Does your broker look under every stone for you?

There has been a lot of commentary about the insurance market cycle over the past few years, as it entered the hard market stage of the cycle – here’s a refresher on the sections of the cycle:

The question on most clients’ lips is: When do we think my premiums will start going down again?

I am not going to predict that the soft market is just around the corner as insurance companies calculate the operating ratios (premium and investment income less operating and claims costs) on an annual basis and the continued economic uncertainty is not going to help either.

But the point I do want to raise is in the past twelve months we have seen several new insurers emerge within insurance sectors that have become particularly effected by Covid, such as hospitality or Directors & Officers.

Both sectors have seen significant capacity reduction and rates increases – for some over 100% year on year. These new insurers are able to offer more competitive options by not being burdened with an existing book of business that either has legacy claims to be concerned with, or capacity being squeezed in respect of Material Damage and Business interruption covers as the market contracted in certain key areas such as our major city centres. They could also be an underwriting agent (MGA) which writes business on behalf of other insurers, where the underwriters working for the MGA have a specific specialist ability.

These insurers, although new, have strong solvency ratings or, in respect of MGA, have insurance partners who do.

The key question to ask yourself as an insurance buyer is: Does your broker have access to these markets? Look back over your last few years of renewal reports. Do you continue to see the same results from your broker remarketing efforts? We are not suggesting the whole list should change but it should have some new names on it.

At Howden, via our own relationships, we have an extensive reach within the insurance market and would always stand by what we look to put forward for our clients and prospects as the most competitive terms available for your risk for the market entirely.

Essentially, if your broker keeps going to look under the same stones, they are going to keep getting the same results. There are some new stones that Howden could give you access to which could give a very different result to what you have seen over the past few years.

Contact us today on 020 7543 2807. We’ll never leave a stone unturned.

Why Is The Insurance Market Hardening - Berkley AUS (berkleyinaus.com.au)