Why James River Insurance Dumped Uber Account

By | November 8, 2019

  • November 8, 2019 at 9:16 am
    Vox says:
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    “In Uber, we wrote a new type of risk that originally seemed to be highly profitable”. That Uber turned out to be rotten comes as no surprise, especially with Florida at their throat. Sometimes an underwriter must use their intuition. Uber just screams, “worse than we thought” in every realm. Being “well-priced” in business auto is tough, with something like Uber, it is nigh on impossible.

  • November 8, 2019 at 1:29 pm
    David Haley says:
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    This article is funny.

    Uber is a Taxi Company (Period).

    Just ask anyone that is involved in the Taxi Insurance business, what the claims are like.

    They will tell you it’s enormous – the drivers are terrible – the accidents are inflated – driving drunk people around is an additional moral hazard.

    They will also tell you that the Insurance Costs alone are likely near equal or higher than what Uber & Lyft’s Gross income is.

    And then Lawyers will go for the throat to claw whatever they extort.

    They can correct a lot of it, but, they will need some experienced rough & tumble Taxi Insurance People to fix it, not the ivory tower folks.

    • November 8, 2019 at 3:58 pm
      Vox says:
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      Of course they’re a Taxi company. Taxis have horrendous claims. It’s frequency and severity, in spades.
      Just because Uber is a West Coast tech company doesn’t make them anything other that what they are.
      Claims are going to up-end Uber’s business model, big time. It’s like, “Gee whiz guys, we thought we’d never have this many bad claims”. James River got their comeuppance and Uber and Lyft will get theirs too.

    • November 8, 2019 at 3:58 pm
      Fair Playing Field says:
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      Mr. Haley:

      Agreed. Uber is a taxi company that began operations masquerading as a web-based sharing-economy platform in an attempt to skirt the regulatory compliance requirements that drive up operating costs for regular taxi and limo companies. Credit the PUC in CA and similar bodies in other states for recognizing the dodge and promulgating regulations to protect the public.

  • November 8, 2019 at 1:39 pm
    Charles Ford says:
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    Let’s get to the point. James River negaged in greed betting on the come and impact of all that money applied to losses. When the risk pool turned sour they got religion. They knew from actuaries what potential loss development could be and undertsood that Uber was changing and expanding scope of operations but hey greed is good right?

    Uber can easily be written as a company owned captive. They have a large number of exposures to prodiuce creditable loss data. Then they can mitigate losses through the use of Deming principles but trut me they won’t have to most likely because another industry whore will accept all that money then die from their greed. Such is the nature of the practice of insurance.

    • November 8, 2019 at 1:46 pm
      Dave says:
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      Charles, you hit the nail on the head. Reading the article with James River stating they had “mispriced the business” I had to laugh. Mispricing business is standard operating procedure for James River. No surprise here. And as you indicate, another foolish underwriter will step up.

  • November 8, 2019 at 1:40 pm
    Andrew says:
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    Let’s face it….it took a little girl’s loss of life in a California cross walk in December of 2013 to force Uber to get insurance in the first place.

  • November 9, 2019 at 3:09 pm
    retired risk manager says:
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    All of the above comments can be summarized as follows: “Never allow the perfume of the premium to overcome the stench of the risk.” This is what happens when money managers try to play “underwriter”. Too funny.



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