February 2018/3

Pricing for directors' and officers' (D&O) insurance is getting firmer, albeit slowly and in distinct areas, while industry executives are heartened that market leaders are walking away from business if they have to.

Spiralling incurred loss ratios from non-appearance risks have put the contingency market under the spotlight, prompting a scaling back in lines being put down and three market exits since last summer.

Underlying results at Bermuda-based (re)insurers worsened in the fourth quarter of 2017, as the group's accident-year ex-cat loss ratio deteriorated year on year.

The six listed Bermudian (re)insurers all reported higher premium growth in the fourth quarter of 2017, as their top lines were bolstered by a combination of M&A, reinstatement premiums, back-up covers and positive rate momentum.

Although Q4 was another messy and loss-hit quarter for Bermudian carriers, when looking at the group's results it is perhaps more important to step back and observe the full-year and longer-term trends

Global credit and political risk insurance capacity has increased by nearly a third since 2015, with the market increasingly willing to take on financial risks without trade collateral.

Protection and indemnity club leaders canvassed by The Insurance Insider have raised concerns that double-digit year-to-date returns from equity investments are allowing clubs to hide imprudent underwriting.

Centerbridge's acquisition of Lloyd's carrier Canopius is poised to close early next month, The Insurance Insider understands.

John Sutton and Toby Humphreys, previously co-heads of Integro's UK operation, have shelved plans to launch a new brokerage and look set to join RFIB instead, The Insurance Insider understands.

In some ways, the problems facing the contingency market are no different to those facing other specialty insurance lines.

Insurance is a really simple business. You take in premiums and you use them to pay out claims. Anything left over is profit.