For those who remember what being "an agent" was like, this section is particularly important.
As a broker the information you are expected to research and retain is enormous. In this newsletter we will attempt to update regularly in simple language—some proven, some not—some recent developments of claims, which will illustrate the pitfalls of simply "not knowing" or not remembering the latest cases and the lessons they provide.
September 2018: Fall 2018 Newsletter
Fall 2018
This interesting case brought to our attention by our retained legal firm, relates to professional liability cover assessed to unintended insureds by a major construction failure in Campbell River, B.C. It is interesting to note that there is a continuous push to broaden the protection to engineering and design build firms by most major engineering risks, while this illustrates how a simple non clarification of who is insured, triples the exposure. We trust this article will continue to make us aware of the care that brokers must take with Professional Liability.
During the past month we have found some strange renewal terms and unexplained delays in underwriter response from London markets that we use. In discussion with some of our valued clients we find that they are experiencing very similar issues.
As a follow up to questions to one of my oldest broker contacts in London he put it in very succinct terms. I thought a short article in this newsletter might lay out what we are experiencing and what the long range expectations of some underwriters appear to be.
“The Lloyd’s governing bodies have instructed all Syndicates to improve their game. This has meant for the first time ever they have directly interfered with the day to day business transacted by the Syndicates. The Syndicates have been told that if they write a particular class of business that has not made profits for four years they must withdraw from that class. This has led several underwriters in various classes to lose their jobs. Classes that are marginal must be improved or face similar sanctions. Syndicates have been threatened with closure should they fail to act on this directive.”
The bottom line is that where some classes have been breaking even, they now have to make a profit. There has been a surplus of capacity within the market for some time. This is a way in which this may be reduced. We have had good results with our professional liability program in Western Canada and continue to find willing underwriters to support our programs; however, as noted above, the loss of familiar underwriters, as you all know, sometimes gets you into a whole new set of questions and answers in areas where the experienced underwriter knew the risk and priced it accordingly. This now takes some negotiations to get back to reasonable terms. We will continue to monitor and negotiate for proper terms for all of our valued clients.
Fall is here and we wish you all the best to enjoy it.
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