Journal of Insurance Regulation最新文献

{"title":"Nuclear verdicts, tort liability, and legislative responses","authors":"Kathleen A. McCullough, Chad G. Marzen, Cassandra R. Cole","doi":"10.52227/26548.2023","DOIUrl":"https://doi.org/10.52227/26548.2023","url":null,"abstract":"The size of punitive damage awards has grown considerably over the years, giving rise to what has been termed “nuclear verdicts.” Such large dollar verdicts can have several adverse effects on companies, such as limited innovation, high out-of-pocket claims-related expenses, increased insurance premiums, and bankruptcy in severe cases. This article reviews the growth of nuclear verdicts, examines the details of some key cases that have resulted in large damage awards, and identifies some reasons for these verdicts. The impact of nuclear verdicts and the actions that are being taken to mitigate such verdicts, with a focus on legal strategies and state legislative activity, are also discussed.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"26 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133409545","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Why do small firms offer health insurance in spite of the employer mandate exception?","authors":"Roger Lee Mendoza, PhD","doi":"10.52227/25542.2022","DOIUrl":"https://doi.org/10.52227/25542.2022","url":null,"abstract":"The largest source of healthcare coverage in the U.S. for the non-elderly population (age < 65) and their dependents is employer-sponsored health insurance. In light of the exemption of small firms (< 50 full-time employees) from the “pay-or-play” mandate of the federal Affordable Care Act (ACA) and the substantial costs of employee health insurance to any employer, we investigate why most small firms still offer coverage and how they manage to do so. We used the Kaiser Family Foundation (KFF)/Health Research and Education Trust (HRET) public dataset (2015–2019) for this purpose. Findings suggest that coverage objectives, strategic choices, and human resource practices in small firms initially pass through the lens of the employer’s comparative advantages.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"36 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121069726","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"AI-Enabled Underwriting Brings New Challenges for Life Insurance: Policy and Regulatory Considerations","authors":"Azish Filabi, Sophia Duffy","doi":"10.52227/25114.2021","DOIUrl":"https://doi.org/10.52227/25114.2021","url":null,"abstract":"Insurers are increasingly using novel data sources and automated systems for risk classification and underwriting. Automation has improved operational efficiencies in the accuracy and speed of underwriting, but it also raises new considerations relating to unfair discrimination. In this paper, we review the current regulatory structures relating to unfair discrimination and suggest they are insufficient to police the myriad new big data sources available. Moreover, AI-enabled systems increase the risk of unfair discrimination if a facially neutral factor is utilized by an automated system as a proxy for a prohibited characteristic. Furthermore, many insurers rely on unregulated third-party algorithm developers, and therefore do not own and may not have access to the logic embedded in the system, which raises unique ethical implications, particularly with respect to accountability among AI actors.\u0000\u0000To address these issues, we propose a framework that consists of three parts: (a) the establishment of national standards to serve as guardrails for acceptable design and behavior of AI-enabled systems; (b) a certification system that attests that an AI-enabled system was developed in accordance with those standards; and (c) periodic audits of\u0000the systems’ output to ensure it operated consistent with those standards. The framework rests on the existing state-based regulatory infrastructure and envisions a self-regulatory organization who can work with the NAIC to develop standards and oversee certification and audit processes. Regulatory enforcement remains with the states. Part I describes the use of technology in life insurance underwriting. Part II discusses the unfair discrimination that can occur due to factors that reflect societal biases, and the unfair discrimination that could occur in artificially intelligent systems if facially neutral factors are substituted by the system for prohibited factors. The current industry standards and regulatory scheme for unfair discrimination in underwriting is also discussed in Part II. Part III describes the ethical concerns regarding accountability when third-party data inputs and underwriting systems are utilized. In Part IV, we propose a governance approach and framework to address these concerns.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129303283","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"\"Are we doing enough\": An evaluation of the utilization of employee assistance programs to support the mental health needs of employees during the COVID-19 pandemic","authors":"R. Hoyt, Kathleen A. McCullough","doi":"10.52227/23478.2020","DOIUrl":"https://doi.org/10.52227/23478.2020","url":null,"abstract":"The purpose of this study was to examine EAP utilization as a result of the pandemic. Specifically, it looked at whether the EAP utilization has increased in a post-pandemic environment, whether demographic factors age, gender, or race/ethnicity influence EAP utilization, and how employers promote EAP benefits to support employee mental health needs during the pandemic.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127551299","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Cost Trends and Affordability of Automobile Insurance in the U.S.","authors":"Martin Grace, J. T. Leverty, Lawrence S. Powell","doi":"10.52227/20973.2019","DOIUrl":"https://doi.org/10.52227/20973.2019","url":null,"abstract":"We consider the affordability of auto insurance in light of recent increases in its cost. We show that increases in the cost of insurance are correlated with increases in the cost of losses, not with changes in insurer profits. We review the existing literature on the affordability of auto insurance and describe the inherent difficulties of evaluating affordability. We also highlight important limitations in the assumptions and methodologies used in past affordability studies. Finally, we conclude that rate regulation is not an appropriate tool for addressing the affordability of auto insurance.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"56 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127577496","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"How's the recovery? Salvage and subrogation in the property liability insurance industry","authors":"Jill Bisco, Stephen G. Fier","doi":"10.52227/26453.2023","DOIUrl":"https://doi.org/10.52227/26453.2023","url":null,"abstract":"Insurers have significant flexibility in the management of the claims process and the degree to which they prioritize the collection of salvage and subrogation. These decisions could materially impact the financial well-being of insurers as well as the prices paid by consumers. Given the potential implications that salvage and subrogation can have for insurers, consumers, and regulators, we investigate the relation between the speed at which U.S. property-liability insurers recover salvage and subrogation and insurer-specific financial and operational characteristics. The analysis is conducted for commercial and personal auto lines of business and studies both physical damage and liability coverages. The findings indicate that factors such as leverage, profitability, size, and accrual decisions are associated with the speed of recovery but that considerable differences exist across coverages.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"41 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121872566","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"CDS Spreads, Systemic Risk and Global Systemically Important Insurers Designations","authors":"Cassandra R. Cole, Ying-Foon Chow, Derrick W. H. Fung, Jason J. H. Yeh","doi":"10.52227/20981.2018","DOIUrl":"https://doi.org/10.52227/20981.2018","url":null,"abstract":"After the recent court case overturning the Financial Stability Oversight Council (FSOC)’s systemic importance designation of MetLife, the public raises awareness about the robustness of the identification methodology for global systemically important insurers (G-SIIs). As the G-SII identification framework proposed by the International Association of Insurance Supervisors (IAIS) lacks empirical support and relies heavily on historical accounting data, we examine how systemic risk measures constructed from credit default swaps (CDS) data, which are market-consistent and forward-looking, can supplement the IAIS’ identification framework. Using a dataset of insurers’ CDS spreads between 2011 and 2015, we construct three different kinds of systemic risk measures (i.e., MESCDS, networks of CDS spreads and absorption ratio) and assess the G-SII designation results announced by the Financial Stability Board (FSB). We find that: 1) the systemic risk of designated G-SIIs is, on average, higher than other insurers, suggesting that the IAIS’ G-SII identification methodology is, in general, sound and effective; 2) reinsurers should fall within the IAIS’ G-SII assessment exercise, as some of them generate more systemic risk than the designated G-SIIs; and 3) given the non-negligible litigation risk from the designated G-SIIs, the regulators should consider supplementing their G-SII identification methodology with CDS-based systemic risk measures to substantiate their designation decisions in court.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"36 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126286542","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Limitations of german insurance disclosures to improve consumer understanding, with lessons for U.S. insurance practices","authors":"Cassandra R. Cole, C. Schwarzbach, H. Weston","doi":"10.52227/23497.2016","DOIUrl":"https://doi.org/10.52227/23497.2016","url":null,"abstract":"Germany changed its insurance regulations to require intermediaries to provide disclosures at the time of application to improve consumer knowledge and protection. The German experience is that the disclosures were incorporated well into the business process but were largely ineffective to improve consumer knowledge. This outcome is consistent with numerous studies on the limitations of disclosures, due to cognitive limitations (bounded rationality) and financial literacy. We review the German practices for effectiveness, compare German and U.S. experiences with insurance disclosures, and conclude that disclosures show little impact on consumer decisions. We recommend that disclosures could provide benefit if conveyed in better formats in line with existing research on financial services disclosures. Regulators and consumer advocates should, therefore, be restrained about general proscriptions for disclosures. Greater benefit to consumers may come from improving default coverages and raising the advisory standard for intermediaries.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"18 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130504633","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Business interruption insurance and COVID-19: Coverage and issues and public policy implications.","authors":"Jill Bisco, Stephen G. Fier, David M. Pooser","doi":"10.52227/22105.2020","DOIUrl":"https://doi.org/10.52227/22105.2020","url":null,"abstract":"This study provides a discussion of the impact of COVID-19 on business interruption losses in the U.S. as well as an overview of the commonly relied upon ISO Business Income and Extra Expense (BIEE) insurance policy. The authors offer an analysis of the language contained in the unendorsed BIEE and summarize the arguments as to why business interruption insurance should or should not cover pandemic-related losses. Finally, the authors provide an overview of proposed approaches to address business interruption losses attributed to current and future pandemics.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"133 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132440275","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Impact of Motor Vehicle Simulator Training on Law Enforcement Officer Driving Behavior: Empirical Evidence from Accident Frequency and Severity","authors":"R. Hoyt","doi":"10.52227/26011.2019","DOIUrl":"https://doi.org/10.52227/26011.2019","url":null,"abstract":"Local Government Risk Management Services (LGRMS) indicates that its No. 1 loss within law enforcement continues to be related to motor vehicle incidents. In order to reduce the risk of these incidents from occurring in the future, LGRMS provides simulator training for its members. As documented by our review of the literature, a question that has remained largely unanswered by prior studies is the efficacy of this sort of training in mitigating risk management costs. In this study, we use accident loss cost data over the period 2000-2015 to determine whether motor vehicle simulator training is reducing loss frequency and severity, and whether such training is cost effective. Our analysis suggests that the training not only reduces accident frequency, and to some extent loss severity, but its return on investment (ROI) is 12:1. Given the recent concern over increasing motor vehicle loss frequency and severity in most states, our research has important implications for state legislative and regulatory authorities as they seek ways to mitigate growing motor vehicle loss costs. In addition to the benefits that we document for the use of motor vehicle simulator training of law enforcement officers (LEOs), our results suggest that efforts by state insurance regulators and legislators to facilitate and encourage motor vehicle simulator use as part of their state's licensing and insurance requirements would provide important benefits to the public in their state.","PeriodicalId":261634,"journal":{"name":"Journal of Insurance Regulation","volume":"24 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133469539","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}