Happy Wednesday! In this week's Big I Buzz, we are discussing how material and labor prices are affecting property insurance, the new FDA COVID vaccine approval and why small business insureds are showing drooping satisfaction. 

How Material, Labor Price Hikes Are Affecting Property Insurance

The COVID-19 pandemic has created a sharp increase in the price of materials and labor. These increases have in turn increased property claim costs. According to the Vice President of pricing solutions for Verisk's Xactware, "The price of sheathing materials such as plywood and oriented strand board increased by more than 350 percent from July 2020 to July 2021 and other lumber materials increased by more than 100 percent... A labor shortage is driving up costs as well."  Pyle said that guess future prices is a "foggy crystal ball". Previously when COVID-19 appeared to be under control in the US, prices started to level out, however, with the Delta variant's arrival, rates started surging again. Read more here. 

FDA's COVID Vaccine Approval Makes Challenges to Mandates Tougher to Win

This week the FDA approved the Pfizer vaccine. According to Insurance Journal, this change will make it nearly impossible to successfully challenge mandates by employers, legal experts said. 

According to Reuters, "Legal experts said there already was a growing consensus that employers could mandate an emergency vaccine. During the pandemic, both the Equal Employment Opportunity Commission and the Department of Justice issued guidance in support of vaccine mandates, provided exceptions were made for medical conditions and religious beliefs. But emergency vaccine requirements have not gone unchallenged. At least a dozen lawsuits have been filed, mostly by students against colleges, but also by employees fighting allegations of wrongful termination for refusing a shot." This new approval will make it more difficult for those who would like to challenge mandates, nearly impossible. Read more here.

The 5 Reasons for Small-Business Insureds' Drooping Satisfaction

A new survey from J.D. Power has found that customer satisfaction surrounding small-business insurance clients declined seven points this year and 15 points during the past two years. They outlined the top 5 reasons for this: 

5. Interactions leave more to be desired - the satisfaction with insurance interactions fell off by 20 points compared to the year prior. Not only was this decline due to courtesy during calls but also in the timeliness of resolution. 

4. Customers exerting too much effort - throughout the last year, small business insureds exerted three times more effort trying to interact with insurance agents. 

3. Outreach comes too late - According to NU Property Casualty 360, "During 2020, less than 20% of clients reported their carrier proactively reached out to discuss their needs related to COVID-19. This significantly increased in 2021, with 45% reported having proactive contact with their insurer. However, the negative impact it had on customer satisfaction suggests the outreach might have come too late."

2. Mixed messaging - more problems and billing issues were reported in 2021 compared to 2020, among insureds who reported receiving proactive outreach. 

1. Turning to multiple channels for answers - clients who experienced billing or other issues were twice as likely to use four or more communication channels. According to the study, "While they leveraged multiple communication tools, including call centers, the customer satisfaction level didn't vary much between channels with clients that experienced problems. This suggests the industry could do more to recreate a more seamless cross-channel experience. 

For more news, check out the Action news section of our weekly e-newsletter, Big I Buzz. If you aren’t subscribed, click here to add your email to our emailing list. We hope that everyone has a great rest of their week!