in telematics programs that reward safe driving. This enthusiasm for tech-based solutions comes despite mixed parental assessments of their teens’ driving abilities: While 42 percent rate their teen’s driving as “good” or “excellent”, similar percentages express concerns about distracted driving and reckless behavior.

“Parents want to feel confident that their teens are making smart choices behind the wheel,” says Casey Kempton, Nationwide president of P&C personal lines. “These tools help make that possible—not just by monitoring behavior, but by encouraging better habits through positive reinforcement.”  

Despite recognizing the value of safety technology, adoption remains limited. While 96 percent of parents said they believe dashcams provide valuable evidence after accidents, only 26 percent of teen drivers actually have them installed.

The survey reveals a broader trend in which consumers are drawn to telematics and monitoring technologies, though motivations vary. While parents prioritize safety benefits, many consumers are equally interested in the insurance premium discounts these programs can provide.

“This isn’t just about technology,” Kempton says. “It’s about creating a culture of accountability and shared responsibility on the road.”  

As comfort with AI-enabled monitoring grows, it appears that families are embracing a future in which technology supports — but does not replace — good judgment.  

Learn More:

IoT Solutions Offer Homeowners, Insurers Value — But How Much?

How Insurers Address Talent Gap Through Innovation & Technology

JIF 2025 “Risk Takes”: Data Solutions for Today’s Challenges

Insurtech Funding Hits Seven-Year Low, Despite AI Growth

Navigating the competitive P&C personal lines market

The global P&C personal lines market, which historically saw premium growth at 3%, has risen sharply to more than 15% in the last two years. Despite this premium growth, the expense ratio for most insurers remains in the high-cost range of 20 – 30%.

The need for operational efficiency has never been more critical. Significant transformation is required to achieve the much more competitive 12 – 15% expense ratio range which has been achieved by a few digital attackers and even fewer incumbents.

In this post, I explore what is driving the higher expense ratio, how to transform your cost curve, and the value it delivers through profitability, enhanced customer experience, and increased market share.

Industry dynamics and strategic shifts

The landscape of consumer insurance is undergoing profound changes. Traditionally, motor and home were subsidized by more profitable product lines, but in 2024 this has changed due to the following trends:

• Divestiture and shareholder pressure: Commercial insurers are divesting non-strategic personal lines across Europe and North America. Simultaneously, personal lines insurers are intensifying their focus on growing either through intermediary partnerships or by bolstering their direct-to-consumer channels. Additionally, shareholders are increasingly exerting pressure on insurance companies to improve shareholder returns.
• Operational brick walls: The insurance industry has already capitalized on the more obvious cost-saving measures, such as tactical headcount optimization, real-estate optimization, and tactical IT optimization, indicating that the low-hanging fruits for cost reduction have been exhausted. Additionally, while affinity and partner business models like bancassurance are growing rapidly on a global scale, they present limited growth opportunities for insurers whose expense ratios remain around the 20% mark.
• Evolving market conditions: The rise of autonomous and electric vehicles necessitates a re-evaluation of traditional claims adjustment methods. Additionally, the shift in consumer behavior towards a ‘Pick & Mix’ approach is evident in the evolving structure of home insurance products, which are transitioning from bundled to more customizable coverage options.

Critical variables influencing expense ratios

Three key factors are pivotal in influencing an insurer’s expense ratio:

1. Claims adjustment methods: The choice between fully owned, managed, or outsourced repair networks can significantly impact costs. Each option offers different benefits and challenges, affecting the overall expense ratio.
2. Customer behavior: Digital adoption is rapidly becoming a cornerstone of modern insurance, however it can vary significantly country by country. Insurers must adapt to this trend by offering digital interfaces that meet customer expectations for simplicity and speed.
3. Distribution channels: The method of distribution also plays a crucial role. Direct sales, partnerships with banks (bancassurance), and digital platforms can offer cost-efficient ways to reach customers.

The rewards of operational excellence

Over the next few years, insurers have the opportunity to capture a substantial portion of the $170b in premiums at risk as customers switch carriers. However, achieving an expense ratio below 20% is crucial for those who wish to remain competitive, capture this growth and remain viable in the future.

In my experience, operational excellence in personal lines insurance is demonstrated through:

• Customer loyalty: Increasing customer retention from an average of 1.5 years to over 4 years in best-in-class scenarios.
• Efficiency in claims processing: Reducing key-to-key motor repair times from 25 – 45 days to 8 – 12 days and home repair times from 237 days to 60 days.
• Expense ratio: Lowering this crucial metric from the industry average of 20 – 30% to an optimal 12 – 15%.

Building blocks for a low-cost structure

Achieving a low expense ratio is not incidental but the result of deliberate strategic choices and investments:

• Overhauling legacy systems: On-premises still remains the most used deployment option for all core systems in the insurance industry (Celent 2023). These legacy systems tend to be difficult, if not impossible to upgrade, slow and typically adorned with bespoke and bulky bolt-ons to get additional functionality as the times and technology landscape continue to change. Not only does this have a negative impact on customer experience (e.g., longer time to implement simple customer queries like address changes across all platforms etc.), but it has a negative impact on employee onboarding due to the sheer volume of different systems and non-standardized manual processes the employees must learn. Embracing digital transformation beyond mere front-end digitization is essential.
• Streamlining workforce: Underwriters are spending 40% of their time on non-core activities, representing an efficiency loss in the tens of billions of dollars every year. If these tasks could be automated or augmented, this would not only reduce cost but also enhance agility and responsiveness.

Strategic choices and leadership

Becoming a personal lines insurer in the low expense ratio range must be a strategic choice as it will redefine the DNA of the company. It cannot be achieved solely through re-platforming, deploying systems of engagement on top of legacy technology, or through out-sourcing. Here are 4 strategic ways to transform your cost curve:

1. Organization transformation
   Organization transformation is about focusing on aligning the right work to the right resource to create a more efficient and effective workforce. The strategic direction must be clear in terms of who the insurer wants to become and sharpening the focus on core customer segments and core products. An insurer with a 12 – 15% expense ratio cannot afford to be distracted spending time and effort on anything outside of their chosen core business.
2. Spend optimization
   Insurers need granular visibility into and oversight of spend with third parties. Eliminating a third or half of the cost base is a colossal move, and if it was easy then everyone would already have done it. Because of the very nature of such a colossal cost reduction, it is worth pointing out that most of the insurer’s leadership are unlikely to have ever done it before. Being a joint-up leadership team with one voice and one direction is hard; it requires a visionary leadership but one that is rooted in fact-based decision making.
3. Technology modernization
   Insurers need to be laser-focused on rationalizing and modernizing IT to enable new capabilities and reduce tech debt. Deciding on re-platforming programs or deciding on system of engagement layers is hard. Trying to bring the employees along on a journey of company change, systems change, and reskilling is hard. The answer lies in having a deep understanding of where the problem is, before trying to find the right solution: what drives the effort and cost, and which is the best course to eliminate them. Gen AI is and should be on every leadership team’s minds. Insurers with a strong digital core can move quickly, but most insurers are coming to the realization of the investments needed to implement AI and Gen AI at scale. Per Accenture’s Pulse of Change research, 46% of insurance C-suite leaders say it will take more than 6 months to scale up generative AI technologies and take advantage of the potential benefits. If applications and data are not on the cloud, and if there is not a strong security layer, then benefiting from Gen AI at scale is virtually impossible.
4. Strategic managed services (BPS)
   This is where it all comes together – what needs to be true for a customer service agent to press a single button to update a customer’s change of address across five products, and for this change to be reflected in the customer’s web portal real-time. By orchestrating customer journeys and internal processes across the middle and back-office, and by utilizing intelligent solutions, insurers can finally achieve optimal productivity and best-in-class responsiveness to their customers.

In conclusion, the journey to achieving a 12 – 15% expense ratio is both challenging and necessary. Insurers must embrace technological advancements, optimize their operations, and make strategic choices that align with long-term profitability and sustainability. The industry’s future will belong to those who can efficiently adapt to these evolving dynamics, ensuring they not only survive but thrive in the competitive landscape of tomorrow.

 

 

Florida’s top five auto insurance groups are cutting personal auto rates by a statewide average of 6.5 percent due to legislative reforms that addressed legal system abuse and assignment of benefits (AOB) claim fraud, the Florida Office of Insurance Regulation (OIR) announced this week.

“Citizens of the Sunshine State are now clearly seeing the benefits of a more stable and affordable insurance marketplace,” Triple-I CEO Sean Kevelighan said.

State leaders credit the reforms for driving down both average rates and loss ratios, with Florida now reporting the lowest personal auto liability loss ratio in the United States, OIR said. Improved underwriting results and reduced litigation are helping insurers lower premiums, while increased consumer shopping is boosting competition and affordability across the state’s auto insurance market.

Resistance to reforms persists

Despite the measurable benefits to consumers, these reforms are under attack in the state legislature. HB 947 and  HB 837 would undo much of this progress.

“The continued reduction in auto insurance rates is yet another sign that Florida’s reforms are working,” said Florida Gov. Ron DeSantis. “We will protect our reforms from those who seek to undo them and continue to fight for Floridians.”

Other states, including Georgia and Louisiana, are following Florida’s lead.

Premium relief for Florida drivers comes on top of significant improvements in the state’s property insurance market, where many consumers are securing better rates for their home insurance due to legislative reform and a competitive market with more than a dozen new carriers, Triple-I Director of Corporate Communications Mark Friedlander told BestWire.

“For many years, unscrupulous glass vendors preyed upon Florida drivers at car washes, gas stations, and shopping center parking lots with promises of gift cards in exchange for signing over their glass repair,” Friedlander said. “When insurers rejected these highly inflated claims, frivolous lawsuits followed.”

Learn More:

Disasters, Litigation Reshape Homeowners’ Insurance Affordability

New Consumer Guide Highlights Economic Impact of Legal System Abuse and the Need for Reform

Florida Bills Would Reverse Progress on Costly Legal System Abuse

Georgia Targets Legal System Abuse

Louisiana Reforms: Progress, But More Is Needed to Stem Legal System Abuse

Triple-I Issues Brief: Florida Reforms Bear Fruit as Premium Rates Stabilize (Members Only)

Triple-I Issues Brief: Georgia Insurance Affordability (Members Only)

Triple-I Issues Brief: Louisiana Insurance Market (Members Only)