Happy New Year! I hope this finds all of you well. I hope your 2017 is off to a great start and that you’ve all persevered through Mother Nature’s trials this winter.
I’ll admit that at first I enjoyed our winter wonderland. Playing in the snow with my kids was a blast, but at some point the novelty wore off even for my three-year-old. This brings me full circle and back to why my team and I are so committed to delivering a quarterly newsletter to you.
As the inclement weather reminded all of us, life is filled with uncertainty. Our newsletter is an additional tool to help you manage that uncertainly. We address this in our “State of the Market” article that I hope all of you will read. In this issue, you will also find an update on Health Care Reform, which is timely due to the new Administration’s promise to repeal the Affordable Care Act.
At Brown & Brown Northwest Insurance, we take our responsibility of protecting what you earn very seriously. As busy as we all are, I encourage all of you to take a moment to look at this newsletter. And then, as questions arise, reach out to your broker – we are here for you.
Thank you for entrusting us with your insurance needs. We appreciate your business.
State of the Insurance Market: Global Uncertainty Demands Strong Insurance Resources
The year 2017 likely will bring some clarity to companies worldwide who are now bracing themselves for a year of increased uncertainty, driven by growing concerns over political, legal and regulatory developments around the globe. Digital dilemmas such as the impact of new technologies on the risk profile of industries and cyber incidents are a rising concern as well, while natural catastrophe activity remains high on the agenda.
Business interruption is the top risk for the fifth year in succession, but new triggers continue to emerge. Perils such as natural catastrophes and fires are the causes businesses fear most, but the nature of the risk is shifting increasingly towards non-damage events. A cyber incident or the indirect impact of an act of terrorism or political violence are events that can result in large losses without causing physical damage.
Terrorism risk is rising, and a business does not have to be the direct victim of an act to feel the effects. Locations can become inaccessible and supply chains impacted in the wake of an attack. The growing risk of political violence, acts such as war, civil war, insurrection and other politically motivated incidents, which focus on countries rather than certain locations, should also not be underestimated, as the impact for global businesses can be much greater and longer-lasting.
An Update on Health Care Reform
Uncertainty abounds as the new presidential administration has elevated repealing the ACA to the top of its agenda. While nothing concrete has happened yet, the environment surrounding the ACA remains fluid and could change at any time.
Budget Reconciliation Process. Since the Republicans do not currently hold a filibuster proof majority in the Senate, it is unlikely that the ACA will be fully repealed. That said, in January, the US Senate and US House of Representatives passed budget resolutions that will allow them to begin rolling back provisions of the ACA through a process called ‘budget reconciliation’. Budget reconciliation bills allow for a simple majority in the Senate and cannot be filibustered, provided they have a direct budgetary impact.
While the details of which ACA provisions have not been decided upon, there are several potential ones that may be affected:
• The Individual Mandate
• The Employer Shared Responsibility Rules
• The Federal Exchanges
Executive Order on the ACA. President Donald Trump signed an executive order on January 20, 2017 that gives federal agencies broad discretion to ignore ACA provisions that create any undue financial burden. While the executive order is an attempt to blunt the impact of the ACA until it can be repealed and/or replaced by legislative means, it doesn’t contain details on specific ACA provisions. Due to its overly broad nature, it’s impact is still largely unknown until additional actions are taken at either the legislative or executive level.
Future Outlook. As we look towards the future, there’s still a great deal of uncertainty surrounding the future of the ACA and health care reform in general. The team at Brown & Brown Northwest is diligently monitoring the political and legislative landscape to ensure our clients are prepared for whatever changes to health care regulation arise. For more information on benefit offerings or how you can plan for future health care reform, contact us at (503) 274-6511.
Did You Know Your Network Could be Hijacked?
This is typically called Crypto-ransomware and most insurance policies do not cover this type of loss.
According to Symantec, Crypto-Ransomware “will use unbreakable encryption on the user’s files. Removing the malware will not solve the problem; the user will still be left with an inaccessible file.” Unless your organization backs up these files, you will be forced to pay the ransom to release your data. However, TechNewsWorld found 20% of companies that pay a ransom didn’t get their data back.
While the terminology may be new to you, Crypto-Ransomware is now the dominating force of cyber threats today. In 2016 Ransomware thefts were up 6000% from 2015 with over 4,000 attacks per day which account for over $1 billion in collected ransoms. According to the FBI, Ransomware cost victims $209 million in the first quarter alone while only $24 million was paid in all of 2015.
One of the most common ways to spread ransomware is through malicious spam emails. Phishing, which is an attempt to obtain sensitive information such as usernames and passwords, is the most common delivery method. These spam emails can also be used to send a fake unpaid invoice asking for monies to be sent to the perpetrator. By using unsecured networks and social media, these emails can appear legitimate tricking the user into transferring the funds. Once the theft is discovered, the monies are not recoverable.
Up to 40% of all spam emails contain ransomware. Of those, 35% of the clicks on emails occur between 9am and noon followed by 2pm. Once an attack occurs, it takes 9 hours on average to reboot a system and 63% of those affected spend more than a full day trying to patch-up their systems. IBM found that 70% of the victims surveyed paid between $10,000 and $40,000 and 25% paid $20,999 to $50,000.
Things your organization can do to help protect your data:
• Educate your employees against the dangers of phishing emails and provide training on how to verify the source of any suspicious email before downloading any attachments or clicking on links.
• Be proactive and continuously search for breaches.
• Minimize exposure by doing daily backups.
• Make sure all firewalls and routers are secure and kept up to date.
• It is crucial and in most cases required by law that you do a risk assessment and have an incident response plan in place.
• Test your incident plan and investigate anything that looks suspicious.
• Download and install software updates for your operating systems and applications as they become available.
• Implement a strict password policy and have employees change system passwords every 30 days.
• Limit employee access to company data and information, and limit authority to install software.
If you receive a ransom attack, immediately contact your Brown & Brown Northwest Agent as well as the FBI at www.ic3.gov.
Flooding is the Most Common Natural Disaster
Most homeowner’s insurance policies do not cover floods and coverage is mandatory in some areas.
Anywhere it can rain, it can flood. You don’t need to live near a coastline or river to experience a flood. Flash floods, inland flooding, and seasonal storms bring flooding to every region of the country. Just a few inches of water can cause tens of thousands of dollars in damage.
Do you have the proper insurance coverage in place?
Only flood insurance financially covers your home and your personal property from floods. A flood insurance policy compensates homeowners, renters, and business owners for all covered losses, and unlike a Federal disaster loan, it does not have to be repaid.
You can’t get flood insurance at the last minute.
In most cases, it takes 30 days after purchase for a policy to take effect, so it’s important to buy insurance before the storm approaches and the floodwaters start to rise.
Flood insurance may be mandatory in your area.
Flood insurance is required if you live in a high-risk area and you carry a mortgage from a federally regulated or insured lender.
You can purchase flood insurance no matter your flood risk. It doesn’t matter whether your flood risk is high or low, you can buy flood insurance as long as your community participates in the National Flood Insurance Program (NFIP). You can get flood insurance if your house has been flooded before, even if your mortgage doesn’t require it. Outside of the high-risk Special Flood Hazard Area, most properties will qualify for the lower-cost Preferred Risk Policy. Even though flood insurance isn’t federally required, anyone can be financially vulnerable to floods. In fact, people outside of mapped high-risk flood areas file nearly 25% of all NFIP flood insurance claims and receive one-third of Federal Disaster Assistance for flooding.
In the Community: BBNW Goes Red
For the second year, Brown & Brown Northwest encouraged teammates to “Go Red” on February 14, to help raise awareness and funds in the fight against heart disease in women.
Teammates who wore red to the office received a raffle ticket. The PAW (Play At Work) Committee organized the raffle, and teammates also had the option of buying tickets to raise funds for the American Heart Association.
February 3, 2017, was National Wear Red Day. During February many individuals, hospitals, organizations, schools and companies “Go Red” for this cause. According to the American Heart Association, heart disease and stroke cause 1 in 3 deaths among women each year.