Allstate Insurance Erie Insurance P INSURANCE REPORTOct 29, 2018 · company’s market dominance. Symbility has been making its case that a different business model makes it worthy

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Oct. 29, 2018INSIDE

Vol. 25#10/586

Size has been a barrier for Symbility, a problem CoreLogic has solved. Page 2

Choose: Closed, tightly integrated software, or open architecture? Page 2

Fewer adjusters = pain. Page 3

Maryland’s improved regulatory efficien-cy speeds decisions. Page 7

Stable Maryland prices. Page 8

Reprinted With Permission Of The Publisher

Hurricane MichaelExposes Gaps in FloridaBuilding Codes

Hurricane Michael, the stron-gest recorded hurricane to hit the Florida Panhandle, has turned a spotlight once again on the abil-ity of building codes to mitigate damage and protect communities. While Florida is known for its very strong building codes, those along the Panhandle are far less stringent.

According to a structural engi-neer quoted in the Miami Herald, most new structures in Miami-Dade County must be designed to with-stand winds of about 175 mph, while the standard in the part of the Panhandle that suffered the most damage is about 120 mph, rising gradually to 150 mph.

As Michael blasted into Flor-ida, it attained peak winds of 155 mph, putting it just shy of Category

Please see MARYLAND on Page 5

Maryland’s Market Is Stable, ButThe Political Environment Is Not

In Maryland’s remarkably stable homeowners insur-ance market, the greatest uncertainty today is the degree to which a political shakeup might change the business envi-ronment.

Insurance Commissioner Al Redmer Jr. – who receives credit for greatly improving the regulatory environment since returning to the Maryland Insurance Administra-tion in January 2015 – is the underdog in his run for the office of Baltimore County executive to succeed Kevin Kamenetz, who died in office in May. While history is against Redmer, the popularity of GOP Gov. Larry Hogan, an ally who seems a shoo-in for re-election, may boost his prospects against his Democratic opponent. The office has been held by only two Republicans since its creation in 1956, including former Vice President Spiro Agnew.

Insurers wouldn’t be too upset if Redmer lost his race

Please see SYMBILITY on Page 2

PROPERTY INSURANCE REPORTThe Authority on Insuring Homes and Commercial Property

Allstate InsuranceErie Insurance

Hartford InsuranceNationwide InsuranceProgressive Insurance

Sentry InsuranceAmerican FamilyAmica MutualLiberty Mutual

California CasualtyCOUNTRY Financial

GeoVera Holdings Inc.Perr & KnightPlymouth RockRisk FriendsState Auto

AAISAon

DeloitteEagleViewLexisNexisMetLife

MSATransUnion

USAAVerisk

CoreLogic Acquires Symbility, Turning Up Pressure on Xactware

In a transaction that has been in the works for many years, CoreLogic last week announced its intention to buy the remaining outstanding shares of property claims estima-tion system provider Symbility. CoreLogic already owns 28% of the company. The deal is expected to close by the end of the year.

The move immediately provides a boost to Symbility’s 18-year campaign to challenge Verisk’s Xactware subsid-iary, which is by far the dominant provider of claims esti-mation software and data to property insurers in the United States.

CoreLogic has a stated goal of diversifying, reducing its heavy reliance on providing data and services to the mortgage and real estate industries by growing in other seg-ments. Toward that end, CoreLogic has been working hard

Please see GRAPEVINE on Page 10

PROPERTY INSURANCE REPORTPage 2 October 29, 2018

Warning: Property Insurance Report is a confidential, copyrighted newsletter for subscribers only. No part of this publication may be reproduced by any form or means, including photocopying, scan-ning, fax or email, without prior permission of the Publisher. For information call (949) 443-0330.


Symbility’s lack of size was a barrier to sales, but CoreLogic has solved that problem.

SYMBILITY Continued from Page 1


to expand its footprint in the insurance industry, most notably acquiring property valuation spe-cialist MSB in 2013. That acquisition brought with it a share in Symbility, a Canadian company in which MSB’s owners had an investment af-ter Symbility bought MSB’s claims division in 2012. Symbility, which opened its doors in 2004, had taken control of IntegriClaim, MSB’s failed effort to compete with Xactware’s Xactimate software.

Like any startup unencumbered by a large customer list, Symbility was able to build a cloud-based platform open to third-party col-laboration and make quick tweaks to respond to customer needs. The company has had success outside of the United States, winning clients in England, Belgium, Germany, and elsewhere

in direct competition with Xactware, but it has found harder going in the United States. Though Symbility is used by Chubb and Erie Insur-ance, the ninth and 10th largest U.S. home in-surers, as well as a number of medium sized-car-riers, such as QBE and American Modern, Xactware has remained the dominant player.

Symbility lured Farmers Insurance away from Xactware in 2010, but the fifth-ranked home insurer returned to Xactware in 2014. Though losing Farmers was a blow, the venture left behind a long-term gain. Farmers insisted that Symbility partner with CoreLogic and use its construction cost database, which Farmers

argued was more robust than Symbili-ty’s data. That close working partnership worked so well for Symbility that it has continued to use

CoreLogic data and was able to forge a closer working relationship that led ultimately to the acquisition. Compiling construction cost data is perhaps the biggest barrier to entry for anyone seeking to compete with Xactware, which has decades of experience. In CoreLogic, Symbility found a partner that could bring it on par with Xactware’s database, or at least close enough to satisfy many insurers.

A major barrier to Symbility’s success in the United States has been its small size. A claim estimating platform is at the very core of a prop-erty insurer’s operation, and gambling on a small Canadian company with few large customers is hard for insurance company executives, who cannot be criticized for sticking with market leader Xactware. In addition, replacing one sys-tem for another is always disruptive and risky, raising the stakes further. But as a subsidiary of data giant CoreLogic, with about $1.9 billion in 2017 revenue, Symbility’s days as “too small” are behind it. By comparison, Verisk had 2017 revenue $2.1 billion.

Xactware’s team understands the value of a big backer. Though it was already the market leader at the time, the 2006 acquisition of fam-ily-owned Xactware by Verisk’s predecessor, ISO, was a substantial boost to the Utah-based company’s market dominance.

Symbility has been making its case that a different business model makes it worthy of con-sideration. Unlike Xactware, which is a tightly integrated system (think of Apple’s closed op-erating system), Symbility was built on an open architecture specifically designed to incorporate third parties (think Google’s Android OS).

Of course, any rational person would happily trade the flexibility that comes with Symbility’s small size in return for the challenges of manag-

PROPERTY INSURANCE REPORTOctober 29, 2018 Page 3





ing the legacy offering of the market behemoth. An Xactware customer neatly summed up that challenge for us not long ago: “When Xacti-mate is changed, I always get mad about the short-term disruption. And then when I look to the long-term, I always get mad that they’re not changing enough.”

Xactware is certainly aware of the challenges of its market position and the need to delicately update the legacy systems that have brought it to dominance. For example, the company has been working hard to encourage insurers to take ad-vantage of ClaimXperience, a tool it developed that lets claims representatives collaborate with policyholders throughout the process.

And while Xactware does not have a reputa-tion for happily partnering with other vendors, it does have deep integration with companies such as EagleView, the provider of aerial imagery, data and analytics.

There is also a modest ecosystem of out-side companies that provide enhancements to Xactware products, such as Accurence, which provides a front-end to Xactimate.

Xactware customers are still wondering if the company will find a way to augment its closed system – which offers many benefits of complete control – with a large, carefully vetted ecosystem of third-party players, as Apple has profitably fostered through its App Store.

An insurance example can be found at Guidewire, the provider of core infrastructure software. The company created Guidewire Part-nerConnect, which it describes as “a network of select partner companies that provide consulting services and solutions to enhance, extend and complement the capabilities of Guidewire prod-ucts.” Earlier this month Guidewire held a large

customer conference in Las Vegas, where it spe-cifically highlighted these partnerships.

It remains to be seen if the management of publicly traded Verisk will be willing to make an even larger investment in further developing Xactimate, perhaps moving toward an updated architecture. Integrating more aggressively with third parties, too, is very expensive and difficult. It can be hard for any owner to accept lower re-turns from a highly profitable subsidiary such as Xactware when the competition has not yet prov-en to be a significant threat.

But everyone we talked with last week agreed that the CoreLogic acquisition changes

the dynamic. In addition to giving insurers the confidence in Symbility that comes with being part of a market giant, CoreLogic brings the kind of analytic firepower that Symbility alone could never develop.

For data-driven software solutions such as a claims estimating tools, artificial intelligence will need to be an integral part of the process. What questions to ask, what data sets to consid-er, and what actions to take are decisions that are increasingly being automated and taken away from field adjusters. Only with a partner such as CoreLogic could Symbility hope to compete on this front with Xactware, which is similarly rein-forced by the analytical powers of Verisk.

One of the major trends disrupting both Xactware and Symbility is the shift away from using highly trained adjusters in the field. In-stead, they work at their desk while having lower cost personnel visit a site to take the video and

All vendors must face a world with fewer adjusters in the field calculating appraisals.




Group Name

Homeowners Multiperil InsurersGroups Ranked by Total 2017 Direct Premium Written (000)

2017Premium

Mktshare2017

LossRatio2017

Maryland

2015Premium

Mktshare2015

LossRatio2015

2016Premium

LossRatio2016

Mktshare2016

State Farm 18.2$320,103 57.3 19.3$313,480 53.019.0$320,549 53.1% % %% % %Allstate Corp. 12.2$213,837 48.7 12.8$208,844 52.512.6$212,704 48.5% % %% % %Erie Insurance 11.3$198,956 50.8 11.0$178,610 50.311.2$189,998 48.7% % %% % %USAA Insurance Group 10.7$188,564 70.5 10.1$164,169 61.110.4$174,990 61.2% % %% % %Travelers Companies Inc. 9.7$171,084 41.6 10.2$166,459 38.09.9$166,685 39.8% % %% % %Liberty Mutual 8.4$148,009 46.3 8.5$137,799 56.48.4$142,909 43.6% % %% % %Nationwide Mutual Group 7.8$137,712 59.4 8.1$131,933 59.87.9$133,629 54.1% % %% % %American Family Insurance Group 3.6$63,617 51.5 2.5$40,195 63.13.0$50,768 52.9% % %% % %Chubb Ltd. 2.6$46,104 43.6 2.2$36,046 74.72.7$45,877 57.0% % %% % %Hartford Financial Services 1.4$25,234 42.8 1.4$23,265 53.21.5$25,256 53.9% % %% % %Farmers Insurance Group 1.0$16,847 49.1 1.0$16,474 50.31.0$17,506 45.4% % %% % %Brethren Mutual Insurance Co. 0.9$14,979 41.2 0.9$14,995 33.50.9$14,376 36.3% % %% % %Donegal Insurance Group 0.8$14,379 42.2 0.8$12,411 50.40.8$13,569 58.6% % %% % %QBE Insurance Group Ltd. 0.8$13,817 56.8 0.7$11,905 39.00.7$12,554 60.6% % %% % %Assurant Inc. 0.8$13,475 32.9 0.6$9,536 36.40.7$11,600 40.0% % %% % %MetLife Inc. 0.8$13,366 61.9 0.9$13,885 43.60.8$13,696 38.1% % %% % %Amica Mutual Insurance Co. 0.8$13,354 54.2 0.7$11,349 78.20.7$12,211 44.9% % %% % %CSAA Insurance Exchange 0.7$12,745 59.1 0.6$9,447 101.00.7$11,175 40.8% % %% % %Cincinnati Financial Corp. 0.6$10,746 30.9 0.4$6,503 66.50.5$8,806 58.4% % %% % %State Auto Insurance Companies 0.6$9,810 52.2 0.7$11,008 50.10.7$10,931 50.9% % %% % %American International Group 0.5$8,926 24.4 0.4$7,084 361.50.5$8,026 107.6% % %% % %Selective Insurance Group Inc. 0.5$8,132 14.7 0.5$7,255 44.30.5$7,789 26.0% % %% % %Cumberland Insurance Group 0.4$7,466 59.4 0.4$6,845 64.00.4$7,170 47.9% % %% % %Progressive Insurance 0.4$7,364 64.3 0.3$4,740 72.90.3$5,387 34.4% % %% % %Frederick Mutual Insurance Co. 0.4$7,021 49.5 0.5$7,717 38.50.4$7,090 32.3% % %% % %Kemper Corp. 0.4$6,939 28.4 0.5$8,521 42.40.4$7,481 25.3% % %% % %Klinefelter Insurance Group 0.4$6,203 27.4 0.3$5,108 31.40.3$5,569 36.8% % %% % %Penn National Insurance 0.3$5,817 60.6 0.3$5,282 58.90.3$5,582 53.8% % %% % %PURE 0.3$5,729 42.4 0.2$3,268 55.40.3$4,509 81.8% % %% % %Mutual Benefit Insurance Co. 0.3$5,703 63.9 0.3$5,308 38.00.3$5,459 59.4% % %% % %Ameriprise Financial Inc. 0.3$5,249 87.5 0.3$4,793 70.80.3$4,720 45.3% % %% % %WT Holdings Inc. 0.3$4,624 50.6 0.3$4,685 57.10.3$4,720 46.4% % %% % %Philadelphia Contributionship 0.3$4,479 68.0 0.1$851 179.80.1$2,156 75.5% % %% % %Munich Re 0.2$3,598 38.8 0.3$4,559 39.60.3$4,184 32.9% % %% % %Main Street America 0.2$2,979 80.3 0.1$2,199 62.70.2$2,496 39.0% % %% % %Lititz Mutual 0.1$2,265 53.0 0.1$1,989 41.20.1$2,168 51.0% % %% % %American National Insurance 0.1$2,206 66.3 0.1$1,831 90.50.1$1,992 83.2% % %% % %Universal Insurance Holdings 0.1$1,909 16.2 0.1$1,018 39.30.1$1,414 37.6% % %% % %Horace Mann Educators Corp. 0.1$1,726 68.9 0.1$1,757 52.50.1$1,721 21.8% % %% % %Farmers Mutl Fire Ins Co Salem 0.1$1,627 45.9 0.1$1,534 20.80.1$1,592 54.7% % %% % %

Source: SNL Financial, by permission, and the Property Insurance Report database.Loss ratio = incurred losses/direct premium earned and does not include dividends or loss adjustment expense.

Statewide Totals $1,756,475 52.5 $1,628,226 54.8$1,691,101 50.4 %%%

Group Name

Homeowners Multiperil InsurersGroups Ranked by Total 2017 Direct Premium Written (000)

2017Premium

Mktshare2017

LossRatio2017

Maryland

2015Premium

Mktshare2015

LossRatio2015

2016Premium

LossRatio2016

Mktshare2016

State Farm 18.2$320,103 57.3 19.3$313,480 53.019.0$320,549 53.1% % %% % %Allstate Corp. 12.2$213,837 48.7 12.8$208,844 52.512.6$212,704 48.5% % %% % %Erie Insurance 11.3$198,956 50.8 11.0$178,610 50.311.2$189,998 48.7% % %% % %USAA Insurance Group 10.7$188,564 70.5 10.1$164,169 61.110.4$174,990 61.2% % %% % %Travelers Companies Inc. 9.7$171,084 41.6 10.2$166,459 38.09.9$166,685 39.8% % %% % %Liberty Mutual 8.4$148,009 46.3 8.5$137,799 56.48.4$142,909 43.6% % %% % %Nationwide Mutual Group 7.8$137,712 59.4 8.1$131,933 59.87.9$133,629 54.1% % %% % %American Family Insurance Group 3.6$63,617 51.5 2.5$40,195 63.13.0$50,768 52.9% % %% % %Chubb Ltd. 2.6$46,104 43.6 2.2$36,046 74.72.7$45,877 57.0% % %% % %Hartford Financial Services 1.4$25,234 42.8 1.4$23,265 53.21.5$25,256 53.9% % %% % %Farmers Insurance Group 1.0$16,847 49.1 1.0$16,474 50.31.0$17,506 45.4% % %% % %Brethren Mutual Insurance Co. 0.9$14,979 41.2 0.9$14,995 33.50.9$14,376 36.3% % %% % %Donegal Insurance Group 0.8$14,379 42.2 0.8$12,411 50.40.8$13,569 58.6% % %% % %QBE Insurance Group Ltd. 0.8$13,817 56.8 0.7$11,905 39.00.7$12,554 60.6% % %% % %Assurant Inc. 0.8$13,475 32.9 0.6$9,536 36.40.7$11,600 40.0% % %% % %MetLife Inc. 0.8$13,366 61.9 0.9$13,885 43.60.8$13,696 38.1% % %% % %Amica Mutual Insurance Co. 0.8$13,354 54.2 0.7$11,349 78.20.7$12,211 44.9% % %% % %CSAA Insurance Exchange 0.7$12,745 59.1 0.6$9,447 101.00.7$11,175 40.8% % %% % %Cincinnati Financial Corp. 0.6$10,746 30.9 0.4$6,503 66.50.5$8,806 58.4% % %% % %State Auto Insurance Companies 0.6$9,810 52.2 0.7$11,008 50.10.7$10,931 50.9% % %% % %American International Group 0.5$8,926 24.4 0.4$7,084 361.50.5$8,026 107.6% % %% % %Selective Insurance Group Inc. 0.5$8,132 14.7 0.5$7,255 44.30.5$7,789 26.0% % %% % %Cumberland Insurance Group 0.4$7,466 59.4 0.4$6,845 64.00.4$7,170 47.9% % %% % %Progressive Insurance 0.4$7,364 64.3 0.3$4,740 72.90.3$5,387 34.4% % %% % %Frederick Mutual Insurance Co. 0.4$7,021 49.5 0.5$7,717 38.50.4$7,090 32.3% % %% % %Kemper Corp. 0.4$6,939 28.4 0.5$8,521 42.40.4$7,481 25.3% % %% % %Klinefelter Insurance Group 0.4$6,203 27.4 0.3$5,108 31.40.3$5,569 36.8% % %% % %Penn National Insurance 0.3$5,817 60.6 0.3$5,282 58.90.3$5,582 53.8% % %% % %PURE 0.3$5,729 42.4 0.2$3,268 55.40.3$4,509 81.8% % %% % %Mutual Benefit Insurance Co. 0.3$5,703 63.9 0.3$5,308 38.00.3$5,459 59.4% % %% % %Ameriprise Financial Inc. 0.3$5,249 87.5 0.3$4,793 70.80.3$4,720 45.3% % %% % %WT Holdings Inc. 0.3$4,624 50.6 0.3$4,685 57.10.3$4,720 46.4% % %% % %Philadelphia Contributionship 0.3$4,479 68.0 0.1$851 179.80.1$2,156 75.5% % %% % %Munich Re 0.2$3,598 38.8 0.3$4,559 39.60.3$4,184 32.9% % %% % %Main Street America 0.2$2,979 80.3 0.1$2,199 62.70.2$2,496 39.0% % %% % %Lititz Mutual 0.1$2,265 53.0 0.1$1,989 41.20.1$2,168 51.0% % %% % %American National Insurance 0.1$2,206 66.3 0.1$1,831 90.50.1$1,992 83.2% % %% % %Universal Insurance Holdings 0.1$1,909 16.2 0.1$1,018 39.30.1$1,414 37.6% % %% % %Horace Mann Educators Corp. 0.1$1,726 68.9 0.1$1,757 52.50.1$1,721 21.8% % %% % %Farmers Mutl Fire Ins Co Salem 0.1$1,627 45.9 0.1$1,534 20.80.1$1,592 54.7% % %% % %

Source: SNL Financial, by permission, and the Property Insurance Report database.Loss ratio = incurred losses/direct premium earned and does not include dividends or loss adjustment expense.

Statewide Totals $1,756,475 52.5 $1,628,226 54.8$1,691,101 50.4 %%%





Continued from Page 1

State Market Focus: MARYLAND

Property Insurance Profit Margins10-Year Summary, % of Direct Premiums Earned, With National Averages

Maryland

Line of BusinessState Homeowner

Nat’l Homeowner

State Fire

Nat’l Fire

State CommMPNat’l CommMP

Note: Profit calculations are by Property Insurance Report using data from the National Association ofInsurance Commissioners. Calculations are estimates, some based on national averages.

AvgTotalProfit

State AlliedLinesNat’l AlliedLines

8.8

8.6

30.6

22.5

11.1

11.8

22.9

12.0

2016TotalProfit

-5.5

32.2

4.2

11.4

7.2

27.6

13.2

28.5

2007TotalProfit22.4

37.2

21.5

39.2

15.0

20.2

19.9

29.9

2008TotalProfit12.5

28.7

23.1

32.1

-2.4

13.2

9.2

2.8

2009TotalProfit13.3

29.8

14.8

38.3

5.7

24.5

11.0

21.2

2010TotalProfit

14.1

24.0

3.7

12.5

11.8

11.0

9.8

10.6

2011TotalProfit-12.4

35.9

17.4

13.4

-3.8

24.8

4.1

5.7

2012TotalProfit

3.2

21.9

4.0

-5.3

8.1

24.7

9.0

-19.4

21.0

35.2

8.1

23.9

16.5

26.9

14.9

6.3

2013TotalProfit

2014TotalProfit

8.3

32.9

12.2

37.0

13.9

21.4

12.4

15.7

2015TotalProfit11.2

28.2

1.7

26.7

14.0

24.2

14.5

19.2

and remained commissioner, a position he also held from 2003 to 2005. But if he wins, they can only hope Hogan would appoint a successor with a similar approach to regulation.

The greater uncertainty for insurers concerns the legislature. Although Democrats hold a 2-to-1 majority among registered voters in Maryland, Republicans are hopeful that Hogan’s popularity will help them break the veto-proof majority Democrats have held for a half century in the state Senate. It requires them to flip five seats, including two held by moderate Democrats who tend to vote favorably on issues of interest to in-surers. Three of the five are leaning Republican.

Even if Republicans break the supermajori-ty, the bigger questions for insurers concern the rise of more progressive Democrats in commit-tee leadership positions, which will influence which pieces of legislation have hearings and which die on the vine. Democratic Sen. Delores Kelley was promoted to chair of the Senate Fi-

nance Committee after a Progressive candidate defeated the longtime chairman, Sen. Thomas Middleton, in the Democratic primary in June. Insurers lost another legislative supporter when the Finance Committee’s vice chair, Sen. John Astle, decided to retire, though insurers have worked well with his successor, Sen. Brian Feldman.

One industry source speculated that Kelley would be less accepting of insurer arguments that their use of various rating factors – including those linked to credit – help produce more accu-rate prices that benefit many consumers. Legis-lation restricting rating factors comes up almost every year, but recent proposals have not gained enough traction to succeed or were amended in compromises negotiated by Redmer.

Insurance lobbyists are also closely moni-toring changes in the House Economic Matters Committee, which handles insurance legislation, and the House Judiciary Committee, where an-




Maryland 2015 Insured Home Values (HO3 Policy Form)Home NationalValue Maryland Average<$50K 0.1% 0.3%$50-75K 0.1% 0.6%$75-100K 0.3% 1.8%$100-125K 1.6% 4.5%$125-150K 4.5% 7.4%$150-175K 7.9% 9.6%$175-200K 9.6% 10.1%$200-300K 35.1% 32.5%$300-400K 20.1% 16.8%$400-500K 9.6% 7.8%>$500K 11.1% 8.7%Total exposures 1,118,895 49,427,514Source: NAIC, Property Insurance Report




Group Name2017

Premiums Mkt

shareLossRatio

Groups Ranked by 2017 Premiums Written (000)

MarylandCommercial Multiperil Nonliability Insurers

Travelers Companies Inc. 11.3$46,261 37.8%%Erie Insurance 11.1$45,570 43.2%%Hartford Financial Services 8.3$34,011 37.1%%Harford Mutual Insurance Companies 6.6$26,921 56.1%%Nationwide Mutual Group 6.3$25,815 24.2%%State Farm 5.2$21,092 68.0%%Tokio Marine 4.6$18,947 39.8%%Chubb Ltd. 3.9$16,038 53.6%%Liberty Mutual 3.5$14,386 26.6%%Cincinnati Financial Corp. 2.7$11,073 13.9%%Allstate Corp. 2.7$10,833 48.1%%Brethren Mutual Insurance Co. 2.7$10,822 34.6%%CNA Financial Corp. 2.6$10,652 79.8%%Hanover Insurance Group Inc. 2.3$9,411 22.4%%GNY Insurance Companies 1.8$7,140 31.1%%Millers Capital Insurance Co. 1.5$6,206 27.0%%Brotherhood Mutual Insurance Co. 1.5$6,138 39.6%%Westminster American Ins Co. 1.4$5,612 44.9%%Allianz Group 1.3$5,262 -12.3%%Donegal Insurance Group 1.3$5,098 53.0%%American International Group 1.0$4,019 27.8%%Zurich Insurance Group 1.0$3,993 -9.6%%Church Mutual Insurance Co. 0.9$3,853 46.0%%Selective Insurance Group Inc. 0.8$3,381 44.2%%W. R. Berkley Corp. 0.8$3,237 23.4%%Farmers Insurance Group 0.8$3,213 17.8%%State Auto Insurance Companies 0.8$3,143 23.3%%National General Holdings Corp. 0.8$3,143 19.0%%American Financial Group Inc. 0.7$2,677 27.4%%Munich Re 0.6$2,562 56.8%%Frederick Mutual Insurance Co. 0.6$2,381 118.5%%Westfield Insurance 0.6$2,381 141.9%%Markel Corp. 0.5$2,121 27.4%%Housing Authority Insurance Group 0.5$2,050 39.1%%GuideOne Insurance 0.5$1,980 154.8%%Utica National Insurance Group 0.5$1,868 13.3%%Fairfax Financial Holdings 0.5$1,851 20.4%%Mutual Benefit Insurance Co. 0.4$1,815 12.8%%Berkshire Hathaway Inc. 0.4$1,800 77.9%%Penn National Insurance 0.4$1,516 48.4%%American National Insurance 0.4$1,442 32.9%%AmTrust Financial Services 0.3$1,357 7.3%%Main Street America 0.3$1,232 34.1%%

Data Source: SNL Financial, by permission, and the PropertyInsurance Report Database.Loss ratio = incurred losses/direct premium earned and does notinclude dividends or loss adjustment expense.

Statewide Totals $408,929 40.8%

Group Name2017

Premiums Mkt

shareLossRatio


MarylandCommercial Multiperil Nonliability Insurers

Travelers Companies Inc. 11.3$46,261 37.8%%Erie Insurance 11.1$45,570 43.2%%Hartford Financial Services 8.3$34,011 37.1%%Harford Mutual Insurance Companies 6.6$26,921 56.1%%Nationwide Mutual Group 6.3$25,815 24.2%%State Farm 5.2$21,092 68.0%%Tokio Marine 4.6$18,947 39.8%%Chubb Ltd. 3.9$16,038 53.6%%Liberty Mutual 3.5$14,386 26.6%%Cincinnati Financial Corp. 2.7$11,073 13.9%%Allstate Corp. 2.7$10,833 48.1%%Brethren Mutual Insurance Co. 2.7$10,822 34.6%%CNA Financial Corp. 2.6$10,652 79.8%%Hanover Insurance Group Inc. 2.3$9,411 22.4%%GNY Insurance Companies 1.8$7,140 31.1%%Millers Capital Insurance Co. 1.5$6,206 27.0%%Brotherhood Mutual Insurance Co. 1.5$6,138 39.6%%Westminster American Ins Co. 1.4$5,612 44.9%%Allianz Group 1.3$5,262 -12.3%%Donegal Insurance Group 1.3$5,098 53.0%%American International Group 1.0$4,019 27.8%%Zurich Insurance Group 1.0$3,993 -9.6%%Church Mutual Insurance Co. 0.9$3,853 46.0%%Selective Insurance Group Inc. 0.8$3,381 44.2%%W. R. Berkley Corp. 0.8$3,237 23.4%%Farmers Insurance Group 0.8$3,213 17.8%%State Auto Insurance Companies 0.8$3,143 23.3%%National General Holdings Corp. 0.8$3,143 19.0%%American Financial Group Inc. 0.7$2,677 27.4%%Munich Re 0.6$2,562 56.8%%Frederick Mutual Insurance Co. 0.6$2,381 118.5%%Westfield Insurance 0.6$2,381 141.9%%Markel Corp. 0.5$2,121 27.4%%Housing Authority Insurance Group 0.5$2,050 39.1%%GuideOne Insurance 0.5$1,980 154.8%%Utica National Insurance Group 0.5$1,868 13.3%%Fairfax Financial Holdings 0.5$1,851 20.4%%Mutual Benefit Insurance Co. 0.4$1,815 12.8%%Berkshire Hathaway Inc. 0.4$1,800 77.9%%Penn National Insurance 0.4$1,516 48.4%%American National Insurance 0.4$1,442 32.9%%AmTrust Financial Services 0.3$1,357 7.3%%Main Street America 0.3$1,232 34.1%%



to fully understand the legislative landscape they will face in the next legislative session, which begins Jan. 9.

For example, three names come up as possi-ble chairs of the Property and Casualty Insurance Subcommittee of the House Economic Matters Committee, including Delegate Eric Bromwell, a moderate Democrat fighting to maintain his seat in a competitive race, and Delegates Benja-min Brooks and Kris Valderrama, who oppose the use of certain insurance rating factors.

In addition to fighting efforts to restrict underwriting and rating factors, insurers have countered bills in the past that, for example, would make it easier to win punitive damages and enable third-party claimants to sue insurers directly.

Insurers have also won passage of legislation that they supported, including a bill that regulate public adjusters. Another lowered the minimum premium required for commercial accounts to qualify as large enough to be exempt from rates for review and allows brokers to negotiate com-

other progressive Democrat has been appointed chairman after Delegate Joseph Vallario, who held the post for 25 years, lost in the Democrat-ic primary. With so many openings on both the House Economic Matters and Senate Finance committees, it will take some time for insurers







missions on large commercial accounts. Since returning for a second time to the posi-

tion of insurance commissioner in 2015, Redmer has worked to improve the regulatory machinery and has shielded insurers from the most vehe-ment attempts to restrict the uses of socioeco-nomic factors in underwriting and rating. While recognizing the concerns of insurers, Redmer doesn’t always grant their wishes, taking into consideration what he hears from consumers and insurance agents.

For example, although insurers successfully fended off legislation in 2016 that would have prohibited them from using driving history in the rating and underwriting of homeowners insur-ance, regulators do not allow it.

“We have had heartburn over that, but we’ve made the decision at this point to not approve them,” Redmer said.

His tenure has been characterized by efforts to improve efficiency and communication and to simplify things where possible. When he re-turned as regulator in early 2015, some 2,000 filings were pending, the oldest of which went back three years. That is now below 300, most of which were submitted within the last 90 days.

“We are in now in the normal turnaround time for rate and form filings.”

Redmer also promoted legislation that ex-panded and clarified the use of wind and hurri-cane deductibles and reduced the number of no-tices home insurers must send to policyholders.

Homeowners insurance legislation that took effect Oct. 1, 2017, required the insurance com-missioner to adopt a notice containing informa-tion explaining aspects of homeowner’s insur-ance policies, such as the flood exclusion, sewer backup coverage, deductibles, discounts for storm-protective devices, and the ability of insur-ers to cancel or nonrenew based on claims histo-ry and increased hazards. Insurers could then use

Group Name2017

PremiumsMkt

shareLossRatio


MarylandFire Insurers

American International Group 13.1$18,802 13.3%%Travelers Companies Inc. 10.9$15,703 44.9%%FM Global 8.2$11,743 66.5%%Farmers Insurance Group 5.5$7,861 29.4%%Zurich Insurance Group 4.9$7,083 8.7%%Liberty Mutual 4.8$6,865 21.6%%Assurant Inc. 4.3$6,235 32.2%%Selective Insurance Group Inc. 4.3$6,220 25.6%%USAA 4.1$5,878 70.9%%Nationwide Mutual Group 3.3$4,735 29.7%%Berkshire Hathaway Inc. 2.5$3,550 43.9%%XL Group Ltd 1.6$2,235 84.6%%Chubb Ltd. 1.5$2,181 -13.9%%Klinefelter Insurance Group 1.5$2,095 19.1%%Cincinnati Financial Corp. 1.3$1,866 3.7%%Munich Re 1.3$1,847 7.3%%Penn National Insurance 1.3$1,824 35.9%%Allstate Corp. 1.3$1,801 57.7%%American National Insurance 1.2$1,682 111.4%%CNA Financial Corp. 1.2$1,666 63.0%%State Auto Insurance Companies 1.1$1,574 48.2%%AXIS 1.1$1,540 251.8%%SCOR 1.0$1,455 28.8%%Alleghany Corp. 1.0$1,411 26.4%%Allianz Group 1.0$1,410 0.2%%Fairfax Financial Holdings 1.0$1,371 90.0%%Cumberland Insurance Group 0.9$1,318 22.6%%Philadelphia Contributionship 0.9$1,216 32.8%%Starr International Co. 0.8$1,197 50.7%%WT Holdings Inc. 0.8$1,189 -4.1%%Brethren Mutual Insurance Co. 0.8$1,116 50.7%%Sompo Holdings Inc. 0.7$1,023 11.0%%AXA 0.7$955 6.3%%Frederick Mutual Insurance Co. 0.7$934 48.5%%Global Indemnity Ltd. 0.7$931 64.0%%HDI V.a.G 0.5$781 10.7%%Arch Capital Group Ltd. 0.5$780 %%Pennsylvania Lumbermens 0.5$757 5.8%%Kemper Corp. 0.5$744 5.0%%Tokio Marine 0.5$721 121.3%%Swiss Re AG 0.5$705 25.6%%Erie Insurance 0.5$686 -7.2%%Hanover Insurance Group Inc. 0.5$663 121.1%%



Group Name2017

PremiumsMkt

shareLossRatio


MarylandFire Insurers

American International Group 13.1$18,802 13.3%%Travelers Companies Inc. 10.9$15,703 44.9%%FM Global 8.2$11,743 66.5%%Farmers Insurance Group 5.5$7,861 29.4%%Zurich Insurance Group 4.9$7,083 8.7%%Liberty Mutual 4.8$6,865 21.6%%Assurant Inc. 4.3$6,235 32.2%%Selective Insurance Group Inc. 4.3$6,220 25.6%%USAA 4.1$5,878 70.9%%Nationwide Mutual Group 3.3$4,735 29.7%%Berkshire Hathaway Inc. 2.5$3,550 43.9%%XL Group Ltd 1.6$2,235 84.6%%Chubb Ltd. 1.5$2,181 -13.9%%Klinefelter Insurance Group 1.5$2,095 19.1%%Cincinnati Financial Corp. 1.3$1,866 3.7%%Munich Re 1.3$1,847 7.3%%Penn National Insurance 1.3$1,824 35.9%%Allstate Corp. 1.3$1,801 57.7%%American National Insurance 1.2$1,682 111.4%%CNA Financial Corp. 1.2$1,666 63.0%%State Auto Insurance Companies 1.1$1,574 48.2%%AXIS 1.1$1,540 251.8%%SCOR 1.0$1,455 28.8%%Alleghany Corp. 1.0$1,411 26.4%%Allianz Group 1.0$1,410 0.2%%Fairfax Financial Holdings 1.0$1,371 90.0%%Cumberland Insurance Group 0.9$1,318 22.6%%Philadelphia Contributionship 0.9$1,216 32.8%%Starr International Co. 0.8$1,197 50.7%%WT Holdings Inc. 0.8$1,189 -4.1%%Brethren Mutual Insurance Co. 0.8$1,116 50.7%%Sompo Holdings Inc. 0.7$1,023 11.0%%AXA 0.7$955 6.3%%Frederick Mutual Insurance Co. 0.7$934 48.5%%Global Indemnity Ltd. 0.7$931 64.0%%HDI V.a.G 0.5$781 10.7%%Arch Capital Group Ltd. 0.5$780 %%Pennsylvania Lumbermens 0.5$757 5.8%%Kemper Corp. 0.5$744 5.0%%Tokio Marine 0.5$721 121.3%%Swiss Re AG 0.5$705 25.6%%Erie Insurance 0.5$686 -7.2%%Hanover Insurance Group Inc. 0.5$663 121.1%%



that single form to fulfill notice requirements at renewal instead of having to send many individ-ual notices. The single notice not only simplifies the flow of information and reduces confusion for consumers, it saves money for insurers.

Legislation passed in 2016 that took effect Jan. 1, 2017, simplified the issue of deductibles. The law permits insurers to require percent-age deductibles or offer them as an option for policies or any specific peril, including wind storms, hail and hurricanes. If a policy has a mandatory percentage-based hurricane deduct-ible it can only apply at the start of the National Hurricane Center hurricane warning for any part of the state, regardless of where in the state the insured’s home is located. After Hurricane





Group Name2017

Premiums Mkt

shareLossRatio


MarylandAllied Lines Insurers

Travelers Companies Inc. 13.4$16,003 33.3%%FM Global 10.0$11,897 232.9%%USAA 9.9$11,838 69.7%%Assurant Inc. 8.1$9,651 26.2%%Selective Insurance Group Inc. 7.3$8,718 41.8%%American International Group 6.7$7,979 -74.9%%Zurich Insurance Group 4.3$5,118 56.6%%Nationwide Mutual Group 3.9$4,601 63.0%%Liberty Mutual 3.0$3,549 230.5%%American National Insurance 2.8$3,286 21.5%%XL Group Ltd 2.2$2,635 96.4%%Chubb Ltd. 1.8$2,201 43.8%%Everest Re Group Ltd. 1.7$2,059 5.4%%State Auto Insurance Companies 1.5$1,776 22.6%%Sompo Holdings Inc. 1.5$1,768 49.8%%Berkshire Hathaway Inc. 1.4$1,696 293.2%%Fairfax Financial Holdings 1.3$1,549 303.0%%Cincinnati Financial Corp. 1.2$1,462 42.2%%Alleghany Corp. 1.1$1,341 -5.2%%WT Holdings Inc. 0.9$1,031 70.2%%Klinefelter Insurance Group 0.8$990 48.1%%AXIS 0.8$941 108.3%%CNA Financial Corp. 0.7$884 32.0%%Cumberland Insurance Group 0.7$863 78.7%%Validus Holdings Ltd. 0.7$850 -14.5%%Hanover Insurance Group Inc. 0.7$841 5.8%%Brethren Mutual Insurance Co. 0.6$770 29.6%%Munich Re 0.6$762 %%Progressive 0.6$749 43.2%%Philadelphia Contributionship 0.6$735 94.6%%Swiss Re AG 0.6$705 47.5%%Markel Corp. 0.6$660 26.6%%Farmers Insurance Group 0.5$631 5.6%%HDI V.a.G 0.4$521 14.6%%AXA 0.4$492 %%Aspen Insurance Holdings Ltd. 0.4$473 158.4%%Frederick Mutual Insurance Co. 0.4$430 17.7%%MS&AD Insurance Group Holdings Inc. 0.4$420 -0.4%%Federated Mutual 0.3$407 -0.8%%W. R. Berkley Corp. 0.3$397 40.1%%Global Indemnity Ltd. 0.3$394 -17.0%%Sentry Insurance Mutual 0.3$385 53.3%%Allianz Group 0.3$372 -4.7%%



Group Name2017

Premiums Mkt

shareLossRatio


MarylandAllied Lines Insurers

Travelers Companies Inc. 13.4$16,003 33.3%%FM Global 10.0$11,897 232.9%%USAA 9.9$11,838 69.7%%Assurant Inc. 8.1$9,651 26.2%%Selective Insurance Group Inc. 7.3$8,718 41.8%%American International Group 6.7$7,979 -74.9%%Zurich Insurance Group 4.3$5,118 56.6%%Nationwide Mutual Group 3.9$4,601 63.0%%Liberty Mutual 3.0$3,549 230.5%%American National Insurance 2.8$3,286 21.5%%XL Group Ltd 2.2$2,635 96.4%%Chubb Ltd. 1.8$2,201 43.8%%Everest Re Group Ltd. 1.7$2,059 5.4%%State Auto Insurance Companies 1.5$1,776 22.6%%Sompo Holdings Inc. 1.5$1,768 49.8%%Berkshire Hathaway Inc. 1.4$1,696 293.2%%Fairfax Financial Holdings 1.3$1,549 303.0%%Cincinnati Financial Corp. 1.2$1,462 42.2%%Alleghany Corp. 1.1$1,341 -5.2%%WT Holdings Inc. 0.9$1,031 70.2%%Klinefelter Insurance Group 0.8$990 48.1%%AXIS 0.8$941 108.3%%CNA Financial Corp. 0.7$884 32.0%%Cumberland Insurance Group 0.7$863 78.7%%Validus Holdings Ltd. 0.7$850 -14.5%%Hanover Insurance Group Inc. 0.7$841 5.8%%Brethren Mutual Insurance Co. 0.6$770 29.6%%Munich Re 0.6$762 %%Progressive 0.6$749 43.2%%Philadelphia Contributionship 0.6$735 94.6%%Swiss Re AG 0.6$705 47.5%%Markel Corp. 0.6$660 26.6%%Farmers Insurance Group 0.5$631 5.6%%HDI V.a.G 0.4$521 14.6%%AXA 0.4$492 %%Aspen Insurance Holdings Ltd. 0.4$473 158.4%%Frederick Mutual Insurance Co. 0.4$430 17.7%%MS&AD Insurance Group Holdings Inc. 0.4$420 -0.4%%Federated Mutual 0.3$407 -0.8%%W. R. Berkley Corp. 0.3$397 40.1%%Global Indemnity Ltd. 0.3$394 -17.0%%Sentry Insurance Mutual 0.3$385 53.3%%Allianz Group 0.3$372 -4.7%%



Continued from Page 7 knocking on a victim’s door and saying, ‘I’ll help you negotiate the claim,’” Redmer said. “Our objective is not to spank people for misbe-having. Our objective is to have people behave properly.”

In typical style, Redmer worked with the Maryland Home Improvement Commission, which licenses and regulates contractors, as well as agents. “We spent a lot of time trying to ed-ucate folks as to who can do what, and that has helped a lot,” Redmer said.

In its latest effort to improve communication, the Maryland Insurance Administration became the first government insurance department to join Nextdoor, a private neighborhood social net-work.

In a recent Nextdoor poll, regulators asked participants if they understood that most home-owners insurance policies do not cover flooding. Of the nearly 3,000 residents who responded, 18% were unaware flooding was not covered. “The Maryland Insurance Administration then provided information to these participants to ed-ucate them on the steps recommended to better protect their family and home,” according to a press release.

Maryland has largely escaped major cata-strophic losses, though this year homeowners suffered through a major wind, snow and water events. In March, insurers suffered losses from a winter storm that brought snow, heavy rains and damaging winds. In May, the historic town of Ellicott City experienced its second catastrophic flash flood in two years after heavy storms that also affected Baltimore.

In general, though, Maryland insurers main-tain relatively low loss ratios, and rates have been stable as a result. The top 10 homeowners insurance groups have raised rates 3.3% so far this year and the same amount for 2017, accord-ing to SNL Financial’s RateWatch. USAA, the


Irene, Maryland had changed its law to limit the application of mandatory percentage hurricane deductibles to only those counties where a hurri-cane warning was issued. The rules were applied differently for flat deductibles and for optional percentage deductibles.

The thought was that allowing more de-ductible options in a transparent way would en-courage standard insurers to write more coastal business.

In 2017, lawmakers adopted the National Association of Insurance Commissioners’ Pub-lic Adjuster Licensing Model Act, which, among other things, sets professional and legal obliga-tions and requires public adjusters to provide a written contract, with a right to rescind, that discloses compensation and any financial interest the public adjuster has with any other party in-volved in any aspect of the claim.

“The issue was we had contractors per-forming public adjuster services without being licensed as a public adjuster. Contractors were







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Focus: MARYLAND Continued from Page 9

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fourth-largest group, has been most aggressive, increasing rates 15.7% this year after a 5.8% hike last year.

The fastest growing of the top 10 home in-surance groups is No. 8 American Family In-surance, which saw premiums in 2017 increase 25.3% while increasing rates 8.2% last year and another 7.3% this year after keeping rates flat in 2016.

Maryland is one of the most affordable mar-kets for homeowners insurance. The average premium was $982 in 2015, the most recent data available from the NAIC. But home insurance is actually even more affordable because of high incomes and high housing values. On our HURT Index, which compares premium to income to rank markets by affordability, Maryland ranks 47th. Only Delaware, the state of Washington, Oregon and Utah are more affordable.

In Maryland, 75.2% of houses are insured for values above $200,000, compared with the na-tional average of 65.1%.

GRAPEVINE Continued from Page 15 strength. Images of Michael’s destruction show many homes flattened, with mostly newer struc-tures left standing.

Loss estimates from wind and storm surge from catastrophe modelers average around $8 billion, ranging from a low of $3 billion to a high of $10 billion.

photographs that feed the estimate. In some cases, consumers can provide the on-site data collection for a claim. In a business where reve-nue has been based on the number of software li-censes sold, it will be difficult to shift from many field adjusters individually needing a claims estimating tool to a field full of lower cost people gathering basic data, and far fewer desk adjusters paying for Xactimate or Symbility licenses.

In the near term, no one contacted for this story predicted dramatic shifts in the market. The lead time to making any change in software as essential as claims appraisal is measured in years, not months.

But because of their close working rela-tionship over at least eight years, Symbility and CoreLogic should be able to integrate their companies much more quickly than most deals of this kind, unlocking opportunities in sales and product development.

CoreLogic still makes most of its money in the mortgage and real estate industry, and while it is aggressively focused on insurance, all the moves so far suggest the company is making a long-term play.

What is clear is the nature of the fight to come. Xactware is the entrenched, dominant player. Symbility is the newly reinforced upstart. A lot of money will be invested by both sides in product development over the next few years, and it is likely that the winner will be the one who makes the right bets on what to invest in and executes best on those decisions.

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Allstate Insurance Erie Insurance P INSURANCE REPORTOct 29, 2018 · company’s market dominance. Symbility has been making its case that a different business model makes it worthy