Page 14 - 2016 State of the Market from AmWINS

124 | AmWINS State of the Market

PROFESSIONAL LINES, continued covered on other types of insurance. projects. Some insurers will only offer job-
Intellectual property claims are also specific excess over their own primary
In public D&O, there has been a slowing arising when teams of people are hired practice policy, while others may offer
of mergers and acquisitions claims. from competitors and the legal rights job-specific excess over other insurers’
Historically, a rising stock market reduces to client lists from the original employer primary if the terms are acceptable.
the claim frequency from shareholder are questioned. While there are often
losses. Industries such as life sciences exclusions that apply to this activity as Rates for tougher classes are creeping
and technology continue to see more it is considered an intentional act, these upwards. Classes such as geotech,
claims activity due to the volatility of their policies are often duty-to-defend and it custom residential homes, and naval/
product development and sales. can be difficult to navigate an argument aerospace/military remain difficult, with
over the allocation of uncovered limited markets and appetites. Project
In private D&O, the frequency of expenses. policies continue to be specialized and
claim activity tends to come from the limited; a few carriers will write standalone
employment practices portion of the Construction continues to experience a true project policies, and a few more
coverage, where wage and hour claims business boom and insurance capacity for will write owners protective professional
continue to be troubling. The addition architects and engineers (A&E) coverage is indemnity (OPPI). There is very little
of more protective federal, state and growing. Claim frequency is trending down appetite for small project policies.
local laws regarding discrimination gives and severity is trending up at the same
plaintiffs more causes of action to file time that buyers are asking for increased Indications are that prevailing professional
claims and, as a result, there has been limits. More insureds are also being liability market conditions will hold,
continued claim activity on employment required to carry E&O via contract. with low pricing, broad forms, and low
practices coverage. retentions across most sectors with some
Rates for traditional, low-risk A&E firms key exceptions to note. In this market,
In other areas of private D&O, claim continue to be soft and competitive with specialization is important to achieving
frequency continues to be a concern. job-specific excess available for the right growth.
Policies generally include full entity
coverage and limited exclusions, which
results in insurers covering unanticipated
alleged wrongful acts that may not be

• London remains extremely competitive in E&O/D&O.
• Banking, insurance, and lawyers are the most challenging classes to insure.
• Demand for A&E coverage is growing with the building boom, with rates competitive for most firms.