february 24, 2014 gary wang, fcas, maaa recent illinois homeowner insurance trends the new insurance...
TRANSCRIPT
February 24, 2014
Gary Wang, FCAS, MAAA
Recent Illinois Homeowner Insurance TrendsThe NEW Insurance Industry Legislative Day
Springfield, IL
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• Agenda – Introduction– Recent Rate Activity– Loss Frequency and Severity Trends– Homeowners Insurance Profitability in Illinois– Conclusion
Recent Trends in Illinois Homeowners Insurance
Introduction
4
Recent Rate Activity
Company 2010 2011 2012
State Farm 5.3% 6.3%
Allstate Indemnity 8.2% 3.0% 10.0%
Country 7.7% 7.3% 8.5%
American Family 9.8% 6.0% 8.5%
Erie Insurance Exchange
9.0% 9.9% 9.9%
Recent Loss Trends
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Pure Premium Trends, through 2013 Q3
2008 - 4
2009 - 2
2009 - 4
2010 - 2
2010 - 4
2011 - 2
2011 - 4
2012 - 2
2012 - 4
2013 - 20
50
100
150
200
250
300
350
400
450Forms 1-3 & 5 Combined Pure Premium($)
Illinois Multi-state
Period (Year Ending Quarter)
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Frequency Trends, through 2013 Q3
2008 - 4
2009 - 2
2009 - 4
2010 - 2
2010 - 4
2011 - 2
2011 - 4
2012 - 2
2012 - 4
2013 - 20
1
2
3
4
5
6
Forms 1-3 & 5 Combined Frequency Per 100 Earned Exposures
Illinois Multi-state
Period (Year Ending Quarter)
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Severity Trends, through 2013 Q3
2008 - 4
2009 - 2
2009 - 4
2010 - 2
2010 - 4
2011 - 2
2011 - 4
2012 - 2
2012 - 4
2013 - 20
2000
4000
6000
8000
10000
12000Forms 1-3 & 5 Combined Average Claim Cost($)
Illinois Multi-state
Period (Year Ending Quarter)
Homeowners Insurance Profitability in Illinois
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• Based on the latest Property Insurance Report analysis:– Illinois ranked 39th in profitability in 2012– Illinois has ranked below 30th each of the last five years– Compared to the 25 most stable states based on variability
• Illinois ranked 21st in 2012• Illinois has ranked from 20th to 23rd over the past five years
Homeowners Insurance Profitability in Illinois
Conclusion
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• From the numbers, the Illinois Homeowners insurance market shows conditions ripe for a hard market, based on the recent activity, and loss and profitability trends.
Concluding Thoughts from an Actuary
Commitment Beyond Numbers 13
Thank You for Your Attention
Gary Wang, FCAS, MAAA(309) 807-2331