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News for the week of April 3, 2023

 
 

ICT News & Updates

Prepare a Plan for Texas' Storm Season

Kens 5 - San Antonio

Texas is number one in the country when it comes to claims for wind, hail, and lightning damage according to an Allstate study. Bexar County gets hit hard. It ranks number five in the state for severe weather claims. Now is the time to review your insurance coverage to make sure you are protected.

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ICT Education Foundation Releases 2022 Impact Report: Raises Record $115,000 for Scholarships 
 

Insurance Council of Texas Education Foundation

Last year was a record-breaking year for the ICT Education Foundation. Thanks to the generous support of individual donors and our corporate sponsors we raised over $115,000 to support students and risk management and insurance programs at our partner universities. Because of you, we were able to make an impact on the lives of 25 students throughout Texas who are pursuing a career in the property and casualty industry.

 

Please take the time to visit the ICT Education Foundation website to view the 2022 Impact Report and learn more about the students and professors at our partner universities and the accomplishments we were able to achieve in 2022.

 

Listen Recent ICT Webinars and Podcasts

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Each month, the Insurance Council of Texas produces a webinar that touches on a topic that members have told us is important to them. This year we have touched on ESG, attracting and retaining talent, DE&I and insurance fraud.

 

In addition to our webinars, we have revived the ICT on P&C podcast series. This year we are focusing on legislative and regulatory issues that are impacting the insurance industry. Texas' 88th legislative session is in full-swing and we are tracking over 400 bills that could impact the insurance industry. The podcasts are designed to condense each issue into 30-minutes bite-sized topics. 

 

Podcasts are available on Apple Podcasts, Google Play and ICT's YouTube Channel. Webinars are member only content and posted to the ICT Member InfoHub, accessible by logging onto our website.

 
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Representatives from ICT recently attended the Risk and Insurance Summit for Student Engagement  at St. Mary's University in San Antonio. Industry professionals are invited to engage with students and discuss various topics. The topics are presented by the students and are based on projects and white papers the students worked on with industry mentors. Several students also presented thought pieces they had submitted and presented at various national conferences. 

 

The ICT Education Foundation provides funding and scholarships to the St. Mary's Risk and Insurance Management program, with the mission of helping to develop the future leaders of the insurance industry. St. Mary's is one of the nine ICT partnership universities.

 
 

Legislative News & Updates

Two Key ESG Related Bills Advance from Committees

HB 1239 Heads to Consideration by Full House

 

On Tuesday, March 28, the House Insurance Committee voted 6-3 to advance a committee substitute to HB 1239, authored by Committee Chairman Tom Oliverson. HB 1239, as filed, prohibited insurers from using an ESG score/rating in establishing a rate for a policyholder or a customer’s consideration and prohibited the use of DEI factors in establishing a rate. A previously introduced substitute version expanded the prohibition to coverage decisions and added other factors insurers could not consider.

 

CSHB 1239, as voted out, applies to both commercial and personal lines, except for certain specified lines; surety, fidelity and guaranty, and crop insurance. While the prohibited acts are essentially the same, the new language provides clarity that insurers do not violate the prohibitions if the insurer’s actions are based on ordinary insurance business purpose, including the use of sound actuarial underwriting principles or financial solvency considerations reasonably related to loss experience for the different types of risk and coverage made available by the insurer. 

 

Other changes include:

  • Adding provisions to prohibit TDI from conducting or requiring an insurer to conduct a disparate impact analysis regarding rate, underwriting, or another insurance practice unless specifically required by statute
  • Language to help courts or regulators see language on construction and intent in the law, including that nothing is intended to create any type of private cause of action
  • Clarifying that proposed new Chapter 565 may not be construed or applied to require an insurer to write any line or type of business that the insurer does not write or require a material change in the insurer’s current business plans

The bill will now go to the Calendars Committee for consideration of placement on the calendar to go before the entire House.

 

SB 1060 Heads to the Senate for Consideration

 

SB 1060 by Chairman Bryan Hughes was heard in his Senate State Affairs Committee on March 27 and voted out of the committee on March 30. The bill prohibits an insurer or holding company from including a political shareholder proposal in a proxy statement or implementing a political shareholder proposal. Political shareholder proposal is defined as a shareholder proposal that seeks to directly or indirectly: prohibit or limit an insurer's ability to insure risks related to the exploration, production, utilization, transportation, sale or manufacturing of fossil fuel-based energy; require or ask an insurer to reduce or track greenhouse gas emissions, including those of the insurer's insured or the entities in which the insurer invests; or prohibit or limit an insurer's ability to insure an entity involved in legal activity for the purpose of achieving environmental, social, or political ends.

 

A committee substitute was introduced, which Chairman Hughes said clarified that the denial of insurance could not be based “solely” because a company was an energy company, but that factors such as a bad safety record would still be allowed. The bill, as substituted, was voted out 8-2. 

 

The bill will now go to the full Senate for consideration. 

Insurance Trade Groups Oppose OEM Repair Requirements

SB 1083 by Senator Phil King, relating to insurer restrictions regarding repair of a motor vehicle covered under an insurance policy, was heard in the Senate Business & Commerce Committee on March 30. SB 1083 is similar to legislation proposed last session and requires insurers to mandate the use of an OEM part, product, or repair process for a vehicle that has been owned by the insured for 36 months or less and that was a new motor vehicle when delivered to the insured. It also prohibits an insurer from limiting the beneficiary of the policy from selecting a repair person or facility. The bill also applies to third party claims. There is a provision allowing an insured or third-party claimant to opt out by signing a written disclosure. 

 

The insurance trades testified in opposition of the bill. LKQ Corporation, a leading supplier of aftermarket parts, also testified in opposition to the bill. The Texas Automobile Dealers Association, who led the efforts for this legislation last session, testified in support of the bill. The bill was left pending. 

 
 
 

DWC News & Updates

DWC Releases Updated Fact Sheet on COVID-19 Data Call

To understand the impact of COVID-19 on the Texas workers’ compensation system, on June 2, 2020, DWC issued a mandatory data call with 74 selected insurance carriers. DWC is releasing an updated factsheet with results as of Feb. 2023. The latest factsheet is on the TDI website.

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P&C Industry News & Updates

APCIA Says Property Insurance Market ‘Hardest in a Generation’

Claims Journal

A combination of historic high inflation and a growing frequency of natural catastrophes is creating the hardest market in a generation for property insurance, the American Property and Casualty Insurance Association says in a new white paper.

 

“The growth of population, housing, and businesses in hazard-prone areas are exacerbating the effects of climate change, leading to more frequent and severe catastrophe losses,” stated Karen Collins, the APCIA’s vice president, property and environmental, in a press release. “The higher costs of capital and reduced reinsurance capacity are further exerting upward pressure on insurance rates and may result in stricter underwriting in catastrophe-exposed markets.”

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Triple I Report and Economic Outlook: U.S. Insurers Remain Resilient Despite Economic Challenges

The Insurance Information Institute

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The Triple-I recently released it's Q1 2023 Economic Outlook. The report states, Property/casualty (P/C) insurance, a category which includes U.S. carriers who underwrite auto, home, and business coverage, saw its cyclical underlying growth rebound fail to materialize in 2022’s second half as interest rate tightening depressed housing starts, corporate spending, and vehicle expenditures.

 

Additionally, increases in P/C replacement costs (e.g., vehicle parts, housing construction materials) slowed down over 2022’s last two quarters but are up 40 percent since 2019.

 

While U.S. Gross Domestic Product (GDP) growth is likely to remain depressed for at least the next two quarters after the Federal Reserve shifted away from its hawkish stand on interest rates; the Fed’s three-year Consumer Price Index (CPI) expectations remain overly optimistic, Triple-I believes.

Triple I members can access the FULL REPORT HERE>>

 

Real Estate Insurance Market Under Pressure 

Reuters

A group of climate activists has called on 30 insurance company bosses to "immediately" stop underwriting new fossil fuel projects in the wake of a stark climate warning from U.N. scientists, a letter seen by Reuters showed.

 

Insure our Future, a global consortium of activists, said it sent the letter dated March 21 to companies including Munich Re, Zurich Insurance and AXA.

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Car insurance is crazy high now. Here are 5 ways to save.

KSAT - San Antonio

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You may have noticed the cost of car insurance is in overdrive. Many of us are getting bills hundreds of dollars higher at a time when just about everything is more expensive. Why are rates rising and how can you reduce your bill? A team of investigators from KSAT’s sister station in Houston, KPRC 2, looked into why rates are rising and found some ways you can try to get a lower bill.

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Revealed – top causes of distracted driving

Insurance Business Magazine

A new survey from The Travelers Companies has revealed the top causes of distracted driving.

The 2023 Travelers Risk Index examines the dangerous behaviors that happen on US roadways. While technology continues to be the top cause of distracted driving, other causes include drowsiness, heightened emotions and work-related stress, the study found.

READ MORE>>

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