Is the insurance cycle a thing of the past?

Property Damage and Business Interruption rates stable, according to survey.

The cost of Property and Business Interruption cover for UK companies has remained stable over the past year, despite the big losses sustained by insurers in 2011.

The third Airmic Property Damage and Business Interruption survey, sponsored by Willis, found that those respondents who had experienced rate increases were offset by those reporting decreases. 40% reported no change in their rates. Most members, however, are expecting increases in the coming two years.

The survey took place in July, with 136 Airmic members taking part. The median annual spend on this type of insurance was between £1m and £5m.

The report, which contains a wealth of data, can be downloaded from www.airmic.com

Main findings of the Property Damage and Business Interruption benchmark survey

• The risk and insurance manager is accountable for PDBI insurance activities in 80% of the organisations that took part.
• Insurance brokers and risk engineers perform well at PDBI risk exposure and loss impact analysis.
• 85% of respondents engage brokers to design and recommend an appropriate PDBI insurance programme; respondents are highly satisfied with broker service and 55% rate capability as ‘highly competent’.
• Respondents rely heavily on brokers to produce data submissions for use by insurers and rate brokers performance highly; although this is at odds with observations about the quality and completeness of submissions.
• All respondents expect their insurers’ security ratings to be at least S&P A- (or equivalent) or better.
• Approximately 75% of organisations with revenues of more than £10 billion do not keep signed and dated copies of proposal forms and/or insurance submission.
• 2012 survey respondents are buying lower limits than the prior year.
• Overall premiums are stable when compared to the prior year.

Download the PDBI Benchmarking Report

Why we should no longer be talking about a soft market
Full Story >