The Binks RiskBlog
Binks Insurance Brokers Limited has moved as of October 13th, 2015.
Please come and visit us!
Our Telephone Number remains unchanged: 613-226-1350. Our Fax Number remains unchanged: 613-226-7029.
Our website remains unchanged: http://www.binks.ca
Our Loyalty to our Clients remains unchanged since 1918!
PREPARING FOR HURRICANE SANDY | The Frankenstorm of 2012
October 29th, 2012: Hurricane Sandy is approaching and is expected to affect a good portion of the eastern part of Canada tonight and into Tuesday and Wednesday; read the attached for some quick tips for both your home and business. CLICK HERE
March 15th, 2012
Interesting headlines within the last month:
- Europe’s Big Insurers Hit by Debt Crisis, Catastrophes, Economy – February 16, 2012
- Multi-billion dollar disasters on the rise – February 22, 2012
- Professional liability rates for architects, engineers to rise – March 5, 2012
- Property/casualty insurance rates rise 2% in February – March 6, 2012
- Commercial Lines Prices Up for 4th Straight Quarter – March 12, 2012
Of course, it’s still anyone’s guess when we’ll be in the middle of a hard market. Having lived through three of the worst, all I can say is that you don’t realize it until you are actually in the middle of it.
And then it gets tough – tough to find capacity, tough to find some renewals, tough to get a reasonable price for the risk. It’s all relative, though, and those who succeed in a hard market are those who have the market reach, the experience, the relationships, and the guts to see it through.
It’s time to start thinking about how to prepare for when it gets tough, and how to prepare our clients for a marketplace where they “can’t always get what they want”, to paraphrase the Rolling Stones.
Read the following article. It contains a real gem about which clients are the ones who will be prepared: “In the years ahead, customers need to be smarter about applying the full range of risk management strategies so that when they do buy insurance, the policies are structured closer to the optimum insurance configuration of losses that are low frequency and high severity in nature”. What does that all imply? Very simply:
1. They need to practice what P&D calls “Cost Control through Loss Control” – basic risk management at the level of Loss Prevention and Loss Mitigation. We can provide Loss Control checklists for virtually any type of business.
2. They need to consider some of the “big picture” risk management items – supply-chain management (are they sourcing 90% of their inputs from a sole supplier? Don’t say it can’t happen – check out Canada’s current hospital drug crisis!), contractual risk transfer, and business continuity planning.
3. Then, when as a last resort to manage their risk, a client turns to purchasing insurance, there are strategies to follow here too – from a stable, reputable insurer, purchase policies with deductibles that are just high enough to start hurting and limits that are high enough (hint, hint – think Excess & Umbrella!) to handle real catastrophes.
What can WE do to help prepare your firm for the day when you will face some difficult choices?
Have Insurers Lost the Capacity to Run an Underwriting Profit?
By Robert Hartwig | February 9, 2012 | InsuranceJournal.com
We frequently hear people ask, “When is the next hard market going to come?” And by that they typically mean double-digit increases in premium growth for a sustained period of time. Of course, no one knows. But perhaps more importantly, we think what they’re really asking is, when will premium volume grow faster than losses and expenses, helping to deliver an underwriting profit?
Underwriting profits were common before the 1980s. In fact, 40 of the 60 years before 1980 the P/C industry had a combined ratio below 100. In the decade of the 1930s, although the country was caught in the midst of the Great Depression, there were seven years with underwriting profits. And in the 1940s, including the war years, all 10 years were profitable from an underwriting perspective. Eight of the 10 years of the 1950s, and nine of the 20 years of the 1960s and 1970s also recorded underwriting profits.
But then underwriting profits vanished. Not a single underwriting profit was recorded in the 25 years from 1979 through 2003. And even though that streak ended in 2004, underwriting profits are anything but the norm they were in the 1930s, 1940s, and 1950s. In the eight years from 2004 through 2011, only three tallied underwriting profits. What’s going on here?
A Look at the Past
In order to understand the present and have reasonable expectations about the near-term future, we need to look at the past — especially the 1930s through 1950s. Some things are quite similar. For example, back then, insurers had never seen high investment income last for a prolonged period of time so they never expected investments to subsidize underwriting losses. Because of the fact they had low investment income insurers during those years knew they had to rely on underwriting if they wanted to be successful.
What’s different? Today there’s more insured value in harm’s way. As a result, insured catastrophe loss experience is a higher proportion of loss payments than before. Also, inflation in the late 1970s and early 1980s boosted bond interest yields, and in the 1980s and ’90s, we had a roaring stock market. We relied heavily — perhaps too heavily — on investment.
The soft commercial market since 2004 was perpetuated by the 2007-2009 “Great Recession.” Demand for insurance dropped, exacerbating an overall decline in pricing.
The Great Recession was officially declared over in June 2009, but unemployment remains uncomfortably high at 8.5 percent in December 2011 and the economy continues to expand at a fairly sluggish pace. Ongoing weak economic conditions are clearly making it more difficult for insurers to move rates where they ought to be even if they are actuarially justified — it’s simply a matter of supply and demand. It’s also true that some insurance commissioners may be fearful of getting caught in a political and media quagmire if they approve rate increases, however actuarially justified they may be.
Rate Changes in 2012
As we move through 2012, various insurance lines will be moving at different paces in terms of price firming. Leading the way is workers’ compensation due to very poor underwriting performance where the combined ratio in 2011 was in the 118 percent to 119 percent range. Increases in commercial property (including business interruption) follow due to high catastrophe losses and somewhat higher reinsurance prices. Most of the casualty lines, whether we’re talking about general liability, directors and officers, etc., are lagging behind.
If we’re pinning our hopes on a hard market rescuing us, thinking that we don’t have to do anything differently, we’re on the wrong track. The world doesn’t stay the same, it does change and we need to adapt. Investment earnings today simply cannot offset large scale underwriting losses.
In the years ahead, customers need to be smarter about applying the full range of risk management strategies so that when they do buy insurance, the policies are structured closer to the optimum insurance configuration of losses that are low frequency and high severity in nature. With the bottom line under pressure, insurers are likely to walk away from unprofitable business. When insurers behave in this economically rational manner, they won’t have to worry about whether a hard market is on its way. They’ll already be way ahead of the game.
December 29th, 2010
To all of our clients and suppliers – THANK YOU for your loyalty as we move into our 93rd year. More than ever, we value our relationships with you and our community.
From all of us to all of you: Happy New Year! May peace and prosperity follow you wherever you go.
November 25th, 2010
November 11th, 2010
5 things you need to know as a Director or Officer of a Private Firm
On Tuesday, November 23rd, we are hosting a private panel discussion about emerging trends in Directors’ & Officers’ Liability Insurance, for the private clients of Binks Insurance and the legal firm of Perley-Robertson, Hill & McDougall.
The following topics will be discussed: OUTSIDE DIRECTORSHIP LIABILITY; STATUTORY TAX/PAYROLL DEDUCTIONS; LIMITS OF BODILY INJURY COVERAGE; PIERCING THE CORPORATE VEIL; EMPLOYMENT PRACTICES LIABILITY.
If you are a client of either firm and have not yet received your invitation, please email Allison Binks to confirm the details.
July 22nd, 2010
Ontario Automobile Reform
On September 1st, 2010, the Ontario Government is implementing a major overhaul to automobile insurance in the province. These changes provide consumers with more choice and flexibility to purchase coverage that best suits their protection needs and budgets.
You now have choices to customize your medical and rehabilitation benefits, certain deductibles and income replacement coverage. The new standard Ontario automobile policy, to be effective September 1st, includes several significant changes from the current standard policy, including provisions that will result in lower coverage for the client.
The goal of these changes is to achieve rate stabilization by keeping the costs incurred by insurers in check. Without these reforms, major rate increases would be required.
For more info and a detailed chart that summarizes these changes please click HERE
July 9th, 2010
New Commercial Pages
We have added three new pages to our Commercial Section:
Eight in 10 incidents of crime are carried out by employees of a business. Unfortunately, fraud and embezzlement in the workplace are on the rise, occurring in even the best work environments. The Association of Certified Fraud Examiners has found that: 1. fraud and abuse costs employers an average of $9 a day per employee; and 2. the average organization loses 6% of its total annual revenues to fraud and abuse committed by its employees.
Protect your business today with the proper Fidelity Bond.
Extortionists don’t discriminate. Any organization of any size can be a target for kidnapping or extortion threats against the organization and its employees. People tend to associate business extortion and kidnapping with global companies. The fact is, radical groups and criminals exist everywhere, and any organization can be a target.
Managing the costs associated with a kidnapping or extortion threat against its property, proprietary information, computer system, or people can be enough to push a company or a not-for-profit organization to its financial limits. These risks may not feel like everyday exposures, but too often they are. And when they happen, the organization may need financial assistance to meet extortion demands and the extensive costs associated with negotiation and recovery associated with a kidnapping.
Contact us today to discuss a solution for your organization.
Binks Insurance Brokers Limited is pleased to announce our association with DAS Canada Legal Expense Insurance, and the launch of a new product for Canadian businesses.
I am pleased to announce that we have formed a new insurance brokerage named Binks Personal.
This does not affect the status of your insurance policies, and all of our staff are still here, so you will still deal with the same Account Manager you have dealt with in the past. Binks Personal has the same address, phone number, and fax number. The email format has changed from “email@example.com” to “firstname.lastname@example.org”.
Over the last 15 years, Binks Insurance Brokers Limited has spun off four divisions into separate companies (Millennium CreditRisk Management Limited, Binks Life & HealthRisk Insurance Limited, Globalex Risk Management (Ottawa) Inc., and Binks Riskplanners). We have always believed in letting people do what they do best, and in focusing in on providing real value for the client. Now we have done the same with Binks Personal.
Binks Personal is a focused and dedicated team of Personal Insurance Brokers – Penny Clouthier, Jill Jeddrie, Shannon Hendricks, and Darlene Mercer. Along with Donna Nelson, they will look after your personal insurance needs with the same care and professionalism that you have been used to with Binks.
Please click on the following link to be taken to the new Binks Personal website.
October 22, 2009
BINKS Insurance supports the GCTC
L to R: John Pole, Ottawa Branch Manager of Intact Insurance, Lise Ann Johnson, Artistic Director of the Great Canadian Theatre Company, and Harry Binks, President of Binks Insurance, standing in the lobby of the Irving Greenberg Theatre Centre.
On October 15th, 2009, John Pole and Harry Binks presented a $5,000 cheque to Lise Ann Johnston from the Intact Foundation to help support the Great Canadian Theatre Company. The GCTC’s mandate is “To foster, produce and promote excellent theatre that provokes examination of Canadian life and our place in the world.” Intact is Canada’s largest Property and Casualty Insurance Company.
Binks celebrated its 90th year in business in 2008 by co-sponsoring the award-winning GCTC play “Five O’Clock Bells” with the Dominion of Canada General Insurance Company, and in 2009, sponsored “The Drawer Boy”.
Harry Binks is a director of the GCTC.
October 9, 2009
Don’t forget our MOVE of December 2008!
In spite of our best efforts, there are still some places on the Web that indicate our old address; considering that we were there for 18 years, and that typing “binks insurance” in Google brings up over 10,000 results, that’s not surprising. But what we don’t want to be a surprise is a client showing up at our old address only to be told that we have moved. We sent out thousands of post-cards telling clients about our new home, so in case you missed getting yours, our new address is as follows:
Binks Insurance Brokers Limited,
100B- 2625 Queensview Drive,
Ottawa ON CANADA K2B 8K2
September 3rd, 2009
Welcome to the New BINKS.ca
Now, more than ever, people and organizations need stability. Binks Insurance was established in 1918. As the first Ottawa Insurance Broker to establish a presence on the World Wide Web in 1996, we are pleased to announce our updated website here at www.binks.ca. Please click on the above pictures or drop-down menu buttons and explore. We’ll be here when you need us.
Binks is committed to finding unique solutions for our clients’ home, automobile, and business insurance needs, providing guidance in the art of risk management to Ottawa businesses and residents for over 90 years.
Binks Insurance celebrates 91 Years in 2009, providing clients and insurers with stability and experience in dealing with their insurance matters.