Tools + Intel.

While COVID-19 offered new challenges, the healthcare market was already primed to be tough in 2021. After more than 10 years of a soft market and deteriorating results, significant rate and retention increases, lower limits, and more policy movement toward claims made, was expected. As healthcare segments react to these changes, E&S experts are keeping a close eye on current market conditions and emerging concerns with the potential to impact the market.

The market for real estate casualty coverage is tightening significantly both for primary and excess with fewer standard markets willing to provide coverage. Rates, retentions and deductibles are all heading higher as claims costs and jury verdicts rise, particularly for habitability claims in California and action-over claims in New York City. To avoid those kinds of claims, underwriters are putting much greater scrutiny on submissions, particularly in litigation-prone areas. In such a fluid market, communication ahead of renewals is critical to manage client expectations. As placements become more challenging, working with experienced wholesale brokers is the key to finding the best coverage options.

The REDY Index leverages CRC Group’s collection of actionable data – the wholesale industry’s largest. It provides critical pricing analysis on a monthly basis giving you a snapshot of the marketplace. The REDY Index generates instant intelligence on pricing trends by industry or coverage, enabling our retail partners to set accurate data driven expectations with their clients. Removing the guesswork empowers CRC team members to negotiate competitively, consistently producing better outcomes, better deliverables, and better results.

The excess casualty market faces a rough road ahead. After a difficult 2020, the market is likely to remain hard at least through 2021 and possibly into the following year. Carriers continue to reduce limits and increase premiums as they grapple with the aftereffects of underpricing in the soft market. Much of the hardening is being driven by losses in auto, and also where social inflation is leading to more so-called ‘nuclear’ verdicts. Along with auto fleets, construction, real estate, habitational and hotels stand among the more difficult markets.

As a coverage line, directors and officers liability was already hardening before the coronavirus pandemic emerged in 2020. COVID-19 has accelerated tightening in the D&O marketplace, which has become much more challenging for both public companies as well as private organizations.

At the beginning of the COVID-19 pandemic, employers moved quickly to develop and implement remote work-from-home protocols to protect employees. Almost a year since it all began, employers are starting to develop return to work plans.

Week after week, hackers and cybercriminals launch new phishing campaigns, develop creative digital extortion threats, and expand scams with the potential to negatively impact business operations in a big way. Cyberattacks can halt online operations in only minutes and take weeks to resolve. In addition, a cyberattack that involves the loss of customer data can result in expensive litigation that seriously impacts a company’s bottom line.

Amid the stubborn coronavirus pandemic, institutional capital and developer investment has paused, forcing contractors to take a wait-and-see approach for their direction in 2021 and beyond. While the industry cheered the economic comeback of the third quarter after a record second quarter slowdown, developers and builders remain cautious, particularly in sectors deeply affected by the pandemic and the associated shutdowns – namely office buildings and hospitality. Well capitalized projects, including those funded by municipal bonds, appear set to continue on plan while other more speculative investments have been sidelined indefinitely.

Mold has been a part of our environment for millions of years, and there are more than 100,000 mold species naturally occurring on Earth.

Wage and Hour (W&H) exposure is an often misunderstood and frequently underinsured risk. It is commonly — and incorrectly — assumed that W&H claims are restricted to either misclassification of exempt/nonexempt employment status or failure to pay overtime. However, W&H liability also includes allegations such as underpayment of overtime, miscalculation of wages, refusal to allow employee breaks, expecting off-the-clock work, not paying employees regularly, refusal to pay exempt employees for absences, not paying for time required to put on or remove protective gear or clothing, and only adhering to federal minimum wage guidelines when state guidelines warrant higher pay.

Employers of every size have some level of liability exposure around employment practices, and those exposures seem to be growing as a result of the changing social and cultural landscape of the modern workplace. Research indicates that as of 2017, employment lawsuits had increased by more than 400% since 1997.

A GREATER SHARE OF THE RISK:
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When a catastrophe such as a hurricane or earthquakes strikes a wide area, the insured losses can easily add up to the billions of dollars. As property values have risen over the years, so have insurers’ catastrophe losses. To limit their own risks, carriers are more often requiring property owners to retain a greater share of the exposure through percentage deductibles based on the overall value of the property at risk, rather than flat deductibles set at a specific monetary value. While percentage deductibles can leave insureds facing much higher losses, there are strategies brokers can use to help lessen the impact.

Internet-based crime shows no sign of letting up. According to the FBI’s Internet Crime Complaint Center, 2019 saw both the highest number of cybercrime complaints and the biggest monetary losses reported since the center’s establishment in 2000. The FBI received an average of almost 1,300 complaints each day and documented more than $3.5 billion in losses for individual and business victims.

The total number of Registered Investment Advisors has not declined in a single year over the past decade. There are more than 30,000 Registered Investment Advisors with the SEC or at the state level and two-thirds have less than $100M in Assets Under Management (AUM).* As with any growing segment of business, the risks associated are on the rise. Insurisk’s FLIP product has been specifically designed to meet the unique insurance needs of Investment Advisors, featuring a proprietary endorsement.

Fifteen years into the soft market cycle, it shouldn’t come as a surprise that the Medical Professional Liability (MPL) market is turning around. Many will remember that the Long-Term Care (LTC) market began to show signs of hardening in 2017, and the Hospital segment began to follow suit in the second quarter of 2019. While the Facilities and Physician segments have lagged behind, they’re also turning the corner toward a firmer market. While the COVID-19 pandemic is to blame for many current challenges, this hard market was well on its way prior to the pandemic. In actuality, the battle against COVID-19 has functioned in many ways as a temporary pause button for the MPL marketplace, giving insureds a short period of respite due to moratoriums on litigation. However, significant market changes are anticipated for the remainder of the year and beyond. Understanding the 5 primary drivers of the tightening market can be important to helping clients comprehend the changes that are coming.