Declarations

Death by Suicide

“Historically failure to adequately reserve and price is the No. 1 killer of insurance companies.”

—Robert Hartwig, president and economist for the Insurance Information Institute, noting that underpricing/under-reserving is the leading cause of death, contributing to about 38 percent of company failures in the property/casualty industry. Hartwig examined centenarian companies to identify trends that lead to longevity. His findings were presented at the National Association of Mutual Insurance Companies Annual Conference.

Weighty Problems

“It’s hard to find conditions that aren’t worsened or made more expensive by obesity.”

—John Cawley, an associate professor of policy analysis and management at Cornell University. Nearly 17 percent of U.S. medical costs can be blamed on obesity, according to new research that suggests the nation’s weight problem may be having close to twice the impact on medical spending as previously estimated. The research by Cawley and Chad Meyerhoefer of Lehigh University placed obesity-related medical costs at around $168 billion. The study released by the National Bureau of Economic Research, a nonprofit, nonpartisan research organization, contradicts a previous study that estimated obesity-related medical costs at $147 billion, or about 9 percent of total medical costs. The earlier study estimated that obesity adds about $1,400 to a person’s annual medical bills. The new study suggests the added cost is double that, exceeding $2,800.

Always Exceptional

“It’s easy to forget the good times during times of adversity, but we need to remember that our unique experiment with democracy has produced greater prosperity for more people than any other system in the history of civilization.”

—David A. Sampson, president and CEO of the Property Casualty Insurers Association of America (PCI). At PCI’s recent annual meeting, Sampson told insurance CEOs and senior executives that America faces a struggle between two competing visions for the future – a choice between a free market system and an expanded federal government. The association leader encouraged the conference attendees to be “cautiously optimistic as America is a hopeful nation.” Sampson said that despite the widespread private sector anxiety over America’s future, the weak economic recovery, and the policy uncertainties out of Washington, America has always been exceptional.