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FROM THE EDITOR
Compiled by staff from news and wire services.
Build It Differently
Insurers and insureds find
themselves on the horns of
an increasingly taut dilemma.
Advancing climate change is
resulting in more and more
property in harm’s way.
That advance, in part, comes in
the form of rising seas threatening
coastal homes and factories; another
threat sees wildfires burning up
western lands by the thousands and
thousands of acres.
Despite what some may think or
wish for, we can’t simply decide to
build elsewhere, because, you know
what? There is no elsewhere.
It also runs counter to human
nature to tell someone they can’t
build their dream home or business
on a pine-forested western slope or
within a stone’s throw of the ocean.
Yes, we have a lot farther to go
in privatizing flood insurance and
making it more actuarially sound,
but that only solves part of the
That’s why our October 15 cover
story focuses on new materials.
New flooring, new drywall, new
and smarter sprinkler systems.
We can build homes and offices
made of different materials that will
be much more fire retardant and
We can deploy smart technology
that will help us do a better job
of lowering flood doors, inflating
property barricades and getting
water and other flame retardants on
burning buildings quicker.
Manufacturers of these materials
and systems see a huge market
opportunity — and good for them.
Yes, many of these new
materials will be more expensive,
but nowhere near as expensive as
replacing the same wooden floor on
the same beach house four or five
times in a generation.
MARSH & MCLENNAN REMEMBERS
Robert J. Newhouse, Jr., passed away
Aug. 26 with his family by his side.
Newhouse spent 36 years at Marsh
& McLennan Companies, serving as
senior executive for Guy Carpenter
& Co. and retiring in 1990 as the vice
chairman for the company.
Dan Glaser, current president and
CEO of MMC, said in a statement,
“During his 36-year career at Marsh &
McLennan, Bob was a transformative
leader in our company’s history, an
iconic executive in our industry and a
Newhouse acted as one of the
architects for the Bermuda insurance
industry. He created and managed
companies including Ace, Excel, AXIS,
Mid Ocean and others.
Following his retirement from
MMC, he continued to serve on the
boards of the companies he founded.
NEW INSURANCE OPTION FOR
PEMCO Insurance now offers a new
auto policy endorsement for personal
auto policies held by rideshare drivers.
The insurance acts as an enhancer
to existing policies, providing gig
economy drivers additional coverage
and lower deductibles.
Rideshare companies like Uber
and Lyft offer varying levels of limited
coverage for their drivers. Data shows
many rideshare drivers without
commercial auto insurance policies
drive with gaps in coverage.
PEMCO aims to give drivers a
“green light” to use their personal
auto policy, filling in coverage gaps
and enhancing insurance coverage
Insuring the gig economy became a bit
easier with a new rideshare endorsement.
beyond the limits set by their rideshare
Additionally, PEMCO aims to offer
coverage where Uber, Lyft and the like
leave drivers most exposed — coverage
for underinsured and uninsured
U.S. DEPARTMENT OF JUSTICE
PROBES EQUIFAX STOCK SALES
The U.S. Department of Justice
is looking into accusations that top
executives at credit monitoring firm
Equifax sold off their holdings in
the company prior to the company’s
announcement that it had been hacked.
Atlanta-based U.S. prosecutors
in conjunction with the FBI are
examining the breach and theft of
credit records of more than 143
million consumers. The Securities and
Exchange Commission is assisting
the Department of Justice and the
FBI in examining the stock sales.
Equifax disclosed the July 29 security
breach in September. Three Equifax
executives sold $1.8 million in shares
in early August. The company says the
executives did not know about the hack
at the time they sold their shares.
IMPORTED ORGANIC FOOD MAY NOT
Results of a U.S. Department
of Agriculture Office of Inspector
General investigation reveal that
imported organic foods may not be as
organic as labeled.
The agency found that the USDA’s
Agricultural Marketing Service, which
examines incoming cargoes at U.S.
ports, couldn’t prove that fruits and
vegetables marked as organic were in
Overall, the report found that there
is a lack of controls at U.S. ports.
The purchase of foreign organic
corn and soybeans for cow and chicken
feed skyrocketed in recent years. In
June, the USDA revoked the organic
certificate of a Turkish seller of grain
and oil seed.
The USDA found that the
company’s grain was treated with
aluminum phosphide, a substance
that is not allowed under organic
According to the USDA’s Office of
Inspector General, the Agricultural
Marketing Service agreed with
the report’s findings and issued
recommendations to correct the errors.
U.S. consumers continue to
purchase higher priced organics at a
record clip. U.S. imports of organic
food in 2016 were pegged at $1.72B.
ARCH REPORTS SECOND QUARTER
Hamilton, Bermuda-based Arch
Capital Group recorded a strong
second quarter, according to a
company earnings release.
Consolidated gross premiums
written, at $1.6 billion, were up 21
percent for the three months ending
June 30, compared to the previous
year’s second quarter. The company’s
consolidated three month combined
ratio declined to 84.6 percent. That
compares quite favorably with the
company’s 2Q 2016 combined ratio of
After tax operating income available
to Arch common shareholders was
$168.91 million in 2Q 2017, as
compared to $140 million in the
second quarter of 2016.