As we approach the halfway point in the year it’s a good time to update on trading conditions in the financial institutions insurance market place.

Author: David Rogers


The insurance market is in some ways extremely predictable, in that following a period of premium rate increases there is almost inevitably a relaxation and then the market retreats with reductions. The debate typically centres on how quickly the changes will occur, which insureds will be able to benefit first, and the severity of change.

The initial signs of relaxation were seen in Q1. Whilst premium increases were still being applied it was obvious that insurers:

  • Had built new business targets into their 2022 budgets meaning that to achieve growth plans they would not be able to simply rely on rate increases from renewal business.
  • Were now less concerned about losses arising from COVID-19 or the economic slowdown.
  • Had lowered their own expectations as to what renewal outcomes to push for.

The practical upshot of this is still evolving, however we can point to the following:

  • Renewal pricing is transitioning away from increases. Insurers are still pushing for single digit increases, but where competing insurers can be leveraged flat renewals are increasingly achievable.
  • It is only a matter of time before flat renewals transition to single digit reductions. We expect this to become prevalent for certain renewals over the summer period.
  • Policy wordings broadly held firm over the last two years, notwithstanding silent cyber clauses and some erosion to extortion coverage. We expect this trend to continue at least until year end.
  • The cyber market is still correcting with threats to limits and notable premium increases.
  • Our market is not immune from the effects of the war in Ukraine. We have prepared a separate comment about this which can be viewed here.

The above makes for easier reading than previous market updates but we are keen to emphasise that these favourable conditions are not delivered without informed disclosure, utilisation of competing markets and strong leverage by the placement broker. If you are not a Gallagher client and would like to discuss how we might assist with your renewal please feel free to get in touch with us.

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