March 21, 2023
The Canadian insurance market in 2023 is facing placement challenges in the areas of Errors & Omissions (E&O), Medical Malpractice, Commercial General Liability (CGL), and Directors & Officers (D&O) Insurance.
These challenges have been influenced by a range of factors, including changing market conditions, increased regulatory scrutiny, and emerging risks.
Below we highlight the current challenges in each insurance class:
In this class, many insurers are becoming more selective in the risks they underwrite, resulting in higher rates and reduced coverage options. This can make it challenging for local brokers to find suitable coverage for their clients, particularly for businesses that are considered higher-risk or have complex operations.
Medical Malpractice insurance is also facing placement challenges, with insurers taking a more cautious approach to underwriting risks in this area. The increasing severity of claims and the emergence of new technologies such as telemedicine and artificial intelligence have made it more difficult to assess and price risks, leading to tighter underwriting criteria and higher rates.
Similarly, Canadian insurers are scaling back their exposure to certain risks or raising rates in response to a range of factors, including increased litigation, new risks such as cyber-attacks and data breaches, and the impact of climate change.
In D&O, insurers are becoming more selective in the risks they underwrite and raising rates in line with the current economic climate. This is partly due to the increasing frequency of claims related to securities litigation and shareholder disputes, which have put pressure on insurers to tighten underwriting criteria and increase pricing.
Despite the placement challenges in the Canadian insurance market for E&O, Medical Malpractice, CGL, and D&O insurance, there are viable options for local brokers looking to secure coverage for their clients.
At Servca, have a long history of providing specialized coverage for complex and high-risk risks and are well-equipped to handle the challenges associated with underwriting E&O, Medical Malpractice, CGL, and D&O risks. We aim to provide an efficient and communicative service for our Canadian partner brokers.
Placement statistics show that the London Market continues to play a significant role in the Canadian insurance market, particularly when it comes to placing high-value and complex risks. In 2022, the London Market accounted for 26% of Canadian commercial insurance premiums, with a significant portion of this being placed in the E&O, Medical Malpractice, CGL, and D&O segments.
Furthermore, a recent survey of Canadian insurance brokers found that 45% of respondents had used a London Market broker for at least one placement in the past year, with the majority reporting a positive experience. Brokers cited the London Market's expertise, range of underwriting options, and ability to handle complex risks as key factors in their decision to partner with a London Market broker.
Servca is an owner-managed independent Lloyd’s broker specialising in casualty lines of Insurance. We leverage our market relationships and expertise in E&O, Medical Malpractice, Cyber Liability, CGL, D&O, and Financial Institution Insurance to provide our Canadian partners with quotations that are robust in coverage.
Why not get in touch and learn more about our appetite and how we can add value to you in the placement of specialty risks into the London Market?