Characteristics Of A Hard Market

The Insurance market is often described as "cyclical" in nature oscillating between "soft" and "hard" conditions. Some of the characteristics of a "hard" market are: -

• High insurance premiums. This raises the Policyolder’s expectation for a prompt and efficient claims service.
• High incident deductibles. This reduces the number of claims. Care needs to be exercised to ensure all costs are considered before concluding the claim is below the deductible.
• High aggregate deductibles. Where aggregate deductibles apply it is important to accurately quantify all losses throughout the year to determine when the aggregate deductible has been breached.
• Constraints on capacity. It is sometimes difficult to insure 100% of a risk. This creates problems if a loss occurs before the full value of the risk has been placed.
• A reduction to the extent of cover with the application of narrower policy wordings.
• Little opportunity to delete Underinsurance clauses contained in policy wordings. It is paramount that correct values are declared.

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Published with permission of Claim Solutions Pty Ltd 

Insurance Policy

Country: - Various.

Policy Description: - Various.

Insurer: - Various.

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