December 29, 2021 by Canadian Underwriter Staff
Douglas Morrow, CEO and Managing Partner, Excel Insurance Group
In 2021, underwriters were asking for a lot more information than in prior years. The calendar never stops, so if you don’t get complete information to the underwriter in a good amount of time, you will very quickly reach a place where you are going to have to extend policies in order to renew them.
In some cases, brokers have to anticipate underwriters’ questions. For example, if we’re insuring a building that has a fire-suppression sprinkler system, it’s no longer enough to just tell the insurer that the building is sprinklered – it was sprinklered last year and the year before, and it still is. You need to be able to confirm that the sprinkler design matches the occupancy.
In 2022, the biggest challenge will be capacity. Climate change and a rash of major climate-related losses in Canada, is making all insurance companies concerned about the limits that they’ll put out for any single risk. We’re seeing many insurance companies say, on commercial liability and property, “We’re no longer willing to provide high limits ourselves. You’re going to need to find other insurance companies to share the risk.”
One of the industry’s biggest challenges in 2022 will be finding balance between premiums that have to be paid and claims that have to be paid. We have chewed up a lot of goodwill during the hard market, consistently providing our clients with 20% to 40% increases every year. In 2022, we’re looking for some stability in the marketplace and a more normal renewal process. We need to be able to go out to see clients a couple of weeks before renewal and present terms respectfully and properly and not be scrambling on every single renewal right down to the actual expiry date.