Best's Review



From the Editor's Desk
Water, Water, Everywhere

Private insurers eye the U.S. flood insurance market while marine insurers in London pull back from certain lines of business.
  • Patricia Vowinkel
  • December 2018
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Floods damage countless homes every year. While major hurricanes like Harvey and Florence generate a lot of press, flood damage is a problem for homeowners in most U.S. states.

And yet insurers generally stay away from flood risks, with flood damage excluded under standard homeowners policies. One reason is that the damage can be so widespread and extensive that it can be impossible to spread the risk adequately. Pricing is also difficult without better data.

Little by little, however, the federal government is seeking to shift more of the coverage into the private market. In “Opening the Floodgates,” Best's Review looks at the latest developments with the government's National Flood Insurance Program and the challenges facing the private market.

While Harvey and Florence damaged residential and commercial properties, yachts were also a big loss with Hurricane Irma in Florida last year.

That was one factor that took a toll on the marine insurance market in London last year. Now as the market prepares for 2019, some syndicates, under pressure from Lloyd's to improve their performances, are exiting one or more lines of marine business. In “Rough Seas,” Best's Review examines the marine market in London and how it is seeking to correct course for 2019.

December is Inland Marine and Marine Insurance Awareness Month. Best's Review's coverage includes rankings of the top U.S. writers in these markets.

Hurricanes often deal sudden, major blows to property. But for most insurers, it's the drip, drip, drip of leaky pipes and malfunctioning appliances that add up to significant losses. Non-weather-related water losses are one of the leading causes of homeowners claims, according to industry reports.

In “Plugging the Leaks,” Best's Review looks at the problem of non-catastrophe water damage and how insurers are using new technology to manage the risk.

Losses from catastrophes have a major impact on industry profitability. Return on equity, one measure of profitability, is expected to improve significantly for the property/casualty insurance industry for 2018, helped by lower catastrophe losses, higher investment income and corporate tax cuts.

In “Rating Return,” Best's Review looks at the metrics of profitability, and in “Hitting the Targets,” Best's Review speaks with Assurant CEO Alan Colberg about the company's multiyear transformation, its financial targets and how close it is to achieving them.

In “Ten Years Post-Crisis,” Best's Review speaks with Michael McRaith, the former director of the Federal Insurance Office, about the formation of the FIO and changes in regulation after the financial crisis.

Also with our December issue we say goodbye to longtime columnist William Panning. Best's Review first published an article from Panning in 1984. The topic then was interest rate volatility and the unpredictability of investment income. While today the problem is low interest rates, then it was high interest rates.

Since 2001, he has written 66 columns. During the courses of his career, Panning worked for the Hartford Insurance Group and later joined Willis Re, where he was executive vice president. He is now principal and founder of ERMetrics, an enterprise risk management consultancy. We thank him for his thoughtful contributions.

A new reader-friendly version of Best's Review is now available online. Go to to read and share these articles and other Best's Review content.

Patricia Vowinkel, Executive Editor,

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