Page 38 - 2016 State of the Market from AmWINS

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INDUSTRIES

TRANSPORTATION

The automobile marketplace tightens while aviation prices
continue their free-fall

In transportation, market conditions flat and stable. To try to keep insurance Carrier Safety Administration (FMCSA)
are vastly different depending on which costs under control, transportation alerts, or high out-of-service numbers
coverage is being sought. On the liability accounts have been looking to corridor are coming to the E&S space.”
side, buyers are being squeezed by higher deductibles, swing plans, and other
rates and tighter underwriting. However, creative strategies. In contrast, the physical damage side
in the physical damage and motor truck of the market is very competitive, with
cargo arena, motor carriers are likely to In the primary liability market, even motor truck cargo particularly soft on
benefit from a competitive market. very clean accounts are looking at both clean and distressed accounts
renewal increases from a minimum of due to ample excess capacity in the
The biggest impact on the liability side 5 to 10 percent. Distressed accounts market and improved underwriting
of the market in 2016 came from the are increasingly unable to find coverage results over the past several years.
departure of Lexington, the largest single among standard carriers and, as a
writer of excess coverage for motor result, business is booming for excess “London is offering great options on
carriers within a $10 million attachment. and surplus markets which are being otherwise hard-to-place physical
“That caused a significant ripple flooded with opportunity. damage risks and unique cargo needs,”
effect,” says Andrea Dickinson, senior says Jon Humphreys, managing director
vice president and casualty broker “Standard markets continue to tighten of the transportation division at THB
at AmWINS Brokerage in Nashville, their underwriting,” says Joe Hutelmyer, Group in London. “Lloyd’s underwriters
Tennessee. “Capacity has stepped in to executive vice president of AmWINS are receiving a lot more business due
close the gap, but it comes at a price.” Transportation Underwriters in to competition, particularly on risks
Burlington, North Carolina. “Companies with a difficult loss history or those that
That price can be an increase of up to in business for fewer than three years are have only been operating for a couple
50 percent or more for limits up to $30 often still considered a ‘new’ venture and of years. Our in-house binders have
million, with riskier accounts seeing the are struggling to find a home. Accounts benefited from the need for quotes
higher end of that increase. Above that with higher Safety and Fitness Electronic within a few hours that we have been
limit, the market has remained relatively Records (SAFER) scores, Federal Motor able to accommodate.”