Claims severity concerns A&E insurers: Survey
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Rising claims severity is a concern for architects and engineer insurers, although most reported the same or better claims results in 2018, says a survey issued Monday.
A total of 83% of 18 insurers reported claims severity as one of top three underwriting concerns, according to the annual survey report by McLean, Virginia-based specialty broker Ames & Gough.
The 18 insurers whose underwriting executives were surveyed account for a “significant percentage” of the current overall marketplace, according to the report.
But 67% reported no change in their overall claim activity in 2018 compared with prior years, while 28% reported better claims results and just 6% reported heightened claim activity.
Other underwriting concerns reported were project mix, cited by 67%, and claims frequency, which was cited by 56%.
The survey report said 89% of insurers reported their professional liability insurance written premium grew in 2018, with 44% stating it grew by more than 20%. The remaining 11% said their premium volume remained flat, and no insurer reported a premium decline.
A total of 94% of the insurers that reported premium growth attributed it to new policies issued, while 81% reported their premium volume grew because of policyholders’ increasing revenue, adverse loss exposure and/or project or service changes.
A total of 44% said policyholders had opted for higher coverage limits, and 31% said the premium growth increase was because of higher premium rates.
The survey also found that while 33% of the insurers surveyed raised rates, 50% said their rates were flat and 17% decreased rates.
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