Capacity-wise, the UK market is sufficient for most risks, except for distressed industries, such as cyber and D&O. This is despite recent expansions in the D&O market that brought in additional capacity.
According to Aon, underwriting scrutiny remained high, partially due to the uncertainty brought by the Ukraine-Russia crisis. Other factors include a continued focus on insurer profitability and persisting supply chain challenges.
Both limits and deductibles remained flat, with cyber again being an exception, with insurers adjusting their exposures amid mounting loss costs.
With the insurance market’s adjustments over the past two years, coverages remained stable in the second quarter, but Aon identified cyber as an exception, where insurers introduced various restrictions, such as coverage territory, war, ransomware, business interruption and systemic risk. Casualty insurers are also monitoring extensions such as pure financial loss, product recall and professional indemnity.
In addition to cyber, Aon identified trade credit as another challenging market in the UK, as global supply chain issues remain. Inflationary and geopolitical crises also contribute to rising demand for trade credit coverage, but risk appetite is expected to decrease in certain countries.
