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Hello Friends! Here is your weekly update on interesting topics in insurance. This will be our final post before taking a holiday break. We look forward to 2023 and wish you and your family a happy and healthy holiday season. This week we are following the Florida special legislative session, insurance bankruptcies and Chubb real estate moves. Here are the three things we learned: |
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Fixing Florida Insurance In the aftermath of Ian, much focus has been given to fixing the Florida property insurance market. This week the Florida Legislature convened a special session and passed historic reforms including: requiring flood insurance to be purchased, regulating claims adjudication and litigation and taking aim at reinsurance costs. AM Best weighed in to suggest that ‘immediate and substantive reforms’ would be needed. Our always insightful friend Ian, lays out additional ideas and forecasts. All in all, these measures were needed but the prospect of more strong storms and climate change could deepen the crisis before it is fully fixed. |
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Bankruptcy Filings Economic concerns continue to dominate headlines this week with the Fed Meeting and interest rates moving higher pushing the US into what most expect to be a slowdown. This week, we had two bankruptcies in the insurance world, neither of which were directly tied to current economic conditions but nevertheless show that insurance is seeing some turbulence. Florida insurer FedNat filed for Chapter 11 after Ian and other weather events finally pushed their balance sheet off the cliff of insolvency. AIG who has been making restructuring moves throughout the year filed Chapter 11 for their Financial Products unit that was made famous during the last downturn in 2008, receiving government bailout funds to avoid financial system calamity. A somewhat controversial move, but another step towards the renovation of one of the venerable insurance conglomerates of all time. |
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Chubb Making Real Estate Moves Speaking of venerable insurance conglomerates, Chubb had two major real estate announcements in the past week. First they are opening a technology hub in Greece. This appears to be a creative move opening a hub for digital innovation and IT talent in a relatively untapped area of Europe. Expect others to follow this lead. In the US, they will open a new Philadelphia office that will house 1,250 new employees with a commitment to create and retain 3,200 jobs in Pennsylvania over the past 5 years. ACE Group historically had a large presence in Philadelphia so the executives at Chubb are familiar with this jurisdiction and were able to work with local officials to create a mutually beneficial deal. |
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