From: Captive International
The hardening of the market happened more quickly in the US than it did in Europe, says Aon’s Vince Barrett. Now, with the impact being felt very keenly by European businesses, Europe can expect to see a significant increase in its captives population. Captive International reports.
Even before the impact of COVID-19 had been fully felt there was much debate in the industry about the nature of the current market conditions and whether they could be accurately described as hard, or merely hardening.
Regardless of where you stood in that debate in early 2020, “there is no question it is a hard market now, and will remain one for several more renewals cycles, at least”, according to Vincent Barrett, Aon’s regional managing director for EMEA and head of captive insurance operations in Dublin.
I don’t think there is any huge appetite in the industry to relax provisions for captives”Vincent Barrett, Aon
In fact, it may be both hard and hardening. “The market may continue to get harder, because carriers are still losing money and they are not making as much supplementary investment income as they have in the past,” Barrett explains.
He points to a “general restating of underwriting principles among many commercial carriers” and a general “lack of willingness to deviate from those principles” which is leaving many clients with a problem when it comes to obtaining the coverage they need.