Premium growth in the professional indemnity insurance category remained soft during the review period (2008–2012), and declined at a compound annual growth rate (CAGR) of 0.20%, as an increase in professional negligence court cases and the volume of registered professionals requiring cover was outweighed by the recessionary economic backdrop. Premiums rose by 2.8% in 2012, to a total of GBP2.05 billion, while a further GBP0.60 billion is estimated to have been underwritten by syndicates on the Lloyd’s market.
Despite soft premium growth, the availability of professional indemnity insurance worsened, particularly for surveyors, small firms of solicitors and independent financial advisers (IFAs). For solicitors, the broad scope of insurance coverage requirements stipulated by the Solicitors Regulation Authority exposes insurers to a high level of risk, while in the surveyor and IFA sub-categories, insurers reduced capacity due to growing apprehension over rising claims related to property valuations and failed investments.
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The professional indemnity insurance category is projected to generate GBP2.33 billion in premiums by 2017 and premiums are forecast to rise at a CAGR of 2.57% over the forecast period (2013–2017), with growth expected on an annual basis. An expected increase in the number of professionals subject to compulsory professional indemnity insurance requirements and insurers expanding into sectors with voluntary insurance needs, such as engineering, information technology and marketing will act as the key growth drivers. Marked improvements in the UK’s economic conditions as the country enters a stronger recovery phase will provide a further impetus for growth in demand.
Professional bodies such as the Solicitors Regulation Authority (SRA), the Royal Institute of Chartered Surveyors (RICS) and the Association of Professional Financial Advisers (APFA) have expressed dismay at members’ ongoing struggles to obtain professional indemnity cover. Large insurers withdrew policies for these clients during the review period, citing unsustainable risk exposure as the reason. The SRA compounded access issues through its abolition of a communal risks pool in 2013, which resulted in the closure of 136 firms unable to obtain mandatory insurance coverage.
Stronger economic growth over the forecast period is expected to ease litigation and reduce claims costs. Nevertheless, the six-year statute of limitations means insurers remain liable for negligent acts which occurred during the recession. A further risk to the outlook of claims stems from the Retail Distribution Review (RDR) increasing the exposure of whole-of-market advisers to rarer investment instruments, and the April 2013 Jackson reforms influencing compensation levels negotiated by lawyers.
- The report provides market analysis, information and insights into the UK professional indemnity insurance business.
- It provides a snapshot of the market's size and segmentation.
- It offers a comprehensive analysis of claims, drivers and market outlook.
- It provides an analysis of distribution channels.
- It summarises deals, news and regulatory developments
- This report provides market analysis, information and insights into the UK professional indemnity insurance business
- It provides a snapshot of the market size
- It analyses drivers and the outlook for the market
- It provides information on distribution channels
- It covers deals, news and regulatory developments
Reasons To Buy
- Gain an understanding of the UK professional indemnity insurance market
- Learn about the performance of market drivers and distribution channels
- Understand the competitive landscape in terms of performance, profitability and product innovation
- Find out more on key deals and recent developments in the market
- Muted growth was recorded during 2008–2012
- Despite soft prices, insurance was difficult to obtain
- The category will benefit from favorable factors during the forecast period
- Capacity for higher-risk groups remains an issue
- Claims will be subject to upside pressures
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Spanning over 61 pages, 35 Tables and 15 Figures “Professional Indemnity Insurance in the UK, Key Trends and Opportunities to 2017” report provide Executive Summary, Market Analysis, Competitive Landscape, Porter’s Five Forces Analysis, Deals, News, Regulation and Compliance, Macroeconomic Backdrop, Company Profiles, Statistics, Appendix. This Report cover 10 companies - ACE European Group Ltd, AIG Europe Ltd, AmTrust Europe Ltd, Chubb Insurance Company of Europe SE, CNA Insurance Company Ltd, HCC International Insurance Company Plc, Hiscox Ltd, QBE Insurance (Europe) Ltd, Royal & Sun Alliance Insurance Plc, XL Group Plc.
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