Staffing cuts at NOAA and the National Weather Service have critically weakened the United States’ ability to forecast both hurricanes and inland severe weather events in 2025. The industry must adapt to a new reality where both named and non-named storm risks pose unprecedented challenges to traditional risk management.
Rate on Line (ROL) is a fundamental metric in reinsurance that quantifies the cost of reinsurance coverage relative to the protection obtained. It represents the ratio of the reinsurance premium paid to the maximum loss recoverable (reinsurance limit), expressed as a percentage. This metric directly influences insurers' risk transfer decisions and reinsurers' profitability assessments.
Telematics technology is fundamentally transforming the landscape of auto insurance and risk management, ushering in a new era of data-driven decision-making and proactive risk mitigation. This article explores how telematics is being adopted in auto insurance, the benefits and challenges it brings, and how risk management is leveraging not just telematics but a suite of emerging technologies to manage risk more effectively.
Louisiana's Creating Holistic Options in Coverage for Enterprise and Self-Insurance (CHOICES) Law, represents the state's first major captive statute overhaul since 2008. By reducing capital requirements, introducing dormancy provisions, and expanding regulatory flexibility, Louisiana aims to compete with established domiciles but remains structurally disadvantaged.
Total Cost of Risk (TCOR) is a holistic measure that captures the full financial footprint of managing risk within an organization. Rather than focusing solely on insurance premiums, TCOR encompasses every expense associated with risk, including direct losses, administrative efforts, and even the hidden costs that can arise when things go wrong. For sophisticated businesses, understanding and managing TCOR is essential to maintaining both profitability and resilience.
Interest rates are a powerful force shaping the insurance and reinsurance landscape. Their movement—whether up or down—ripples through investment portfolios, pricing strategies, and the very stability of insurers and reinsurers. To understand this relationship, imagine an insurance company as a careful steward: it collects premiums, invests them, and pays claims, all while navigating the unpredictable tides of the financial markets.
When a business decides to form a captive insurance company, it often does so with a few main objectives—greater control over risk, improved cost management, and the ability to tailor coverage to its unique needs. But as many seasoned professionals in the insurance industry can attest, the road to a successful captive is lined with pitfalls that can undermine even the best-laid plans. Understanding these common missteps is critical for any organization considering this journey.
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