2022 outlook for insurance rates, claims for hotels and resorts.

Although commercial property rates saw double-digit increases this past year, moderation of rate growth is on the horizon in 2022 for hotels, resorts and companies that manage these businesses, according to John Welty, president of Suitelife Underwriting Managers.

“This year, we predict that good property accounts may see rate increases of 5%-10%, with general liability rate increases of 7.5%-10%”. “On the other hand, a less attractive account could see rates increase anywhere from 10%-30%.”

Less attractive accounts might include hotels located in a catastrophic loss area, those with increased exposure to wildfire risk, flooding, hurricanes and businesses with complex loss histories, Welty explains.

“Just like we are seeing rate increases slow for good accounts, rates are also predicted to soften in the second half of 2022,” he continued. “At the same time, more carriers are introducing reinsurance on their policies in 2022, particularly property policies. This will lead to potential rates increasing once again.”

What are some of the factors influencing that?

Weather plays a large role in the property market. Weather-related losses in 2021 were more costly than in 2019. But we are also seeing losses outside weather-prone areas. These losses come as the result of a variety of challenges such as nationwide material shortages and labor shortages. The labor and building issues, coupled with inflation are raising insurance-to-value concerns.

What are some of the unique risks facing hotels today?

While risks for the hospitality industry remain largely unchanged — with slips, trips and falls and weather-related incidents taking the lead — an increase of new technology and the use of it presents additional risks. With services such as online booking, contactless receptionists and remote concierges increasing in popularity, risk exposure increases for hotel operations.

How can insurers help these businesses mitigate these risks?

It is the responsibility of the insurer, partnered with the agent or broker, to guide businesses in mitigating risks. Often carriers don’t get involved until after claims have occurred or if a hotel proactively reaches out and asks for help. A broker, however, should be regularly discussing risk assessments and offering mitigation measures, as well as suggesting training, and confirming that coverage is in place.

While it is incumbent on the hotel to ask for help as they know their business best, at Suitelife we provide a resource page, access to our risk managers as resources and consistent communications to help mitigate risks. We provide a pre-loss, during and post-loss checklist, an executive report on trends and challenges on a quarterly basis and weekly email and social media communications to brokers on how they can help hoteliers.

With so much turnover in the hospitality industry during the past two years, what should hoteliers make sure to instill in new hires about potential risks and worker safety?

Employees are the hoteliers’ most important asset. Training frequently and often is the key to operating safely and reducing over risk exposure, particularly in times of high employee turnover. Some hotels are still seeing turnover rates as high as 50%. As a result, many employees are performing different and new jobs.

With proper, consistent training in place employees can better understand what to expect and how to handle incidents. In addition to training, it is important to have reminders and communications around such training and procedures in place. A daily checklist of expected duties posted in the right place can go a long way toward mitigating risk.

At the end of the day, hoteliers are focused on consistently providing and improving upon a superior guest experience. Training and vigilance around simple but critical tasks, such as cleaning and maintenance can go a long way toward keeping guests happy and providing a good experience.

Taken From: https://www.propertycasualty360.com/2022/02/04/2022-outlook-for-insurance-rates-claims for-hotels/?kw=2022%20outlook%20for%20insurance%20rates%2C%20claims%20for%20hotels&utm_campaign=ne wsroomupdate&utm_content=20220204&utm_medium=enl&utm_source=email&utm_term=pc360

Specific Technologies Driving Insurtech Investment in 2024

Understanding the Funding Decline The decrease in funding does not necessarily spell trouble for the insurance sector but instead highlights a strategic shift, the report suggests. “The insurance industry, like many sectors, is focusing on the most promising ventures with substantial insurance potential,” the report explains. “Insurers are directing their investments toward key areas and current trends such as embedded insurance, employee benefits, and cyber risk management. This strategic investment approach signals a forward-looking mindset within the industry.” Three Key Insurtech Trends for 2024 The report identifies three major trends shaping insurtech investments in 2024: Public Insurtech Companies: Financial and Growth Strategies The report also notes that public insurtech companies are prioritizing revenue growth as their main goal. These firms are restructuring their financial strategies to boost cash flow and capitalize on rising revenue streams. Their growth prospects are supported by expanding asset portfolios and strong market demand. “Public insurtech companies are focusing on revenue growth and optimizing their financial frameworks to increase cash flow,” the report states. “The growth potential for these companies is driven by increasing revenue opportunities, broadening asset bases, and a robust market for their services.” In summary, while global insurtech funding saw a decline in 2023, the industry’s focus on GenAI, digital process management, and connected insurance technologies is setting the stage for a dynamic and forward-looking 2024.

Business

Insurer Secures Unanimous Supreme Court Victory in New York Choice of Law Dispute

In the world of sports, a clean sweep, a shutout, or a perfect game is the ultimate achievement. In the legal arena, a unanimous decision from the U.S. Supreme Court is equally rare and significant. In a notable legal triumph, Great Lakes Insurance SE achieved a unanimous 9-0 victory in the Supreme Court on February 21, 2024. This victory follows a protracted legal battle that began in the District Court of Pennsylvania, advanced to the U.S. Court of Appeals for the Third Circuit, and culminated in the Supreme Court’s decisive ruling. Background of the Case: Great Lakes Insurance SE v. Raiders Retreat Realty Company The heart of the dispute was the insurance contract’s clause selecting New York law to govern any future legal conflicts. Although the financial implications of this case were relatively minor compared to the broader marine insurance industry, the insurer’s determination to uphold a crucial maritime legal principle has significant long-term implications for marine insurance. Faced with the insured’s counterclaims—including allegations of breach of fiduciary duty, insurance bad faith, and violations of Pennsylvania’s Unfair Trade Practices Law—the insurer was confronted with serious risks. Such claims could lead to the shifting of attorney’s fees, treble damages, and more, which might normally encourage insurers to settle rather than risk pursuing justice. However, Great Lakes Insurance, supported by The Goldman Maritime Law Group, opted to challenge the Third Circuit’s decision and seek clarity from the Supreme Court. Supreme Court Ruling: A Landmark Decision In a landmark ruling, Justice Brett Kavanaugh affirmed that choice of law provisions in maritime contracts should be upheld by default. This ruling is a major victory for establishing a consistent federal standard in maritime law and avoiding a patchwork of state laws that could complicate marine insurance disputes. The Supreme Court’s decision overturned the Third Circuit’s earlier judgment, which had questioned whether Pennsylvania’s public policy concerns might override the insurance contract’s choice of New York law. By upholding the New York choice of law clause, the Supreme Court eliminated the extra-contractual bad faith claims under Pennsylvania law, thereby ensuring that the dispute could be resolved based on the merits of the insurance claim itself. Significance of the Supreme Court’s Decision This ruling represents a significant advancement in maritime law, affirming that choice of law clauses in maritime contracts are generally enforceable. The decision establishes a clear, uniform legal framework for resolving maritime contract disputes, which will streamline the process and ensure fair adjudication of future insurance claims. Justice Clarence Thomas’s concurring opinion was particularly notable for its criticism of the 1955 Wilburn Boat v. Fireman’s Fund Insurance decision, which had previously influenced maritime insurance law. Thomas argued that Wilburn Boat was incorrectly decided and stressed that a uniform and enforceable set of rules is essential for the development of maritime law. Impact on the Marine Insurance Industry The Supreme Court’s decision sets a “bright-line” rule affirming that choice of law clauses are valid unless there is a strong argument against the selected jurisdiction. By endorsing New York’s insurance laws as a reasonable choice, the ruling supports a more consistent and predictable legal environment for marine insurers. This decision represents a major step forward in maritime law, helping insurers better assess risks, determine premiums, and ensure fair and efficient resolution of maritime insurance disputes.

2022 outlook for insurance rates, claims for hotels and resorts.