Mitigation of hazards may help reduce workplace injuries
Leverage AI to improve homeowner claims outcomes
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The use of artificial intelligence, which includes generative artificial intelligence, large language models and machine learning algorithms has exploded across multiple industries.
A burning question in the insurance industry is: “What are AI’s pros and cons in the claims process? ”
PROS
Streamline claims process and other information—From claims to compliance to forecasting, insurance agents must sift through mountains of information to perform their duties.
Data protection—Insurance agencies and companies that want to keep their claims data safe can use AI to learn from existing data patterns and alert them when there are anomalies.
Support for remote workforce—
The ongoing COVID-19 pandemic has transformed the way we approach work. AI can bridge information gaps between remote workers, like reliably capturing and transmitting claims data.
CONS
Barrier to entry—Fully integrating AI into your business has some hurdles. The costs associated with supporting and maintaining AI can become expensive quickly.
AI biases—Like human beings, AI is susceptible to biases. Where our biases come from a variety of socioeconomic factors (e.g., where we grew up), AI biases crop up when it learns from incomplete data sets.
Reduced human presence— Whether you use AI to help users file their claims or use it to help your employees organize them, that human touch can be missed: it can even disenfranchise the workforce through excessive automation.
Helene and Milton: A hurricane of claims
and losses in the p/c sector
2024’s Atlantic hurricane season was one for the history books.
Currently, it stands as the second costliest on record—causing billions of dollars in damages and over 400 deaths. Two of this season’s named storms—Helene and Milton— significantly impacted the United States, and they were responsible for the lion’s share of the fatalities and damages—though Hurricane Beryl was responsible for the second largest amount of deaths of the season (a total of 73).
As climate change worsens, storms in the Northeast are expected to become more intense. By analyzing the significant damage caused by these hurricanes in the property/ casualty sector, independent insurance agents can better prepare for the next hurricane season, as well as destructive yearround storms.
Hurricane Helene produced dramatic scenes of destruction in western North Carolina. Due to the region’s topography and prior heavy rainfall, Helene’s deluge was extremely potent. According to local reports, over 100,000 homes were damaged or destroyed in the region, which impacted 200,000 people. Entire communities and roads were washed away by the storm: over 200 people perished. While other states saw significant
fatalities and widespread damage (e.g., Florida, Georgia and Tennessee), western North Carolina outpaced them all. It’s important to note that most of Helene’s damage came from water damage, and unfortunately for the people of western North Carolina and other affected states, they may not have had the right coverage. Some estimates indicate that only 5% of those individuals affected had adequate coverage for the effects of Helene.
The estimated insured losses for Helene would be roughly $10.5-$17.5 billion—for a total damage loss of $30.5-$47.5 billion. Additionally, Hurricane Milton’s insured losses are expected to range from $17-$28 billion—for a total damage loss of $21-$34 billion.
What is to be learned from these destructive, costly storms?
For one thing, stress to your clients that climate-fueled storms like Helene and Milton can behave in extreme, unexpected ways.
Helene’s path was mapped out, but it was almost impossible to predict how the topography and local weather of western North Carolina would enhance the remnants of the storm. While Hurricane Milton made landfall as a Category 3 Hurricane, it was briefly a Category 5, and it was the fifth most intense Atlantic hurricane on record. If it made landfall as a Category 5, there’s no telling how much damage it could have done.
Remind your clients that they shouldn’t leave their property and
life to chance. Encourage them to review their homeowners insurance policy to understand weather-related definitions, to check for exclusions, and to consider supplemental policies as needed. Sudden flooding in landlocked areas also is a risk, so flood insurance through the National Flood Insurance Program or private insurance should be considered. Finally, encourage them to pay attention to their local weather patterns and topography when intense storms are predicted. Do they live along rivers and creeks that are flooded easily? Are they close to an elevated area? Before a storm, how much has it rained? These and similar questions may play a crucial role in protecting your clients even before local authorities can issue warnings. Your clients should be adequately prepared when disaster strikes— and you should be ready to see more claims come your way.
Statistically speaking …
From 1980 to 2023, the dollar amount of flood claims paid by the NFIP totaled nearly $12.8 billion in PIA Northeast’s five-state footprint.
July 2023, Northeast storms and flooding costs roughly $2.2 billion dollars, according to the NOAA.
Per the NOAA, Hurricane Katrina remains the costliest hurricane on record, causing $200 billion in damages; Superstorm Sandy, which affected the Northeast, cost $88.5 billion
Step-by-step guide: Help clients who have been in an accident
Has a client ever asked: “What do I do if I’m involved in a car accident?” This resource helps you answer some questions:
What do I do at the scene of the accident?
After a motor vehicle accident, the first thing you should do is contact the police. If anyone is injured, give details to the police, then give the victims whatever help you can. To avoid injuring them further, try not to move them. If you smell or see leaking gas, call the fire department and clear the area.
The police will complete an on-the-scene accident report, which the insurance company will need to settle the claim. Give the police the necessary information, but try not to make self-incriminating statements, such as taking blame for the accident. Your comments may be used against you later.
Exchange information with other drivers. Obtain the other drivers’ license numbers, registrations, insurance agents’ names, insurers and policy numbers. Also, write down the names, addresses, work and phone numbers of the drivers and any passengers in the other vehicles. Note injuries, if any, or if they say they are unhurt.
Record the names, addresses, and phone numbers of any witnesses, and the names and badge numbers of police officers or emergency personnel.
Take photos of the accident, use different angles; capture the other vehicle’s license plate; and photograph the damage, skid marks or other evidence to show what happened.
Sketch the positions of the vehicles before, during and after the collision. Don’t move your vehicle, unless it creates a hazard. If the police can record the exact position of the vehicles when they crashed, it will help substantiate your claim. If you need to move your vehicle, take reasonable steps to protect it from further damage. Set up flares, get the vehicle off the road, and call a tow truck, if necessary.
While your memory is fresh, note the time of the accident, what the weather was like, road conditions, visibility, traffic conditions, the speed of the vehicles involved and how the accident happened.
Ask the investigating officer where and how you can obtain a copy of the police report.
How do I file an insurance claim?
If you are involved in an accident, contact your insurance agency as soon as possible to report the claim. Have your policy number ready, plus license numbers, phone numbers
and other information. The police must be notified immediately of any motor vehicle accident or theft.
What happens then?
Whenever you talk with anyone regarding the accident, take detailed notes. Record the time, date, name of the person and what you discussed. Include all decisions or promises made. Keep our agency fully informed and furnish us with copies of any documents you send or receive.
Save all receipts. Your auto insurance policy may cover incidentals, such as vehicle rental or a hotel room if your accident occurs out of town. Check with your insurance agency for specific details of your policy.
Cooperate fully with any insurance company employees who may contact you for further information.
• You will be asked to drive the car to a drive-in claims center, where an adjuster will inspect your car and issue an estimate of damages.
• You will be asked to take the vehicle to several body shops for estimates, and then turn the estimates over to the adjuster.
• Your insurance company will contact an adjuster to review your case and expedite your claim. Get the adjuster’s name, address and the name of the firm. If an adjuster has not contacted you within 10 days, call your insurance agent.
When reviewing an estimate with the adjuster, find out if the damaged parts are to be repaired or replaced. Determine whether the estimate is for original manufacturer or after-market parts, and if that type of part is covered by the terms of your policy.
After you have received authorization to repair your vehicle, make an appointment with a reputable repair shop. Ask how long the job should take and find out if the needed parts are in stock. If the cost of the repairs exceeds the estimate, ask the shop to notify the adjuster for authorization.
If you are not satisfied with the claim payout, do not sign and cash the claim check. Often, signing and cashing the claim payout check is an admission of satisfaction and could possibly remove any further negotiating options.
PIA Northeast members can send clients a version of this article that they can keep in their glove compartments. To access this content, logon to pia.org, click the “Consumer content” link, and then “What to do if you’re involved in an accident.”
Helping clients avoid dogrelated liability claims
Independent insurance agents play a crucial role in helping clients navigate potential risks—and one of the most overlooked areas involves liability arising from dog ownership. In recent years, there has been a significant rise in dog ownership, with more families adopting or purchasing canines.
According to the American Veterinary Medical Association, around 46% of U.S. households own a dog, a figure that increased exponentially during the COVID-19 pandemic. Increasingly, dogs are being recognized as integral members of the family, often treated as children or valued assets. This emotional bond leads dog owners to invest heavily in their dogs’ well-being, from veterinary care to specialized services like grooming, training and even dog-specific insurance policies. However, while dog owners are willing to spend money on their animals’ health and happiness, many overlook the legal and financial risks associated with dog ownership—specifically the liability that arises from their dogs’ actions.
The rise in dog ownership and liability risks
Recently, I was reminded of the importance of this coverage through a personal experience involving a dog attack. Two dogs got into a fight on a bar patio, and one of the parties involved plans to sue the other for damages. What often is surprising to clients—and perhaps reassuring—is that both homeowners and renters insurance policies provide liability protection in such cases—even though the incident occurred away from home. This real-world scenario highlights why it is essential to ensure that clients—especially dog owners— have comprehensive coverage in place.
Renters, homeowners insurance and dog owners
When discussing insurance with dog-owning clients, it’s essential for agents to highlight that both homeowners
RISKS
and renters insurance policies generally include personal liability (Coverage L) and medical expenses (Coverage M) protection. Often, these coverages extend beyond the insured premises, meaning clients are protected up to the policy limits for legal fees, medical bills and property damage, even if an incident occurs off their property.
This comprehensive protection can provide valuable peace of mind—especially for clients concerned about potential risks associated with dog ownership. It ensures that clients are protected financially in the unfortunate event that their dog causes injury or damage to someone else’s property— whether at a dog park, on a walk or during a visit to someone else’s home. Additionally, agents should encourage clients to review their specific policy limits and exclusions, as some breeds or specific incidents may impact coverage. By understanding the scope and limits of these protections, clients can feel more confident knowing they are prepared for unexpected situations involving their dogs.
Liability coverage beyond the home
This is particularly true in the context of renters insurance, when many clients may not think to purchase a policy unless it is required by their landlord. The reality is that renters insurance is a vital protection for dog owners, regardless of whether the landlord requires it. Renters insurance not only protects personal property, it also provides coverage in cases in which there is liability for incidents that may occur inside or outside of the home. Without renters insurance, dog owners could be left exposed to significant financial risk if their dog causes injury or damage while they are away from their residence. For agents, it’s crucial to emphasize that renters insurance isn’t just a requirement imposed by landlords, but it is a safeguard that can protect dog owners from the financial and legal costs of their dog’s actions, wherever they occur.
Dog
ownership brings with it significant potential liability risks, and it is essential for independent insurance agents to ensure their clients are protected adequately.
Key limitations and exclusions
It is equally important for agents to inform clients about the limitations of such policies. While renters and homeowners insurance policies generally cover dog-related liability, there are exclusions that agents must clearly communicate to dog owners.
Some policies exclude certain breeds deemed dangerous or high risk, such as pit bulls, Rottweilers and Dobermans. For clients with these types of dog breeds, these exclusions can leave
them exposed to liability if they own a breed that the insurer will not cover. However, agents can help clients find policies that accommodate these breeds, ensuring that coverage is still available. Additionally, clients may assume that their policy will cover any dog in their care, but coverage usually extends only to dogs that are owned by, or in the care of, the insured. Understanding these nuances is critical to ensuring that clients fully grasp the scope of their protection under their insurance policy.
Connect with dog owners
Framing the conversation from this perspective allows independent insurance agents to connect with dog owners on a deeper, emotional level —highlighting the importance of safeguarding not only their dogs, but also their financial well-being. By sharing real-life examples, such as the dog attack involving my friend, agents can make the topic of liability more relatable and tangible. These stories illustrate the real risks that dog owners face and provide a powerful, compelling reason for clients to reassess their current insurance coverage. Ensuring that they have adequate protection, including enhanced liability limits for dog-related incidents, can offer peace of mind and protect against unexpected claims.
Moreover, as more clients adopt or purchase dogs, agents should look for ways to reach this growing market. Engaging with local dog communities or dogrelated businesses, such as veterinarians or pet supply stores, can be an effective way to connect with dog owners and provide valuable information about liability coverage. Additionally, targeted marketing efforts aimed at
dog owners—whether through direct-mail campaigns, social media or partnerships with local dog services— can help agents expand their client base while offering a critical service.
Ensure comprehensive protection for dog owners
Dog ownership brings with it significant potential liability risks, and it is essential for independent insurance agents to ensure their clients are protected adequately. Whether through homeowners or renters insurance, liability coverage can safeguard dog owners from financial exposure—particularly when incidents may occur inside or outside the home. By understanding the nuances of these policies and communicating the importance of coverage to dog owners, agents can help their clients avoid costly claims and provide peace of mind.
The case of my friend facing a lawsuit due to a dog attack is a stark reminder that comprehensive insurance coverage is a necessity—not a luxury—for all dog owners. Independent agents who proactively address this issue will not only protect their clients, but also build stronger, more trusting relationships with them.
Alexander is a contributor to PIA Magazine.
DANIEL J. HAMMOND, CPCU, AIS, AIC, AINS, ARe Director of coverage & specialty claims, Utica National Group
When clients ask: Should I report a claim to my policy?
Many errors-and-omissions claims involve clients alleging that they told their agents about situations that were never reported to the clients’ carriers. Often, the agent tells his or her E&O claim adjuster that the client did talk to him or her about the situation, and that the client did not want to report it.
If clients ask you whether they should report a claim, the answer is that their insurance policy spells out the claimreporting requirements—and that they likely need to report the claim right away and provide the details specified in the reporting provisions of their policy.
If it is the client’s decision not to report a claim, document this in writing to the client, and include it in your file.
Whether it is reporting a claim or reporting a potential claim under your E&O policy ... a good rule of thumb is to immediately submit a claim to the carrier and let the claim adjusters take care of the rest.
Best practices
Remember the following when dealing with agency client claim reporting:
• Do not tell a client not to report a claim.
• Do not take it upon yourself to make an insurance coverage decision as a reason to not report a client’s claim.
• Be sure to report to all applicable policies (e.g., primary, umbrella). If you are uncertain as to whether a policy is applicable, report the claim.
• When submitting a loss notice form on behalf of a client, consider placing the carrier on notice with a cover sheet that the agency accepts no responsibility for reliance upon, and has not undertaken verification of, the information contained in the loss notice, and that the carrier needs to verify all information with the agency client.
• Many policies require reporting claims directly to the carrier. Consider from an E&O perspective whether it may benefit the agency to have clients report directly to their carriers rather than having your agency accept the responsibility and potential liability surrounding claim-reporting issues. If clients contact you regarding claims, it is best to advise them in writing that they should report the claims directly to the carrier and provide the claims contact information, or you should advise them where they can locate this information.
• Keep your agency file well documented.
A good rule of thumb
Whether it is reporting a claim or reporting a potential claim under your E&O policy—or fielding a claim-reporting question from a client—a good rule of thumb is to immediately submit a claim to the carrier and let the claim adjusters take care of the rest.
Could this happen to your insurance agency?
Consider the following scenario:
An agent received a notice of a potential claim from a client, and the agency has a policy of not accepting notices of a claim. The agent advised the client that the client would need to submit the claim directly to the carrier, supplying the client with the claim-reporting details. The client did not report the claim to the carrier at that time. A few months later, the client further contacted the agent with a notice of summons, and the client was again advised to report the claim to the carrier. Again, the client did not report the notice to the carrier. Subsequently, a default judgment was made, and the claim was then reported to the carrier by the agent. There was no documentation of the
instruction from the agent to the client regarding reporting the claim. This E&O claim resulted in a payout to the client exceeding $100,000.
LESSON: Document in writing if you advise a client to report a claim directly to a carrier.
Hammond is the director of coverage & specialty claims with Utica National Insurance Group.
Utica National Insurance Group and Utica National are trade names for Utica Mutual Insurance Company, its affiliates and subsidiaries. Home Office: New Hartford, NY 13413. This information and any attachments or links are provided solely as an insurance risk management tool. They are derived from information believed to
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Adverse weather’s effect on WC claims
Mitigation of hazards may help reduce workplace injuries
PATRICK COATE, PH.D. Senior economist, National Council on Compensation Insurance
According to the National Council on Compensation Insurance’s recent survey of over 100 carrier executives, weather and impacts of climate on workers is an emerging area of focus for the workers’ compensation industry.
This ongoing topic of interest prompted the question from NCCI researchers: Do adverse weather conditions— including heat, cold, precipitation or snow—affect work injuries and therefore workers’ compensation claims?
Our research may be particularly insightful to stakeholders in workers’ compensation for two reasons in particular. First, research we reviewed notes that recent years have experienced an above-average amount of adverse weather, with more warm weather in 2023 and 2024 and costly winter storm seasons in 2021 and 2022. Second, it appears there may be early signs of regulatory movement toward providing added clarity of employer requirements related to workplace weather exposure. For example, in July 2024, new heat-related standards for workplaces were proposed by the U.S. Department of Labor.
With hints of potentially evolving interest regarding impacts of adverse weather in the workplace and workers’ compensation claims, NCCI researchers expanded on prior analyses by studying impacts of cold and precipitation, as well as heat and examined data spanning a longer history and wider geographic variation than previous studies—22 years and 35 states, respectively.1
Weather and workers’ compensation
NCCI researchers found that weather may have impacts on the frequency of workers’ compensation claims in a variety of contexts. This impact is seen in aggregate data, which uses all years, all industries and all causes of injury, although we do see more pronounced impacts for certain subsamples.
In the base model, we begin to see incremental impacts on workplace injuries when temperatures rise just a few degrees from a baseline of mild weather—meaning daily high temperatures of 60°–65°F. These estimated effects hold even after accounting for differences in claim patterns over time or across seasons in a year (such as more claims due to additional construction activity in the summer months) that may be correlated with average weather but are not directly caused by it. By the time the high temperature reaches the low 80s, there are 5% more injuries than the baseline comparison point. The impact doubles to over 10% for temperatures above 100 degrees. All else equal, there also are more injury claims on colder days with high temperatures around freezing. By comparison, frequency is lowest on the coldest days and days between 40°–60°F.
Next, we overlay the effect of precipitation and temperature. We find that precipitation leads to particularly high claim frequency on freezing days. On wet days when the high temperature is between 25°–40°F, there are 7–10% more injuries than the baseline of 60°–65°F dry days, holding all else equal. On dry days at the same temperature, the same comparison is only about 1–3% more than baseline. In short, workers’ compensation claims are shown to increase more on days that are cold and wet rather than on days that are cold and dry.
Impact of temperature on the frequency of workers’ compensation claims
Impacts of adverse weather on claim frequency and types of workers may vary across industry sectors. When it comes to heat, outdoor sectors such as construction experience the highest impact on injuries.
In fact, construction claims jump nearly 20% when temperatures rise above 100 degrees from the mild-weather baseline. That’s about double the impact on claims from the transportation sector, and four times higher than the impact on office jobs experiencing the same weather conditions.
In contrast, cold weather impacts the transportation and warehousing industries more than any others. In adverse weather—especially wet weather—delivery drivers can be affected by both road conditions and increased risk of slipand-falls. Office, health care, and upkeep also experience increased injury frequency on cold days.
For construction, natural resources, and manufacturing, injury frequency is lower on cold days than the mild-weather baseline. This may reflect that outdoor work is less likely to be performed on days with particularly harsh weather. In these instances, measured exposure would remain the same on such days, but workers may not be doing as much hazardous work.
Types of injuries
Claim frequency for all types of injuries increase with heat. Among major categories of injury, the relative increase in frequency compared to the 60°–65°F baseline is largest for contact injuries, a grouping, which includes “caught on,” “cut by,” “struck by,” and “rubbed against” injuries.
On cold days, frequency is lower for contact injuries and strains than at the 60°–65°F baseline. The higher overall frequency observed for 25°–40°F days is primarily due to a large increase in slip-and-falls, and secondarily by an increase in motor vehicle accidents. Both claim types are especially prevalent on cold and wet days—as much as 75% more than baseline for slip-and-falls, and 45% more for motor vehicle accidents. However, on cold and dry days the impact on motor vehicle accidents is small. Frequency increases for slip-and-falls even on cold and dry days, but the impacts are especially large on cold and wet days.
For days warmer than the 60°–65°F baseline, claims increase with heat on dry days for all injury types. At the baseline temperature, there are more slip-and-falls and motor vehicle accidents on wet days than on dry days; and for other injury types, there are more claims on dry days.
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Impact of adverse weather over a season
NCCI researchers sought to understand not just the impact of adverse weather on a particular day, but how much impact on claims adverse weather can have over the course of a whole season.
When comparing the overall impacts of weather, we studied two related but distinct questions: How much does adverse weather impact certain cities versus others? And, what effect would more adverse weather have in different types of areas? One scenario we examined in our study is the impact of heat on construction injuries.
When examining the impact of adverse weather on claims in construction class codes across all cities in our data, summer heat has the greatest impact. We estimate over a 10% increase in construction injuries from the average summer heat versus a baseline of all mild days at 60°–65°F. Note that this is after adjusting for the natural increase in summer injuries in construction since there is more construction activity in the summer than winter months.
Next, we estimate the impact of summer heat by city average temperature. Our estimates suggest that the hottest cities, like Miami or Phoenix, have almost double the amount of impact from heat on construction claims during the summer compared to cities like Chicago and Denver. We don’t assume that workers in these cities respond to heat differently; rather, there is a greater prevalence of hot days in the former cities.
To assess the impact of additional heat on claims, we then estimated the increase of injuries that would occur from a five-degree temperature increase every summer day across each city type. This is a very large increase, but cities experience variation in severity of summer heat from year to year. For most cities, 2023 was less than five degrees warmer than the average summer in our dataset; however, in nearly every city, 2023 was more than five degrees warmer than the coolest summer in our dataset.
In this scenario, we find a 2–3 percentage point increase in construction injuries for cities at all temperatures. This follows from our initial finding: increased temperature leads to more claims monotonically from about 50 degrees and up. Hot cities face more days with particularly hazardous temperatures, but an increase from 70 to 75 degrees has about the same marginal impact as an increase from 80 to 85 degrees or from 90 to 95 degrees. In other words, when a city experiences more hot days compared to whatever
workers in that city are used to, we estimate similar impacts on workers’ compensation claims.
Overall, heat can have a greater impact in the hottest cities. But increased heat—such as that seen in much of the United States during the summers of 2023 and 2024—is likely to have a similar marginal impact on both warm and cool areas. This is because we find that more heat is associated with higher frequency both for hot and for relatively mild summer temperatures. Additional risk is not limited to the most extreme days.
In our research, we also studied the impact of additional winter precipitation. Here, we found the largest overall and larger marginal impacts of additional wet days in cold-weather cities, because precipitation matters mostly to injury frequency when it is freezing, and such days mostly occur in colder regions.
Looking forward
The overall observed impact of weather on workers’ compensation claim frequency does not depend on a single day; rather on patterns that persist over a season or year. Adverse weather can lead to noticeably more claims—especially in areas with particularly hot summers or icy winters.
Understanding how both hot and cold temperatures may impact workers suggests that improved mitigation of hazards related to adverse weather may help reduce workplace injuries—especially for outdoor workers in the heat and for slip-and-fall injuries on cold and wet days.
As insurers continue to navigate this emerging concern, the results are clear: both hot and cold daily temperatures are associated with more workers’ compensation claims than days with mild temperatures.
Coate joined NCCI in 2017 in the economic research focus area. Previously, he worked as a research fellow at the American Institute for Economic Research, and as a postdoctoral fellow at the University of Michigan Population Studies Center. He earned a Ph.D. in economics from Duke University and a B.S. in mathematics from the University of Dayton. To read more about the NCCI’s recent survey, see here: tinyurl.com/45kjersp.
1 For an in-depth explanation of the survey’s methodology and modeling strategy, see here: https://www.ncci.com/Articles/ Pages/Insights-Adverse-Weather-and-Workers-CompensationClaims.aspx
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Leverage AI to improve homeowner claims outcomes
Artificial intelligence has emerged as one of the most transformative forces in the insurance industry. From underwriting to fraud detection, AI has the potential to reshape how carriers operate, creating opportunities to streamline processes and enhance customer satisfaction. Nowhere is its impact more profound—or more nuanced— than in the realm of homeowner claims.
For customers, a homeowner claim often is the most emotionally charged interaction they will have with their agent and insurer. It is a moment of vulnerability: damage to their most cherished asset can disrupt lives and challenge their sense of stability. As insurance producers, we aim to restore what’s been lost and bring peace of mind. In this high-stakes context, AI offers significant promise—but it also requires thoughtful implementation to ensure we remain empathetic and human-centric, in compliance with applicable laws and regulations.
This article explores how generative AI and related technologies can improve homeowner claims outcomes, from accelerating claim resolution to improving accuracy. It also cautions against the risks of over-reliance on AI, advocating for a balanced approach that blends the power of technology with the irreplaceable value of human judgment and human compassion.
ANDREW LEEDS Chief claims officer, Plymouth Rock Home Assurance
The potential of AI in homeowner claims
AI—when thoughtfully integrated—can transform the homeowner claims process, addressing long-standing challenges in efficiency, consistency and customer experience. The key lies in leveraging AI to augment adjusters’ capabilities rather than replacing them. Here are three areas where generative AI has the potential to drive meaningful improvements:
No. 1: Expedited damage assessment with enhanced accuracy. Historically, assessing damage after a loss has been a time-intensive process. Adjusters must physically inspect the property, document the damage and estimate repair costs. AI-powered image recognition tools, paired with generative AI models, now are revolutionizing this step.
Customers can upload photos or videos of their damaged property through a mobile app. AI models can analyze these images to identify damage types, measure affected areas— and in some cases generate initial repair estimates. These tools can recognize everything from roof shingle loss after a storm to water damage in a basement, often within minutes.
For insurance adjusters, this technology eliminates much of the manual effort involved in the early stages of claims. AI-generated insights provide a strong starting point, allowing adjusters to focus on verifying the information and
addressing the unique aspects of each claim. The result? Faster claim processing, improved estimate accuracy and more satisfied customers.
However, it is essential to recognize the limits of AI in this area. While algorithms excel at identifying patterns, they may miss nuanced issues—such as structural vulnerabilities, material types or hidden water damage—that require human expertise. Integrating AI as a supportive tool ensures claims are settled fairly and thoroughly.
No. 2: Proactive claim resolution through predictive analytics. One of AI’s greatest strengths is its ability to analyze vast datasets to uncover patterns and make predictions. In the homeowner claims process, predictive analytics can play a crucial role in identifying claims that are likely to escalate into disputes or delays.
For instance, AI can flag claims that have a high likelihood of requiring additional documentation or experiencing contractor delays. Armed with these insights, insurers can allocate resources proactively, such as assigning senior adjusters to complex cases or engaging with contractors earlier in the process. This predictive capability helps prevent bottlenecks, allowing insurers to resolve claims more smoothly and maintain high customer satisfaction.
Generative AI also can assist in crafting proactive communication strategies. By analyzing customer data and prior
... insurance producers and carriers must be mindful of how AI impacts their workforce. While these technologies can enhance adjusters’ productivity, they also may create anxiety about job security.
claims communications, AI tools can suggest personalized messaging that reassures policyholders and keeps them informed at every step. Furthermore, AI can flag claims that lack the necessary communication for immediate review and action. This type of tailored outreach not only reduces anxiety for customers, but also strengthens the relationship between insurance producers and their clients.
No. 3: Streamlining communication and documentation. Effective communication is at the heart of a positive claims experience, yet often it is a pain point for customers and adjusters alike. AI-powered tools—including chatbots and generative language models—are improving how insurers manage communications.
For example, AI-driven chatbots can answer routine questions about the claims process, freeing up adjusters to focus on higher-value interactions. Generative AI models can assist adjusters with the drafting of repair scopes, or summary reports based on claim details. These tools not only save time, but they also reduce the risk of errors or inconsistencies. More advanced/specialized generative AI models even can analyze complex policy language and recommend coverage determinations. While the final decision should always rest with a qualified, licensed adjuster, this capability can help assist in efficient and effective claim review.
The key challenge in this area is maintaining empathy. While chatbots and automated messages are efficient, they lack the emotional intelligence needed to support customers during stressful situations. Striking the right balance—using AI for routine tasks while reserving human interaction for sensitive moments—is critical.
Avoiding the pitfalls of over-reliance on AI
Despite its advantages, AI is not a panacea. Insurance producers must approach its implementation with caution to avoid unintended consequences that could erode trust and harm the customer experience.
One of the greatest risks is removing humans from the loop in pursuit of efficiency. Homeowner claims often involve emotionally charged situations, such as a family displaced by a fire or flood. In these moments, customers need more than a quick resolution—they need empathy, reassurance and a sense of connection. No algorithm, however advanced, can replicate the compassion of a skilled adjuster or agent. Another concern is the potential for bias in AI models. If training data is not representative, AI algorithms may produce outcomes that disproportionately disadvantage
certain groups. Insurers have begun to explore ways to rigorously test and monitor AI systems to ensure fairness and transparency, again in compliance with applicable laws and regulations.
Furthermore, as it relates to training data—agents and carriers must consider the legal discovery process as part of any challenge to the claim handling procedures. If a carrier uses AI in any part of its claim history, can that be discoverable and expose the carrier to risk that far exceeds the benefit? Even for carriers that seek to grant coverage, do the right thing and pay what is owed, there is potential risk here that needs to be considered.
As the insurance industry faces the talent cliff—thousands of highly tenured and experienced claims adjusters and leaders leaving the workforce—we will need to replace them—but how? AI is one potential solution, making it easy for new and low-tenured adjusters to gain knowledge quickly and turn that into wisdom. Taking the mystery out of claim handling, and quickly turning raw talent into an experienced adjusting force will both improve retention and results.
Finally, insurance producers and carriers must be mindful of how AI impacts their workforce. While these technologies can enhance adjusters’ productivity, they also may create anxiety about job security. Investing in training and upskilling programs ensures that employees see AI as a tool for empowerment rather than a threat.
Toward a connected ecosystem
As AI continues to evolve, its potential to transform the homeowner claims process will only grow. One of the most exciting frontiers is the development of agency architecture that links disparate AI solutions into a cohesive ecosystem.
Imagine a future in which AI tools for damage assessment, predictive analytics and communication are seamlessly integrated. A single platform could analyze an incoming claim, predict potential issues, recommend resources and automatically draft communications—all while keeping the adjuster and carrier in control.
This interconnected approach would not only improve efficiency, but it also would enhance the consistency and transparency of claims handling. Independent insurance agents, too, would benefit from real-time insights into claim progress, allowing them to provide better support to their clients and strengthen relationships.
In the longer term, AI may even extend its reach beyond claims, playing a proactive role in risk mitigation. For ex-
ample, smart-home devices could use AI to detect potential hazards—such as water leaks or electrical issues—and alert policyholders before damage occurs. By partnering with agents and policyholders, insurers could shift from a reactive to a preventative model, reducing losses and enhancing value for all stakeholders.
Technology as a partner, not a replacement
The promise of AI in homeowner claims is undeniable. It offers the tools to settle claims more quickly, more accurately and more transparently than ever before. For agents, these improvements can strengthen client relationships and reinforce the value of working with a professional adviser. For policyholders, they mean faster recovery and greater peace of mind.
But as we embrace this technology, we must not lose sight of what makes insurance unique: our commitment to being there for customers during their toughest moments. Empathy, trust and human connection are the cornerstones of this industry—and no machine can replicate them.
By leveraging AI thoughtfully—augmenting, not replacing, the human touch—we can achieve the best of both worlds: a claims process that is efficient and accurate, yet compassionate and deeply personal. This is the future of the insurance industry, and it is one in which agents, adjusters, and technology work together to deliver exceptional outcomes for our customers.
Leeds, chief claims officer at Plymouth Rock Home Assurance joined Plymouth Rock in February of 2021 after serving in a variety of roles within Liberty Mutual where he began his insurance career in 2004. Prior to joining Liberty Mutual, he was a captain in the United States Army, where he served as an Infantry officer in the 10th Mountain Division at Fort Drum, N.Y.
Thank You 2025 Annual Sponsors
Connecticut Young Insurance Professionals ... would like to thank these sponsors for their generous contributions. Through its partnership, the association is able to provide education and leadership tools that raise the standards of professionalism for the entire insurance industry.
JULIE CIRILLO Chief risk officer, Engage PEO
Reduce WC costs and boost claims efficiency for clients
In working with different carriers and third-party administrators, we’ve seen firsthand how proactive oversight and strategic claims management can save businesses significant money while ensuring employees get the care they need.
We want to share some insights and examples about how partnering with a professional employer organization can help your clients manage workers’ compensation claims effectively and keep their insurance costs under control.
Saving with a PEO
To help keep expenses in check, a PEO can help a business with the following:
Risk assessments. A PEO can conduct workplace safety evaluations to reduce the likelihood of accidents, ultimately resulting in fewer claims and lower premiums.
Claims oversight. A PEO can monitor claims to ensure spending is justified and the claims are brought to a prompt and efficient resolution.
Return-to-work programs. A PEO can help injured employees transition back to work sooner, minimizing downtime and associated costs.
Case study: 200-employee beverage distribution company
An employee at a beverage distribution company sustained a knee injury that required reconstructive surgery after a slip-and-fall. The worker was very forthcoming about prior medical history and eager to return to work. However, the third-party adjuster attempted to order reports that were not mandatory or relevant in this jurisdiction. This oversight would have delayed treatment and increased costs unnecessarily. By intervening, we ensured that the injury was managed efficiently and affordably, avoiding unnecessary expenses and delays.
Why oversight of TPAs matters
Third-party administrators handle many of the day-to-day tasks involved in processing workers’ compensation claims, but without proper oversight, mistakes can happen—mistakes that cost your clients time and money. That’s why PEOs keep a close eye on their work.
Here’s how to maintain accountability and ensure effective claims handling:
No. 1: Ensure accountability. Third-party administrators are expected to follow strict guidelines. PEOs review their work regularly and address any discrepancies right away.
No. 2: Prevent unnecessary spending. We can’t tell you how many times we’ve encountered TPAs requesting services for tasks the adjusters should be handling themselves or requesting surveillance that isn’t financially justified. PEOs scrutinize every decision to ensure it’s necessary and cost-effective.
No. 3: Communicate clearly. Regular communication with the third-party administrators ensure they’re aligned with the goals and policies of each client.
Case study: 40-employee manufacturing company
After a fall from a ladder, an employee required surgery for a fractured ankle. The worker’s recovery progressed well and as expected, but the adjuster assigned a telephonic case manager, without approval. This led to an unnecessary expenditure before we noticed and stopped it. By stepping in, we stopped the waste and ensured that every dollar spent on the claim was necessary and justified.
Red flags in claims management
Managing claims isn’t just about processing paperwork—it’s about actively identifying and addressing potential issues before they escalate. Some of the most
common red flags PEOs watch for include:
Overpayments. Without careful oversight, third-party administrators can authorize excessive payments inadvertently. To avoid unnecessary costs, every expense must be reviewed.
Delays in treatment. When injured employees don’t receive timely care, costs rise, and recovery times lengthen. To ensure prompt medical attention, PEOs can step in and monitor the situation.
Improper or fraudulent claims. Patterns of suspicious claims activity or errors in processing can lead to inflated premiums. Detecting and addressing these issues requires vigilance.
Case study: 75-employee assisted-living facility
A worker suffered a torn ACL after slipping on a wet floor. Delays in MRI referrals threatened to prolong recovery and increase claim costs. By closely monitoring the adjuster’s handling of the case, we ensured timely diagnostic exams and prevented any unnecessary delays that could have led to prolonged recovery or a worsened condition. Typically, treatment delays result in higher claim costs so it is important to establish benchmarks with the third-party administrator on claims processing and handling guidelines.
How PEOs support your clients
We know agents and brokers are always looking for ways to add value for clients, and partnering with a PEO is a great way to do that. Here’s how PEOs help:
Reducing administrative burden. A PEO can take on the heavy lifting of claims management, freeing your clients to focus on running their businesses.
Providing expertise. A PEO team should have the knowledge and experience to manage claims effectively, which helps keep costs down and compliance up.
Building client confidence. When your clients see how well a PEO can handle claims and can reduce their expenses, it strengthens their trust in you as their agent or broker.
Case study: 125-employee home health care group
A motor vehicle accident resulted in minor injuries for an employee, who continued working modified duty. Despite the straightforward nature of the case, the adjuster suggested surveillance, which we determined was unwarranted given the circumstances. Surveillance should be used selectively and strategically, focusing on cases in which it is expected to provide valuable insights. By halting this expense, we ensured that resources were allocated appropriately, and the claim was resolved efficiently at a reasonable cost.
Partnering with a PEO
Research backs up what we see every day. According to the Risk and Insurance Management Society, employers who actively oversee their third-party administrators see improved performance and reduced inefficiencies.
According to the National Association of Professional Employer Organizations, businesses that partner with a PEO experience significant savings and improved outcomes, such as:
Lower costs. PEO clients save an average of 27.2% on human-resource administration costs, including workers’ compensation.
Fewer claims. A proactive approach reduces workplace injuries through safety training and risk management.
Faster resolutions. Active oversight ensures claims are resolved efficiently, which lowers costs per claim.
Lessons learned from oversight
By working closely with claims every day, we can tell you that it is all about keeping insurance costs down and ensuring workers’ compensation claims are managed effectively.
For agents and brokers, introducing clients to a PEO strengthens their value proposition, helping businesses tackle a challenge with confidence and expertise. In an era where every dollar counts, a PEO’s oversight is not just a service—it’s a strategy for success.
Cirillo is the chief risk officer for Engage. She is a seasoned veteran in the workers’ compensation industry, with more than 20 years of experience in workers’ compensation litigation, claims management and risk management. She is a former workers’ compensation defense attorney and has held multiple senior roles in management, claims, loss prevention, risk management and sales. Cirillo earned a Bachelor of Arts from the University of South Carolina-Columbia and a Juris Doctor from the University of Pittsburgh School of Law.
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Contact Design & Print today to make the most of your business. You are important to us—let us show you!
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Corporate transparency, tenant cannabis businesses and more
Conn.: Insurable interest
Q. Does a homeowners association (not a condo or co-op association) have an insurable interest in a free-standing house owned by one of its members? The association is mandating that owners of homes in the development include the association as an additional insured for both property and liability coverages. Our company is reluctant to do this, saying the association does not have an insurable interest.
A. It is possible for the association to have an insurable interest beyond ownership based upon Insurance Law, contractual rights and exposure to lawsuits.
Connecticut Insurance Law Section 38a-1(10) defines an insurable interest as “an interest which is subject to a risk of loss through destruction or impairment of that interest.”
With respect to insured property, contract rights can create an insurable interest. Thus, a bylaw requiring the homeowner to rebuild could create an insurable interest for the association. However, the policy states the insurer will not be liable in any one loss to an “insured” for more than the amount of such “insured’s” interest at the time of loss.
With respect to liability coverage, insurable interest can be equated to potential legal liability to an injured third party bringing an action. Thus, a liability interest does not require ownership, but simply some degree of potential legal culpability. Since it is possible—or even likely—that the homeowners association would be named in any action involving a property owned by an association member, this test would be met. It is the insurer’s prerogative to refuse to add the association as additional insured, but lack of insurable interest may not be a valid reason.
For further details on insurable interest, PIA Northeast members can access Insurable interest—how far will it stretch? (QS90118) in the PIA QuickSource library.—Dan Corbin, CPCU, CIC, LUTC
N.H.: Tie-in sales
Q. A customer informed me that the bank preparing her mortgage loan refused to approve the loan unless she also bought her homeowners insurance through the bank. Is this legal?
A. No. New Hampshire law clearly prohibits the tying of banking and insurance products (Title XXXVII, Chapter 406-C:10).
The law not only prohibits a financial institution from requiring or implying that the purchase of an insurance product is required as a condition of the lending of money; a written disclosure also is required to be provided to (and expressly acknowledged by) the customer. The disclosure must clearly state that the customer is free to select another insurance provider, and that the customer’s choice of another insurance provider will not affect the financial institution’s credit decisions or credit terms in any way.
Insurance agents who have policyholders who are facing pressure by lending institutions should provide a copy of this law to their policyholders.—Bradford J. Lachut, Esq.
Vt.: Producer fees
Q. Can insurance producers charge fees?
A. Vermont Banking and Insurance Law Section 4724, Unfair methods of competition or unfair or deceptive acts or practices defined, paragraph 14 states that:
Failure of any agent or broker to obtain a prior written agreement with a client, policyholder or other member of the public concerning fees or charges made by that agent or broker directly to the client, policyholder or member of the public for that agent or broker procuring services or providing advice on insurance contracts is an unfair or deceptive act or practice. It states that commissions, expense allowance, bonuses, fees, or any other compensation received directly by agents or brokers from any legal entity engaged in the insurance business is exempt from this subdivision. [emphasis added]
So, yes. Producers can charge a fee. However, it must be disclosed beforehand, and you must obtain written permission from the client.—Bradford J. Lachut, Esq.
Corporate Transparency Act
Q. My agency received a notice about a beneficial ownership information disclosure required under the federal Corporate Transparency Act. What does my agency need to do to comply with the law?
A. Nothing. Insurance agencies and producers are exempt from the requirements of the law.
The Corporate Transparency Act, which became law on Jan. 1, 2021—and took effect on Jan. 1, 2024—aims to increase transparency in business ownership structures to combat money laundering, tax fraud and other illicit activities. It was enacted as part of the Anti-Money Laundering Act of 2020, which itself is included in the National Defense Authorization Act for Fiscal Year 2021.
The CTA requires that certain business entities, defined as “reporting companies,” file beneficial ownership information with the Financial Crimes Enforcement Network. Under the CTA, a reporting company generally includes corporations, limited liability companies and similar entities created by filing formation documents with a Secretary of State or a similar office. However, the CTA provides exemptions for entities already subject to close federal or state regulation, as they already disclose beneficial ownership information to government authorities. These exemptions cover entities like securities issuers, domestic government authorities, banks and others.
Since your agency falls under this exemption, no further action is required to comply with the CTA. For more details, you can refer to FinCEN’s guidance here: fincen.gov/boi-faqs#C_2.
For more information about the CTA, PIA Northeast members can access Corporate Transparency Act (QS91097) in the PIA QuickSource library.—Bradford J. Lachut, Esq.
Tenant with cannabis business
Q. I have a landlord client who is not in the cannabis business, but his tenant may have an exposure with cannabis products. Given that most policies now have a cannabis exclusion, is there some way to protect the landlord?
A. Yes. The Insurance Services Office Inc. introduced the CG 40 16–Cannabis Exclusion With Hemp and Lessors Risk Exceptions with its 2019 general liability multistate endorsements. This endorsement includes an explicit exception addressing bodily injury, property damage or personal and advertising injury arising out of the ownership, maintenance or use of a premises leased to others by the named insured.—Dan Corbin, CPCU, CIC, LUTC
Multifactor authentication
Q. What is multifactor authentication and why is it important?
Insurance agencies and producers qualify for an exemption. Specifically, the CTA’s 13th exemption includes “state-licensed insurance producers,” which applies to “any entity that (i) is an insurance producer authorized by a state and subject to supervision by a state insurance commissioner or similar official or agency, and (ii) has an operating presence at a physical office within the U.S.”
A. Multifactor authentication is a method of authenticating users on an information system by requiring them to go through multiple steps to access that information system. Commonly, this is accomplished through a combination
of a username and password, followed by a requirement for the users to prove their identity again through a notification sent to their mobile device or by inputting an additional code.
Often, MFA is the first and best defense against a cyberattack. MFA can help prevent a cyberattack from occurring. Microsoft estimated that 99.9% of cyberattacks can be blocked by MFA.
Here are some other best practices to increase cybersecurity:
Update outdated systems. Outdated systems—referred to as legacy systems— often do not support MFA. To prevent issues, businesses should update any outdated systems. Updates should be implemented with direct oversight and with a plan in place that will eliminate security gaps. Avoid “self-setup” updates that require each individual user to set up MFA credentials. In addition, a proper inventory of information technology assets should be kept to ensure old legacy systems are no longer online.
Use MFA for all applications. MFAs should be utilized for all applications that permit a user to access a business’s information system. For example, a business may utilize a Virtual Private Network service that requires the use of MFA, but only requires single-factor authentication for an email application. Once again use of an inventory of IT assets will help a business. A business should review its inventory routinely to ensure all relevant applications require MFA.
Third-party users. Third parties, such as payroll or human resources companies, may have access to a business’s information system. MFAs should be required for all users, including third-party users, to have access to a business information system. —Bradford J. Lachut, Esq.
Resort Casino | Mashantucket, Conn.
PIANH 2024 – 2025 Board of Directors
OFFICERS
President Casey Hadlock Hadlock Agency Inc. 150 Old County Road Littleton, NH 03561-3628 (603) 444-5500
casey@bestinsurance.net
Vice President
Jeffrey Foy, AAI Foy Insurance-Manchester 1889 Elm St. Manchester, NH 03104-2500 (603) 641-8111 jeff.foy@foyinsurance.com
Secretary/Treasurer
Alex Kapiloff, CPCU, CLU, CIC, AAI Kapiloff Insurance Agency Inc. 417 Winchester St. Keene, NH 03431-3914 (603) 352-2224 akapiloff@kapiloff.com
