Natural disasters caused $76bn of insurance losses in 2020
Losses have been driven by severe storms, floods, tornadoes and wildfires in the US. If man-made disasters are factored in, this figure increases to $83bn. As such, the company notes, 2020 has been the fifth-costliest year for the industry since 1970, with economic losses standing at 45%, 8% above the 10-year average.
COVID-19 may have stolen significant portions of the headlines this year, but Swiss Re reminds us that climate change, particularly rising global temperatures which provide a more fertile atmosphere for extreme weather, is a problem that cannot be ignored.
A huge test for insurance
”As with COVID-19, climate change will be a huge test of global resilience. Neither pandemics nor climate change are 'black swan' events. But while COVID-19 has an expiry date, climate change does not, and failure to 'green' the global economic recovery now will increase costs for society in future,” said Jerome Jean Haegeli, Group Chief Economist.
Furthermore, continues Martin Bertogg, Head of Cat Perils, with Occidental hurricane activity projected to increase in 2021 and beyond, the issue shows no clear sign of resolution:
”Large-scale climate conditions in the North Atlantic suggest elevated hurricane activity for 2021 and likely beyond. This increases the probability of a catastrophic landfall. Combined with the loss impact of secondary perils accelerated by climate change, insured catastrophe losses will only rise in the future.”
Finding a solution
Adopting new technologies and working closely with customers and policymakers could help to bolster resilience through climate-related programmes, Deloitte suggests. The aim would be to reassure “regulators and other stakeholders about their ability to withstand extreme weather events and effectively transition to a low-carbon economy.”
With the general consensus seeming to indicate that climate change will only continue to worsen industry strains, finding a balance between affordability, availability and stability will be key to the industry’s future.
SIMON Insurance expands its annuities platform
The New York-based insurance and annuities services company, SIMON, has announced the launch of its expanded annuities service via its new digital platform, called LiveWell.
The valuable annuity service is issued by the Midland National Life Insurance Company and administered by Sammons Retirement Solutions - a division of Institutional Group, as the first-to-market. More carriers are cited to join SIMON’s variable annuity marketplace over the next few months.
The move means financial professionals can now find and explore Sammons’ LiveWell Variable Annuity solutions, access product-specific marketing literature, and run powerful allocation and income analytics within the product—all directly within SIMON’s interactive platform.
Tax-deferred growth for the retired
According to reports, variable annuities are favoured by savings markets because they can help accumulate assets for retirement with tax-deferred growth. They also offer agile and flexible tax-free reallocations as well as optional death benefits for heirs.
Frequently used as part of a long-term retirement planning strategy for tax-efficient growth, VAs are now available in SIMON’s Marketplace alongside fixed indexed annuities, fixed annuities, and structured annuities.
The SIMON annuities platform also provides financial professionals with centralised access to the tools and resources they need to analyse marketplace products based on their clients’ risk profiles and investment horizons.
The platform also allows investors to:
- Explore various rider illustrations
- Leverage powerful allocation analytics
- View fund options and their performance statistics
- Dive deep into the historical performance of allocations and funds
Speaking about the launch of LiveWell, Melissa Scheuerman, VP of Business and Sales Development at Sammons, explained, “Everyone seeks custom solutions today—from news feeds on our cell phones to grocery delivery services, and retirement planning is no different. Products need to offer flexibility, and professionals need intuitive tools at their fingertips to analyse and manage products that offer that flexibility.
“Our partnership with SIMON illustrates a commitment to offering scalable annuity solutions to professionals serving a growing population of retirees.”
Scott Beshany, Chief Distribution Officer at SIMON, added, “With game-changing analytics for this product class, variable annuities are a natural new addition to SIMON’s product lineup. Our Marketplace is now able to deliver a more holistic product experience, and we look forward to driving a better, more powerful VA product experience for financial professionals.”