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Mercury Insurance Launches Programs to Help California Homeowners with Wildfire Risk

Mercury Insurance Launches Programs to Help California Homeowners with Wildfire Risk

LOS ANGELES, Oct. 12, 2020 /PRNewswire/ — Wildfire season is well underway, with wildfires scorching a record breaking number of acres up and down California, and the peak of the season is yet to come. Mercury Insurance (NYSE: MCY) today announced two new programs the company is launching to help Californians better protect their homes and families if they live in areas prone to wildfires. Homeowners who take one or more steps to either harden their homes against wildfires or live in a community recognized by the National Fire Protection Association® (NFPA) as a Firewise USA® site will be eligible to receive discounts of up to 18%.  And, homeowners who have a California Fair Access to Insurance Requirements (FAIR) Plan policy are now able to strengthen their protection with Mercury’s new difference-in-conditions endorsement, which fills the gaps in their FAIR Plan coverage.

Mercury Insurance is one of the first companies to offer wildfire mitigation discounts to California homeowners living in the wildland urban interface. Homeowners who take property and community wildfire prevention measures could be eligible to save up to 18% on the wildfire premium portion of their insurance policy.

“We’re in this together, which is why Mercury is engineering solutions to encourage proactive actions that better protect homeowners from wildfires,” said Jane Li, Mercury Insurance’s director of product management. “It’s important for homeowners in these areas to take proactive steps to help shield their property from fire, and it’s just as important for everyone in the community to work together to reduce their shared ignition risks, which could save them money and improve their insurance eligibility.”

The property level discount applies to policies for hardened home structures and landscapes with sufficient defensible space. Installing a class “A” rated roof, using siding made of stucco, metal or

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Public-Private Partnerships May Be a Needed Insurance Backstop Against COVID-19-Exposed Systemic Risk

Public-Private Partnerships May Be a Needed Insurance Backstop Against COVID-19-Exposed Systemic Risk

AM Best believes proposed public-private partnerships to address the disastrous effects on businesses related to COVID-19 are warranted, given the systemic risk posed by the pandemic.

In its new Best’s Commentary, “Retroactive Legislation, Social Inflation: Credit Negatives for Insurers,” AM Best states that it expects significant reserve uncertainty arising for the current accident year given the challenge for insurers to estimate ultimate losses resulting from the COVID-19 pandemic and the related shutdowns. Social inflation, combined with lawsuits addressing liability policies, will drive defense containment costs significantly higher. Court decisions will influence actual claims payouts, creating challenges in determining prudent reserve estimates and payout patterns. In addition, a number of legislative and policy measures are being contemplated that would nullify business interruption coverage exclusions in commercial property policies and force insurers to compensate policyholders for risks that were excluded during underwriting. Insurers with smaller capital bases in particular would be more vulnerable to these measures. AM Best previously has discussed the potential threat to property/casualty insurers’ solvency should legislated policy changes force them to pay retroactive coverage (see related Best’s Commentary).

AM Best believes any public-private partnership adopted to fill this protection gap should take into account the capital supporting all risks insurers bear, which is critical due to the uncertainty inherent in taking on those risks. As insurers consider the level of capital they should hold, they factor in the demands that each risk poses, as well as assumptions about the level of diversification among these risks. In addition, rating agencies and regulators require a specified level of capital commensurate with the level of risk the insurers have on their books.

“Pandemic risk does not afford insurance companies any geographic diversification due to its global nature,” said Stefan Holzberger, AM Best chief rating officer. “Diversification by line of

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Fifth of countries at risk of ecosystem collapse, analysis finds | Biodiversity

Fifth of countries at risk of ecosystem collapse, analysis finds | Biodiversity

One-fifth of the world’s countries are at risk of their ecosystems collapsing because of the destruction of wildlife and their habitats, according to an analysis by the insurance firm Swiss Re.

Natural “services” such as food, clean water and air, and flood protection have already been damaged by human activity.

More than half of global GDP – $42tn (£32tn) – depends on high-functioning biodiversity, according to the report, but the risk of tipping points is growing.

Countries including Australia, Israel and South Africa rank near the top of Swiss Re’s index of risk to biodiversity and ecosystem services, with India, Spain and Belgium also highlighted. Countries with fragile ecosystems and large farming sectors, such as Pakistan and Nigeria, are also flagged up.

Countries including Brazil and Indonesia had large areas of intact ecosystems but had a strong economic dependence on natural resources, which showed the importance of protecting their wild places, Swiss Re said.

“A staggering fifth of countries globally are at risk of their ecosystems collapsing due to a decline in biodiversity and related beneficial services,” said Swiss Re, one of the world’s biggest reinsurers and a linchpin of the global insurance industry.

“If the ecosystem service decline goes on [in countries at risk], you would see then scarcities unfolding even more strongly, up to tipping points,” said Oliver Schelske, lead author of the research.

Jeffrey Bohn, Swiss Re’s chief research officer, said: “This is the first index to our knowledge that pulls together indicators of biodiversity and ecosystems to cross-compare around the world, and then specifically link back to the economies of those locations.”

The index was designed to help insurers assess ecosystem risks when setting premiums for businesses but Bohn said it could have a wider use as it “allows businesses and governments to factor biodiversity and

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New York ‘At Risk’ Of Coronavirus Outbreak, Analysis Finds

New York ‘At Risk’ Of Coronavirus Outbreak, Analysis Finds

NEW YORK, NY — A little over three months ago, New York was one of just three states that was on track to contain the coronavirus, according to the nonprofit Covid Act Now, which tracks local-level coronavirus data. It was a remarkable turnaround for the state, which quickly became the world’s COVID-19 epicenter in the spring and at one point saw over 800 coronavirus-related deaths a day.

And while the number of New Yorkers dying from the disease each day has dramatically fallen into the single digits, Covid Act Now has since revised its rosy outlook and warned that New York is at risk of an outbreak, much like the majority of the country.

New York’s outlook is now worse than Maine, Washington State, California, New Mexico, Hawaii, Maryland and the Northern Mariana Islands.

The outlook comes as Gov. Andrew Cuomo this week announced drastic new rules for places seeing clusters of cases. In the hardest hit areas, non-essential businesses and schools would close, and houses of worship could have no more than 10 people inside.

The state identified clusters on south shore of Nassau County on Long Island, in Rockland and Orange counties in the Hudson Valley, and in parts of Brooklyn and Queens in New York City.

The state has so-called “Red Zone” focus areas in four counties where the positivity rate over the past three weeks reached 6.4 percent. The rest of the state, meanwhile, held steady at 0.91 percent. Red zone focus areas are home to 2.8 percent of the state’s population but account for nearly a fifth of all positive cases in the state during that three-week period.

New York remains at the second-highest level of risk behind “active or imminent outbreak,” according to Covid Act Now.

New York Coronavirus Overview

  • Daily new cases per

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Musk says Tesla to use new batteries, tech at Berlin factory; flags production risk

Musk says Tesla to use new batteries, tech at Berlin factory; flags production risk

(Reuters) – Tesla Inc Chief Executive Elon Musk said on Wednesday the company will produce Model Y with a new structural battery design and technology at its Berlin factory next year and that could result in a “significant production risk”.

The U.S. electric carmaker plans to manufacture a new version of its Model Y crossover vehicle, and possibly even battery cells at the site. Last month, Musk said that Tesla will use its Germany-based plant to demonstrate a radical overhaul of how its cars are built.

The company plans to start the production of Model Y at Gigafactory Berlin during the second half of 2021.

Tesla’s new battery cell – a larger cylindrical format called 4680 that can store more energy and is easier to make – is key to achieving the goal of cutting battery costs in half and ramping up battery production nearly 100-fold by 2030.

The company’s new structural battery pack requires the new 4680 battery cells in order to work.

Musk said on Wednesday that it will take about two years for Tesla factories in Fremont and Shanghai to embrace the new technology.

“Fremont and Shanghai will transition in 2 years when new tech is proven,” Musk said in a tweet https://bit.ly/2I8Gam3.

The company said last week that it delivered 139,300 vehicles in the third quarter, a quarterly record for the electric carmaker.

Tesla’s delivery push has been supported by its new Shanghai factory, the only plant currently producing vehicles outside California, as it is also building a new vehicle and battery manufacturing facility near Berlin.

(Reporting by Sabahatjahan Contractor and Kanishka Singh in Bengaluru, Editing by Sherry Jacob-Phillips)

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