Q3 2019 RBN Market Update
P&C MARKET UPDATE
The overall market has been relatively stable, but over the last few months we have begun to see significant disruption in certain pockets. In particular, accounts with high-hazard property exposure or larger vehicle fleets have been experiencing meaningful rate increases. Additionally, certain accounts that purchase significant excess/umbrella limits have been experiencing capacity and pricing challenges. Broad indexes of insurance rates have been reporting low-mid single digit increases, but in some cases we’ve seen much more drastic rate hikes. If your business has higher-risk property (either from hazardous operations or from exposure to natural disaster) or a large vehicle fleet, we will be working with you closely and proactively to manage your renewal.
Outside of the auto, property, and excess/umbrella markets, pricing trends have been neutral. Anecdotally, we have noticed some circumstances where carriers have been more detailed in their underwriting process and pickier about taking on new business risk for companies with imperfect risk management practices. While this has not yet translated into rate increases on lines such as General Liability and Workers’ Compensation, we have been strongly urging clients to review their safety practices, quality control systems, and customer contracts to ensure they are managing their risk appropriately and not assuming unnecessary risks through customer contracts.
HEALTH INSURANCE RENEWAL SEASON
The cost of health insurance continues to be a significant burden for many businesses. A recent report from the Kaiser Family Foundation showed that the cost of employer-provided health insurance surpassed $20,000 for family coverage in 2019. This represented a 5% increase versus 2018. The ability to offer high-quality health insurance at a reasonable cost remains a profound challenge for business owners and HR professionals. As businesses continue to make decisions to manage their costs, we believe the most important tool for managing the impact on employees is clear and detailed communication. Over the next few months, our team will be spending significant time working with executives and their employees to navigate their insurance plans and make informed decisions.
CYBERSECURITY AWARENESS MONTH
October is Cybersecurity Awareness Month. In order to protect against fraud and security breaches, we strongly recommend that all companies carry cyber insurance and crime coverage with appropriate limits. That said, it is equally critical that businesses implement and maintain essential safeguards to protect their systems, funds, and business information. These include:
- Training for employees on social engineering and phishing scams, including the procedures for reporting phishing attempts to management or IT security professionals
- A strong password policy that includes requirements for complexity and regular password resets
- Clear procedures for installing software and operating system updates promptly after they are released
- Detailed recovery plans for quickly restoring systems after a breach
Many cyber insurance policies offer credits toward the cost of proactive security improvements. Additionally, RBN or your cyber insurance carrier can provide you with useful resources for reviewing or strengthening your cybersecurity practices.
Over the last few months, RBN proudly sponsored events for A Better Chicago and VOCEL, organizations that help fight poverty by investing in educational opportunity. This week, RBN employees will be volunteering at Share Our Spare, an organization that helps families with young kids get access to diapers, clothing, and other essentials.
RBN is excited to announce that we have been named one of Business Insurance’s Best Places to Work for 2019. We’re honored by this recognition and grateful for all of our team members who make RBN a great place to work every day.
WHAT WE’RE READING
NYT: Employer Health Insurance is Increasingly Unaffordable
Modern Metals: Wrestling with Risk
Forbes: California Independent Contractor Law: It’s Not Just Uber
RBN FEATURED CLIENT
Client Name: Erie Café
Location: 536 W. Erie Street, Chicago, IL
Length as Client: 10 Years
Type of Client: P&C, Employee Benefits
Overview of Business:
Erie Café is one of Chicago’s Best Steakhouses. Housed in an architecturally significant building in River North, the décor and artwork sets the tone for a wonderful meal. The menu offers a variety of prime aged steaks and chops, seafood, pasta, and numerous house specialties.
How has RBN helped manage your risks?
“RBN and Erie Café have a strong business partnership. Having continuous communication with my RBN advisor, Matt Dennett, has helped me better understand my risks and how to proactively manage them. Insurance claims can happen even when you try your best to protect your business and your employees. It’s important to have coverage for the unpredictable.” – Ron Lenzi, Owner