Q4 Automobile Summary
Overall (Moderate)
As insurers remain focused on profitability, market conditions remain stable.
Pricing (Flat)
Despite year-end budget targets, insurer pricing did not soften in Q4. Instead, expiring pricing was achieved in most cases.
Underwriting (Prudent) Underwriting is cautious as insurers remain focused on profitability.
Limits (Flat) Limits remain stable.
Deductibles (Flat) Expiring deductibles can be achieved in most cases.
Coverages (Stable) Each of the three main coverages for automobile insurance remain stable.
A Look Ahead (Soft) A slight softening is expected in early 2022.
Q4 Cyber Summary
Overall (Challenging)
Market conditions have deteriorated as a result of continued claims escalation, particularly related to ransomware.
Pricing (>+30%)
Significant rate corrections continue as risk complexity and volatility rises.
Capacity (Constrained) Insurers continue to manage their capacity through reduction strategies.
Underwriting (Rigorous) Underwriting rigor has strengthened – especially related to ransomware, multi-factor authentication, critical vulnerabilities and technical controls. Insurers are leveraging external scanning tools in their risk assessment. In most cases, local underwriting referral to regional/global office is required.
Limits (Decreasing) Primary limits are decreasing, the extent of which depends largely on industry type.
Deductibles (Increasing) Deductible increases are being mandated as insurers look to manage their exposure levels.
Coverages (Restricting) Ransomware restrictions are being imposed, often in the form of coinsurance and/or sub-limits.
A Look Ahead (Challenging) Current market conditions are not expected to improve in the near term – and insurer selectivity in underwriting and capacity deployment is expected to continue.
Q4 Employers Liability/Workers Compensation Summary
Overall (Moderate)
The market has moderated as rate increases have decelerated. Appetite is broad and capacity is abundant.
Pricing (Flat)
Rate increases were mandated by the Work Injury Compensation Act in 2020 and pricing is stable.
Capacity (Abundant) The market is robust – with strong appetite and abundant capacity; however, there are fewer options for risks with high claims frequency.
Underwriting (Prudent) There is a growing trend for underwriters to require completion of proposal forms and questionnaires, especially with risks related to work on board vessels and handling of gases.
Limits (Flat) Limits are established by the Work Injury Compensation Act; however, additional limits – including for Employers Liability – are available.
Coverages (Stable) Coverages are established by the Work Injury Compensation Act and are stable.
A Look Ahead (Moderate) Current market conditions are expected to continue. Risk pricing will remain focused on industry, claims experience and the amount of wages declared.
Q4 Trade Credit Summary
Overall (Stable)
Insurers have gained confidence as COVID-19 related uncertainty subsides. Risks renewing with an incumbent insurer are experiencing a generally stable market, while risks transitioning to a new insurer may experience limited appetite and less favorable pricing.
Pricing (+1-10%)
Pricing stabilized in 2021, but continues to be elevated from pre-COVID-19 market conditions, even for well-performing risks.
Capacity (Ample) Capacity is stable, except for sectors that were most impacted by the pandemic.
Underwriting (Prudent) Underwriters are cautious, but flexibility has increased from 2020.
Limits (Flat) Limits are stable, but some well-performing risks may achieve increases.
Deductibles (Flat) Deductibles are generally stable, with the exception of poor-performing risks, where deductible increases are being mandated.
Coverages (Stable) As insurer confidence increases, coverage improvements can be achieved, primarily for well balanced portfolios with a good loss history.
A Look Ahead (Moderate) Current conditions are expected to continue into 2022.
Q4 Casualty/Liability Summary
Overall (Moderate)
Market conditions are modestly challenging but stable. Risk differentiation and quality underwriting information are important to achieving favorable outcomes.
Pricing (+1-10%)
Insurers remain focused on price adequacy and, as such, modest increases are being imposed, even for risks with little or no claims experience. High hazard risks and/or poor performing risks are experiencing more significant increases.
Capacity (Ample) Capacity remains sufficient although there is a slight contraction for high hazard industries such as power and logistics.
Underwriting (Prudent) Robust, detailed underwriting submissions are increasingly important. Some insurers have declined to quote – or will offer limited terms and conditions or a limited policy period - when information is deemed insufficient. Underwriters are flexible on well-performing, in-appetite risks.
Limits (Flat) Expiring limits can be achieved in most cases.
Deductibles (Flat) Expiring deductibles can be achieved in most cases. Insureds continue to explore deductible options to help offset premium costs but very few are opting to actually reduce their deductibles as the premium reduction is deemed incommensurate with the increased risk.
Coverages (Stable) Coverage has stabilized as communicable disease exclusions and restrictions on USA/Canada domiciled operations have already been applied.
A Look Ahead (Moderate) Current market conditions - including continued underwriting scrutiny - are expected to continue.
Q4 Directors and Officers Summary
Overall (Moderate)
Market conditions are moderating, although they remain challenging in pockets, particularly for non-Asia domiciled risks and risks related to ADR/Australia listings.
Pricing (+11-30%)
Risks deemed to have not yet been sufficiently adjusted in past renewal cycles continue to experience significant price increases, with notable pressure on excess layer premiums.
Capacity (Ample) Capacity remains sufficient; however, insurers continue to closely monitor limit aggregation on any single risk and are managing their exposure to higher-risk industry segments.
Underwriting (Prudent) Underwriting scrutiny is heightened for SPAC-related risks and activities, following recent increases in SPAC-related litigation.
Deductibles (Increasing) Deductibles remain elevated, particularly in high-risk industry segments, and insurers are requiring deductible adjustments on any risk not previously adjusted.
Coverages (Stable) Broad coverage remains available for non-US listed Asia-domiciled risks, but underwriters are not keen to offer coverage enhancements. Affirmative “silent cyber” clauses are being mandated; however, language varies widely from insurer to insurer.
A Look Ahead (Moderate) Market conditions will continue to moderate; however, SPAC-related coverages will experience further challenges as insurers continue to grapple with potential litigation exposures.
Q4 Property Summary
Overall (Moderate)
Market conditions are stabilizing. While price increases continue, they are not as severe as in recent years. Capacity is sufficient but has contracted for Nat Cat exposed risks. Detailed underwriting information is key to achieving favorable outcomes.
Pricing (+1-10%)
Price increases continue but have decelerated, with flat renewals for preferred classes of business and/or those with a clean claims record. Insurers continue to insist on technical pricing for more challenging risk types.
Capacity (Ample) As a result of Nat Cat losses, some insurers have reduced capacity for challenging risk types. In addition, insurers remain cautious on less desirable risks such as warehousing / logistics and would prefer to take a quota share even if they have the capacity to underwrite the entire risk.
Underwriting (Prudent) Underwriting is generally prudent, with more stringency applied for some risks and limit requests that require central decision-making from global/regional offices. Quality underwriting submissions, including documentation of proactive loss control and risk improvement details, remain key to achieving favorable outcomes.
Limits (Flat) Limits remain stable; however, options may be explored to help offset premium increases.
Deductibles (Flat) Low deductibles can be achieved for non-hazardous occupancies; e.g., offices. Deductible options continue to be explored to offset premium increases.
Coverages (Stable) Coverages have stabilized as Communicable Disease and Cyber exclusions have already been imposed.
A Look Ahead (Moderate) Rising costs and an increase in climate-driven claims are expected to lead to a further focus on underwriting profitability. Capacity and underwriting changes may emerge for insurers looking to evolve their portfolios.
Thailand Market Dynamics
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