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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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N.Y. publishes infectious disease prevention rules for employers

The New York State Department of Labor on Tuesday published its Airborne Infectious Disease Exposure Prevention Plan under the recently enacted New York Health and Essential Rights Act, which requires the state to create various industry-specific model plans for the prevention of airborne infectious disease.

Under the law, employers who are not subject to the federal Occupational Safety and Health Administration emergency temporary standard for COVID-19 prevention — which applies only to the health care industry — can choose to adopt the applicable policy template/plan provided by state DOL or by Aug. 5 establish an alternative plan that “meets or exceeds” the standard’s minimum requirements.

The plan calls for infectious disease exposure controls, such as social distancing, face coverings, disinfection and hand hygiene facilities, to be put into place in the event of “an airborne infectious agent or disease designated by the Commissioner of Health as a highly contagious communicable

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Lemonade’s disturbing Twitter thread reveals how AI-powered insurance can go wrong

Lemonade, the fast-growing, machine learning-powered insurance app, put out a real lemon of a Twitter thread on Monday with a proud declaration that its AI analyzes videos of customers when determining if their claims are fraudulent. The company has been trying to explain itself and its business model — and fend off serious accusations of bias, discrimination, and general creepiness — ever since.

The prospect of being judged by AI for something as important as an insurance claim was alarming to many who saw the thread, and it should be. We’ve seen how AI can discriminate against certain races, genders, economic classes, and disabilities, among other categories, leading to those people being denied housing, jobs, education, or justice. Now we have an insurance company that prides itself on largely replacing human brokers and actuaries with bots and AI, collecting data about customers without them realizing they were giving it away,

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Marsh McLennan reveals April data breach

Marsh & McLennan Cos. Inc. was hit by a data breach in April involving access to Social Security numbers and other personal information of staff, former staff, clients and a range of other people linked to the brokerage.

The company sent a breach notification dated June 30, which was obtained by Business Insurance, stating that it discovered the breach on April 26 and that an “unauthorized actor had leveraged a vulnerability in a third party’s software since at least April 22.”

The breach involved a “limited set of data,” and Marsh McLennan notified law enforcement authorities and took action that ended the breach on April 30, the notification said. The company said it reset system access rights and imposed additional restrictions.

The information involved included names, Social Security numbers or other federal tax identification numbers.

Marsh McLennan said in the notification it held the data because recipients were current or

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Aon, Marsh trade accusations in poaching dispute

Aon PLC and Marsh LLC are engaged in a bitter legal dispute the hiring of 44 former Aon employees, with the brokerage seeking a temporary restraining order against Marsh.

Aon charges in litigation initially filed in state court in Miami June 24 that Marsh recruited “ringleader” Michael Parrish, formerly managing director for its east region, his chief lieutenant, Robert Lynn, as well as key executives “through promises of lavish raises and financial reward, and induced them to organize a covert, mass resignation” despite “reasonable restrictive covenants,” according to court documents, Aon Risk Services Inc. of Florida et al. v. Marsha USA Inc. et. al.

The lawsuit charges that defendants conspired to solicit Aon clients and prospects across the brokerage’s commercial risk and health care industry sectors and to misappropriate valuable intellectual property, including proprietary and confidential information and trade secrets.

Marsh fired back Tuesday, pointing to the U.S. Department of

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Coverage ‘inadequate’ in Florida condo collapse: Judge

The Surfside, Florida, condominium building that collapsed last week had $48 million in total property and liability coverage, which will be “inadequate” to compensate everyone fully, a Miami-Dade circuit judge has said.

In an online meeting Thursday, Judge Michael Hanzman was told by attorneys for the Champlain Towers South condo association that they were aware of only $30 million in property insurance and $18 million in liability coverage, according to a segment posted online by the Miami Herald.

Great American Insurance Co. is the property insurer for the building.

“It looks like for the property damage claims and the injury and death claims there’s going to be a total of $48 million which will obviously be inadequate to compensate everyone fully to the extent of their harm,” Judge Hanzman said.

“I don’t know if there are any third-party claims. Maybe there are, maybe there aren’t, but we are dealing with

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