Navigating the Challenges

The insurance industry continues to experience increased loss activity especially in the property and auto lines of business. This increase in loss activity leads to higher rates and decreased capacity from both primary insurers and reinsurers alike. This has a real-world effect on all businesses including the Forest Products industry. One of the biggest culprits for the increased cost of claims is the impact that social inflation is having on claims. The industry is full of examples where a claim is expected to be settled for less than 100,000, and then social inflation enters the room, and the company is paying 5, 10 or 20 times more than expected. The problem with this trend is, when it starts recurring, it becomes the norm and insurance carriers become very concerned with how much of their capital is exposed to these unexpected events. This uncertainty drives rates up and limits reinsurer capacity as they look for better places to invest their capital, leaving the insurance buyer with fewer options. In some cases, the buyer can’t afford the insurance and they are forced to make some hard decisions. Unfortunately, this scenario is happening with increased regularity, and it should concern all of us.

NAVIGATING THE CHALLENGES

Forestry Mutual continues to navigate these challenges thanks to our deep industry knowledge and strong carrier partnerships. With over fifty years of experience in underwriting for this niche market, Forestry Mutual offers our policyholders a range of competitive coverage options, and solutions to help our policyholders manage through these difficult times.

At Forestry Mutual, we understand the wood products industry's logging, chipping, log hauling, and mill operations. Our continued collaboration with key business partners in the industry allows us to work with our policyholders to help them solve their many complex insurance needs. We are also proud to have earned so many endorsements with the many leading trade associations we work with, setting us apart from other insurance providers in the marketplace. By working together, we are building a more resilient partnership that will allow us to find ways to solve the challenges our policyholders face each and every day.

EDUCATION IS A DRIVING FORCE

One of the industry's most pressing issues today is the need for more log truck drivers. As many drivers near retirement age, there is a growing need for young drivers. Recognizing this issue, Forestry Mutual is consulting with regional association partners and community colleges to assist in their development of programs to inform people about a career in logging and continue to train and educate truck drivers. This will be an ongoing challenge as the industry competes for the next generation of truck drivers.

LOOKING DOWN THE ROAD

Looking towards the future, Forestry Mutual will continue to help our policyholders manage their exposures with first class loss control services, innovative technology to help protect and reduce losses from log hauling, and help our policyholders find the insurance products they need to protect their business from financial hardship. We continue to promote the financial benefits of utilizing dashcams and telematics to monitor and improve driver safety and transport efficiency and fight social inflation. We will make sure our Loss Control remains best in class.

While the forest and logging industry may face many challenges, I would like you, our policyholders, to know Forestry Mutual is stepping up to meet these challenges and create new opportunities. By focusing on specialized knowledge, partnerships, and technology, we are paving the way for a stronger and more sustainable industry.

We also want to thank each and every one of our policyholders for your business. We know you have choices, and we want to make sure we continue to deliver to you and your employees the best insurance experience possible. We are here for you and will work with you to manage and solve your insurance needs.

Bill Dine, AAI

President, CEO