Sunday, February 24, 2008

Outsourcing Property Insurance

Insurance companies are quite traditional in conducting their business. In all their business transactions, they employ the same conservative attitude and tradition-bound ideas. Their conservatism and traditional outlooks affect the way they invest the premiums they get from policyholders. This fact is rather ironic when you think about the nature of their jobs.

Insurance companies are the key aspects in an industry where quantifying risks is considered part of the job. It is their function to offer as much financial security as they could to their clients. How come then that outsourcing property insurance is considered too risky?

Many insurance agencies defend themselves by saying that it is a time-honored tradition to keep business processes to themselves and outsourcing property insurance does not necessarily fall into that category. This is not to say however that outsourcing property insurance does not get a bit of share in the competitive market.

Although a relatively new concept, outsourcing property insurance is beginning to increasingly gain popularity among insurance companies. These companies who embrace the idea of outsourcing property insurance have grappled the fact that business always involves risks. So why not join the outsourcing property insurance market?

Indeed, outsourcing property insurance is not without its benefits. Industry insiders are predicting double-digit increases for 2003 due to the increasing popularity of outsourcing property insurance. With the degree of competition in today’s markets, companies are willing to squeeze in anything into their operations if it means increasing their efficiency in delivering goods.

Outsourcing property insurance is the way to go if it is a question of survival.

Outsourcing Property Insurance – Transcending Traditions

Based in McHendry Illinois, Member Insurance Agency offers insurance products and services for their clients in the hardware and building material industry. Wayne Fell, president and CEO of Member Insurance, states that it had taken some time for their company to finally accept the idea of outsourcing property insurance. “Nobody can do this better than we can” is the kind of traditional thinking that keeps large companies like Member Insurance from accepting the idea of outsourcing property insurance.

Finally though, by 2000, Member Insurance transferred their customer service to an outsourcing property insurance company. According to Fell, outsourcing property insurance is a form of specialization. “Just because you’re good at underwriting and you’re good at selling, it doesn’t mean you’re good at doing the paperwork,” Fell says by way of explaining why they opted for outsourcing property insurance.

And for most insurance companies who have adopted outsourcing property insurance, the trend is natural. Outsourcing property insurance has become a by-product of the competition in the market.

The Market is now open to outsourcing property insurance

More and more insurers are looking at outsourcing property insurance with a clearer vision. A research firm in Stamford, Connecticut, Gartner, Inc. found out in October and November of 2001 the extent of outsourcing property insurance in U.S. insurance carriers. According to their research, which used 114 U.S. insurance carriers as basis, 51 per cent of life and health insurers are outsourcing property insurance. In addition, outsourcing property insurance is done in 48 per cent of property and casualty insurers.

Industry insiders believe that the driving force of outsourcing property insurance is the Internet. The number of insurance companies selling Web-based products has placed much pressure on their company’s IT departments. The solution? Outsourcing property insurance.


Friday, February 22, 2008

Property Insurance Jobs

Despite the complications involved in a property insurance job, getting it is not that hard. For instance, there are only two significant points that you need to consider before applying for a property insurance job.

One of the first things you should think about when you apply for a property insurance job position is education. Although a property insurance job only requires minimum education, a high school diploma perhaps, most companies prefer to take on those who have at least some college. So a college education is a step in the right direction if you’re planning on taking a property insurance job.

Employment rates in the insurance industry may vary and this is what you need to understand when you apply for a property insurance job. The number of property insurance jobs open to you may change according to the dynamics of the insurance industry. For instance, taking on a property insurance job as a welfare eligibility clerk right now might not be a good idea. Because of the reforms going on in welfare legislation, the demand for applicants in this kind of property insurance job is not that high.

However, if the property insurance job you want involves customer relations, then you might just be in for a great ride. Since emphasis on customer relations are becoming a trend, a property insurance job as an adjustment clerk, otherwise known as customer service, is a good place to start.

Now, speaking of places to start, where can you find postings of property insurance jobs? Below are a few job sites that are currently posting property insurance jobs. – Property Insurance Job Posting

CareerMag is currently posting a property insurance job vacancy at USAA. The property insurance job opening requires only a high school diploma. If you apply for this property insurance job, you will be based in San Antonio, Texas. The salary for this property insurance job is open for negotiation.

Nature of this property insurance job. The property insurance job as a Property Insurance Claims Examiner requires considerable skills in investigation, evaluation, and assessment. Since this property insurance job involves evaluating and assessing the eligibility of insurance claims filed, you will need to have exhaustive knowledge of all the terms and facts of the USAA policies.

Aside from the Property Insurance Claims Examiner, CareerMag also has another property insurance job posting open. The property insurance job is as Property Field Adjuster for USAA. This property insurance job requires a higher education minimum than the first one – 4-year college degree. With this property insurance job, you will be based in San Diego, California.

Nature of this property insurance job. The property insurance job as a Property Field Adjuster involves direct contact since you will serve as a field customer contact representative. In this property insurance job, you will be investigating, evaluating, and resolving property claims. With that in mind, this property insurance job therefore requires extensive knowledge on the terms and conditions of USAA policy contracts.

Another online job site listing is ExecutivesOnly. The current property insurance job posting at ExecutivesOnly is a position at a company based in Connecticut. This property insurance job is full-time. The compensation for this property insurance job is $90,000 – quite high since it is basically an executive position. This property insurance job is for an accounting position. In order to apply for this property insurance job, you must have very strong background in P&C back office structures and accounting.


Friday, February 8, 2008

Home Title Property Insurance

Is it possible for someone else to claim ownership of a property after closing?

The answer is yes.
And this is especially true if you do not have home title property insurance.

Without home title property insurance during your title examination, legal entanglements may arise when the rights of the previous owner are overlooked. A home title property insurance policy protects you against losses that occur when you find out that after closing the sale someone else may claim ownership of the property.

What is home title property insurance?

Home title property insurance is an insurance policy that offers protection for the property owner against loss that occurs arising from a deficiency in a title for real estate. For example, you just bought a piece of property. At a later date, you find that someone else claims ownership of it.

The home title property insurance will pay your losses should that person decide to sue for his rights. The same thing applies when the property is mortgaged. The only thing different is that the lending company will have a separate home title property insurance policy to protect its interests.

What is a title examination and how does it affect home title property insurance?

As a general rule, all property titles are subject to close examination prior to closing. The person conducting the test will look into past deeds, wills, and trusts to see if there are any problems. Should any defect, problems, or “clouds” are found, these are corrected by the title examiner.

So why should you get home title property insurance anyway?

If the title looks good, home title property insurance should not be a terrible necessity. This is not necessarily true. No one is perfect. If there are inaccuracies in the results of the examination, having home title property insurance will protect you from losses that arise from those.

What does home title property insurance policy cover?

Typically, home title property insurance covers pretty much any problems that did not show up during the title examination. Home title property insurance also protects you from losses resulting from misses on the examiner’s part. For example, during a title search, the examiner failed to correct the fact that the wife of the previous owner was listed on the deed but did not sign-off at closing. When the wife sues for her rights, home title property insurance will cover your losses.

In addition to problems with the title search, home title property insurance will also cover losses caused by errors in public records. If problems arise after closing, the home title property insurance policy will pay for legal fees, including fee for your lawyer, if you must go to court to defend your deed. And if you lose your property, the home title property insurance will cover your loss up to the amount of the policy.


Sunday, February 3, 2008

Citizens Property Insurance Corporation

Citizens Property Insurance Corporation was created by the Florida Legislature in 2002. The purpose of forming Citizens Property Insurance Corporation was to provide insurance coverage for homeowners in Florida, especially those in high-risk areas.

Citizens Property Insurance Corporation is the off-shoot of a merger between two state-run insurance entities. These two companies that make up Citizens Property Insurance Corporation are the Florida Residential Property and Casualty Joint Underwriting Association 9FRPCJUA) and the Florida Windstorm Underwriting Association (FWUA).

Citizens Property Insurance Corporation provided the kind of coverage that high-risk homeowners need. Before Citizens Property Insurance Corporation, Florida homeowners had trouble finding an insurance company willing to fund for the cost of their damages. With Citizens Property Insurance Corporation, Florida homeowners are looking at coverage that could reach up to $350,000. This amount which Citizens Property Insurance Corporation is willing to provide covers the costs of damages, repair, and rebuilding.

In addition, Citizens Property Insurance Corporation also pays for reconstruction of structures outside the house such as fences, swimming pools, and the like. Replacement costs for lost or damaged items are also included in the coverage that Citizens Property Insurance Corporation provides.

Recently though, Citizens Property Insurance Corporation is experiencing a squeeze in its budget. Four hurricanes – Charley, Ivan, Jeanne, and Frances – devastated Florida. On July 28, 2004, Citizens Property Insurance Corporation estimated about 78,257 insurance claims for damages wrought by the four hurricanes.

According to Risk Management Solutions, an independent organization that assesses disaster damages, Citizens Property Insurance Corporation faces total damages worth $1.77 billion. Contrary to what Citizens Property Insurance Corporation released in late July, Risk Management Solutions found that the number of claims reaches almost 92,000. Citizens Property Insurance Corporation also faces the challenge of even higher claims within the next few months.

Citizens Property Insurance Corporation suffers $252 million in damages in their wind-only policies for High-Risk Accounts from Hurricane Jeanne. The estimated loss from the same hurricane for the Personal Lines Accounts of Citizens Property Insurance Corporation is $53 million. Citizens Property Insurance Corporation experienced somewhat lesser deficit from Hurricane Jeanne in their Commercial Lines Account with only $27 million to grapple with.

Hurricane Ivan costs less for Citizens Property Insurance Corporation in damages. The High Risk Accounts of Citizens Property Insurance Corporation, the former Florida WUA, only costs $220 million, a somewhat lower number compared to Hurricane Jeanne. Citizens Property Insurance Corporation estimates a total loss of $12 million from Hurricane Ivan for both their Personal and Commercial Lines Accounts.

Citizens Property Insurance Corporation estimates spending $225 million worth of coverage for damages and loss caused by Hurricane Frances. For the residential multi-peril policies of Citizens Property Insurance Corporation, the amount reaches up to $50 million. Citizens Property Insurance Corporation also expects to spend an additional $15 million in commercial residential policies from the same hurricane.

Citizens Property Insurance Corporation projects a loss worth $850 million from Hurricane Charley for their wind-only High-Risk Account policies. For the Personal Lines Accounts, Citizens Property Insurance Corporation sees spending around $60 million. An additional $15 million from Citizens Property Insurance Corporation is also needed to cover their Commercial Lines Accounts. All in all, Hurricane Charley costs Citizens Property Insurance Corporation an astounding $925 million.

Citizens Property Insurance Corporation is no doubt facing a peril of going into deficit. If Citizens Property Insurance Corporation, the company will be forced to assess other insurance companies in order to cover all claims.


Saturday, February 2, 2008

Commercial Property Insurance

Commercial property insurance is insurance primarily targeted for commercial properties such as businesses, farms, and ranches. Commercial property insurance protects people who own such types of properties from damage to their buildings and contents.

Commercial property owners may include those who are business operators or those leasing a property to another entity. For protection, these people purchase commercial property insurance policies that protect the building and its associated structures. Property owners who let their houses or buildings may buy commercial property insurance policies that protect the building’s contents, such as machinery, furniture, and stored or displayed merchandise.

Types of Commercial Property Insurance Policies

There are different types of commercial property insurance policies. These types of commercial property insurance policies cover different kinds of risk factors for causes of loss and damage. These risk factors that are covered by commercial property insurance policies may include natural disasters.

Commercial property insurance policies generally fall into three categories.

  1. The first category of commercial property insurance policies is the basic form. Commercial property insurance policies of this kind cover common perils like damage caused by fire, lightning, windstorm, vehicles, aircraft, and civil commotion.

  2. The second commercial property insurance policy category is the broad form. Broad form commercial property insurance policies include coverage for basic perils, plus others, such as water damage, collapse, glass breakage, weight of snow, ice or sleet, and sprinkler leakage.

  3. The third is the special form commercial property insurance policy. This type of commercial insurance policy protects business owners from all causes of loss except those that are specifically excluded in the contract. These causes that can be covered by the special form commercial insurance policy include flood, earth movement, war, nuclear disaster, wear and tear, insects, and vermin.

Other additional coverage bought by consumers of commercial property insurance are liability policies, business interruption, and extra expense. The liability policy of commercial property insurance protects the business owner against the cost of a lawsuit and possible judgment. Coverage on business interruption can reimburse the commercial property insurance policyholder for income lost when his business is interrupted due to the loss or damage of a building.

Extra expense in commercial property insurance covers payments made by the policyholder to resume business operations as quickly as possible after a loss. Many commercial property insurance policies include coverage for flood. But despite this, most commercial property insurance policyholders get their insurance from the National Flood Insurance Program of the Federal Government.

Some commercial property insurance policies do not cover losses from extreme glass damage or crime. If that’s the case, business owners generally buy this from other, more specialized commercial property insurance companies. A lot of companies are focusing their commercial property insurance policies to cover certain areas not covered by traditional policies.


Friday, February 1, 2008

Property and Casualty Insurance

With recent issues including natural disasters, mold, terrorism, and market share competition, property and casualty insurance has become more costly and hard to obtain. This aspect of property and casualty insurance is especially true in conventional and government-assisted housing and the commercial markets.

In 2001, the property and casualty insurance industry has posted a $7.9 billion net loss. This property and casualty insurance loss is the first ever net loss, according to the Insurance Services Office, Inc. (ISO) and the National Association of Independent Insurers (NAII). Experts have predicted a return rate for property and casualty insurance at a negative 2.7 per cent, almost 6.5 per cent lower than that of year 2000.

As a result, several property and casualty insurance companies are retrenching. One of the steps they undertook to cut back on their losses is to avoid adding any new policies into their property and casualty insurance.

They have also purposefully stopped updating or renewing their existing property and casualty insurance policies. Furthermore, the premium price of property and casualty insurance policies has increased.

Stated causes of the property and casualty insurance problem

“Mold is Gold” was the headline of one trial lawyer publication. The recent large court decisions against insurers have jeopardized profitability of the property and casualty insurance industry.

The trial courts recognize the invasive mold as the latest household hazard and property and casualty insurance policyholders are getting the most out of their lucrative lawsuits. A well-publicized Texas lawsuit resulted in a $32.1 million decision – good for the owner, bad for the property and casualty insurance industry.

The September 11 event has also negatively impacted the property and casualty insurance industry. It has been reported that September 11-related property and casualty insurance claims total to as high as $70 billion. The same event has also caused the decline of the stock market which added to the downward movement of the property and casualty insurance industry.

The effects of the property and casualty insurance problem

Property and casualty insurance is essential in real estate. The real estate market cannot function properly if property and casualty insurance is not as accessible as it used to or not as affordable as before. Property and casualty insurance coverage is essential because it is an underwriting requirement when you apply for a conventional, government-assisted and commercial mortgage. Lending companies require property and casualty insurance; otherwise the mortgage application will be rejected.

Real estate leans heavily on mortgages to close a great majority of its sales. Without property and casualty insurance, there won’t be any mortgages. As a result, sales in the real estate market will plummet.

Moreover, without property and casualty insurance coverage, homeowners will have a difficult time maintaining their mortgage obligations. This may force lenders to foreclose on the property or subject the homeowners to expensive lender forced-place coverage.