Marsh & McLennan Agency Blog

Flood: Understanding the Risk & Navigating Insurance Options

With three-quarters of the Earth covered in water, it’s no surprise that flood is one of the world’s most destructive — and most common — natural disasters.

Individuals and businesses can be exposed to flooding virtually anywhere, at any time of year; yet flood continues to be one of the world’s most under insured events. To bring awareness to this issue and to educate consumers and businesses on the importance of obtaining flood insurance.

Marsh & McLennan Agency has developed a whitepaper, Flood: Understanding the Risk, Navigating Insurance Options.

Read the report now!



Is the Automobile Industry Ready for an Electric Revolution?

Though Tesla has emerged as the seeming electric car leader, in July 2017 Volvo announced that it would go fully electric by offering an electric version across its full range and, that their new models offered would all be electrically powered. Other automobile manufacturers, such as Ford, General Motors, and BMW have likewise pledged to design and deliver vehicles to meet the growing public demand for electric motor vehicles. But is the automobile ecosystem ready for the dramatic changes that electric-powered autos will bring?

Electric Vehicle Charging Stations

Currently, petroleum-based fueling stations outnumber electric charging stations by a wide margin. That gap is expected to narrow with planned charger installations and significant development in fast charging. In order for electric vehicles to become competitive with internal combustion engine vehicles, a charging infrastructure needs to be in place to ensure drivers won’t be stuck out on the road. While many of the current chargers being installed run on 240 volts, in order for chargers to be seen as truly competitive, fast chargers need the capacity to reach 350 kilowatts (kW). The next-generation fast charger is expected to recharge electric cars for a range of 200 – 300 miles with a 15 minute fast charge. Continue reading…

Explaining Personal Insurance Auto Premium Increases

Auto accidents – and their severity – have been on the increase in recent years, with insurance companies paying more in claims and policyholders paying more for insurance. Consider these factors:

  • Technology Usage – At any given daylight moment across America, approximately 660,000 drivers are using cell phones or using electronic devices while driving.
  • Distracted Driving – Every day there are 9 deaths and more than 1,000 injuries due to distracted driving – that’s more than 3,000 deaths and almost 400,000 injuries a year.
  • Rising Medical Costs – Medical costs in the United States have risen at an average annual rate of 3.0% for the past five years.
  • Inexperienced Drivers – Motor vehicle crashes are the leading cause of teenager deaths, and in 2015, 9% of all drivers in that age group involved in fatal crashes were distracted at the time of the crash.
  • Auto Repair Costs – The cost of repairing a vehicle has increased every year since 2010. Average collision
    claims are almost 24% higher than they were in 2010.
  • More Cars On the Road – 3.22 trillion miles were driven on the nation’s roads in 2016, up 2.8% from the year before. The more people drive, the more frequently they get into accidents.
  • Severe Weather – Weather disasters like hurricanes, hail and flood end up costing billions in damages, which auto insurers cover through comprehensive insurance.

Contact us today if you have any questions!

EEOC’s Status Report in AARP V. EEOC Creates Uncertainty for Wellness Programs

In its March 30 status report to the U.S. District Court for the District of Columbia in American Association for Retired Persons (AARP) v. EEOC, the EEOC stated that “it does not currently have plans to issue a Notice of Proposed Rulemaking addressing incentives for participation in employee wellness programs by a particular date certain, but it also has not ruled out the possibility that it may issue such a Notice in the future.”

Employers continue to face uncertainty as to wellness program incentives subject to the ADA and GINA (i.e., those with medical exams or disability-related inquiries) as the EEOC awaits confirmation of Janet Dhillon as EEOC Chair and considers “a number of policy choices available.” In other words, the EEOC may wait until the Senate confirms outstanding nominations before re-engaging in the rulemaking process, leaving wellness programs open to challenge in 2019 by employees who feel that the incentives (or penalties) are so great that they render the program involuntary.

Read the full compliance update…

Vertical Integration Continues with CIGNA/Express Scripts Announcement

Not long after the announcement that CVS Caremark would buy Aetna comes news of CIGNA’s deal to buy Express Scripts. Given that United Health Group already owns the OPTUM pharmacy benefit manager, the proposed CIGNA/ESI deal underscores that the market has swung “back to the future,” where medical and pharmacy benefits are managed by one entity.

This type of vertical integration makes business sense because of the opportunity to manage the total cost of care across medical and pharmacy. As discussed in this WSJ article, we’re seeing other examples of market integration as well. The proof of concept will be in the bottom line for the consumer and employer-sponsored plans. Historically, large employers have carved pharmacy benefits out of the medical plan and gone directly to a PBM for more favorable pricing and a greater share of rebates than the carriers were usually willing to share. The big question is whether the alliances between the medical plans and PBMs bring greater cost efficiencies, or whether they limit competition, choice and employers’ leverage in the market.

Read More…

CMS Extends Transition Relief for Non-Compliant Plans through 2019

On April 9, 2018, the Centers for Medicare & Medicaid Services (CMS) announced a one-year extension to the transition policy (originally announced November 14, 2013 and extended several times since) for individual and small group health plans that allows issuers to continue policies that do not meet ACA standards. The transition policy has been extended to policy years beginning on or before October 1, 2019, provided that all policies end by December 31, 2019. This means individuals and small businesses may be able to keep their non-ACA compliant coverage through the end of 2019, depending on the policy year. Carriers may have the option to implement policy years that are shorter than 12 months or allow early renewals with a January 1, 2019 start date in order to take full advantage of the extension.

Read the full compliance update…

Will the Chemical Industry Embrace Blockchain?

Innovations in technology are driving an opportunity for development and growth in almost all industries today. One such advancement known as blockchain, may provide the chemical industry with a vehicle for great innovation gains.

Blockchain is a continuously growing list of records (blocks), which are linked and secured using cryptography. Each block contains a secure reference of the previous block (a cryptographic hash), a timestamp and transaction data. By design, blockchain is inherently resistant to data hacking. It is an open, distributed ledger that can record transactions in an efficient, effective, verifiable and permanent manner. Blockchain is purportedly more secure, and less expensive that existing data storage methods. Continue reading…

Compliance Issues That Should Be on Your Radar Screen for 2018

It’ll come as no surprise that a top compliance issue for employer-sponsored health plans right now is ACA shared-responsibility requirements and related IRS reporting. Although the recent tax reform legislation zeroed out the individual mandate penalty beginning in 2019, the employer mandate and its assessments remain on the books. The means large employers must continue to gather data on offers of coverage and enrollment for 2018 reporting due in 2019.

With respect to 2017 reporting, the IRS delayed the deadline for furnishing 2017 Forms 1095-C and 1095-B to individuals to March 2, but IRS filing deadlines are unchanged – February 28 if filing by paper or April 2 if filing electronically. An automatic 30-day extension of the IRS filing deadline is available by submitting Form 8809 before the relevant due date. The IRS has also extended the good-faith compliance standard to 2017 reporting but has said it doesn’t expect to do so for 2018 reporting due in 2019.

Read More…

Equipment-as-a-Service Offers New Options for Manufacturers

The Internet of Things (IOT) is poised to deliver significant changes to many industries in the next few years. Silicon Valley experts Bain & Company predict that companies selling IoT solutions will see revenues increase to over $450 billion in the next 3 years. Incredibly, worldwide there will be 75.4 billion connected devices by 2025. This disruptive change to the market is opening up new opportunities to the manufacturing industry.

Digitization is adding another layer of opportunity for manufacturing companies to develop revolutionary new business models to the market. One new business model that is showing great promise is applying the software-as-a-service (SAAS) business model to provide IoT technology to equipment manufacturers.

SAAS became popular with the development of cloud computing. Basically, SAAS business models offer users with software access for a subscription fee. Netflix was an early adopter; today, thousands of subscription software service applications (apps) are available to businesses and end-users alike. One of the main advantages of SAAS services is that the company manages upgrades, maintenance and security issues. Continue reading…

New Commercial Auto Loss Recoupment Surcharge

The NC Reinsurance Facility (NCRF) will implement a new commercial auto loss recoupment surcharge of 14.61% on October 1, 2018 for all new and renewal commercial auto policies effective on or after October 1, 2018 through September 30, 2019. The surcharge will apply to all commercial auto policies whether ceded to the NCRF or retained as voluntary business by the carrier.

The NCRF was established by the Legislature in the early 1970s as a replacement for the Assigned Risk Plan in order to provide auto liability insurance for auto owners who could not get insurance in the voluntary markets. The NCRF is operated on a no loss/no gain basis. Recently, the NCRF has sustained substantial losses from commercial auto operations. To recoup these losses, it is necessary to add a recoupment surcharge to all commercial auto policies written in North Carolina. The recoupment surcharge is reviewed and adjusted on an annual basis.

The Independent Insurance Agents of North Carolina have compiled a list of frequently asked questions and a video seen below to help further detail this surcharge.

If you have any questions or need guidance, please do not hesitate to reach out to your local Marsh & McLennan Agency representative.