Protecting your client's executives
Ian Fraser of RSA Canada and Patrick Bourk of Integro Insurance Brokers discuss the state of the directors and officers (D&O) market in Canada right now, as well as how brokers can take advantage of current market conditions.
Video transcript below:
David Gambrill, Insurance Business TV
David Gambrill: When your commercial clients face losses from shareholders or consumers, the buck stops with the company’s Directors and Officers. What is the market like for insuring these corporate executives? I am David Gambrill, welcome to Insurance Business TV.
Insurance cycles are often described as hard markets or soft markets. Hard markets are generally characterised by higher premium prices, fewer risks eligible for coverage and less capacity to insure risks. Soft markets on the other hand generally feature lower premiums, more insurance coverage and more capacity available in the market and so what is the market like for companies and executives who what to defend themselves against losses?
Ian Fraser, RSA, Canada
What’s the current market trend?
Ian Fraser: Trends in the D&O marketplace are a significant, given we are in an very competitive soft market. Last check there was roughly 45 markets that could offer D&O coverage. So we are seeing advancements to the D&O policy on a coverage basis. Insurers are being much more creative in offering coverages that historically weren’t part of the D&O policy and we are seeing a push for locally admitted policies in foreign jurisdictions to ensure compliance, corporate governance, everything is above board and legal in the foreign jurisdictions.
Patrick Bourk, Integro Insurance Brokers
Patrick Bourk: Well I think that in the current marketplace we are seeing softened market and competitive trends in most insurance, that it’s really more important than ever to know the underwriting appetites of the insurance companies and to having a knowledge of the specialisation of the product and I think that a lot of companies today are a lot of more sophisticated. They understand D&O insurance and so you have to be able to provide them with real specialised insurance coverage and you also have to direct them in the right insurance companies for their coverage profile.
David Gambrill: A broker’s value to the client will be affected to some degree by the current state of the market. With the current market in D&O being more on the soft side with ample coverage available for risks, the value of a broker comes in finding exactly the right kind of coverage the client needs or wants.
Ian Fraser: So how do insurers and brokers work together to ensure a deeper relationship and ensure we are providing more value to our clients. Certainly there is more communication between the broker, the client and the insurer, we are bringing in our claims counsel to really have that deep discussion with our clients and our brokers to insure everyone is on site with the services being provided and at the end of the day, we really do want to ensure that that relationship between the broker, client and insurer is really a partnership and is through constant communication and evolvement that that happens.
David Gambrill: Generally it’s a good time to be looking for D&O insurance for your clients. A myriad of options available in the current market, speak to the importance of brokers in finding the right coverage for the right price. I am David Gambrill, thank you for watching Insurance Business TV.