This study provides a discussion of the impact of COVID-19 on business interruption losses in the U.S. as well as an overview of the commonly relied upon ISO Business Income and Extra Expense (BIEE) insurance policy. The authors offer an analysis of the language contained in the unendorsed BIEE and summarize the arguments as to why business interruption insurance should or should not cover pandemic-related losses. Finally, the authors provide an overview of proposed approaches to address business interruption losses attributed to current and future pandemics.
In this study, the authors discuss the pet insurance market and offer recommendations regarding licensing and reporting that they believe will better serve consumers and improve market transparency.
This paper examines the association between monitoring and earnings management by property‐casualty insurers. Prior literature has evaluated the impact of auditors and actuaries on insurer reserving. We extend this work by considering the nonrandom nature of monitor assignment. We model the insurer decisions regarding choice of auditor and actuary jointly using a Heckman selection model. Consistent with prior literature, we account for potential loss reserving incentives that may confound these decisions. We find that the use of internal actuaries is significantly related to higher reserve errors, but this is reduced, but not fully offset, when the internal actuary is an officer of the insurer. We find lower reserve error for auditors from a Big N firm. However, the use of an auditor and actuary from the same Big N firm is significantly related to higher reserve errors.
This research investigates information verification by life insurers with respect to postclaim underwriting through denied and resisted claims. We provide a theoretical model to explore the optimal strategy for insurers regarding preloss versus postclaim underwriting. Using differential cost structures, the model predicts that it is possible for some insurers to follow a strategy of postclaim underwriting while others do not. Evidence of this is found in the empirical analysis. Insurers that postclaim underwrite are identified by a decrease in underwriting expenses and an increase in the claim investigation expense in conjunction with increases in denied and resisted claims.
Life insurance is generally purchased to protect against the economic consequences associated with premature death. Consumers and producers may assume that all life insurance companies settle death claims in one way—full payment of the life insurance proceeds. This is not always the case. Life insurers may deny or resist paying life insurance claims, and these claims are reported on the Schedule F of the statutory financial statement. This paper analyzes the claims that have been denied and resisted by life insurers and makes recommendations to modify the current Schedule F so that it is more informative to consumers, producers and state insurance regulators.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.