PCI looks to boost awareness of rises in auto fatality rates

The US property/casualty market must focus on a number of long-term challenges that threaten insurers and reinsurers, according to David Sampson, the president and chief executive officer of the Property Casualty Insurers Association of America (PCI).

Sampson told PCI Today that there is a wide range of issues the PCI is seeking to address via Federal and state authorities.

These include the need to address the recent historical high levels of auto losses and auto fatalities, changes to the Dodd-Frank Act, proposed tax reforms, and changes to the National Flood Insurance Program (NFIP).

In terms of auto losses, Sampson said PCI wants to raise awareness of just how bad auto fatality rates have become and encourage policymakers to act.

“We’re very focused on auto loss cost and drivers on both personal and commercial lines,” he said. “Auto fatality rates are at 50-year historic highs and we’re trying to sensitise regulators and public policymakers on how dramatic accident frequency and severity trends are increasing.”

According to Sampson, the reasons behind these historic high levels of fatalities are many, and include distracted driving, whereby the driver’s attention is diverted by talking or texting on a cellphone.

PCI has persuaded authorities in Texas to add distracted driving to their list of vehicular offences. It has failed to get Florida to do the same, although Sampson said that it had not given up on trying to get Florida to reconsider.

Driving under the influence of drugs is another problem, due to the increase in the number of people driving under the influence of opioids and prescription drugs, including medical marijuana in some states.

Sampson added that the PCI was pressing for the passing of the HR 1422 bill, also known as the Ross-Castor Private Flood Insurance Market Development Act of 2017, which is designed to promote the development of a robust private flood insurance market to compete with the NFIP.

Sampson believes the private market has the potential to step up when it comes to covering flood losses. He pointed out that the NFIP may end up covering flood losses of up to $15.5 billion from hurricanes Harvey and Irma, but that private insurers were expected to cover flood losses of up to $25.5 billion from the same storms.

Looking at total losses the NFIP was covering just 37.5 percent of losses, while the private market covered the remaining 62.5 percent.

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