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Marsh McLennan reports higher revenue, recruitment increase

Marsh & McLennan Cos. Inc. reported a nearly 20% jump in revenue in the second quarter as economies continued to reopen after going into lockdown ahead of the comparable reporting period last year.

The world’s largest brokerage also added about 2,000 staff in the first half, which included a significant increase in its rate of hiring from rivals Aon PLC and Willis Towers Watson PLC since those companies announced merger plans last year, Marsh McLennan’s senior executive said.

Its insurance and reinsurance broking units continued to benefit from higher insurance pricing pushing up commissions and fees, but price increases are moderating, Dan Glaser, president and CEO of Marsh McLennan, said in a conference call with analysts Thursday.

Key concerns for Marsh McLennan clients include the effect of climate change and cyber risk, he said, as cyberattacks accelerate. Marsh McLennan itself was hit by a cyber breach in April.

Marsh McLennan

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Three Ways Insurance Brokers Can Use Technology To Help Small-Business Clients

Co-Founder and CEO of Ease, a leading HR and benefits software solution for small businesses, insurance brokers and insurance carriers. 

The past decade has brought more significant changes to the insurance landscape than the previous several decades combined. The popularity of cloud-based software in everyday life, the mass adoption of Zoom during the Covid-19 pandemic and millennials making up the largest generation in the U.S. labor force have all dramatically shifted the needs of small businesses across the country, especially with how they handle employee benefits.

As these changes continue to converge, small business HR priorities increasingly focus on three primary areas: bringing in and retaining talented employees, handling compliance issues and keeping overall benefits costs down. To help their clients achieve these goals, insurance brokers can leverage technology, enabling small and medium-sized businesses (SMBs) to satisfy the expectations of their employees and increase their business efficiencies.

With

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Chubb CEO calls for public-private pandemic risk partnership

Evan G. Greenberg, chairman and CEO of Chubb Ltd., on Thursday renewed calls on Capitol Hill for a public-private partnership for pandemic risk, saying such a program would lessen the financial blow of a future pandemic.

Mr. Greenberg’s comments came as he testified at a hearing of the U.S. Senate Banking Committee’s Subcommittee on Securities, Insurance and Investment to examine frameworks to address future pandemic risk.

Combining the insurance industry’s risk insight with the government’s balance sheet capability to take on “pandemic tail risk” would provide an “affordable, efficient liquidity backstop for small businesses and a market-based program for larger businesses,” Mr. Greenberg said.

However, Robert Hartwig, clinical associate professor and director of the Risk and Uncertainty Management Center at the University of South Carolina in Columbia questioned whether such a program was needed.

“Bearing in mind all of the pandemic insurance frameworks under consideration were developed during the very

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AIG unit must defend Texas retailer in data breach case

A federal appeals court reversed a lower court Wednesday and ruled an American International Group Inc. unit is obligated to defend a retailer in connection with a data breach.

Houston-based Landry’s Inc., which operates retail properties including restaurants, hotels and casinos, discovered a data breach that occurred between May 2014 and December 2015 that involved the unauthorized installation of a program on its payment processing devices, according to Wednesday’s ruling by the 5th U.S. Circuit Court of Appeals in New Orleans in Landry’s Inc. v. The Insurance Co. of the State of Pennsylvania. 

Over about a year-and-a-half, the program retrieved personal information from millions of credit cards and at least some of that information was used to make unauthorized charges, the ruling said.

The issue led to litigation between Landry’s and its credit card processor, Paymentech LLC, a unit of JPMorgan Chase Bank N.A. Paymentech alleged Landry’s was obligated to

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Cincinnati Insurance loses bid to dismiss gym’s COVID-19 case

A Pennsylvania state court refused Tuesday to dismiss a COVID-19 business interruption lawsuit filed by a gym against its insurer, stating the business had sufficiently alleged a “direct physical loss or damage” to its property.

Brown’s Gym Inc. in Clarks Summit, Pennsylvania, filed suit against Cincinnati Insurance Co., which had issued it an all-risk policy that did not include a virus exclusion, in the Court of Common Pleas of Lackawanna County in Scranton, Pennsylvania, according to the ruling in Brown’s Gym Inc. v. The Cincinnati Insurance Co. and C.C. Young and Henkelman Insurance.

Cincinnati had denied Brown’s COVID-19 business interruption coverage claims on the basis it had not sustained a direct physical loss or damage.

The court disagreed. While the policy does not include a virus exclusion, it does contain a “communicable disease or virus” exclusion for other “crisis event response communication expense coverage,” it said.

This created “a reasonable

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Ransomware rattles cyber insurance market

Ransomware has become a business. And that’s having an impact on companies that provide cyber insurance.

The cyber insurance industry faced “a reckoning” in 2020 in the wake of a wave of ransomware incidents, according to a report from Fitch Ratings provided to FOX Business.

The direct loss ratio, a critical statistic for the industry, spiked in 2020 to 73%, compared with an average of 42% for the previous five years (2015–2019), according to a May 2021 Fitch Ratings report.

And the average paid loss for a so-called closed standalone cyber claim jumped to $359,000 in 2020 from $145,000 in 2019, Fitch said.

JBS USA paid an $11 million ransom to cybercriminals who temporarily knocked out plants that process roughly

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Liberty Mutual agrees to purchase Columbus-based State Auto Insurance

COLUMBUS (WCMH) — Liberty Mutual Holding Company has agreed to purchase State Auto Insurance, based here in Columbus.  

According to prnewswire.com, under the agreement, State Auto mutual members will become mutual members of Liberty Mutual and Liberty Mutual will acquire all of the publicly held shares of common stock of State Auto Financial for $52 per share in cash.   

“State Auto Group’s capabilities and product expertise are an ideal complement to Liberty Mutual’s domestic personal lines and small commercial business, and we welcome 2,000 talented associates to our family,” said Liberty Mutual Chairman and Chief Executive Officer David Long. “Equally appealing are its values. For almost a century, State Auto has celebrated a culture of caring for people, exceptional service and deep philanthropy, mirroring our purpose to help people embrace today and confidently pursue tomorrow.”

“The opportunity

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Liberty Mutual in $2.29 billion mega deal

Liberty Mutual will also gain roughly 3,400 independent agencies across 33 states, adding to its already sizeable network of more than 100,000 independent agencies countrywide. This will make Liberty Mutual the second largest carrier in the independent agency distribution channel in the United States.

Through the deal, Liberty Mutual will also add $2.3 billion in premium and will significantly expand market share in personal lines and small commercial insurance.

Read next: Liberty Mutual Insurance reaches “important chapter” with leadership shuffle

“State Auto Group’s capabilities and product expertise are an ideal complement to Liberty Mutual’s domestic personal lines and small commercial business, and we welcome 2,000 talented associates to our family,” said Liberty Mutual chairman and chief executive officer David Long.

“Equally appealing are its values. For almost a century, State Auto has celebrated a culture of caring for people, exceptional service and deep philanthropy, mirroring our purpose to help people

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State Auto Financial sold to Liberty Mutual for $1 billion

One of Columbus’ longtime insurance companies is getting a new owner as consolidation in the industry continues.

State Auto Financial said Monday that it is being bought by Boston-based Liberty Mutual in a $1 billion deal being pitched as a way to help Liberty expand its offerings for small commercial insurance and consumers.

Liberty Mutual is buying State Auto for $52 per share, or about triple its closing price of $17.26 on Friday. 

State Auto said it doesn’t expect the deal to result in any staff reductions.

“Liberty Mutual looks forward to welcoming more than 2,000 State Auto associates to their team once the acquisition is approved and closed,” State Auto spokesman Kyle Anderson said. “Liberty Mutual has a long history of strategic acquisitions and successfully integrating those companies to optimize the value for Liberty Mutual and our customers and distribution partners.”

Liberty Mutual has committed to operating out of

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Top insurance brokers, No. 8: Lockton Cos. LLC

2020 brokerage revenue: $2.15B

Percent increase (decrease): 14.9%

Lockton Cos. LLC has continued to thrive despite the coronavirus, its senior executives say. 

The Kansas City, Missouri-based brokerage reported $2.15 billion in brokerage revenue for its 2020 fiscal year, which ended April 30. That was a 14.9% increase from the prior fiscal year.

Lockton, which added 220 employees to its brokerage business last year, remained in the No. 8 position in Business Insurance’s 2021 ranking of the world’s largest insurance brokers. 

It is still the only privately held brokerage among BI’s top 10 not wholly owned by a private equity firm or hybrid of private equity and private ownership. 

“Our performance even at the financial level was the best it’s ever been,” and “actually far exceeded my expectations,” said Peter Clune, Lockton’s president and CEO. 

“Now that we’re on the other side of it, it’s easy to breathe a

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