News: Demand for liability insurance increasing during economic downturn

Companies across Europe, the Middle East and Africa are buying higher levels of liability insurance as fears increase over possible claims during the economic downturn, according to research by Marsh.

Heightened demand, coupled with competitive pricing, has led to an increase in the amount of insurance purchased compared to four years ago.

Since the onset of the financial crisis, the average level of insurance limit in the region EMEA has risen from €29 million in 2008 to €31 million in 2012, peaking at €32 million in 2011. In Northwestern Europe, including the UK, the average limit purchased for liability insurance has increased by 40%, from €40 million in 2008 to €56 million in 2012.

According to Marsh’s data, pricing has decreased by 22% since 2006, while the maximum available capacity for EMEA-domiciled buyers now exceeds €2.5 billion. However some firms, including pharmaceuticals with US exposures, those with long-tail risks associated with occupational disease or US product liability, and smaller firms whose exposures exceed their revenue, are now experiencing difficulties in securing the liability cover they require.