The Federation of Insurance Women of Texas will hold the FIWT Leadership and Education Mid Year Expo at the Hilton College Station, April 22-23. The event will include continuing education and CIPT classes, as well as the second annual Bunco Tournament. The Insurance Women of San Antonio will serve as hosts. Event registration is $135; rooms blocked for the event are $95 for single or double occupancy. Hotel reservations at the special rate must be made by March 31; call 979-693-7500 to reserve a room.
The annual Charity Chili Cook-Off sponsored by the Independent Insurance Agents of Houston will be held Saturday, Feb. 26 at Powder Keg, 1300 Brittmoore Road. Set up starts at 7 a.m.; registration opens at 7:30 a.m. Chili will be turned in by 12:30 p.m., with winners announced at 1 p.m. Team registration is $100, and sponsorship opportunities are available. The event raises funds for IIAH’s community support for Brookwood Community, First Responders Foundation and Mission K-9 Rescue. Besides being held at a new location, the event will feature family friendly activities such as a bouncy house, face painting and games. For more information, contact Ayla Benavides, email@example.com.
The Metroplex Insurance Professionals will host its 20th annual MIP Bowling Tournament on March 11, from noon to 4 p.m. at Alley Cats Entertainment in Arlington. Lunch and two drink tickets are included. Bowlers can sign up individually or on four-person teams. Cost is $80 per bowler; non-bowlers can attend for $35. There is a $3 upcharge if paying by credit card. Teams will bowl three games. Shoe rental for bowlers is included in the registration fee. Sponsorship opportunities start at $150; cash donors and door prize donors are encouraged. Contact Mary Gunn, 817-320-7822 or firstname.lastname@example.org.
The Insurance Women of San Antonio will host its 26th annual Swing into Spring Golf Tournament on April 20 at the Canyon Springs Golf Club. The event benefits the IWSA scholarship and community service programs. Cost per player is $225, and it includes breakfast, lunch, green fees, cart, range balls, a door prize ticket and the Mulligan Player Pack of two mulligans and a special cash raffle ticket. The day starts with registration at 7:30 a.m., then breakfast, with a shotgun start at 9 a.m. The golf tournament concludes with lunch, awards and door prizes at 2 p.m. Registration is available online at www.iwsatx.com or by a form available from Lucy Filipowicz, email@example.com or Liz Glover at firstname.lastname@example.org.
Homeowners renewing their home insurance policies are finding that premiums are on the rise, the Washington Post reported Dec. 26, citing the Insurance Information Institute. Several factors have pushed home insurance premiums up by an average of four percent to $1,398. Since 2017, rates have increased 11.4 percent on average. Dale Porfilio, III’s chief insurance officer, expects rates will remain high, and could go even higher. The cost of insuring a home can be affected by location, whether or not it was built to withstand natural disasters, the cost of rebuilding after it was destroyed or damaged and the cost of building materials. Despite the increases, experts say regulators are keeping rate increases in check. For example, the Post said, homeowners insurance premiums in California haven’t kept pace with costly claims linked to wildfires.
Brown and Brown Inc. said Jan. 3 that it has acquired Houston-based Harco Insurance Services Inc. and Lone Star Affiliates Inc., which does business as Harco Financial Services. Terms of the deal were not disclosed. Harco employees will continue to work out of their current office as a branch location of Brown and Brown’s Houston retail operations under Ryan Beavers, executive vice president of Brown and Brown Lone Star Insurance Services Inc. Tommy K. Huval, regional president of Brown and Brown’s retail segment, who oversees offices in Texas and Louisiana, said the deal would expand the broker’s Texas presence.
Wright National Flood Insurance Company, announced Dec. 29 its agreement to acquire the flood insurance policy book from Westfield Insurance Company. Wright Flood will service, administer and issue flood coverage under the National Flood Insurance Program for Westfield policyholders and agents. Additionally, Wright will assume the servicing of Westfield’s private flood business. Wright Flood has more than 40 years of experience exclusively in the flood insurance industry. Patricia Templeton-Jones, the president of Wright National Flood Insurance Services, said, “Westfield has provided flood coverage solutions for the past 20 years for its agent partners and policyholders. We look forward to continuing their long history and providing their agents with our experience in the flood insurance industry.” Beginning in early 2022, Wright Flood will manage Westfield’s NFIP flood placements. All new policies and renewals will be issued by Wright National Flood Insurance Company, which is A.M. Best rated as A- (Excellent) for financial strength. For retail agents accessing flood coverage through Westfield, there will be minimal change in the process to continue to provide NFIP flood insurance coverage for policyholders. Wright and Westfield representatives together will be in contact with their agents. Westfield was founded in 1848.
Darag Group announced Jan. 4 that it has entered into a stock purchase agreement and received regulatory approval to buy Nebraska-based property/casualty company Acceptance Insurance Co. The Nebraska entity was immediately merged into a previously acquired Texas entity after receiving the necessary regulatory approvals, Darag said in a statement. The move will provide an immediate increase in surplus to assist with the expansion of the Texas entity across all 50 states and will meet key organizational objectives in North America, the acquirer said. In a September order, the Texas Department of Insurance approved the acquisition of Vesta Insurance Corp., of Dripping Springs, Texas, by Darag North America for $4.5 million. In January 2005, Acceptance Insurance Cos. filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code, but the company said at the time the move wouldn’t affect assets or operations of its Omaha-based subsidiary, Acceptance Insurance Co. The Council Bluffs, Iowa-based insurance holding company filed for reorganization in U.S. Bankruptcy Court in Nebraska. Two of Acceptance’s noninsurance company subsidiaries — Acceptance Insurance Services Inc. and American Agrisurance Inc. — filed voluntary petitions for liquidation under Chapter 7 of the Bankruptcy code. Vesta is a domestic property/casualty insurance company in rehabilitation, the TDI order said.
Hallmark Financial Services Inc. said Dec. 23 that it is no longer actively pursuing a separation of its specialty commercial segment and doesn’t intend to proceed with an initial public offering of the business. The insurer’s board of directors will continue to evaluate all actions that may enhance shareholder returns, Hallmark said in a statement. “Hallmark and its subsidiaries are well-positioned to benefit from current conditions in the insurance market, including a continuing favorable pricing environment,” said Mark Schwarz, chairman, president and chief executive officer. The company said current evaluations by its board noted “significant progress achieved over the past 18 months,” including the completion of a loss portfolio transfer transaction and improved underlying operating results for the nine months of 2021. Hallmark has three segments — specialty commercial, standard commercial and personal. In April, Hallmark said it planned an IPO for a non-controlling stake in what would be a new specialty commercial company. It planned to offer an economic ownership stake of about 50 percent in Hallmark Specialty Group while retaining a majority of the combined voting power of Hallmark Specialty shares through its ownership of high-vote common shares, Hallmark said at the time.
On. Jan. 7, the Texas Windstorm Insurance Association submitted revised commercial application forms to the Texas Department of Insurance for approval. The revisions to the applications for builder’s risk, condo building master, habitational (non-condo), business property only, and building and business personal property are minimal, except that the new forms will allow users to print them, making it easier for agents and policy applicants to review. To preview the forms pending approval, visit www.tdi.texas.gov/submissions/indextwia.html.
NAIC REPORT ON P/C
The National Association of Insurance Commissioners’ report on profitability in the property and casualty insurance industry indicated that total premiums earned increased in 2020 for the 11th straight year. NAIC’s Report on Profitability by Line by State in 2020 analyzes property/casualty insurance by state and line of insurance. The report is designed to provide information that can be used to analyze competition and market performance. Losses incurred and loss adjustment expenses remained relatively flat. The direct return on net worth for the total property and casualty insurance market decreased two percentage points to 6.6 percent in 2020. The report said that private passenger auto accounts for roughly 36 percent of the P/C market’s total direct premiums earned in 2020. The return for PPA increased over the prior year moving to 10.5 percent in 2020, up from 7.2 percent in 2019. The report said that losses and loss adjustment expenses accounted for over 70 percent of direct premiums earned nationwide for all property and casualty lines combined over the past five years. Combined expenses accounted for approximately 26 percent of direct premiums earned during that time.
Insured losses of $44 billion from Covid-19 so far represent the third largest cost to insurers of any catastrophe, behind Hurricane Katrina in 2005 and the 9/11 attacks on the Twin Towers and the Pentagon in 2001, insurance broker Howden said in a report on reinsurance renewals published Jan. 4. However, initial projections of $100 billion-plus for Covid-19 insured losses now look “improbable,” Howden said in the report, titled Times are a-changin’. The $100 billion prediction was made by industry gurus in the early days of the pandemic nearly two years ago, as events were canceled and businesses forced to shutter across the world. Since then, insurers have excluded Covid-19 from many policies. “There’s only so much event cancellation coverage out there, there’s only so much civil action coverage out there, and when you get to $40 billion, that’s pretty much exhausting what was underwritten,” David Flandro, head of analytics at Howden is quoted as saying.
Swiss Re reported Dec. 30 that global estimated losses from natural catastrophes during 2021 stretched beyond $105 billion, making it the fourth-highest year for catastrophe losses since 1970. “It seems to have become the norm that at least one secondary peril event such as severe flooding, winter storm or wildfire, each year results in losses of more than $10 billion,” said Martin Bertogg, head of cat perils at Swiss Re. According to Christian Aid, the 10 most expensive natural disasters in 2021 were Cyclone Tauktae, $1.5 billion; Typhoon In-fa, $2 billion; the Australian floods, $2.1 billion; Cyclone Yaas, $3 billion; the cold wave in France, $5.6 billion; the floods in British Columbia, $7.5 billion; the floods in Henan, $17.6 billion; the Texas winter storms, $23 billion; the floods in Europe, $43 billion, and Hurricane Ida, $65 billion.
Munich Re reports that insured losses from natural catastrophes totaled around $120 billion in 2021, second only to the $146 billion in damages during the hurricane-ridden year of 2017, Reuters reported Jan. 10. The tally for 2021 is higher than an estimate of $105 billion that Swiss Re earlier reported. From Hurricane Ida to dozens of tornadoes, freezes in Texas, and drought and wildfires in the West, Munich Re expects the United States to see more extreme weather in the future. The reinsurer partially attributes extreme weather to climate change. Meanwhile, total losses, including those not covered by insurance, were $280 billion in 2021, the fourth-highest on record, Munich Re reported.
FEMA announced Jan. 6 that it has transferred $1.064 billion of the National Flood Insurance Program’s financial risk to the private reinsurance market. FEMA transferred $1.15 billion of the NFIP’s financial risk to the private reinsurance market in 2021. This year, 28 private reinsurers will take on the NFIP risk, compared with 32 last year. The total premium for 2022 is $171.9 million, FEMA said. Reinsurance premiums last year were $195.8 million. The 2022 placement covers portions of NFIP losses above $4 billion arising from a single flooding event. FEMA paid $171.9 million in premium for the coverage. The agreement is structured to cover 4.163 percent of losses between $4 billion and $6 billion; 26.565 percent of losses between $6 billion and $8 billion, and 22.453 percent of losses between $8 billion and $10 billion. Combined with the three capital markets reinsurance placements of 2019-2021, FEMA has transferred $2.3 billion of the NFIP’s flood risk to the private sector. If a named storm flood event is large enough to trigger all reinsurance agreements, FEMA will receive qualifying payments. For named storms resulting in NFIP claims exceeding $10 billion, FEMA will receive the full $2.3 billion of reinsurance coverage from the private markets.
On Jan. 5, Shantee Orr, one of eight former NFL players accused of taking part in a scheme to defraud a player health care reimbursement fund, pleaded guilty in Harris County of submitting false claims totaling more than $129,000. TDI investigators and prosecutors worked with the Harris County District Attorney’s Office. TDI prosecutor Rick Watson said investigators discovered a Houston athletic trainer hatched the plan to submit false claims to the Gene Upshaw NFL Player Health Reimbursement Plan. “Those claims were for rehab therapies and medical treatments that were never actually provided,” said Watson. “The players and the trainer would each get a cut of the money that was reimbursed by the fund.” Chris Davis, head of TDI’s Fraud Unit, said it’s the kind of crime that takes time and resources to pursue. “Having our investigators and prosecutors in the district attorney’s office allows us to share resources and bring our insurance expertise to the table,” said Davis, thus solving complex crimes. Orr, a former linebacker for the Houston Texans, pleaded guilty to the third-degree felony of securing the execution of a document by deception. He paid restitution and must serve five years’ probation.
TDI’s Division of Workers’ Compensation announced on Jan. 13 that as of Jan. 1, all medical quality reviews for shoulder surgery will follow the revised Medical Quality Review Process included in the Process and Plan-Based Audit posted to the TDI website at www.tdi.texas.gov/wc/hcprovider/medadvisor.html. DWC’s protocol for Shoulder Surgery Plan-Based Audit was developed following constructive input solicited in November. Questions should be addressed to Mary Landrum, 512-804-4814 or email@example.com.
The Texas Department of Insurance is seeking job applicants for several positions: attorney I in the Enforcement Division; statewide auditor III and financial analyst/examiner III in the Financial Regulation Division; business analyst III in the Division of Workers’ Compensation. See the TDI website for these and other regulatory and professional level positions. Included with each listing are the position responsibilities, education and credential qualifications and salary range.
Houston area businessman Kunal “Sonny” Puri was arrested on Jan. 11 on multiple charges in connection with a premium fraud scheme. Puri secured his release from the Fort Bend County jail by posting a $20,000 bond. In December, a Travis County grand jury returned two indictments against Puri and several of his corporations including Sehgal and Sons Enterprises, Ultra Building Services Inc, and Ultra Medical Cleaning and Environmental Services. The indictment alleges that for a period of seven years from July 24, 2009, to Aug. 16, 2016, Puri, hid employees and their payroll under other companies to lower workers’ compensation insurance premiums and obtain work contracts. The Division of Workers’ Compensation (DWC) Prosecution and Fraud Units worked closely with carriers, Texas Mutual Insurance Company, Service Lloyds, and Travelers. Puri was charged with securing execution of documents by deception with intent to harm or defraud. If convicted, Puri faces up to 99 years in prison.