Hostname: page-component-77c89778f8-9q27g Total loading time: 0 Render date: 2024-07-19T13:29:01.517Z Has data issue: false hasContentIssue false
  • English
  • Français

Professional Indemnity Insurance

Published online by Cambridge University Press:  11 August 2014

N. D. Hooker  and
L. M. Pryor
Get access

Extract

Recent years have seen many changes affecting the market for professional indemnity insurance. The law is changing, widening the scope of liability. The insurance market is changing, with more mutuals and captives being formed. The price and availability of insurance are changing, too.

The internationalization of professional firms has introduced new problems, with claims being brought in the jurisdiction perceived as most favourable to the claimant. The broadening range of services offered by individual firms, and the consequent growth of truly multidisciplinary firms, can only make the situation more complex.

Like many other insurance markets, the market for professional indemnity insurance is cyclical. In the two or three years following 1984 most premiums more than doubled in real terms, and deductibles rose significantly. At the same time capacity fell. The result of all this change is that professionals are considering their indemnity insurance needs in a new light. The main reason for buying insurance is to provide a smooth cash flow. This need has not been met in the recent past.

We therefore believe that now is an appropriate time for the attention of actuaries to be drawn to professional indemnity insurance.

Type
Research Article
Information
Journal of the Staple Inn Actuarial Society , Volume 32 , March 1990 , pp. 37 - 69
Copyright
Copyright © Staple Inn Actuarial Society 1990

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

(1) Jess, D. C. (1982). A Guide to the Insurance of Professional Negligence Risks. Butterworths.Google Scholar
(2) General Insurance Business: Actuarial Reports. Institute of Actuaries Guidance Note 12.Google Scholar
(3) Bornhuetter, R. L. & Ferguson, R. F. (1972). The Actuary and IBNR. P.C.A.S. LIX, 181.Google Scholar
(4) Craighead, D. H. (1986). Techniques of Reserving—The London Market. J.I.A. 113, 411.Google Scholar
(5) Ryan, J. P. (1987). U.S. Casualty Business written in the London Market. Paper presented to the Institute of Actuaries Students' Society on 18th March 1986. Synopsis in J.S.S. 30, 225.Google Scholar
(6) Finger, R. J. (1976). Estimating Pure Premiums by Layer. P.C.A.S. LXIII, 34.Google Scholar
(7) Aitchison, J. & Brown, J. A. C. (1957). The Lognormal Distribution. Cambridge University Press.Google Scholar
(8) Beard, R. E., Pentikainen, T. & Pesonen, E. (1984, 3rd ed.). Risk Theory. Chapman and Hall.CrossRefGoogle Scholar
(9) Sherman, R. E. (1984). Extrapolation, Smoothing and Interpolating Development Factors. P.C.A.S. LXXI, 122.Google Scholar