Pay Attention to Policy Language in a Hardening Insurance Market

Ian Ascher[1] and Jared Zola

The insurance market has proven to be a difficult environment for buyers in 2019. The long tenure of the soft insurance market cycle is changing, and is presenting challenges with pricing, capacity, and sustainability of favorable coverage terms. Coming out of difficult natural catastrophe years in 2017 and 2018, the property insurance market took a sharp turn to protect insurers’ bottom lines. While hardening of the property insurance market was expected, the broader casualty market has taken this opportunity to drive corrective action on their portfolios as well, leaving insurance buyers with little leverage.

How Insurers Are Reacting to the Market Shift

Insurers are approaching the market shift with different strategies, some focused on rate increases, while others are focused on restricting terms, or both. While individual loss experience still plays a role in renewal outcomes, there appears to be more of a portfolio-level push on rate and terms regardless of individual quality of risk factors for any given policyholder. In this environment, stricter control over capacity deployment leads to less competition, which may force the buyer into tough decisions regarding what utility insurance provides for its organization. The guarantee of comprehensive coverage at a fair price becomes harder to balance in a setting where definitively having both is less than certain. Continue reading “Pay Attention to Policy Language in a Hardening Insurance Market”

Insurance Coverage for the Opioid Crisis

Amy J. Spencer

With the “opioid epidemic” at an all-time high—and the resulting news coverage and public awareness also at an all-time high—now is the time for pharmaceutical companies, pharmacists, hospitals, doctors, first responders, and employers to review their professional liability and general liability insurance policies and any other potentially applicable policies such as products liability and directors and officers (“D&O”) insurance. Continue reading “Insurance Coverage for the Opioid Crisis”

Renewing Product Liability Coverage? Consider the Number of Occurrences

James S. Carter

Carter, James S.Many companies at this time of year are preparing to renew their product liability coverage, which is supposed to provide security for products lawsuits.  The insurance policy that a company is considering for its products liability coverage, however, may leave the amount of coverage for product liability losses up to chance because of an issue that arises in insurance coverage litigation, particularly those involving product liability claims, known as the number of “occurrences.”  Simply put, the number-of-occurrences issue asks whether product liability claims arise from one occurrence or more than one occurrence.  Because the amount of coverage or any deductible is typically stated as a dollar amount “per occurrence,” the answer to that question can leave a policyholder with an abundance of coverage, or leave it essentially self-insured.

The number-of-occurrences issue can have a particularly profound effect on insurance coverage in the product liability context because of the potential for numerous claims.  If, for instance, a policy has a per-occurrence deductible, and each product liability claim is deemed to be a separate occurrence, the total amount of deductibles could exceed the total amount of coverage.  Alternatively, if product liability claims are grouped together as one occurrence, then only one deductible would have to be paid, thus preserving coverage. Continue reading “Renewing Product Liability Coverage? Consider the Number of Occurrences”