MarketStance Blog

AAISalliance LAUNCHED ON REDESIGNED AAISdirect SERVICE Integrating MarketStance

2011-01-06T16:16:00.000-08:00

Click here for a link to the full release.

Wheaton, Ill., Jan. 6, 2011--Member insurance companies of the American Association of Insurance Services (AAIS) now have access to additional risk information services through AAIS's proprietary web portal.

AAIS is a national advisory organization that develops standardized policy forms and rating information used by more than 600 P/C companies throughout the U.S.

This week, AAIS implemented its "AAISalliance" of information providers accessible through the newly redesigned AAISdirect online library of policy forms, manuals, bulletins, and other information.

With the AAISalliance, AAIS member companies can access information services throughAAISdirect at discounted rates.

"The AAISalliance allows each individual AAIS member company to access these services with the purchasing power of our collective membership," says Rick Maka, AAIS director of marketing and strategic alliances. "This initiative is directly in line with our mission of helping our member insurance companies compete in the market."

To date, the alliance includes four other organizations that will remain independent but provide AAIS member companies with information services under arrangements with AAIS.

NERA Economic Consulting and Institute for Legal Reform leverage MarketStance

2010-12-28T06:12:00.000-08:00

NERA Economic Consulting and Institute for Legal Reform leverage MarketStance for a study on tort liability costs for small business. A copy of the 32-page study is available here on the ILR's web site.

MarketStance's continues to work primarily with clients in the domestic property and casualty vertical, but the application of our core models and methodology is far reaching. As demonstrated by NERA's reference to MarketStance estimates throughout this study commissioned by the Institute for Legal Reform, MarketStance remains a singular source for detailed and accurate exposure information.

For more information please visit our website here.

NERA Economic Consulting (www.nera.com) is a global firm of experts dedicated to applying economic, finance, and quantitative principles to complex business and legal challenges. For half a century, NERA’s economists have been creating strategies, studies, reports, expert testimony, and policy recommendations for government authorities and the world’s leading law firms and corporations. We bring academic rigor, objectivity, and real world industry experience to bear on issues arising from competition, regulation, public policy, strategy, finance, and litigation.

The U.S. Chamber Institute for Legal Reform (ILR) is a national campaign, representing the nation's business community, with the critical mission of making America's legal system simpler, fairer and faster for everyone.

Founded by the U.S. Chamber of Commerce in 1998 to address the country's litigation explosion, ILR is the only national legal reform advocate to approach reform comprehensively by not only working to change the laws, but also changing the legal climate.

PRESS RELEASE: MarketStance Provides Insight Into Outlook for Large Commercial Lines Accounts

2010-12-16T04:41:00.000-08:00

Middletown, Connecticut – December 15, 2010 – MarketStance, a leading resource for demographic
data and analytical services for the U.S. insurance industry, is pleased to announce the release of an indepth,
expert article which provides a detailed analysis of the recessionary impact specifically on large
commercial accounts.

Click here for a free copy of the article Article

Click here for a copy of the press release Release

November Economic Advisory Note

2010-12-07T04:17:00.000-08:00

Economic Advisory Note

Eric Price-Glynn, Manager, Research & Analytics

Tuesday, December 07, 2010

Reviewing Friday’s weak government employment situation report, I want to and would say “Bah humbug”! Save for the positive trends indicated by other reports, in particular the ADP employment report released earlier in the week, it would look like a lousy situation indeed.

The government partially squashed happy holiday hopes of continued employment recovery created by October’s more positive employment report and subsequent positive releases by ADP and others. The job gains in October – initially reported as 150,000+ were actually revised slightly upward to 170,000+ but that is about where the holiday cheer ends as far as the government data are concerned.

The labor economy rests near “the bottom” reached in 2009 with over 20 million un- or underemployed, vast underutilization of resources, house prices – hence wealth-driven consumption, again on the decline, and a global flight to the dollar as a safe-haven currency working against growth driven by US exports. Add in that theatrics over deficit and matters of no economic consequence such as a federal employee pay freeze – not reducing unemployment – have grabbed political center stage, and the end of the year brings seemingly little to cheer about in general as the broad labor economy meanders into an uncertain 2011.

But there is some positive news from other corners, consistent with our forecast of an economic recovery beginning to take hold in the 2^nd and 3^rd quarters of 2011.

This news comes from that “other” employment report this week, produced by ADP (Automatic Data Processing, Inc, one of the world’s largest payroll outsourcing firm).

Most importantly, the ADP report tells a somewhat different story, in particular for small business. Small businesses (with <50 employees) have added an estimated 200,000 jobs this year – more than half of them in the last three months , with the overwhelming majority of gains coming in the service sector. While monthly job gains in the range of 200-300,000 in small business are truly what are needed to cement the recovery, the continued trend of monthly job growth over the last 4 months could reach that pace of growth as early as July or August 2011—more likely the end of the year—provided the cross- and head-winds mentioned above (or some new negative shock) don’t divert the recovery.

In general, the 2011-2013 recovery in commercial lines premiums from the awful reality of the last three years, hinges on sustainable payroll and revenue growth—especially among small commercial insureds, which through the first quarter of 2010 were still cutting jobs. Here’s hoping the positive trend of the last 6-9 months continues!

So this month’s mix of good and bad:

Employment:

· Overall, only 39,000 jobs were added in November – less than half the average job growth to date in 2010, and far below the rate at which a recovering economy would be expected to absorb a labor force if it were growing at a healthy, recovering trend. This is simply not anywhere sufficient job growth to sustain a recovery.

· The unemployment rate rose to 9.8 percent; expect it to rise further before it falls, as unemployed workers restart active job searches, many of them re-entering the labor force for the first time in years.

· Classes with more than 500,000 employees and significant year-over-year job growth momentum include:

o Mining & mining support services: up 13 percent over the year

o Primary and fabricated metals: up 4.7 percent over the year

o Motor vehicles and parts: up 4.2 percent over the year

o Temporary help services: up 14 percent over the year

o Home health services: up 4.1 percent over the year

Payrolls:

· In nominal terms payrolls have returned to exactly the level of 2007. Factoring in inflation, payrolls are still well below the 2007 level.

· Sector differences are substantial:

o Healthcare and education continue to lead the pack out of the recession, with payrolls 14 percent above 2007 – or about 8 percent higher in real terms. However on a month-over-month basis, payrolls were flat.

o On the flip-side, construction and manufacturing payrolls are still only 80 and 92 percent of their 2007 levels, respectively – and 6 percent worse in inflation-adjusted terms.

Overall, a mixed picture for the labor and broader economy moving into 2011, with some bright spots, in particular the gathering strength of job creation in the small commercial sector.

Happy Holidays and New Year!

October Economic Advisory Note

2010-11-12T13:58:00.001-08:00

The October employment situation report and a number of other economic news releases of late provide reasons for cautious optimism about the direction if not the pace of recovery in demand for the economy in general and property and casualty insurance in particular.

Employment:

· Over 150,000 new jobs were added in October – the fastest rate of job growth of the year, factoring out the distortions of Census hiring in earlier months.

· While a more robust recovery would mean sustained monthly job growth in the range of 250-350k per month, the 150k jobs added to payrolls in October was more than double the average for the first nine months of the year.

· Growth in the 150k/month range is just about sufficient to absorb new entrants to the labor force at the usual rate of labor force growth.

· If the demand for labor continues to increase, expect the unemployment rate to rise before it falls, as unemployed workers restart job searches, many of them for the first time in years.

Payrolls:

· In nominal terms payrolls have returned to exactly the level as 2007. Factoring inflation, payrolls are still well below the 2007 level .

· Sector differences are substantial:

o Healthcare and education payrolls are the most significant classes of business (NAICS 61 & 62) leading the pack out of the recession, with payrolls 14 percent above 2007 – or about 8 percent higher in real terms.

o On the flip-side, construction payrolls are still only 80 percent of the 2007 level. With the enormous excess of residential and commercial property on the market (or being intentionally withheld from the market), don’t expect a turn around there any time soon.

· Key recovery belle-weathers continue to show steady improvement year-over-year:

o Employment placement/Executive Search payrolls – growing at a 14 percent pace over the same quarter last year

o Temporary help services payrolls – growing at a 21 percent pace

o Professional Employer Organizations – growing at a 5 percent pace

Overall, a pretty good jobs report. With any luck, another 2-3 months of jobs growth at or above the October level will mark the beginning end of flat / shrinking payroll exposures. Though negative risks remain, most prominently the Congressional move to fiscal austerity before the recovery truly takes hold, this is the best news on the economic front in several months.

2010 Fall Seminar - The Uneven Nature of the Economic Recovery - Tuesday, October 26,

2010-09-29T07:02:00.000-07:00

Come join us for our fourth annual Fall Seminar event on the Uneven Nature of the Economic Recovery as it impacts the P & C industry. There is no charge for the event and full details are available at Full Agenda.

Historically, these events are well attended by users, managers and executives at our clients and partners. It is a unique experience to take a different perspective on relevant topics with your peers. A day filled with insightful presentations on the P & C industry, the economy, and proactive applications of information to grow business.

We hope to see you on October 26th.

September Economic Advisory Note

2010-09-10T07:53:00.000-07:00

The Bureau of Labor Statistics reported last Friday (September 3, 2010) that aggregate US employment was little changed in August from the previous month’s level. However, the private sector did manage a modest, 28,000 jobs gain.

So far this year, the health care sector has reported some of the strongest gains, adding a total of 160,000 jobs. In addition to bolstering payrolls, and thereby the demand for workers compensation coverage, the health care sector’s expansion has helped to increase demand for other lines of coverage. For example, this pace of employment gains is consistent with the creation of about 6,000 new small firms, each of which needs at least basic BOP coverage for its office exposures.

Again last month, temporary employment services recorded sizable job gains underscoring many employers’ atypical reluctance to create new, full-time positions. Over the past year, these temporary staffing firms have added almost 400,000 new employees. Such rapid temporary jobs growth continues to represent a significant challenge to workers comp insurers, many of whom struggle to align the rate charged with the jobs actually performed by these workers.

Job Posting - Client Services

2010-09-07T15:27:00.000-07:00

MarketStance is hiring a Client Services Associate. Please click on the above link for a full job description and forward to anyone who may be interested.

August Economic Advisory Note

2010-08-11T13:34:00.000-07:00

At best, the just-released July employment report confirmed the tepidity of the current recovery and at worst it heightened fears of a “double-dip recession”. Private non-farm jobs edged up by 71 thousand over the month – about half the expected amount. Since the recovery got underway at the beginning of this year, private non-farm jobs in the US have grown by an average of 90,000 per month – far below the pace that is typical of recent economic recoveries.

Although modest, employment gains are continuing in some key sectors such as healthcare, manufacturing and transportation. These three industries have accounted for about half of the 630 thousand jobs that have been generated by the recovery since the beginning of the year.

The disparity in job gains – both from one industry to another and from one state to another -- highlights the dilemma commercial lines carriers face in dealing with current soft pricing conditions. The rising tide of an economic recovery typically floats all boats by boosting insurable exposures. This time around, its benefits will be experienced only those carriers’ whose boats are moored in the harbors provided by certain state and industry segments of the broader commercial lines marketplace.

June Economic Advisory Note

2010-06-04T09:04:00.000-07:00

US private sector employment continued to grow in May, but at a rate that reflects a stalling recovery. If June & July 2010 are as weak as May, the furtive recovery could be jeopardized, as consumer incomes and spending are curtailed. In terms of private sector employment (+41,000) there was barely any forward momentum in May: 3 out of every 4 new positions were created by temporary hiring services, continuing a year-long trend for this business class. Apart from the 411,000 Census hires, the fiscal crisis of the states continues to impinge on any recovery. Stressed state governments cut 15,000 jobs in May - 13,000 of them outside of education.

In terms of insurable payroll exposures, there are still too few bright spots to describe them as "recovering". On a year-over-year basis, private payrolls for 2-digit NAICS sectors remain below the April 2009 level (inflation adjusted), with the exception of mining (Sector 22) and utilities (Sector 23) -- the former boosted substantially by the ongoing BP disaster / clean-up in the Gulf.

Manufacturing remains one of the few relatively bright spots. Although inflation adjusted payrolls are essentially flat relative to last year, manufacturing is pretty much the only economically significant sector that has gained momentum this Spring. Over the last three months (March-May), manufacturing payrolls are up 2.7 percent. Continued growth in manufacturing will be key for any reasonable chance for recovery through 2010-2011.

MarketStance Customer Service receives Excellent rating by clients

2010-05-17T07:09:00.000-07:00

In a recently completed user survey, MarketStance's industry-leading customer service team was given the highest ratings by 9 out of every 10 respondents.

MarketStance, through its team of customer service representatives, continually strives to provide exceptional service and fast response time to any support issue across all our products. We are pleased to see such glowing ratings from a broad snap-shoot of our currently installed user base.

MarketStance continues its aggressive expansion plans through the 2010 year and welcomes any comments or suggestions.

Please don't hesitate to contact us us at any time:

via email at: ms@marketstance.com

via phone at: (860) 704-6381

via web at: www.marketstance.com

Another successful MarketStance Seminar Series event

2010-04-27T05:11:00.000-07:00

MarketStance just completed another successful MarketStance Seminar Series event together with a long-time client. The MarketStance Seminar Series was started in 2005 as a mechanism to interact with our clients in an educational and collaborative environment. We assemble a half or full day of relevant content, lectures and discussion on recent and relevant topics topics in our arena of insurance analytics, then present the information through outside speakers or inside experts.

Past Topics include:

- Economic Update - Impact on Commercial Lines

- Distribution Channel Management

- Segmentation Strategies - New Business and Underwriting

- MarketStance Business Intelligence Portal demonstration

- Growth Advisor - apply MarketStance's proprietary economic forecasting to determine which business will be growing, staying the same, or shrinking as we begin to emerge from the recession

- Client Specific Topics

We host two to four public MarketStance Seminar Series each year at our headquarters in Middletown, CT, Chicago and on the West Coast. Additionally, we will convene at a client's site to host an event for their senior management and analytical teams. If you would like more information, please contact MarketStance Support at ms@marketstance.com or (860) 704-6381.

MarketStance Economist Corner: Insurance Implications of the Employment Report for March 2010

2010-04-12T13:37:00.000-07:00

Today's employment situation release again provides reason for cautious optimism in payroll exposure growth rates. First the optimism: employment is growing ,not shrinking, even when you factor out the gains in temporary Census hiring of about 60,000 jobs last month and this month (+114,000). To boot, the revisions of January and February employment were slightly positive -- more jobs were added than first reported.

Now the cautionary notes. For a sustained let alone robust recovery, the private sector would need to add on the order of 250,000 jobs per month -- 150,000 jobs are necessary just to keep pace with trend growth in the labor force. The US economy is still well below that rate of net job creation. The fact that much of the employment growth in the last six months has come from temporary hiring, both Census and private sector, reflects the nascent -- read potentially reversible -- nature of the recovery. Job growth will likely be structurally constrained for years, because so many workers from hard-hit construction and manufacturing occupations are poorly matched to the jobs that will be created in the recovery. Millions are saddled with houses that are 20-30 percent or more underwater. Moving for that new job someplace else means accepting a large financial hit that many will simply refuse to take.

A recovery in dismal worker's comp trends will be stalled until aggregate payroll exposures show marked improvement. Unfortunately, there the story is even more muted than with the nascent employment growth. The index of weekly payrolls, which factors both hours and hourly pay for all private sector works, remains well below the 2007 level, with preliminary 2010 numbers showing a decline in payroll exposures between January and February, and then a slight rise between February and March. Basically, payroll exposures are bouncing right around the bottom reached in 2009, with little sign of recovery as of yet.

On another note, personal auto exposures, at least as reflected by new light vehicle sales, are showing some signs of life, but this is wildly overblown in recent news reports. Yes auto sales are gaining, but relative to what? Recall that Spring 2009 saw a relative cessation of auto sales, in part due to credit crises and bankruptcy proceedings, so the comparison year over year dominating the headlines is quite misleading. Taking the longer view, March 2010 light vehicle sales (11.8 million), while trending up due to Toyota-led incentive programs, remain at historically depressed levels, though off the lows.

Workers / consumers by and large are still scared. Until they become a lot less so, these core exposures will remain a drag on growth in written premium.

Now the cautionary notes. For a sustained let alone robust recovery, the private sector would need to add on the order of 250,000 jobs per month -- 150,000 jobs are necessary just to keep pace with trend growth in the labor force. The US economy is still well below that rate of net job creation. The fact that much of the employment growth in the last six months has come from temporary hiring, both Census and private sector, reflects the nascent -- read potentially reversible -- nature of the recovery.

Job growth will likely be structurally constrained and unemployment high for years, because so many workers from hard-hit construction and manufacturing occupations are poorly matched to the jobs that will be created in the recovery. Millions are saddled with houses that are 20-30 percent or more underwater. Moving for that new job someplace else means accepting a large financial hit that many will simply refuse to take.

In at least one way this recession is quite unlike any other since the Depression, with long-term unemployment (>27 weeks) running double the rate it has at any time since (hat-tip Calculated Risk).

MarketStance Newsletter

2010-04-12T07:31:00.000-07:00

MarketStance sends out a quarterly client newsletter. This newsletter is a great resource for insurance professionals to learn more about the latest news at MarketStance. Click on the link below to check out the most recent newsletter:

http://www.marketstance.com/newsletter.html

MarketStance / AAIS Partnership

2010-03-15T18:47:00.000-07:00

MarketStance and American Association of Insurance Services "AAIS" will be presenting our recently formed strategic partnership at the AAIS Main Event in Sanibel Island, Florida on April 11. This alliance will provide an array of MarketStance products and services specific to the AAIS membership. The event's title "Harnessing Data for Results" articulates one of MarketStance's founding principals.

Find more information about the conference at http://www.aaisonline.com/communications/annualconf.html

We look forward to seeing you there.

MarketStance Economist Corner: Commercial Insurance Implications of the Employment Report for February 2010

2010-03-10T13:25:00.000-08:00

The just released employment data for February contain some good news and some notes of caution for writers of workers comp coverage. First, the good news. While the economy continues to lose jobs, the pace has slowed substantially and several key sectors show signs of stabilizing at long last. In particular, both the mining and manufacturing sectors, which together account for some 20% of workers comp premiums, have reported stable employment since the beginning of the year.

Now, the cautionary implications. The temporary employment services industry, which includes PEO’s and other labor supply businesses, has shown an appreciable uptick in employment since the beginning of the year. In its own right, this growth is obviously a positive development. For workers comp writers, however, this trend signals a renewed challenge to underwriting profitability to the extent that carriers continue to experience difficulty in getting appropriate premium rates for these temporary workers.

New Faces At MarketStance!

2010-03-04T10:03:00.000-08:00

MarketStance is pleased to announce the addition of three new members to the team. Shruti Jain, Nirav Shah and Nikhil Shivalkar join MarketStance as analysts to assist in new product development for the Research and Analytics team. Each bring extensive skill sets to MarketStance enhancing the abilities of the Research and Analytics team to more quickly create the in-demand products that MarketStance provides our clients.

Announcing MarketStance Feedback

2010-02-22T10:50:00.000-08:00

MarketStance is pleased to announce a new tool that we plan to use to better service our clients- MarketStance Feedback. The tool gives you the power to tell us what we can do to assist you better, ideas for product improvements, or to just give us feedback.

This new tool allows you to suggest an idea, view the ideas of others, and vote on these ideas, all in one online location. Through this application, you to have a direct pipeline to the MarketStance think tank, can share your feedback and then monitor the progress of ideas that are being considered. As your ideas become projects for the MarketStance development team, you can anticipate their release and contact the sales team to learn more about them and secure them in your toolbox of MarketStance products upon their release.

We want to hear from you. Please click the following link to give us your feedback via MarketStance Feedback:
Click Here To Explore MarketStance UserVoice

If you need help accessing or navigating MarketStance UserVoice, please email ccydylo@marketstance.com or call 860.704.6384.

Welcome To The New MarketStance Blog

2010-02-17T10:50:00.000-08:00

Hello and welcome to the new MarketStance blog!

This is a new venture for MarketStance and an exciting new avenue through which to communicate with current and prospective clients, as well as anyone else interested in learning more about the insurance industry. Please continue following this blog and feel free to contact us with any questions or comments. Until our next post, here is a little more about MarketStance:

MarketStance enables insurers to achieve their goals of profitable growth and increased market share. We deliver timely, accurate and complete market information, analytics, consulting services, and innovative business solutions to commercial insurers.

MarketStance is one source for economic market, business, insurance, and agency information while offering the expertise of economists, analysts, and insurance industry veterans. MarketStance utilizes a proven “bottom-up” analytic methods for reliable information and delivers this information in flexible packages designed to fit our client's needs and budget.

Through a clear lens, our customers gain competitive insights to identify new target market opportunities, optimize distribution channels, improve retention, streamline the audit process, and much more.

Visit www.marketstance.com or call 860.704.6381 to learn more.