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O P I N I O N
Flat lining A/E firms with sound risk management may benefit most from a competitive professional liability market, and should take the opportunity to increase coverage.
D esign firms that practice sound risk management, have good loss experience, and maintain what underwriters consider a desirable project mix, stand to benefit most from an increasingly competitive market for A/E professional liability insurance. A recent survey of A/E professional liability insurers reinforced that while they may be more flexible on premium pricing, they maintain adherence to prudent underwriting standards.
Joan DeLorey
As A/E firms plan for their insurance renewals, they should evaluate and consider increasing their coverage limits – not only to meet higher contractual requirements (limits such as $5 million or $10 million are frequently being “A recent survey of A/E professional liability insurers reinforced that while they may be more flexible on premium pricing, they maintain adherence to prudent underwriting standards.”
Ames & Gough’s survey of 19 leading A/E professional liability insurance companies finds 68 percent are planning to keep their rates flat this year, with another 11 percent planning modest rate decreases. These decisions are being influenced by a continued high level of competition and better-than-expected claims experience in the last two years. UPTICK IN LARGE LOSSES. Although claims experience generally has been improving, the potential for large claims still exists. Last year, 53 percent of the insurers surveyed paid a claim of $1 million or higher, including two insurers who reported their largest claim paid was between $5 million and $9.9 million and one insurer with a claim between $10 million and $19 million.
See JOAN DELOREY, page 12
THE ZWEIG LETTER June 5, 2017, ISSUE 1203
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