Education As we approach July 1st, one of the busiest times for school insurance renewals, the industry continues to navigate a challenging and persistent hard market for liability. General Liability, Excess Liability and Educators Legal Liability are significantly impacted by:
› Social inflation › Third-party litigation financing › The rising cost of claims
› Reviver statutes for abuse › Expanding duty of care › Antitrust claims within higher education
› Claims from student mental health › Ongoing concern of the looming demographic cliff
These challenges and their impact on premiums are placing pressure on already stressed budgets as institutions navigate enrollment challenges, wage inflation and other inflationary impacts on goods, services and materials.
Liability Market Impact While antitrust claims are primarily limited to elite higher education institutions, their impact on the liability market for certain insurers will affect all institutions. Social inflation and rising claim costs will impact all insurers, many of which have limited choice of counsel, increased retentions, and modified defense and settlement strategies. The suspension of statute of limitations for abuse claims continues to affect insurers’ balance sheets and, depending on the age of the allegations, impacts the availability of insurance for schools. In some cases, schools cannot access policy records from the 1960s and 1970s; even if they do locate coverage, the limits are often far lower than what institutions currently purchase. As a result, liability insurers for education are pushing higher rates and evaluating how much capacity they are willing to deploy to the market. For institutions that purchase high excess limits, budget, risk tolerance, retention levels and program structure (claims made, retained limits, buffer layers) are key considerations for the upcoming renewals. Additionally, institutions in regions known for challenging litigation environments (plaintiff- friendly) will face even higher costs.
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