The year 2015 was a year during which the property/casualty insurance industry worried and learned about disruptive forces, new competitors, new leaders and emerging risks. Also, some of the industry’s news revived long-running stories. It was a year when P/C insurance professionals turned in record numbers to InsuranceJournal.com to keep up with developments. Judging by readership numbers, InsuranceJournal.com readers found these stories the top stories of 2015:
- The ACE-Chubb Marriage
The biggest story of the year — ACE’s $28.3 billion acquisition of Chubb — broke on July 1 and the story and its offspring have been grabbing readers’ attention ever since. The news sparked questions about competing offers (Chubb said it didn’t seek any and Travelers said it passed on the opportunity). The deal is expected to close in the first quarter 2016, although ACE CEO Evan Greenberg has acknowledged that integration will take years. He also vowed that the “new” Chubb will preserve the “old” Chubb’s agency culture. Greenberg has been unveiling his organizational structure and management teams for the post-merger company. The deal has been approved by shareholders and antitrust watchdogs.
- Google’s Auto Insurance Entry
Insurance Journal was among the first to report it on January 15: Google Poised to Enter U.S. Auto Insurance Market and again on March 5 when it actually happened: Google Compare for Car Insurance Has Arrived. This news continues to stir reaction with some downplaying the entry (Google will face the same obstacles faced by others selling insurance online and Google is duping customers), and others warning agents not to take it lightly and telling agents that if they aren’t scared of Google, they should be.
- Cyber Risk Evolution
No risk topic generated more worry than cyber, even though, or perhaps because, it is still evolving. One of the top cyber stories asked, just how costly and fast-growing is cyber risk? Much of the news supplied answers. Cyber was at the top of their list of concerns by CEOs and the public. There were data breaches at Anthem and VTech (and elsewhere that did not make the news because breaches have become so commonplace). More than four in 10 medium sized businesses reported having a breach. Much of the cyber news in 2015 involved the claims from the Target, Sony and Uber breaches of 2014. Every day brought a new research or consulting report, as well as new cyber services and programs from insurers. Experts openly worried about potential breaches affecting every type and size of organization or connected thing. By close of year, there was some progress to report: cyber underwriting had moved from “toddler” to “teen” as insurers learned from their claims.
- CEO Successions
This year has been a year when for a variety of reasons, including planned retirements, shareholder pressures and, unfortunately, serious illness, a surprising number of high-profile CEOs stepped down, opening the door for new leaders at the helm of some of the industry’s biggest brands. Readers were also drawn to stories about executive changes to occur in 2016.
Two of the industry’s giants— Hartfords’ Liam McGee, 60, and AIGs and MetIfe’s Robert Benmosche,70, passed way in 2015 after battles with cancer. They had passed their batons to their successors—Christopher Swift and Peter Hancock. — before their deaths.
In August, Travelers CEO Jay Fishman, citing his ALS symptoms, stepped down, replaced by insider Alan D. Schnitzer. William R. Berkley, founder of W.R. Berkley Corp., stepped aside this year as planned; his son, W. Robert Berkley Jr. took control. Also in the Class of 2015 was Michael Tipsord, who succeeded State Farm’s long-time CEO Edward B. Rust Jr. in September.
As the ACE-Chubb deal closes to create the new Chubb, ACE CEO Evan Greenberg will head the new entity, Chubb CEO John Finnegan assume other responsibilities and Chubb’s Dino Robusto will join CNA Insurance to be in position to succeed CEO Tom Motamed when he retires next December.
These are just some of the CEO changes of 2015 and 2016. Earlier this week, Insurance Journal reported more fully on who’s in and who’s out and the CEO Classes of 2015 and 2016.
- Disruption and Innovation
In addition to being glued to the Google news, readers were drawn to the stories predicting major change ahead for the industry. They included the prospect of driverless cars and on-demand services erasing as much as 60 percent of the auto insurance market; how wearable devices collecting real-time data could disrupt workers’ compensation, claims management and other segments of the industry; and how drones could revolutionize claims and risk management. Marketers have lost control of insurance buying and soon, small groups of people could be running their own peert-to-peer insurance companies. It has all convinced the industry to finally take the need for innovation seriously.
- Workers’ Comp’s Grand Bargain
National Public Radio and ProPublica launched an investigative series on the workers’ compensation system that questioned whether reforms in states have changed the system to the point where it no longer serves as a fair trade-off and exclusive remedy for injured workers who give up their right to sue. The debate over options to the traditional workers’ compensation system continued in various states including Oklahoma, Tennessee and South Carolina while Florida insurers worried about a legal challenge to the constitutionality of Florida workers’ compensation system.
- Greenberg’s Beef with AIG Bailout
The $85 billion AIG bailout was in 2008 but the headlines have continued. This year saw Maurice Greenberg, former AIG CEO and now CEO of Starr, win his long-shot court fight over his claim that the government’s bailout terms were unfair to AIG shareholders including Starr. U.S. Court of Federal Claims Judge Thomas Wheeler agreed, ruling the Federal Reserve set illegal conditions for the $85 billion rescue loan to AIG in September 2008, though he didn’t award damages. Greenberg is still trying to get damages.
- Weather Watching
The industry always follows the weather closely. The continuing California drought, including the related wildfire threat, topped the bad weather news. The Atlantic hurricane season stayed below normal with 11 named storms, while the eastern and central Pacific were above normal with both regions shattering all-time records. Readers closely followed the progress of El Nino and what El Nino would mean for this winter’s weather.
- Obamacare Ongoing
Obamacare remains controversial in certain circles and every story brought attention and reader comments, whether it was about progress, a setback, an enrollment marker, religious complaints or another vote to repeal. The most popular Obamacare story asked, “How Long Will Health Insurers Remain Patient with Obamacare?”
- Auto Insurance Pricing
Other popular stories of 2015: Continued downward pricing in P/C insurance and reinsurance; the Supreme Court ruling on gay marriage; the Willis-Towers Watson merger; whether Uber or other “gig” economy workers should be classified as contractors or employees; calls by activist investor Carl Icahn to split AIG into three separate companies; and renewal of the federal terrorism reinsurance program.