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December 2, 2021

Rising coverage costs

The cost of insurance for low-income households is on the rise, causing affordability issues

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What: The broad premise of insurance is that the premiums of the many pay for the claims of the few. But some experts worry that closer risk-profiling, helped by the growing quantity of data at insurers’ fingertips, will render certain groups of people and areas increasingly uninsurable.

Why it matters: Although the data may indicate a difference in risk, adjusting ratings based on that data could increase the level of scrutiny of whether that differentiation is acceptable.

Read: Low-income households ‘priced out’ of insurance market

Litigation Watch

Georgia court of appeals decision could spell trouble for insurers in high-crime areas

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What: A recent case in Georgia upheld a $43 million premises liability verdict against CVS Pharmacy, claiming the company failed to take appropriate security measures to prevent a shooting that took place in 2012. This increases the count of eight-figure liability suits in Georgia to three, and could spell difficult times nationwide for businesses and insurers in high-crime areas.  

Why it matters: Verdicts like this could decrease certain companies’ ability to get coverage, or increase the amount of liability coverage needed in high-crime areas. We could see new products emerge to address the issue, specifically focused on high-crime coverage.

Read: Insurers for High Crime Areas on Notice after Georgia Court Affirms $43M Verdict

Industry Challenge

Man pulls brass knuckles when asked to wear a mask

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What: An Ohio man was arrested at Walmart after pulling out brass knuckles when asked to wear a mask. Since Covid began, low-wage workers have the added responsibility of enforcing mask policies, and have been asked to take on the added risk associated with that responsibility.

Why it matters: The well-documented mental health crisis initiated by the pandemic is affecting workplaces everywhere. Entering the holiday shopping season, the resulting growth in tension and violence is a major peril that insurers and policyholders will need to address. 

Read: Walmart Mask Arrest Highlights Black Friday Dangers for Workers

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