fbpx
Friday, 11 September 2020 22:49

Liability Exposures on the Rise Globally: AGCS

Written by Ryan Smith, Insurance Business Magazine

Index

Liability exposures for companies around the world are increasing, according to a new report from Allianz Global Corporate & Specialty (AGCS.)

Rising litigation, collective redress and large court verdicts, frequent recalls in the automotive and food sectors, civil unrest, environmental concerns and other factors will likely impact businesses and insurers, according to the report, which highlighted five trends for the sector.

 

“Pricing in the liability insurance market may have turned in recent months. However, social inflation trends and large court verdicts continue in the United States,” said Ciara Brady, global head of liability at AGCS. “This, combined with expanded exposures for non-U.S. companies doing business in the U.S. and an increase in automotive part recalls, is putting pressure on liability insurers.

 

"Overlay this with the uncertain economic outlook, political instability and unknown impacts from coronavirus, and this is creating a challenging market for clients, brokers and insurers alike.”

 

Trend 1: Social inflation in the U.S. and the rise of collective redress globally

 

Social inflation is particularly prevalent in the U.S., driven by the emergence of litigation funders, higher jury awards, more liberal workers’ compensation claims and new tort and negligence concepts, AGCS said.

 

The median settlement amount of the top 50 U.S. verdicts from 2014 to 2018 nearly doubled, from $28 million to $54 million. Litigation funding is also on the rise in the UK, Europe and elsewhere, contributing to a growing trend of collective redress as benchmarks for consumers to file class actions are lowered.

 

While AGCS said it was too early to identify a definite trend, court closures due to COVID-19 may slow down social inflation as plaintiffs realize that it may be years before their case is tried and therefore may be willing to settle out of court.


Previous Page Read More »

Read 167 times