Rising claims and enhanced focus
Jurgen Hellweg, CEO: Western National Insurance
Liability insurance, once considered a more niche segment of the South African insurance market, is now gaining significant attention as the size and frequency of claims continue to rise.
This transformation presents both challenges and opportunities for brokers to further support their clients in an increasingly litigious and complex business landscape.
Understanding the changing claims environment
The surge in liability claims is driven by various factors, including high-profile incidents, the growing complexity of legal environments, evolving risks like cyberattacks and environmental concerns, and the increasing role of social media. These trends highlight vulnerabilities across industries and underscore the importance of robust liability coverage.
Additionally, factors such as the evolving regulatory landscape, advancements in technology, and heightened consumer awareness have played a pivotal role. Today’s consumers are more informed and assertive when it comes to holding companies accountable. Businesses must ensure they are adequately covered to navigate this heightened risk environment.
Regulatory bodies have also raised the stakes for businesses, with stricter compliance requirements leading to potential legal exposure. Although many claims may not succeed on their merits, the need to defend against them can still impose financial and resource burdens, primarily due to rising legal defense costs. As a result, insurers and brokers alike must navigate this terrain carefully to manage increasing premiums and associated costs.
THINK BACK.THINK AHEAD.
Now Rethink Insurance.
At Western, tradition meets progress. We are your
timeless partner in an ever-changing world.
For all insurance solutions related to the commercial, agricultural, engineering or sectional title sectors contact your broker, or call Western:
Western Cape +27 21 914 0290,Gauteng +27 12 523 0900 or visit www.westnat.com
Western National Insurance Company Ltd, affiliates of PSG Financial Services Ltd, a licensed controlling company, are authorised financial services providers. FAIS: Juristic Reps under FSP 9465.
Insurers and brokers: A collaborative approach
Insurers have a critical role in managing liability risks, but brokers are at the heart of ensuring clients have the right coverage. By working closely with insurers, brokers can gain valuable insights into liability underwriting, enabling them to provide tailored, effective solutions to their clients.
The evolving nature of liability risks calls for a more focused approach to underwriting, where brokers and insurers collaborate to assess each client’s unique risk profile. Brokers serve as trusted advisors, equipped with the expertise needed to recommend the most appropriate coverage, and insurers provide the necessary support to help brokers succeed in this vital role.
Supporting brokers in navigating liability claims
The liability claim process can be intricate, requiring a solid understanding of both legal and insurance principles. Brokers already play a key role in guiding clients through this process, and their expertise is crucial to ensuring clients are well-prepared for potential claims.
As liability insurance continues to evolve, many brokers are deepening their knowledge and skillsets, often with the support of insurers. A focus on professional development and closer partnerships with insurers can be incredibly valuable in helping brokers offer specialised liability solutions.
In today’s environment, brokers can benefit from considering specialist roles within their firms to focus on complex products like liability insurance. By building a closer relationship with their insurer partners, brokers can enhance their understanding of underwriting principles and offer clients even greater value.
Opportunities for brokers
Brokers who embrace ongoing learning and adapt to the changing liability landscape will find ample opportunities to differentiate themselves. The ability to offer specialised, informed advice is a significant advantage in this competitive market. Liability insurance is not a one-size-fits-all solution; it requires a deep understanding of each client’s specific needs.
Brokers who position themselves as experts in liability insurance will be better placed to support businesses facing increasingly complex risks. As businesses become more aware of their exposures, they are more likely to turn to brokers who can offer tailored advice and comprehensive coverage solutions. The principle remains: “Know Your Client and provide them with the correct cover.”
Conclusion
As the liability insurance market continues to evolve, brokers are in a unique position to provide invaluable guidance to their clients. By staying informed and fostering continuous learning, brokers can enhance their ability to navigate the complexities of liability insurance and deliver the best possible outcomes for their clients.