July 2023
Financial Institutions London Market Conditions
Despite some headwinds from macro-economic conditions, the insurance market continues along its softening trajectory from 2022. Increased competition, stability of capacity and more willingness to take risk by insurers results in a favourable market place for buyers.
Fortunately, premium reductions are continuing to gather momentum through 2023 so far. To illustrate this, Gallagher Specialty’s Financial Institutions team have marked our average renewal premium reductions within the following company domiciles and sectors:
N.B., These figures are rounded projections made at the time of this article’s production. Reductions will be dependent on individual risk profile.
Some key considerations for Financial Institutions include:
- Adverse underwriting factors from geopolitical and macroeconomic uncertainties to regulatory pressure are being overruled by insurers seeking to retain and grow their premium base;
- The banking crisis of March 2023 has had a negligible effect on the wider market place and so premiums are still coming down;
- Targeted policy wording improvements and in some instances reductions to self-insured retentions are available;
- Higher limits of indemnity can often now be fully funded by premium reductions;
- Regarding Directors’ and Officers’ liability insurance, Side A DIC is increasingly being considered as commercially attractive and offers significant coverage benefits.
With these reductions supplying some much-needed relief for many financial institutions, now is a great time to reassess your insurance programme to take advantage of favourable conditions. Gallagher’s Financial Institutions team can perform an analysis of your existing programme to identify potential exposures. We will also discuss your appetite to risk and insurance with key stakeholders within your organisation and can provide a report with our recommendations, collaboratively agreeing next steps. We suggest engaging in this activity with plenty of time before your renewal, allowing brokers and insurers more time to understand your business in order to create a bespoke, tailored insurance programme for you and your company.
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Arthur J. Gallagher (UK) Limited is authorised and regulated by the Financial Conduct Authority. Registered Office: The Walbrook Building, 25 Walbrook, London EC4N 8AW. Registered in England and Wales. Company Number: 119013.