The new year will bring big changes to the property and casualty insurance industry, and increased competition from insurtech companies will be a key contributor to these changes.
Flooding, particularly in Florida, is the number one re-occurring natural disaster to impact properties in the United States. Unfortunately, when the temperatures dip during the winter months, more properties are vulnerable to experience winter flooding.
Millennials have officially overtaken Baby Boomers to become our country's largest generation. However, a surprising statistic about Millennials is that they're also the most underinsured generation. Much of this can be related to many Millennials choosing to delay major life events, such as getting married or buying a home. Another reason why this generation is underinsured is that some are simply not aware of all that insurance risk entails, particularly when it comes to property and casualty insurance.
Typically, limited interaction occurs between insureds and insurance carriers, which makes it challenging to build relationships and establish loyalty. However, a way that you can add value to insureds is to complete a commercial inspection this winter to ensure that the property is in good condition to withstand seasonal weather.
The roof is the most vulnerable part of a commercial building as it serves as the first defense against rain, wind, hail, ice, and snow. When underwriting risk, it's essential that insurance carriers carefully evaluate the condition of a property's roof during the commercial inspection process.
Just a few years ago, the idea of being able to control a home's lighting from a mobile device seemed very futuresque and only something that the ultra tech-savvy would be interested in. However, the smart home has quickly gained traction with more than 40 percent of Americans owning smart home gadgets as of 2017.
Technology is changing the way that business is conducted today, and this is no different with property and casualty insurance carriers. While the insurance industry has been slower to incorporate technology into business operations, we've seen drones become part of the property inspection process and a flood of technology-heavy insurtech companies enter the marketplace.
When the FAA loosened the rules surrounding the use of commercial drones in August of 2016, many insurance carriers began experimenting with the use of drones in the commercial inspection process.
Cyber theft is a risk that is getting the attention of many business owners today. Alarmingly, 55 percent of small businesses have experienced some form of a cyber attack in the past 12 months. Even more astonishing, 60 percent of small businesses that experience cyber theft have to close their doors within six months.
The property and casualty insurance industry is currently dealing with a highly competitive market, which is leading to more lax underwriting practices. As a result, many carriers have found themselves in a precarious situation when dealing with the astronomical losses associated with recent storms Harvey, Irma, and Maria.