Category Archives: Insurance industry

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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More pain for online retailer THG as top insurer reduces cover

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Cut-back of cover for suppliers is latest in a series of headaches for founder of the troubled business

The troubled online beauty retailer THG faces more pain after a leading credit insurer reduced cover to its suppliers.

The Guardian can reveal that Allianz Trade, one of the UK’s largest credit insurers, cut back cover for suppliers to the beauty-to-nutrition retailer, formerly known as the Hut Group, in recent weeks.

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The Australian suburbs where more than half of properties will be uninsurable by 2030

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‘We’re now seeing that the system is not able to cope with climate change,’ insurance analyst says

When Kim Sly moved to a lower-lying area of Forbes four years ago, she was asked to pay $12,000 a year for flood insurance.

The bill was a shock. Her new home was built 1.2 metres above the ground to protect it from floods, a factor that did not seem to influence the insurance company’s assessment.

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Insurance firms must lower premiums as government funds disaster prevention, minister says

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Murray Watt says Canberra is funding disaster mitigation infrastructure and ‘expects the insurance industry to fulfil its end of the bargain’

Insurance companies need to reduce premiums for customers in disaster-prone regions now the federal government is investing heavily in infrastructure to minimise loss during extreme weather, the emergency management minister, Murray Watt, says.

Ahead of confirming funding on Friday for 34 new mitigation projects to reduce the impact of coastal erosion accelerated by the climate crisis, Watt used an insurance industry conference to put the sector on notice.

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California bans insurers from dropping customers in wake of largest wildfire

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State enacts temporary insurance protections for a quarter-million homeowners in areas affected by recent blazes

California temporarily banned insurance companies on Thursday from dropping customers in areas affected by recent wildfires, a day after evacuation orders were lifted for residents near a two-week-old blaze that’s become the largest in the state so far this year.

Several days of sporadic rain helped firefighters reach 60% containment on the Mosquito fire in the Sierra foothills about 110 miles (177km) north-east of San Francisco. At least 78 homes and other structures have been destroyed since flames broke out 6 September and charred forestland across Placer and El Dorado counties.

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US fossil fuel firm sues insurer for refusing to cover climate lawsuit

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Aloha Petroleum’s case against AIG could set precedent as to whether firms are protected against climate damage claims

A fossil fuel firm is suing its insurer for refusing to cover a climate lawsuit in a case that could affect the wider industry’s ability to defend itself from litigation.

Aloha Petroleum, a subsidiary of the US-based Sunoco, filed a claim against AIG’s National Union Fire Insurance Company of Pittsburgh earlier this month, arguing it had failed to protect Aloha from the mounting costs of defending climate-related claims by local governments in Hawaii.

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Rise in insurance fraud fuelled by cost of living crisis, says UK insurer

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Zurich UK says fraudulent property claims from 1 January to 31 May 25% higher than in same period in 2021

A growing number of financially squeezed households are “turning to crime” by submitting bogus insurance claims, with data revealing a sharp rise in cases over the past year.

Zurich UK, one of Britain’s biggest insurers, said the cost of living crisis was fuelling the increase in insurance fraud, where people exaggerate or make up claims for items such as jewellery and electrical goods.

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Insurers Geico ordered to pay woman who caught STD having sex in car $5.2m

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Missouri appellate court rules Geico must cover ‘injuries and losses’ from disease after 2014 incident in Hyundai Genesis

The insurance giant Geico must give more than $5m to a woman who had sex with a motorist in his car and contracted a sexually transmitted disease, a Missouri appellate court ruled.

The ruling represents a preliminary legal victory for the plaintiff over the company best known for commercials starring an anthropomorphized gecko which speaks with a British accent.

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Youpla funeral fund collapse: minister seeks advice on compensating victims

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Stephen Jones says he needs to know scale of problem before committing to redress scheme

The new minister for financial services has asked Treasury for advice on how to compensate Indigenous people who were victims of the collapse of the funeral expenses fund Youpla.

Stephen Jones, who was sworn in last Wednesday after Labor’s election victory, stopped short of committing the Albanese government to compensating the victims, telling Guardian Australia he first needed to understand how big the problem was.

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‘Unacceptable’: Aviva CEO hits back at shareholder sexism

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Amanda Blanc says sexism in business has actually got worse after being told she is ‘not the man for the job’

The chief executive of the insurer Aviva has hit out at sexism in the industry, saying “unacceptable behaviour” has only increased since she took more senior roles in the sector.

Amanda Blanc, who became the company’s first female chief executive in 2020, published a LinkedIn post thanking people for their support after shareholders made sexist remarks at the company’s annual general meeting on Monday. Investors said Blanc was “not the man for the job” and should be “wearing trousers”.

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Lloyd’s moves to cancel insurance cover of Russian firms hit by sanctions

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Action comes as Lloyd’s of London returns to profit but warns Ukraine war will present ‘major claim’

• Russia-Ukraine war: latest updates

Lloyd’s of London has said it is working with the UK government to implement sanctions imposed over the war in Ukraine as fast as possible, including cancelling Russian firms’ insurance cover.

Announcing a swing back to an annual profit as it recovers from the pandemic, the world’s biggest insurance market warned that the war will present a “major claim” for the insurance market this year, but said it was “manageable”.

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Pressure mounts on Morrison government to include flooding in $10bn reinsurance pool

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Politicians at state and federal level back calls to expand Northern Australia cyclone scheme to other natural disasters across the country

The federal government is under increasing pressure to expand its reinsurance pool for cyclone damage to include flooding, with calls for the Coalition to pass the legislation in the final days of parliament before the looming election.

Politicians across the political divide, at state and federal level, have backed calls to expand the $10bn Northern Australia reinsurance pool for cyclone damage to cover more natural disasters, across the country. Several Coalition members – including Warren Entsch, one of the scheme’s principal advocates, and Kevin Hogan, representing the Lismore-based electorate of Page – have thrown their weight behind the changes, as well as north coast MPs Janelle Saffin and Tamara Smith.

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From bamboo to barbecues: the cargo caught up in Ever Given legal battle

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Ship cannot sail out of Egyptian waters as authorities detain crew and cargo until owners pay for blockages

Lemons, bamboo shoots and tofu sit in the sweltering heat, alongside goods from Lenovo, Ikea, Dixons Carphone and dozens of other brands – including barbecues, sun loungers, swimwear, lawnmowers and camping equipment – that will arrive at their intended destinations long after summer ends.

Since the successful operation in late March to dislodge the 220,000-ton Ever Given from the Suez canal, where it was stuck for six days, the cargo ship has been grounded again – this time by a fierce legal battle between the ship’s owners, insurance companies, and the Suez Canal Authority (SCA).

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Who pays for Suez blockage? Ever Given grounding could spark years of litigation

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Ship likely to be centre of protracted legal battle over what caused it to run aground in the Suez and who is to blame

After hauling its 220,000-ton bulk down the Suez canal a week after blocking the essential waterway, the Ever Given container ship is likely to become the centre of a protracted battle over who will pay for its rescue.

The 400-metre-long vessel was aground on the banks of the Suez canal for a week, causing an estimated £7bn loss each day in trade owing to ships stuck on either side, and up to £10.9m a day for the canal. “We managed to refloat the ship in record time. If such a crisis had occurred anywhere else in the world, it would have taken three months to be solved,” said Osama Rabie, the head of the Suez Canal Authority (SCA).

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UK insurers warn against go-ahead for self-driving cars on motorways

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Government plans set to start in 2021 risk lives and are ‘hugely wrong’, experts say

Plans for cars to drive themselves on UK motorways as soon as 2021 are unlikely to go ahead after insurers warned government proposals were risking lives and “hugely wrong”.

Cars with the technology to keep in lane, accelerate and brake automatically will be on the road next year, and ministers had proposed that drivers could relinquish control to their vehicles at speeds of up to 70mph on motorways.

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Fifth of countries at risk of ecosystem collapse, analysis finds

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Trillions of dollars of GDP depend on biodiversity, according to Swiss Re report

One-fifth of the world’s countries are at risk of their ecosystems collapsing because of the destruction of wildlife and their habitats, according to an analysis by the insurance firm Swiss Re.

Natural “services” such as food, clean water and air, and flood protection have already been damaged by human activity.

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Nearly 75% of City firms reviewing office space provision

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Rise in home working during the pandemic means many companies are assessing their needs

Nearly three-quarters of City firms are reviewing how much office space they really need following a boom in home working during the pandemic, new research shows.

The latest CBI/PwC financial services survey found 74% of companies – particularly banks and insurance firms – have been taking stock of their office requirements in the hope of either using the space differently, or reducing it.

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