Short-term correction will be followed by continuation of soft market and leveling of premiums; Drones and social media to be used in helping customers assess damages and settle claims
A KPMG survey of more than 300 senior insurance executives found that 44 percent of respondents expect the property market to harden in the short-term, with reduced supply and higher premiums, as a result of the devastation caused by hurricanes Irma and Harvey. Forty-seven percent also expect a short-term correction in primary insurance pricing, to be followed by a continuation of a soft market. The KPMG survey was conducted during the 29th annual KPMG Insurance Industry Conference.
The KPMG survey also found that the top three significant risks insurers will face in connection to hurricanes are ‘stream of capital flow,’ ‘lack of available future reinsurance coverage,’ and ‘lack of claim handling personnel.’
“Insurance companies are well capitalized to respond to the destruction caused by hurricanes Irma and Harvey,” said Laura Hay, National Insurance Leader, KPMG LLP. “It’s a critical moment for the insurance industry to demonstrate the incredible value and security it brings to people’s lives, protecting them and helping them at their time of need. This is the moment of truth in the relationship between the insurers and their customers.”
Survey participants said the two biggest challenges facing insurers, are the difficulties in assessing property damage, as well as managing customer expectations and awareness of coverage. To improve claims efficiency and communication with customers, insurance executives cited the use of drones and social media as the top technologies they will utilize to help customers quickly settle claims.
“The insurance industry has been doing a great job embracing technological innovation,” added Hay. “The recent hurricanes will present an opportunity to showcase some of the advancements made in assessing damages and rapidly settling claims.”
KPMG LLP, the audit, tax and advisory firm (www.kpmg.com/us), is the independent U.S. member firm of KPMG International Cooperative (“KPMG International”). KPMG International’s independent member firms have 189,000 professionals, including more than 9,000 partners, in 152 countries.