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Commercial Insurance prices up for the 5th consecutive quarter…

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We are in the beginning of a hard market for business insurance. It looks like this market turn is starting with small rate increases for the average account, large increases if you have had losses, carriers dropping things they should not have written in the first place, and restrictions in coverage. 

Commercial insurance market cycles tend to run through long periods of decreasing rates.  Carriers make money and pursue growth while stating they won’t compromise their standards.  Then they compromise their standards and, since insurance losses take a long while to mature, the carriers still make money.  But they store up future losses, make too many assumptions based on current results, and think they can make small changes to improve results when things begin to deteriorate.

Per Towers Watson, gathering data across the industry, rate increases of 5% annually are the highest since 2004.  Loss ratios in many lines of insurance have stabilized, though they are not making much if any money for the insurance companies.  And remember that the companies have little chance to make money with investments, so they have little choice but to raise prices until they are making money on their basic business.

Could be worse; it hasn’t reached double digit increases on average, yet.  We’ve lived through 20% average increases, and worse, in changing markets decades ago.  Talk to us if you have questions.  1-800-548-2329  or contact us by clicking here.

Here’s a link to a  Towers Watson article reviewing the state of commercial insurance pricing.

Congress Re-authorizes Flood Insurance – Only through the end of May

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Here’s the notice we just got from Travelers as a servicing company for the National Flood Insurance Program:

“Dear Travelers Agents,
We are pleased to report that the National Flood Insurance Program (NFIP) has been reauthorized to May 31, 2010. The bill that was passed by Congress and signed by the President includes retroactivity to March 1, 2010.
This means that Travelers Flood can resume processing transactions using the dates that items were received during the lapse for calculating effective dates. The National Flood Insurance Program waiting period rules will be used to determine all effective dates. We will resume sending renewal offers and will also send those renewal offers that were being held during the lapse.
Because Congress made the bill retroactive, Travelers will be allowed to go back to fix transactions that were impacted due to the lapse. March 1st and 2nd can now be used in determining effective dates according to the National Flood Insurance Program waiting period rules.
Travelers will continue to work with industry trades, legislators and FEMA to help support a longer term reauthorization of the NFIP prior to the expiration on
May 31, 2010.”

A change from flood insurance – Solar Energy

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Installation of solar panels on homes has become more popular, especially with the tax credits available. Here’s a link to an engineering company that does installations. We’re linking to them because 1) we know a client who said their brand new installation held up in the recent wind storm while other people’s panels were blowing down the street. And 2) their web site is helpful in reviewing how such installations work. 3) they do seem to give more complete help in getting the project done. Entech Energy.  But the first point is really important. 1-800-548-2329

Written by gbwinsurance

April 5, 2010 at 10:10 am

What claims have you seen from Northeast storms?

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GBW Insurance topped out with about 2% of our clients reporting claims on Flood Insurance, Homeowners Insurance for wind/falling branches damage, or Homeowners Insurance for backup of sewers and drains (water up through the sump pump for example). What have you seen?

Written by gbwinsurance

March 31, 2010 at 11:25 am

Flood Insurance – Feds let it lapse again – You can’t get it

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Congress let the National Flood Program lapse, again. But this time they went on break and did not fix the problem. So the servicing insurance companies can not issue new policies. Good luck until April 14, which is the earliest that Congress can act. If you want advice, give us a call at 1-800-548-2329.

Will FEMA help homeowners with water in the basement?

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Someone searched that question. Basic answer, no. If you are in a Federal disaster area, you may qualify for loans (Note LOANS) to deal with damage. But you need flood insurance or backup of sewers & drains insurance (depending on the circumstances) to be paid for the damage. And start with a pump, which is very unlikely to come from FEMA.

A flood, according to the NFIP, is surface water affecting two or more acres or two or more contiguous properties.  At the moment, most of the Northeast qualifies.

Here’s the direct quote from FEMA/NFIP:


  • A general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is the policyholder’s property) from:
    –Overflow of inland or tidal waters; or
    –Unusual and rapid accumulation or runoff of surface waters from any source; or
  • Collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical levels that result in a flood as defined above.

For questions call GBW Insurance at 1-800-548-2329

Written by gbwinsurance

March 18, 2010 at 7:50 pm

Claims starting to come in from bad weather weekend

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Well, the mighty Rockaway River seems to have crested at a few feet above flood stage so it’s off to work. The automated systems say three client claims were reported Sunday, which means many more today. Insurance carriers have been notified and we’ll be there.

Written by gbwinsurance

March 15, 2010 at 6:02 am