Category Archives: Insurance industry

Using an e-scooter can add £1,000 to your car insurance quote

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Under-30s risk a huge hike in huge car insurance premiums later in life if handed the IN10 endorsement

Young people using private electric scooters on roads and pavements risk facing huge insurance premiums when they want to drive a car, says the comparison website MoneySuperMarket.

It emerged this week that almost 800 children aged 13 to 16 had been issued an IN10 endorsement – the code used by the police for “using a vehicle uninsured against third-party risks” since the start of 2020. It stays on a person’s driving record for four years from the date of the offence.

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California insurance plan asks private insurers for $1bn after wildfires

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Private plans, such as State Farm, required to give to Fair plan so all residents have access to fire insurance

California’s home-insurance safety net does not have enough money to pay all of the claims from damage caused by the Los Angeles wildfires and has asked private insurers to contribute $1bn toward those claims.

All private insurers operating in California are required to contribute to the Fair plan, a plan of last resort established so all Californians would have access to fire insurance. More than 450,000 California homeowners got their insurance through the Fair plan in 2024 – more than double the number in 2020. As of 4 February, the plan had received more than 4,700 claims from the Palisades and Eaton fires, almost half of which were for “total losses”.

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State Farm seeks emergency 22% rate hike in California after LA wildfires

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State’s largest home insurer, which has paid customers over $1bn, claims fires put firm under increased financial strain

State Farm General, California’s largest home insurer, is seeking an emergency rate increase for homeowners following the Los Angeles wildfires last month. If approved, the hike would average a 22% increase for policyholders.

The insurance giant claims that the fires have put the company under increased financial strain. The company has already received at least 8,700 claims and paid more than $1bn to customers and expects to pay out “significantly more”, according to a press release.

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Insurance firms are sending firefighters to defend homes amid LA wildfires

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Private efforts to combat wildfires are not just for the superrich – many work for insurers seeking to minimize the policies they’d have to pay out

When a wildfire started spreading through the Pacific Palisades last Tuesday morning, employees of Wildfire Defense Systems, which provides “loss intervention services” to insurance companies, were already nearby, Dave Torgerson, the company’s founder, said.

Once they arrived at the scene, the private company’s workers stood back for a while, waiting for the government firefighters to complete the most urgent life-saving efforts. When they got clearance from public fire officials, they started their job, which focuses on protecting insured homes and businesses, Torgerson said.

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City regulator vows to ease ‘burden’ on UK banks amid government pressure

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Bank of England says it is rowing back on ‘overcooked’ regulations introduced after financial crisis

The Bank of England plans to slash the “reporting burden” on UK banks and allow insurers to make riskier investments without initial approval, as it comes under government pressure to ease regulations introduced after the financial crisis.

Sam Woods, a deputy governor at the Bank who leads its regulatory arm, the Prudential Regulation Authority (PRA), said the central bank had rowed back on rules that appeared to be “overcooked”, as he suggested it might have gone too far and harmed the financial sector.

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New York police search for person suspected of killing UnitedHealthcare CEO in ‘brazen’ attack

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Police look for suspect who shot and killed Brian Thompson, 50, outside Hilton hotel in midtown Manhattan

The CEO of UnitedHealthcare, one of the US’s largest health insurers, was shot dead on Wednesday in midtown Manhattan, police confirmed in a press conference.

Brian Thompson, 50, was shot outside the Hilton hotel at 1335 Avenue of the Americas just after 6.45am after arriving early for the company’s annual investor conference. A man wearing a mask approached him and fired at him repeatedly, police said.

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Boss of takeover target Direct Line wants time to turn around insurer

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New management at struggling firm, which rejected £3.3bn bid from Aviva, ‘making excellent progress’, says CEO

The Direct Line chief executive, Adam Winslow, has appealed to shareholders to give his team more time to turn around the struggling insurer, faced with an unsolicited £3.3bn offer from Aviva, while its bigger rival is trying hard to drum up support from investors for the takeover.

The two companies – the UK’s biggest insurer, Aviva, and the Churchill owner, Direct Line, known for motor cover and its red phone on wheels mascot – are facing off in a takeover tussle that has sent the Direct Line share price soaring, amid speculation that Aviva could raise its offer or launch a hostile bid, or face a counterbid.

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Insurance is failing hurricane survivors: ‘People thought they were covered’

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Flooding is separate from typical US home insurance and many homeowners are not adequately covered

As millions of US residents begin working to file insurance claims on their homes in the aftermath of Hurricanes Helene and Milton, many could be denied, particularly if their homes were damaged by flooding.

A quirk in the US home insurance market is that flood insurance is separate from typical home insurance, which usually covers wind damage from hurricanes but not flooding. Homeowners must purchase flood insurance separately if they want their homes protected against flooding.

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Vehicle damage claims in Wales fall 20% since speed limit cut to 20mph, says insurer

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Campaigners say lower speeds reduce casualties but scheme has since been amended to give people more choice to rescind limits

Vehicle damage claims in Wales have fallen by 20% at one leading car insurer since the nationwide 20mph speed limit was introduced there last September.

Wales was one of the first countries in the world, and the first nation in the UK, to introduce legislation for a default 20mph speed limit in built-up areas last year.

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Average cost of UK car insurance rises by one-third in a year, analysis finds

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ABI reports annual jump of £157 in first quarter of 2024 but says 1% increase on previous quarter indicates rises are easing

The average price paid for comprehensive motor insurance in the UK was about a third (33%) or £157 higher in the first quarter of this year than a year earlier, according to figures from the Association of British Insurers (ABI).

Based on analysis of policies sold, the typical price paid in the first quarter of 2024 was £635, marking a 1% increase on the previous quarter, the ABI said.

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UK weather-related insurance claims reach record £573m

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Flood and frozen pipe damage caused by series of storms, says Association of British Insurers

Storms and heavy rain pushed up weather-related home insurance claims in the UK by more than a third last year to a record £573m, according to industry data.

The repair bill for storm damage and other extreme weather during 2023 was £150m more than in 2022, the Association of British Insurers said, contributing to an overall 10% rise in residential property claims settled last year.

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Forgiving medical debt after it is sent to collections has fewer benefits – study

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Experts partnered with RIP Medical Debt, a medical non-profit that buys and forgives debt, found it had little effect on people’s credit scores and mental health

Medical debt is the most common form of debt in collections in the US. But forgiving that debt once it has gone to collections may provide fewer health and financial benefits than once hoped.

A new study by researchers who partnered with RIP Medical Debt, a non-profit that buys and forgives medical debt, found “disappointing” results when people’s bills were purchased and forgiven, with little impact on people’s credit scores and willingness to go to the doctor.

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Secret home insurance commissions raking in millions for landlords in England and Wales

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Insurers have made huge hidden payments for buildings cover over many years, experts say

Landlords of developments in England and Wales where residents face hefty service charges face calls to disclose millions of pounds in “secret commissions” raked in over the years for arranging buildings insurance.

Experts say these hidden commissions, paid to landlords including City investment funds that hold freeholds and managing agents, have been worth tens of millions of pounds a year. The arrangements were made without residents being told and resulted in higher service charges.

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New federal US rules to curb use of prior approval by private health insurances

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Providers working in federal programs will be required to expedite patients’ prior authorizations for medications and/or surgery

A new set of rules from the Biden administration seeks to rein in private health insurance companies’ use of prior authorization – a byzantine practice that requires people to seek insurance company permission before obtaining medication or having a procedure.

The cost-containment strategy often delays care and forces patients, or their doctors, to navigate opaque and labyrinthine appeals.

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UK students launch Barclays ‘career boycott’ over bank’s climate policies

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Campaign at leading universities such as Oxbridge and UCL warns lender it will miss out on top talent if it finances fossil fuels

Hundreds of students from leading UK universities have launched a “career boycott” of Barclays over its climate policies, warning that the bank will miss out on top talent unless it stops financing fossil fuel companies.

More than 220 students from Barclays’ top recruitment universities, including Oxford, Cambridge, and University College London have sent a letter to the high street lender, saying they will not work for Barclays and raising the alarm over its funding for oil and gas firms including Shell, TotalEnergies, Exxon and BP.

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Ikea warns Red Sea attacks could disrupt supplies and deliveries

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Firm says it is weighing up options to secure product availability amid Yemeni rebel attacks on shipping

Ikea has warned that the disruption to global trade caused by Yemeni rebel attacks in the Red Sea could delay its deliveries and affect availability of some products.

The world’s largest furniture company said it was “evaluating other supply options to secure the availability of our products” after many big shipping companies stopped sending vessels through the Suez canal in response to the attacks by Houthi militants’ protests against the Israel-Gaza war.

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Direct Line to pay £30m to overcharged car and home insurance customers

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Company breached rules that state existing policyholders should not be charged more than new ones

Direct Line will pay about £30m to customers who were charged more than they should have been to renew car and home insurance policies.

The UK’s second biggest car insurer said it discovered the overcharging problem after the incorrect implementation of the new pricing practice regulation that came into force in January last year. Under the rules, existing customers should not be charged more than if they were a new customer.

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Fears many Australians will abandon home insurance as premiums jump 50% in high-risk areas

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Median premiums across all areas rose 28% in the year to March and actuaries warn climate disasters are driving them to unaffordable heights

Home insurance premiums have climbed by 50% in high-risk parts of Australia as global heating increases the frequency and cost of climate disasters, a new report has found.

The Actuaries Institute’s research on home insurance affordability and funding for flood costs, released on Monday, found median home insurance premiums rose by 28% in the year to March, sitting at an average of $1,894 across all states.

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Florida rocked by home insurance crisis: ‘I may have to sell up and move’

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Soaring hurricane-cover premiums are bad news for the state’s homeowners – and Ron DeSantis is accused of dragging his feet

Households in Florida, the third most populous state in the US, have been grappling for some time with a property insurance crisis that is making home ownership unaffordable for many. After at least six insurers went insolvent in Florida last year, Farmers on Tuesday became the latest to pull out of the Florida market, saying in a statement that the decision was based on risk exposure in the hurricane-prone state.

Climate change is threatening the very existence of some parts of Florida. And the costs are already being felt by Floridians. At the end of 2022, average annual property insurance premiums had already risen to more than $4,200 in Florida – three times the national average.

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Direct Line ordered to review five years of car claims after underpayments

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Insurer told to reassess vehicle write-offs to identify any unfair settlements

Britain’s second-biggest car insurer, Direct Line, has been ordered to go back through five years of claims after admitting it had underpaid some customers who had their cars and vans written off.

After an investigation into the car insurance market that began in December 2022, the Financial Conduct Authority (FCA), this week ordered Direct Line to conduct a review of claims where vehicles had been written off “to identify any policyholders who received unfair settlements and provide them with appropriate redress”.

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