Risk management in theory and practice, including evolving risk strategies, risk financing, the risk management profession, risk analytics and core property/casualty coverage issues.
Developments and trends affecting buyers of specialty insurance lines, including D&O, E&O, employment practices liability, cyber risk, marine and transportation, and surplus lines.
News and analysis about the legislative, legal and insurance market issues that affect workers compensation managers, as well as strategies for reducing comp claims and costs, promoting workplace safety and returning injured employees to work.
Helping executives at midsize firms address people risks, such as benefits, workers comp and professional liability; property and liability risks, including insurance and loss control; and operational growth risks such as M&A and product development.
Covering the operational and strategic concerns of brokers, insurers and reinsurers, including legislative and regulatory developments, business challenges, market conditions and competitive intelligence.
Legislative and regulatory compliance, plan design, financing and strategy issues related to managing employee benefit plans, primarily health care and retirement benefits.
Buyers get back to basics as global crisis continues
The credit crisis and economic downturn have focused the minds of Europe's risk and insurance managers on core issues such as the strength of their insurance carriers, the need to control costs and worries about key suppliers. The following analysis pinpoints the main points to emerge from this year's survey:
Market outlook
Renewal pricing change
Levels of limits
Coverage
Captive usage
Europe's leading risk and insurance managers believe European and international insurance markets will harden this year after a prolonged period of benign rates.
Those buyers interviewed for this year's Business Insurance Euro 100 survey reported a significant slowdown in rate reductions for property coverage, and saw average prices for liability coverage increase at their last renewal.
Property premium rates for buyers among those surveyed were on average 1.4% lower at renewal, compared with an average 10.4% reduction in last year's survey.
Liability premium rates were 2.2% higher on average at renewal, compared with a 7.4% reduction last year; auto fleet premium rates were 1.4% lower on average, much the same as in last year's survey.
Most of the buyers surveyed were surprised at the relative lack of upward movement in prices experienced to date, and some took advantage of the soft market by buying more cover or tried to tie themselves into last year's prices with long-term deals.
But the majority stuck with existing levels of coverage at their last renewal.
Only 17% of respondents said they bought more corporate insurance coverage at their most recent renewal, compared with 55% in last year's survey.
Instead, 80% said they had bought the same level of corporate insurance this year as last year, compared with 41% in the 2008 survey. Only 3% (4% in the 2008 survey) purchased lower levels of coverage, despite the deterioration in economic conditions.
Similarly, insurance buyers at Europe's largest companies said they were offered much the same coverage at their recent renewals.
Tighter terms were experienced only in loss-affected classes of coverage, such as financial institutions and credit insurance.
But most of those surveyed accept that the good times are almost certainly over and expect rates to harden as the year progresses.
But for many buyers, a sharp marketwide rise in premium rates is far from certain and none expect the financial crisis, rising claims and tightening reinsurance to force the kind of dramatic rate increases seen in 2002 and 2003.
The findings are an almost complete reversal of buyer expectations expressed in last year's survey when buyers were interviewed at the height of the soft market. Some buyers expressed their frustration with the difficulty in predicting market cycles.
When insurance markets harden, insurance managers often seek to limit the cost increase by making more use of their captives.
But this time may be different.
Only one-third of risk managers surveyed expect to use their captives more this year while the majority expect to use them the same or less.
Some respondents cited stable or reduced risk exposures because of lower economic activity as a reason for unchanged captive use. Continued availability of cheap coverage was another reason cited.
However, many risk managers said they would consider increasing use of their captives if premium rates harden significantly.
Several companies that expect to use their captives more will do so because they have recently added coverages, notably employee benefits.
Insurer service levels fail to impress but brokers improved compared with last year.
Risk and insurance managers with Europe's leading companies believe service levels delivered by their insurers have worsened during the past year.
According to those surveyed as part of the Business Insurance Euro 100 project, insurers are failing to match expectations in key areas, such as, innovation, flexibility and willingness to pay claims.
Overall, 88% of risk managers surveyed said insurers' service levels had not improved during the past year. Twenty-nine percent said that service had deteriorated, while 59% said that service levels were unchanged. Only 12% said it had improved.
This marked a deterioration against last year's survey in which just 11% said insurers' service was worse, 62% said it had stayed the same and 27% said it had improved.
Many respondents to this year's survey said that while service levels were unchanged, they still were not happy with the service provided.
Flexibility was the worst category, as 43% of those surveyed said insurers were less flexible than in the previous year. Only 14% reported an improvement.
Innovation also was an area that had suffered during the past year. Some 36% of respondents said innovation among insurers was worse. Only 4% said they had noticed an improvement.
Brokers received a more positive report, but most risk managers surveyed said they still have room for improvement.
During the past year, brokerage services improved for 29% of respondents to this year's survey, while for 58% they stayed the same, and for just 13% service deteriorated.
Service levels were down slightly compared with last year's survey in which 36% of risk managers said service levels had improved, while 61% said they had stayed the same and just 3% said they had deteriorated.
The assault on the big brokers by former New York Attorney General Eliot Spitzer on the issue of contingent fees is regarded as the chief driver of change and improvement at the brokers among the European risk management community, according to the survey.
Speed of response and flexibility, in particular, improved as a result, the risk managers noted.
Thirty-six percent of risk managers surveyed by Business Insurance said brokers' flexibility had improved during the past year, while only 7% said brokers were less flexible. Speed of response was less clear-cut, with 21% saying service had improved and the same number (21%) saying it had slowed.
Several risk managers acknowledged that brokers had taken steps to improve transparency, but remained cautious.
Insurer security and financial volatility are top concerns for Europe's risk managers.
Insurer security, price of coverage and willingness of insurers to pay valid claims are the top three insurance risks identified by this year's survey of Europe's leading risk and insurance managers.
Perhaps not surprisingly, given the recent financial and economic turmoil, financial market volatility topped the list of business risks identified by the pan-European group.
Concerns over counterparty risks and supply chain reliability also rose on the list.
The top three insurance risks were unchanged from last year.
The risk and insurance managers surveyed ranked security of coverage as their biggest insurance risk issue. Thirty-eight percent ranked it as their top concern, and 81% at least ranked it in their top two risks. Price was ranked in the top two risks by 58% of respondents.
When asked what will be the key business risks that need to be tackled in 2009, respondents ranked financial risks highest, even though almost all those interviewed have no direct responsibility for financial risk management.
Financial volatility was ranked as the top concern by 42% of respondents, and appeared in the top two risks for 62% of respondents.
Supply chain risks were ranked in the top two by 46% of respondents, while 50% of risk managers surveyed ranked security of counterparties in their top three.
Some think more CROs would stop future financial crisis.
Most of Europe's leading risk managers believe that the credit crisis and subsequent global economic downturn represents a failure of risk management and regulation.
But only a small majority of risk managers surveyed by Business Insurance think that the answer is to hand more power to risk managers and make them chief risk officers.
Seventy-nine percent of risk managers surveyed by Business Insurance thought a failure in risk management was behind the credit crunch and 77% thought a failure in regulation played a part.
This was the broadest topic raised during this year's survey and the answers were diverse.
Risk managers who responded said that they thought the financial crisis occurred for a number of reasons including political, economic and human failings.
It was interesting to hear, however, that a large number of risk professionals blame their own profession, albeit primarily the financial risk management arm, for the current problems.
Buyers fear Solvency II will raise costs and cut choice.
Most risk and insurance managers polled for this year's Business Insurance Euro 100 survey do not believe Solvency II, Europe's planned new capital adequacy regime, will be good for insurance buyers.
The large majority expect the new rules, to be implemented in 2012, to raise costs for insurers, encourage consolidation and reduce capacity in certain lines of business.
Those surveyed also fear the regime could make captives less attractive options for corporations because of higher capital requirements and increased compliance costs.
Broker commission disclosure improves
Transparency of broker payments is better, but there is still room for improvement.
The vast majority of European risk managers surveyed by Business Insurance said they are satisfied with levels of transparency regarding brokers' compensation.
More than three-quarters (77%) of risk managers at Europe's largest 100 companies surveyed said they are satisfied with the level of transparency that they receive from their brokers.
Most (60%) said transparency has improved since former New York Attorney General Eliot Spitzer completed his investigation into the use of contingent commissions by the large broking firms and forced them to reform their compensation practices. However, a large percentage said room for improvement remains.
Security fears force change in buying habits.
Many risk managers have changed the way they buy corporate insurance after the near-failure of American International Group Inc. and the collapse of other financial institutions over the past year.
Roughly half of the risk managers surveyed said they had made some changes to the way they buy insurance because they are worried about counterparty risks.
These changes included greater scrutiny of insurers' financial strength, a willingness to spread risk among insurers and the wider use of rating triggers in contract wordings.
Some risk managers at Europe's largest companies said they are reviewing their lists of major insurers, and many said they have taken steps to improve their assessment of insurer financial strength.
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Buyers get back to basics as global crisis continues
The credit crisis and economic downturn have focused the minds of Europe's risk and insurance managers on core issues such as the strength of their insurance carriers, the need to control costs and worries about key suppliers. The following analysis pinpoints the main points to emerge from this year's survey:
Market outlook
Renewal pricing change
Levels of limits
Coverage
Captive usage
Europe's leading risk and insurance managers believe European and international insurance markets will harden this year after a prolonged period of benign rates.
Those buyers interviewed for this year's Business Insurance Euro 100 survey reported a significant slowdown in rate reductions for property coverage, and saw average prices for liability coverage increase at their last renewal.
Property premium rates for buyers among those surveyed were on average 1.4% lower at renewal, compared with an average 10.4% reduction in last year's survey.
Liability premium rates were 2.2% higher on average at renewal, compared with a 7.4% reduction last year; auto fleet premium rates were 1.4% lower on average, much the same as in last year's survey.
Most of the buyers surveyed were surprised at the relative lack of upward movement in prices experienced to date, and some took advantage of the soft market by buying more cover or tried to tie themselves into last year's prices with long-term deals.
But the majority stuck with existing levels of coverage at their last renewal.
Only 17% of respondents said they bought more corporate insurance coverage at their most recent renewal, compared with 55% in last year's survey.
Instead, 80% said they had bought the same level of corporate insurance this year as last year, compared with 41% in the 2008 survey. Only 3% (4% in the 2008 survey) purchased lower levels of coverage, despite the deterioration in economic conditions.
Similarly, insurance buyers at Europe's largest companies said they were offered much the same coverage at their recent renewals.
Tighter terms were experienced only in loss-affected classes of coverage, such as financial institutions and credit insurance.
But most of those surveyed accept that the good times are almost certainly over and expect rates to harden as the year progresses.
But for many buyers, a sharp marketwide rise in premium rates is far from certain and none expect the financial crisis, rising claims and tightening reinsurance to force the kind of dramatic rate increases seen in 2002 and 2003.
The findings are an almost complete reversal of buyer expectations expressed in last year's survey when buyers were interviewed at the height of the soft market. Some buyers expressed their frustration with the difficulty in predicting market cycles.
When insurance markets harden, insurance managers often seek to limit the cost increase by making more use of their captives.
But this time may be different.
Only one-third of risk managers surveyed expect to use their captives more this year while the majority expect to use them the same or less.
Some respondents cited stable or reduced risk exposures because of lower economic activity as a reason for unchanged captive use. Continued availability of cheap coverage was another reason cited.
However, many risk managers said they would consider increasing use of their captives if premium rates harden significantly.
Several companies that expect to use their captives more will do so because they have recently added coverages, notably employee benefits.
Insurer service levels fail to impress but brokers improved compared with last year.
Risk and insurance managers with Europe's leading companies believe service levels delivered by their insurers have worsened during the past year.
According to those surveyed as part of the Business Insurance Euro 100 project, insurers are failing to match expectations in key areas, such as, innovation, flexibility and willingness to pay claims.
Overall, 88% of risk managers surveyed said insurers' service levels had not improved during the past year. Twenty-nine percent said that service had deteriorated, while 59% said that service levels were unchanged. Only 12% said it had improved.
This marked a deterioration against last year's survey in which just 11% said insurers' service was worse, 62% said it had stayed the same and 27% said it had improved.
Many respondents to this year's survey said that while service levels were unchanged, they still were not happy with the service provided.
Flexibility was the worst category, as 43% of those surveyed said insurers were less flexible than in the previous year. Only 14% reported an improvement.
Innovation also was an area that had suffered during the past year. Some 36% of respondents said innovation among insurers was worse. Only 4% said they had noticed an improvement.
Brokers received a more positive report, but most risk managers surveyed said they still have room for improvement.
During the past year, brokerage services improved for 29% of respondents to this year's survey, while for 58% they stayed the same, and for just 13% service deteriorated.
Service levels were down slightly compared with last year's survey in which 36% of risk managers said service levels had improved, while 61% said they had stayed the same and just 3% said they had deteriorated.
The assault on the big brokers by former New York Attorney General Eliot Spitzer on the issue of contingent fees is regarded as the chief driver of change and improvement at the brokers among the European risk management community, according to the survey.
Speed of response and flexibility, in particular, improved as a result, the risk managers noted.
Thirty-six percent of risk managers surveyed by Business Insurance said brokers' flexibility had improved during the past year, while only 7% said brokers were less flexible. Speed of response was less clear-cut, with 21% saying service had improved and the same number (21%) saying it had slowed.
Several risk managers acknowledged that brokers had taken steps to improve transparency, but remained cautious.
Insurer security and financial volatility are top concerns for Europe's risk managers.
Insurer security, price of coverage and willingness of insurers to pay valid claims are the top three insurance risks identified by this year's survey of Europe's leading risk and insurance managers.
Perhaps not surprisingly, given the recent financial and economic turmoil, financial market volatility topped the list of business risks identified by the pan-European group.
Concerns over counterparty risks and supply chain reliability also rose on the list.
The top three insurance risks were unchanged from last year.
The risk and insurance managers surveyed ranked security of coverage as their biggest insurance risk issue. Thirty-eight percent ranked it as their top concern, and 81% at least ranked it in their top two risks. Price was ranked in the top two risks by 58% of respondents.
When asked what will be the key business risks that need to be tackled in 2009, respondents ranked financial risks highest, even though almost all those interviewed have no direct responsibility for financial risk management.
Financial volatility was ranked as the top concern by 42% of respondents, and appeared in the top two risks for 62% of respondents.
Supply chain risks were ranked in the top two by 46% of respondents, while 50% of risk managers surveyed ranked security of counterparties in their top three.
Some think more CROs would stop future financial crisis.
Most of Europe's leading risk managers believe that the credit crisis and subsequent global economic downturn represents a failure of risk management and regulation.
But only a small majority of risk managers surveyed by Business Insurance think that the answer is to hand more power to risk managers and make them chief risk officers.
Seventy-nine percent of risk managers surveyed by Business Insurance thought a failure in risk management was behind the credit crunch and 77% thought a failure in regulation played a part.
This was the broadest topic raised during this year's survey and the answers were diverse.
Risk managers who responded said that they thought the financial crisis occurred for a number of reasons including political, economic and human failings.
It was interesting to hear, however, that a large number of risk professionals blame their own profession, albeit primarily the financial risk management arm, for the current problems.
Buyers fear Solvency II will raise costs and cut choice.
Most risk and insurance managers polled for this year's Business Insurance Euro 100 survey do not believe Solvency II, Europe's planned new capital adequacy regime, will be good for insurance buyers.
The large majority expect the new rules, to be implemented in 2012, to raise costs for insurers, encourage consolidation and reduce capacity in certain lines of business.
Those surveyed also fear the regime could make captives less attractive options for corporations because of higher capital requirements and increased compliance costs.
Broker commission disclosure improves
Transparency of broker payments is better, but there is still room for improvement.
The vast majority of European risk managers surveyed by Business Insurance said they are satisfied with levels of transparency regarding brokers' compensation.
More than three-quarters (77%) of risk managers at Europe's largest 100 companies surveyed said they are satisfied with the level of transparency that they receive from their brokers.
Most (60%) said transparency has improved since former New York Attorney General Eliot Spitzer completed his investigation into the use of contingent commissions by the large broking firms and forced them to reform their compensation practices. However, a large percentage said room for improvement remains.
Security fears force change in buying habits.
Many risk managers have changed the way they buy corporate insurance after the near-failure of American International Group Inc. and the collapse of other financial institutions over the past year.
Roughly half of the risk managers surveyed said they had made some changes to the way they buy insurance because they are worried about counterparty risks.
These changes included greater scrutiny of insurers' financial strength, a willingness to spread risk among insurers and the wider use of rating triggers in contract wordings.
Some risk managers at Europe's largest companies said they are reviewing their lists of major insurers, and many said they have taken steps to improve their assessment of insurer financial strength.
