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Charities taking on new activities risk outgrowing their insurance

A new project can change an insurer’s appetite even when it feels like a natural extension of a charity’s work

Charities taking on new activities risk outgrowing their insurance

Men’s Sheds are community groups built around practical workshop activities. “Their purpose is dealing with social isolation,” said Tim Larden, sales and marketing director at UK charity insurance broker Access Insurance, part of Benefact Group. 

As those activities develop, groups may overlook the need to revisit their insurance. A group might buy a policy, he said, “and then put that on the shelf and think, well, that’s our insurance sorted.” Then a new project comes along. Larden has seen Men’s Shed groups build canoes and take on hot tools, and they may not have spoken to their insurer about either. 

An insurer comfortable with the hand tools a group started out with might not accept fixed machinery, hot tools or bicycle repair. Repair cafés, where volunteers help repair items people bring in, raise a similar issue: general repairs may fall within an insurer’s appetite, while work on white goods brings the risk of a failed repair causing a fire. 

“It’s not a natural distinction to necessarily make that this activity was okay, but this activity actually is not okay with your current insurer,” Larden said. 

When buyers don’t know what to disclose 

Many people arranging insurance for charities draw on their experience of buying car, home or travel cover, Larden said. That can lead them to assume that if they were not asked about something, they do not need to mention it. 

Charities arranging non-consumer insurance are subject to the duty of fair presentation under the Insurance Act 2015. Brokers need to explain that responsibility, he said, so they understand that “even if it doesn’t appear on a proposal form from an insurer, we should talk about everything that really is material to your organisation.” 

Sector knowledge also helps brokers explain unfamiliar activities to insurers. When Larden first sought cover for Men’s Sheds, insurers “weren’t that keen”, he said. His case included the sheds’ limited opening hours, perhaps a couple of sessions a week, and some insurers eventually came on board. 

Renewals that tell a story 

Charities tend to change more than an average business. While a traditional commercial renewal might focus on income, wages and employee numbers, a charity could receive a £1 million grant from a local authority or NHS trust to deliver a major project. 

Some work with people with complex needs, rely on volunteers and hold sensitive data. Changes to a charity’s activities can alter its insurance needs, even when those changes are less obvious than a new building or a large grant. 

Open questions can reveal more than the figures alone, Larden said – what new projects a charity has, what it is proud of, how its services are changing and what pressures it is under. 

“You tend to then get a little bit more of a story, and that deeper conversation benefits everybody,” Larden said. 

That gives the client more relevant advice and the insurer better information, while allowing the broker to look beyond processing a renewal. 

Bringing the broker in early 

Property acquisitions make the value of early discussions particularly clear. It is not uncommon for a local authority to hand a charity a building that may be borderline derelict, Larden said. It may initially be unoccupied or require renovation work, creating a need for specialist cover or risk management. 

Clients are encouraged to make their broker the “first port of call and not the last line of defence”, he said, but requests can still arrive the day before a charity exchanges contracts on a property. 

“Giving an underwriter time to understand something and ask sensible questions and work constructively with us is a much better position than presenting an underwriter with an urgent fait accompli,” Larden said. 

The same principle applies to a new workshop activity or service: involving the broker while plans are taking shape gives the charity time to establish whether its insurer can accommodate the change and what protection it needs. 

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What do people really mean by ‘digital trading’?

We like to have a big idea each year at LIIBA. Something that goes above our day-to-day role of lobbying, training and market support and expands on a relevant theme of the time. Over the years we have looked at such things as how our members were developing solutions to the climate crisis; what would be the future of face-to-face negotiation in a post COVID world; and the contribution of insurance distribution to the global economy. This year we decided to try and define what people really mean by “digital trading” – a phrase much used but seldom with a concrete concept of what it might actually entail. 

In Trust Imperative – How Digital Trading Can Revolutionise Client Outcomes But Why Humans Must Stay in Control we accept that the rapid technological advances we are seeing do have the potential to completely overhaul how we service client needs. But it will only work if it is managed in a way that understands what the relationship between client and broker really is. We don’t sell products, we provide an experience. Clients look to our members’ risk management expertise to provide the peace of mind that allows them to take bolder, innovative decisions that drive economic growth. So, whilst technology has a huge role to play in providing a more efficient and personalised solution, it will need humans to remain in control to provide reassurance that the solution is the right one. Trust will continue to be the foundation upon which our market is built. I commend the work to you, and all episodes can be downloaded now on our website. 

But it is all fine and dandy having big ideas. What really matters is how we build on this to provide a suite of support for members trying to negotiate this new epoch – particularly the 80% of LIIBA members that are small businesses with fewer than 50 staff. So, what comes next? 

A challenge for small firms, without dedicated in house technical resource, is how do you go from AI (I use the term loosely) doing something clever to doing something useful. And this is especially true in the heavily regulated industry in which we work. Operationalising the new technology so that it delivers tangible, consistent efficiencies is not straightforward. This is an area where a trade association can help. We will start with a webinar (working title: how to go from ******* about on ChatGPT to becoming an AI driven business) to look at the basics. And we might explore a partnership with a suitable technology firm to provide an AI audit service for members who want to build on this.

One of the interesting findings from our research was that many members faced a common problem. They have employed brilliant data scientists, but they tend not to know a lot about risk. And they have brilliant risk analysts who might not be well versed in spotting patterns in data. So, it is sometimes only a serendipitous accident if these two professional groups converge on a practical proposal. We will explore the extent to which this is a result of a gap in the academic system in UK. Is there scope for sponsoring a combined data and risk course somewhere?  How can our schools and universities develop the rounded recruits we need? 

The report looks at how the ability to process real time data will see a move away from a static annual renewal process to a continuous analysis of client risk. And that this will require the development of new financial instruments to be able to trade risk day-to-day. That will have regulatory implications in that our members will need to be active in markets that may well sit beyond their current permissions. If this is to work, particularly for smaller firms, it will need a streamlined authorisation and supervision model to support it. Smaller firms will not be able to cope with the regulatory burden of being separately regulated as an insurance intermediary and a derivative trader for instance. We need to find a way to recognise their hybrid role – especially as this new way of approaching client risk will enhance London’s international competitiveness – something our regulators are now duty bound to encourage. So we will begin discussions with FCA on how we flesh out this idea and work together to find the right outcome. 

Technology is already speeding up processes in our market – especially around the execution of the trade with the growth of automated follow facilities. This is going to create time for traders and we believe that will allow a renewed focus on growing the market by addressing the protection gaps that exist around the world. In our Innovation Imperative report launched last year, we estimated this at $2.5 trillion globally. This is a huge opportunity for London but it will require our members to have the right access to international markets to allow their magic to come to bear. So we will renew our work – through our global partnerships such as BIPAR (the European federation of insurance intermediaries) and World Federation of Insurance Intermediaries – to lobby for sensible, proportionate approaches to licencing that recognise the need of all economies to manage their risk by accessing global capital. Indeed, I am writing this article in Colorado Springs where I am attending the annual conference of Council of Insurance Agents and Brokers – our sister organisation in Washington DC with whom we work hand in glove. These relationships are going to be more and more important. 

With that, we have a plan to turn our big idea into ways in which we can grow and expand the impact of our membership across the world. A big idea can become a big concept. We better get on with it.

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In Insurance news

Green buildings aren’t safer

00:00 – Mike Ward: do whatever it takes to win and retain business.
David Tilly: Had a mini flood out the front of my house yesterday afternoon.
Justin Warents: The greener building isn’t necessarily um spelling a lower insurance risk.
Paul Lucas: Hello everyone and welcome to the latest edition of our property insurance power panel. Now catastrophe modeling, inflation and data center risk were a focus last quarter. This session looks at what’s flowing down from the reinsurance renewal and into harder to place property risk along with the

00:28 – Paul Lucas: physical shifts reshaping the asset classes that insurers are covering. And to take us through it, we welcome back Justin Warents, senior vice president, global real estate at Lockton, Mike Ward, executive director, head of property at Bridge Specialty Group, and joining us for the first time, David Tilly, partner in real estate at Gala Specialty. So, welcome all. And to get us started, tell me how are the outcomes of the recent reinsurance renewal feeding through into primary property terms uh capacity as well and pricing of

00:59 – Paul Lucas: course. Uh Mike, what are you seeing?

Mike Ward: Yeah, good morning. So, you know, we are continuing to see the direct soft market uh sorry the direct insurance property market being very soft. There’s significant capacity available with existing insurers remains grow their current portfolios. you know deploy extra capacity if needed but also there is a lot of new entrance into the markets and MGAs which again continues to increase competition across the market you know this is obviously very

01:28 – Mike Ward: valuable for the buyers at the moment with insurers competing aggressively on pricing you know cover enhancements service offerings basically to do whatever it takes to win and retain business but from a reinsurance level you know we are seeing capital positions remain strong um which is obviously supported by a healthy balance sheet. You know, unfortunately, well, not unfortunately, but looking ahead, we see little evidence uh to suggest a meaningful hardening off of the London market and the property market. The only

01:57 – Mike Ward: way this is going to change if there’s a major significant loss or see series of major losses, you know, that particularly impacts insurers and the reinsurers balance sheets.
Paul Lucas: Yeah. And David, from your perspective, do you think reinsurers are willing to concede on rate?
David Tilly: Absolutely. Certainly from the January and the July uh renewals, it certainly seems to be the case still from a very basic economic perspective, we’re in a position where we’ve got an over supply versus uh the demand on there. So very

02:28 – David Tilly: basically that drives the financial contribution on it, but it’s also given clients the opportunity to broaden the terms that they’re receiving, not just focusing purely on price on there. So as we insurers start to concede on pricing and give away some of the coverage, naturally that flows through to the direct market on there. So as Mike was saying, it would need something quite considerable to uh influence the market direction between now and the end of the year on there. So I think from a

02:55 – David Tilly: client perspective, they can expect to enjoy a continued uh buyers market environment and really start to push those uh pricing and the uh and the coverage options available to them. And there and I think that will continue into the uh into the new year as I say unless something significant happens between now and then.
Paul Lucas: Yeah, agree with that just in that that reinsurance tailwind perhaps feeding through into the primary property market.
Justin Warents: Good morning, Paul. Good to be back on. Um yeah, I would agree with those

03:23 – Justin Warents: sentiments. Um certainly we’re seeing the reinsurance tailwind is now generally feeding through into the property uh primary property market. The January renewal, as David said, saw further softening in the property catastrophe reinsurance. We’ve got healthy level of capacity in the primary property market. So very much a uh a soft market uh still remains. However, you know, underwriting uh is not necessarily uh soft. You know, insurers are becoming increasingly sophisticated about what how they deploy their

03:58 – Justin Warents: capacity. So the clients are getting the best outcomes when they can demonstrate that they generally understand their assets. Um, ranging from cat exposure, valuation, construction, defense resilience, and business interruption.
[03:58 – 04:48]  Paul Lucas: I don’t know about the rest of you guys, but I’ve certainly been under the caution of some heavy rains lately, and it sort of provokes this question if you want because of course flood and coastal exposure zones have remained a persistent challenge,

04:24 – Paul Lucas: haven’t they? David, from your perspective, what’s the current state of availability and indeed affordability for property in in the particularly high-risk areas?
David Tilly: Uh, yes, I can share that sentiment, Paul. I had a mini flood out the front of my house yesterday afternoon. Um actually some of the uh bits that Justin just mentioned there around the reinsurance market is flowing into certainly into this question and that can be around evidencing your risk profiles to the insurer themselves

04:52 – David Tilly: because this is always an area of the market that is under constant scrutiny on there and I think this can come down to something very basic as the accuracy of your postcode uh on there. I know it sounds silly, but it can be the difference between you being at the bottom of the hill and the top of the hill. And that can really drive an insurer response to what your risk profile looks like. And one of the um areas that certainly we’re seeing insurers looking to do is yes, they want to help in clients on this. And yes,

05:19 – David Tilly: they want to start writing more of your client’s business, but at the same time, they recognize if there’s been an inherent um loss or I guess the program’s been affected by a coastal flood, how do we work with them to uh improve that risk profile? and some of the implementations from a risk management bery. So your help insurers helping with the client cost of improving those resilience certainly is something that we’re seeing creep back into the market now as some of the maybe

05:45 – David Tilly: you might say the softer market behaviors from an insurer perspective on there. So a lot of it comes down to is it available? Yes. Is it affordable? Depends on what your risk profile looks like. So what coverage is available also comes down to what your risk profile is like. So work with your broker, present your risk as clear as possible and be open to maybe implementing and deploying some capex to improve the risk profile of certain assets.
[05:45 – 06:47]  Paul Lucas: Yeah. And Justin, do you think this area around flood can be a little bit

06:16 – Paul Lucas: misleading sometimes?
Justin Warents: Yeah, I would say Paul that flow is probably one area where the general soft market that we’ve just spoken about can be uh a little bit misleading. Um there’s certainly more capacity across the property market but where there are the you know the highest flood and coastal exposures then insurers um do remain cautious um that’s not to say that cover cannot be achieved. Um but ultimately the underlying physical risk that remains uh is not going away. Um

06:46 – Justin Warents: so what’s really important is to make sure that um a broker gets well behind uh the position uh because insurers will want to know it’s not about just saying um is does this property sit in a flood zone? It’s you know what is the ground elevation like you know what are the flood defenses in place? What does the drainage look like? Has it had history of flooding? U what resilience measures have been installed? And with all of these uh questions with answers, then that does create an

07:18 – Justin Warents: opportunity to have a conversation with insurers take a view um you know model the flood zone uh properly using latest technology that’s available. So I’d say that good data, engineering information and evidence will certainly help to achieve a meaningful outcome for property owners.
Paul Lucas: Great tips from David and Justin here so far, Mike. But overall, would you say that flood is maybe still one of the more challenging perils in the UK market?
Mike Ward: Yeah, definitely is is evident is one of

07:49 – Mike Ward: the most challenging perils to get there. However, again to reiterate, there is capacity available. Insurers are heavily relying on their flood modeling tools. Um but again, you know, if organizations can demonstrate they’re doing as much as they can to potentially mitigate against a claim happening, you know, by putting in fluff barriers, elevating plant equipment, you know, just basically robust emergency planning, then insurers are willing to come to the table and work with a client to make sure that the cover’s

08:17 – Mike Ward: there in in the event of a claim.
Paul Lucas: Of course, a big discussion point right now is those net zero retrofits and those new green building materials which are changing the risk profile of commercial property. So, uh Justin, how are underwriters adapting to assess that?
Justin Warents: Okay. Well, first thing would we be to make the point that um you know insure the insurance industry is certainly not putting the brakes on when it comes to you know green and net zero. they’re very much in in favor and

08:46 – Justin Warents: recognize that, you know, modern developers are deploying and using that for good reason. But it’s also important to bear in mind that a greener building isn’t necessarily um spelling a lower insurance risk. So typically we’re seeing property owners introduce um things like um you know EV charging which is popular now the use of mass timber the number of buildings that have been developed that that has hybrid use of that um new insulation of facade uh systems all of this works towards net

09:18 – Justin Warents: zero but actually putting on um you know a blue roof or green wall doesn’t necessarily remove the risk. So, it’s really important that the broker works with the property owner to make sure that things like, you know, water damage exposures, the installation, um, who’s designed this, what’s the fire separation, all of these things will contribute to understanding the building better. And I think a really important point here is to make sure that you know from the outset before a property has uh at the

09:51 – Justin Warents: development stage, you know, developers and their professional advisers are taking the time to look at these nuances and testing what it looks like with and without so that they can get a more informed position. because sometimes making a subtle change will not necessarily have a large impact significant impact on an insurance premium and allows the proxy owner developer go along with their strategy. Um whereas for other things um consult consulting with the insurance market means that the risk engineers from the

10:24 – Justin Warents: insurers are able to provide some meaningful input towards things and um they end up getting a better steer on what that property premium would look like once the building has practically confused.
Paul Lucas: Such a good point that that Justin’s made there, isn’t it Mike? I mean greener is not necessarily safer. So from your perspective is there enough data in this area
Mike Ward: at the moment? you know there is there isn’t much long-term data so it is quite limited so that’s why you know we are

10:52 – Mike Ward: seeing insurers you know emphasize the requirement of you know quality of installation fire protections know there’s main procedures and contracts in place for the equipment itself you know again what Justin said there is just because it’s green it doesn’t make it safer or lower risk but again this will come in time when the loss data does come in uh because obviously it’s all fairly new and it’s not It’s not as comprehensive as the older building materials that have been used in the

11:19 – Mike Ward: past. So, it’s still a long way to go until we know the full impact of the, you know, net zero refits and the green building materials, what they’re going to cause to the market.
Paul Lucas: What you’re seeing, David, do you think that insurers actually want to support clients who are making these green steps?
David Tilly: Absolutely. And I think they’ve been vocal for a number of years, being wanting to work with clients, not just from um a global overview, but for their own personal perspective. they want to

11:45 – David Tilly: be partnering with uh clients that are moving into this net zero space. But with that, when you’re tweeting when you’re talking about retrofitting, you’re talking about a building that may have a loss record over the last 10, 15 years that could very well be jeopardized going forward with the introduction of heightened electrical risk, maybe introducing higher fire risk. I think Justin covered it off earlier. So, who are you partnering with from a contractor perspective? And a lot of this comes down to some of the very

12:13 – David Tilly: basics of uh insurance partnerships is don’t tell us when it’s just about to be completed. Get engaged with your broker, get engaged with your insurer, get engaged with the experts when you’re starting to considering this uh move into a retrofit and they will point you in the right direction. So we remove as many surprises as they possibly can be once you get to the PC element of a of a retrofit so you’re comfortable that the insurance is going to be in place what it looks like and of course you might

12:40 – David Tilly: want to make some changes along that development way to improve the insurance coverage and the pricing that might be available to you in general insurers are absolutely on board with working with clients on this. To Mike’s point, unfortunately, we are a data driven industry and until such time as we’ve got a plethora of data on there, there’s still going to be a little nervousness about deploying a huge amount of capacity on there just because we don’t have the numbers to plug into a modeling

13:07 – David Tilly: system.
Paul Lucas: I just want to ask you all about the warehouse and logistics space as well, if I can. Of course, e-commerce growth has driven demand in that space. So Mike, how is that changing the property risk landscape and indeed the underbriding approach that accompanies it?
Mike Ward: Yeah, sure. So, you know, we are seeing obviously the modern warehouses definitely have a larger footprint now. They’re storing more pieces of equipment, more stock, whatever they’re keeping there. And also, you know, a lot

13:35 – Mike Ward: of the modern warehouses do have solar panels on the top as well. So we are seeing insurers focusing more heavily on you know sprinkler protection how the stock or whatever is being there how is that being stored what is being stored and also and also the BI exposure uh you know supply chain dependencies and also the accumulation of the risk around the facility but again you know with tech technology improving we are seeing you know new technologies being implemented um you know real real time

14:07 – Mike Ward: monitoring uh of the building, you know, risk conditions such as, you know, sensors that track factors such as, you know, temperature, mechanical plant performance, when the fire protection systems are in place, you know, it literally generates thousands of data points per hour. So, you know, it’s that is key for property owners to identify potential issues before they actually develop into significant losses, which again is more repeated into insurers to, you know, so they know that the clients on the ball and they’re

14:36 – Mike Ward: doing again as much as they can to stop any claims happening.
Paul Lucas: And David, is there a concentration of risk here in in one area?
David Tilly: Absolutely. I mean maybe not in one area per se but certainly where you get a um a part of Europe, maybe a part of Asia where a lot of uh clients are building in the same general area. What you do start to see is the potential of a wide area event actually causing quite a huge amount of disruption to the to the industry and that can cover all sorts of

15:06 – David Tilly: uh industries like automation um you know last mile logistics on there and as you start to introduce automated robots and systems within the building obviously the fire risk starts to change and develop as that goes along. So I think again a lot of it comes down to engagement with brokers who your tenants going to be. Are you specifically fitting it out for a certain tenant in in which case do they have a history of how they fit that out? Do they have a profile of what they work to or are you literally building a shell and core and

15:37 – David Tilly: then letting your tenant build what however they like to do it fairly I guess un supervised which obviously brings in some different considerations in if you look purely from a concentration of risk perspective and potentially accumulation for one insurer that then comes down to data and potential restrictions in capacity which might be deployed in there and the fact that something like a hail storm across Europe, which we have certainly seen over the last couple of years and some flooding in there can have a much bigger

16:09 – David Tilly: effect than maybe they would have done maybe five, six years ago. But also then you’ve got the knock-on effect of these were maybe once flood planes or grasslands. These are now concrete industrial parks which in themselves have a secondary effect to other buildings and surrounding areas.
Paul Lucas: The Justin, you’re nodding along. It looks like you agree with David.
Justin Warents: Yeah, I would agree with those uh sentiments. Absolutely, Paul. Um, you know, I would say the best way of describing what’s

16:37 – Justin Warents: happening in logistics really is, as you’ve said, concentration of risk. Modern logistics warehouse can look relatively straightforward from the outside. Uh, but actually what’s sitting in in the inside of the building has changed enormously. It’s very complex. they these will there’ll be much greater automation as David alluded to ranging from robotics to sophisticated conveyor systems there’s high density storage and a lot of significant amount of IT infrastructure in in there as well

17:07 – Justin Warents: when you add together um roof mounted solar uh PV batteries EV charging then you you’ve got the potential for loss and it’s just not the cost of rebuilding these warehouses it’s the knock-on effects in the wider supply chain. Uh you know if you’ve got the head office um warehouse for a particular retailer um they’re reliant on that supply chain and if they have damaged that infrastructure that’s going to knock them back. So very loss of very expensive equipment business

17:39 – Justin Warents: interruption and of course the cost of rebuilding. So the thing to do here really is look at what the accumulation is um across several locations because as David had said these could be affected by the same uh perils you know flood storm uh in the environment. So it’s getting ahead of the curve, making sure that there’s good property data like we said before, accurate valuations, uh full uh detailed modeling of the asset and also you know business interaction uh analysis will go a

18:13 – Justin Warents: long way to differentiate one portfolio from the next to make that uh extremely competitive in the insurance market.
Paul Lucas: I just have one final question to throw at you all if I can and that’s just simply to ask what’s changed recently in how large and complex property losses are being handled specifically from a a claims perspective. Uh David, are you seeing any changes?
David Tilly: Well, I think the uh the introduction of technology to these claims responses certainly if I can capture the mood is

18:42 – David Tilly: is improving the speed of response uh to these losses. Um and that can be admittance of liability, understanding the um the cause of the loss and that can be the introduction of drones, um satellite imagery. Once upon a time, you know, just to get that data would have involved a battalion of soldiers getting down to the risk and with that comes time delays and everything else that that contributes towards. So I think in general technology is speeding up the ability to respond positively or negatively whatever way it needs to be

19:16 – David Tilly: from the claim. But we’re also now looking at other areas, not just, oh, the building’s had a fire. What are the knock- on effects of that? How long is it going to take to reinstate this building? We’ve got geopolitical influences across that across supply chains on there. And linking back to what we were saying earlier about retrofitting buildings for you know net zero when they are having losses are clients using this opportunity to potentially change the profile of the asset how they reinstate that. If they

19:44 – David Tilly: are maybe moving and pinching towards a greener building, then actually again does that have an impact on how long it’s going to take to reinstate that building, get the client back to where they were before the loss, but also is it going to have a cost impact and as I say supply chain issues about whether we can get those materials uh in a timely manner to deliver what the clients after.
Paul Lucas: Continuing the claims theme, Justin, are we seeing larger complex claims?
Justin Warents: Yes, Paul. Um we have the generally

20:14 – Justin Warents: the real estate market has is seeing larger losses um coming in you know across you know multiple asset classes. I would say the biggest change really in major property claims have become they’re much more forensic and they’re multi-disciplinary. Uh you know significant property losses today can evolve very quickly and they will involve a lot of a number of parties um working together. So you know David’s right from the perspective of you know using technology but this range

20:45 – Justin Warents: from this ranges from you know loss adjusters engineers um risk surveyors forensic accountants and potentially lawyers and coupled with the insurer and of course the broker there’s quite a you know a number of parties around the table discussing the claim and you know the optimum best outcome for this I think you know looking at mitigation um early on um claim preparedness, uh, modeling what a loss would look like on a portfolio cuz you’re not going to stress that test that, you know, at the

21:19 – Justin Warents: point of a loss, you’re just going to find either that your indemnity period for your business interruption was not long enough or, you know, unfortunately that your reinstatement value was short um, and you’ll have exposure there. So yeah, it’s extremely important for the broker to test all of this with the client. Making sure that major claims can be managed and looked at assessed well before an event happens I would say would be the would be the best thing. You know we buy insurance policy

21:48 – Justin Warents: for a reason and you know for it to respond to claims. So it’s important that that robustness um is there and will ultimately be the test of a quality insurance program.
Paul Lucas: Yeah. Uh Mike, from your perspective, do you think that the insurers, the loss adjusters, everybody across the kind of the value chain when it comes to claims, are they working together a little bit uh smoother now than they were before?
Mike Ward: 100%. Yeah. You know, we’re seeing insurers are actively bringing in

22:16 – Mike Ward: loss adjusters, forensic accountants, you know, even restoration specialists much earlier in in the claims process just to speed everything up. You know there’s definitely a stronger focus on you know business interruptions like supply chain disruption and obviously the challenge of getting the operation back up and running which is you know the most important but you know this has all been sped up again which been echoed here you know the use of drones remote inspections you know d the digital data

22:42 – Mike Ward: collection now is much more fast so you know it’s helping speed up the loss assessments and the resolution but again ultimately what we are hearing what we are seeing is you know obviously prior to use the priorities to make, you know, get claims settled as soon as possible, but also ensures that we want to work with businesses to be able to help them recover as quickly as possible and also obviously emerge more resilient for the future to make sure you know this sort of thing does happen

23:08 – Mike Ward: again that the claims costs remain as low as possible. Um, and you know, obviously the clients want to get back up and running as soon as possible. So, it should work in everyone’s favor really.
Paul Lucas: Great perspectives from everybody. Really interesting discussion. A huge thanks for your time. Remember, of course, that this group will be back together again one more time in 2026. But until then, keep it right here and Insurance Business TV.
 

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Eight in 10 workers would use workplace mental health support, but two-thirds lack access, AXA finds

Most employees would use mental health support at work if it were offered. Most also say it is not, or that they do not know it exists. AXA Health Business chief executive Alain Zweibrucker said eight in ten employees would join workplace mental health support programs, but two-thirds say such programs are not available to them or they are unaware of them.

The finding comes from AXA Global Healthcare’s 2026 Mind Health Report, titled Reaching the right support, a survey of 19,000 people in 18 countries. Among people with a mental health concern who have not seen a professional, a third (33%) say the cost of consultations and treatment stopped them, and 15% cite fear of stigma.

Cost matters far more in some countries than others. Half (50%) of respondents in Mexico and 49% in the Philippines say it stops them seeking help, compared with 15% in Germany and 17% in Turkey. The research links the gap to funding. Where people pay directly for consultations and treatment, seeking support carries a heavier financial burden than where care is publicly funded or covered by compulsory health insurance.

Stigma varies too. It is a greater barrier in the UK, South Korea and Hong Kong than in Switzerland, Turkey and Thailand, and the report ties it partly to how well conditions are managed. In the UK, where 25% cite stigma, 36% of those with a condition say it is well managed. In Thailand, where 13% cite stigma, the figure is 52%.

Where those barriers bite, people are turning to AI. AI use tends to be higher where cost is a bigger obstacle, with 71% in the Philippines using AI tools for their mental health. People held back by stigma are also more likely to use AI to search for information on managing their mental health, at 60% against 52% of those who are not. Dr Anne Lepetit, chief medical officer at AXA Health Business, described AI as “a potential gateway to care” and said it is not a replacement for therapists, psychologists or psychiatrists.

The pattern holds for non-natives, meaning people living or working outside their country of birth. Two in five (40%) use AI to find suitable healthcare professionals or facilities, and 52% use it to search for information on managing their mental health, against 47% of natives. Cost of consultations and treatment is their main barrier to professional support, at 36%.

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In Insurance news

Poaching wars: Marsh spends US$30m in a quarter fighting rivals over staff

The giant broker’s legal bill points toward Howden, the London-based firm at the centre of a string of US poaching suits

Poaching wars: Marsh spends US$30m in a quarter fighting rivals over staff

Tucked into the back pages of Marsh’s third-quarter results is a line that most readers will have skimmed past. Among the one-off items the broker stripped out of its adjusted earnings was US$30 million for “a restrictive covenant litigation against a competitor.”

That is US$30 million in legal costs in a single quarter, according to the reconciliation tables in Marsh’s earnings release filed with the US Securities and Exchange Commission. The nine-month figure is US$38 million, which means spending on the case nearly quadrupled in the third quarter compared with the first half of the year combined.

The release does not name the competitor. But the timing, and the scale of the spending, point toward one obvious candidate.

No rival has taken more from Marsh in the past 15 months than Howden. The London-based broker launched its US retail business in mid-2025 under Mike Parrish, a former Marsh executive. More than 140 Marsh staff from its Florida operations followed him, beginning in July 2025. By early February 2026, Marsh said in court that it had lost about 160 employees and 82 clients to Howden.

Marsh responded with a string of lawsuits. At one point five cases between the two brokers were running at once across Delaware, New York state and New York federal courts. The results have been mixed.

In February, a federal judge in Manhattan granted Marsh a partial injunction against seven former Florida managers and brokers who joined Howden. Judge Jennifer Rochon found Marsh was likely to succeed on its breach-of-contract claims, but declined to stop the brokers from serving clients who had already moved. In June, she allowed Marsh to add Howden’s London-based parent, Howden Group Holdings, to the case, along with new trade-secret claims.

London has seen this kind of fight before. Marsh’s reinsurance arm, Guy Carpenter, sued in London after more than 30 people were hired away by Howden Tiger, a dispute that settled before trial, Insurance Business has reported.

Read next: The brokerage industry’s litigation epidemic: When poaching becomes a business model

The most recent ruling went the other way. On September 22, Judge George Daniels ruled that Parrish and three other former Marsh executives were no longer bound by a preliminary injunction barring them from soliciting Marsh staff and clients after September 19. They remain barred from misusing Marsh’s confidential information, and the court said Marsh can still pursue damages and permanent relief.

Howden has disputed Marsh’s claims throughout. In earlier filings, the four executives argued that their restrictive covenants had been superseded in 2025 by agreements without non-compete clauses.

Not the only front

Marsh is fighting on several other fronts, which is one reason the footnote cannot be pinned to Howden with certainty. Its US middle-market unit, Marsh Agency, formerly Marsh McLennan Agency, sued three former brokers in June who had joined Lockton earlier this year. It alleged a “corporate raid” on the Birmingham, Alabama, office it acquired with McGriff. The same month it sued Patriot Growth Insurance Services over the alleged poaching of a surety team. It has also litigated against Alliant and WTW.

Read next: Brown & Brown wins TRO against Howden over alleged employee raiding

Marsh is also far from the only broker in court. Brown & Brown has won restraining orders against Howden in Massachusetts and Minnesota, alleging a nationwide raid that took roughly 200 of its employees. Aon took a different route and settled its US case, and its UK claim against Howden Group Holdings filed in 2023, in April on confidential terms.

Why are people moving?

Although the lawsuits seem to be focused on what a company has done to attract a competitor’s talent, it may be something that is coming from the employees themselves.

“Do you recognise that this generation of employees is no longer keeping their head down and doing what they’re told to do ‘just because’, in hopes that something will pay off in the end? “ said . “There’s a quality of life that they’re looking for. There’s a meaning to the work that they’re looking for.”

“This is a group that’s walking away and will go where they feel that they’re most valuable,” she explained. “And there’s no loyalty to anyone just because you smile and you give them a paycheque every week.”

For producers weighing a move, the lesson from this year’s rulings is mixed. Courts have generally been willing to enforce non-solicitation agreements in the short term, but they have also declined to force clients back and have let restrictions lapse once their terms run out. Brokers thinking of leaving should read their covenants closely, and so should the firms hiring them.

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In Insurance news

Cyber cover’s many names fuel debate over common terms

Flexibility allows cyber cover to fit different risks, but inconsistent terminology makes policies harder to compare

Cyber cover’s many names fuel debate over common terms

Business interruption cover can appear in a cyber policy as network interruption or material interruption. Breach response costs might be called emergency costs, event management or crisis containment.

That variety sits behind a debate over whether cyber wordings should be standardised. Most voters in an IBUK LinkedIn poll said insurers should be left to compete, while just one backed standardising only triggers and loss calculations, the middle ground suggested in an interview on why cyber policies can look identical until a claim.

Same cover, different names

Daniel Johnson (pictured top, left), class underwriter, cyber at AEGIS London, said liability cover can also be labelled privacy liability or network security liability. Insurers are not the only ones using their own definitions: brokers and vendors do too.

Differentiation can benefit clients, he said, but has pitfalls when buyers do not understand the wording or coverage. He regularly hears of clients choosing the cheapest option, even though a lower price usually comes at the expense of cover.

“This is the crux of it for me: brokers having the appropriate level of knowledge to review, compare, and explain differences in cyber wordings – it comes down to training and awareness throughout the insurance placement chain,” he said.

The case for flexibility

Tim Johnson (pictured top, right), partner and head of the insurance practice at Browne Jacobson, said it was hard to call one approach good and the other bad. He compared cyber with employers’ liability, where regulations largely set out what a policy has to cover. That gives buyers greater certainty, but leaves less flexibility, with specialist risks having to go to specialist markets.

“With cyber, I think standardisation would be too difficult because a cyber policy for a small one-person owner-managed business working from their spare bedroom with a laptop will be entirely different from an aviation business with 1,000 planes in the skies all over the world at any one moment in time,” he said.

In his personal view, insurers and commercial buyers should retain the freedom to negotiate terms rather than have specific language mandated. The ability to assess risks differently, price them accordingly and tailor wordings is one of the keys to the London market’s strength in bespoke and unusual risks, he said.

Insurers make the same case. Lindsey Maher (pictured, immediately above), head of global cyber development at CFC, which recently added executive protection and affirmative AI wording to its cyber policy, said standardisation risks solving the wrong problem in one of insurance’s fastest-moving risk environments, where insurers need the freedom to evolve cover as technology, threats and client needs change.

“If we standardise wordings too heavily, we risk standardising the market around yesterday’s risks,” Maher said.

Tim Johnson acknowledged that flexibility has a cost when insurers describe what is nominally the same risk in different ways.

“If you’ve got two different insurers using two different sets of language, then the inevitable consequence of that is potentially more disputes,” he said.

Common definitions, easier comparisons

Daniel Johnson said he would personally welcome some standardisation around common definitions to make cyber policies easier to understand.

“I believe differentiation is required to allow for innovation, but for such a complex product, common definitions should be standardised,” he said.

Technology could also help with comparisons. Philip James (pictured immediately above), partner and head of UK data, privacy and cybersecurity at Browne Jacobson, said AI can analyse multiple policy wordings quickly.

“AI could take 10, 20, 30 policy wordings and actually do a fairly quick analysis of the various wordings in it,” James said.

He said that gives brokers and customers more ability to compare policies, leaving less room to argue that a buyer did not know what they were buying.

Tim Johnson said wordings were becoming clearer, a shift that began before Consumer Duty and has gained focus through it, driven by insurers wanting to do the right thing and competition in a soft market. He sees education as a bigger barrier to businesses buying the right cyber cover than complicated wordings or insufficient coverage.

A cyber policy can combine six to nine different covers in various permutations, he said, so it cannot be reduced to a one-page summary, even as cyber has moved from something of a luxury a decade ago to one of a business’s core covers.

Most poll voters favoured leaving insurers to compete on wordings. That leaves brokers with the task Daniel Johnson identified: understanding the differences well enough to explain what a client gains, or gives up, when choosing a policy.

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In Insurance news

A clearer path into claims – and up through the market

We have a strong story to tell – but we need to be better at telling it

A clearer path into claims – and up through the market

Claims offers young people a career built around consequential decisions. It combines technical knowledge, investigation, negotiation and an understanding of what customers need when something has gone wrong. In the MGA sector, that work can involve specialist risks, close relationships with underwriters, brokers, and direct exposure to how an insurance business operates.

We have a strong story to tell prospective recruits. We need to become better at telling it, and equally serious about the opportunities available once they join.

Telling the claims story

Attracting young talent starts with making the work understandable. Someone leaving school or university may have little idea what a claims professional does. Talking about the circumstances behind a claim, the problems that need resolving and the judgement involved gives them something concrete to consider. Job titles and lists of required competencies rarely convey that.

We should also be explicit about the breadth of talent claims needs. Analytical ability matters, as do curiosity, empathy, clear communication and the confidence to ask questions. Recruitment should recognise those qualities and provide accessible routes through apprenticeships, work experience, internships and entry-level roles. Expecting prior insurance knowledge can unnecessarily narrow the field.

Ambition needs to be matched with responsibility

The greater test comes after recruitment. A young person who joins with ambition needs to understand how good performance translates into greater responsibility. If progression is unclear, we leave them to work out their prospects through informal conversations or by looking elsewhere.

Claims leaders should be able to explain what the next stage looks like: the knowledge required, the decisions someone will be trusted to make and the support available to help them get there. That applies to technical specialism as much as management. A strong career should be possible for someone whose ambition is to handle increasingly complex claims.

Development requires more than courses. Reviewing a difficult case with an experienced colleague, explaining a coverage recommendation or joining a discussion with an underwriter can teach lessons that formal training alone cannot provide. Those opportunities should be planned into the working week, with managers accountable for making them happen.

Cross-function exposure

Within the MGA market, exposure across functions is particularly valuable. Young claims professionals should understand how products are designed, how risks are selected and how relationships with capacity providers operate. Equally, they should have opportunities to explain what claims experience reveals about wording, service and customer needs. That exchange helps them develop commercial understanding and makes their contribution visible. The value a claims professional can add to future risk appetite, pricing and product design cannot be underestimated.

Technology must feature in this development. Emerging professionals need the ability to interpret data, question automated outputs and recognise where human judgement is required. As tools change the work, employers must ensure that junior colleagues still acquire the underlying knowledge needed to take responsibility for decisions.

Confidence grows through practice. Giving someone a case to present, a meeting to contribute to or a defined improvement to lead helps prepare them for more senior work. Clear supervision and constructive feedback make that responsibility useful. Waiting until somebody appears fully confident risks withholding the experience that would help them become so.

Building relationships

The sector also benefits when young professionals build relationships beyond their own businesses. Meeting peers and experienced practitioners broadens their understanding of the careers available and gives them people to learn from as they progress.

Attracting talent and developing it are inseparable responsibilities. The promise we make to a new entrant must be supported by credible opportunities to learn, contribute and advance. These themes will inform the MGAA Next Gen session at I Love Claims’ MGA Claims Conference 2026, held in association with the MGAA on November 5, 2026, from 9am, at 8 Northumberland Avenue, London. It will provide an opportunity to consider how we help the next generation build lasting careers in claims.

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In Insurance news

Keeping the Consumer Duty focused on outcomes

Three years after its introduction, the FCA’s Consumer Duty is now embedded in retail financial services. Its central principle is simple but important – firms should be able to demonstrate good outcomes, not merely compliance with a process.

The FCA’s proposed changes to the scope and proportionality of the Duty should also be welcome, allowing firms to focus their time and evidence on the areas where they can genuinely influence customers’ experiences. More proportionate information gathering and board reporting can reduce duplication and help leaders concentrate on the evidence that matters. But simplification must sharpen the Duty’s impact, not lower expectations or allow firms to step away from responsibility.

That balance matters particularly across distribution chains. Consumers experience a product or service as a single journey, even when several organisations design, distribute or support it. So, there need to be clear rules identifying the primary manufacturer and when other firms exercise material influence. Such a hierarchy is more likely to create accountability than a loosely defined model of co-manufacturers and all firms would probably benefit from sector-specific case studies showing when they may reasonably rely on one another and where responsibility remains shared.

Of particular concern are consumers in vulnerable circumstances, who will be a crucial test of any more proportionate framework. Responsibility cannot sit only with the customer-facing firm. Product design, distribution choices, communications and support all affect whether foreseeable harm is prevented. The FCA has recognised that responsibilities differ according to each firm’s role, but firms need more practical guidance on things like information sharing across the chain. They should also be able to draw on credible specialist research where it provides richer evidence than service data alone, for example, in understanding economic abuse.

Governance should follow the same outcome-focused approach. Board reporting is beneficial where it reflects a firm’s circumstances and actual influence, and can lead to meaningful challenge rather than weaker senior accountability. As a result, Boards need a coherent view of customer outcomes, culture and the quality of evidence, not simply larger compliance packs. Alongside complaints, value assessments and service metrics, firms and the regulator should continue to develop measures of trust, confidence and behaviour.

There is also an opportunity to create greater coherence between the Duty and adjacent rules. The Consumer Duty’s more nuanced combination of product design, fair value, consumer understanding and support is better suited to assessing outcomes across different customer groups. Over time, definitions and expectations across the Handbook should be aligned so that firms are encouraged to undertake more useful analysis.

All in all, the FCA’s direction is broadly right. Bringing provisions together, clarifying reasonable reliance and matching obligations to material influence should make the Duty easier to apply. A sufficiently long transition for existing products will also help avoid disruption. But success should not be measured by whether firms produce fewer documents. It should be measured by whether responsibilities are clearer, foreseeable harm is identified earlier and senior leaders can see more clearly where customer outcomes need to improve. Proportionality should support disciplined judgement and stronger professionalism. If the reforms achieve that, backed by practical and sector-specific guidance, they will preserve the Duty’s ambition while making its application more focused, credible and effective.

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In Insurance news

Tiger attack fatality raises questions over where zoo cover stops

Brokers highlight operators’ duty of care and the limits of standard business interruption cover following a closure

Tiger attack fatality raises questions over where zoo cover stops

A man has died after entering the tiger enclosure at Yorkshire Wildlife Park near Doncaster on Saturday 10 October, prompting a health and safety investigation by City of Doncaster Council, the park’s licensing authority.

The park has remained closed since, and has told ticket holders they will be contacted to reschedule.

A question of reasonable precautions

Shaun Mallia, managing director of Tower Hospitality & Leisure at Tower Insurance Brokers, said the operator’s precautions would be central to assessing any public liability claim, from warning signs to barriers and security measures. Where every reasonably practicable step had been taken, the policy could respond by defending a potential claim.

“The determining factor will be if the operator fulfilled its legal duty of care,” he said.

Marc Loud, director at Park Insurance Services, said insurers had to be careful not to automatically blame a zoo or wildlife park when an incident occurs, given the considerable sums such businesses spend on safety, fencing and staff training. Where someone deliberately ignores warning signs or climbs barriers, their own actions have to be taken into account, he said.

“You cannot completely eliminate the risk of somebody deliberately ignoring safety measures, and it would be unreasonable to expect any business to guarantee that nobody will ever act irresponsibly.”

Dr Campbell Murn, a former member of the government’s expert committee for zoos and a lecturer in conservation science at the University of Reading, said such incidents remain rare, and that enclosures for dangerous wild animals must meet clear standards on size and height, with staff trained to respond rapidly to emergencies.

Where cover stops

Loud said his biggest concern was not that zoos are uninsured, but that they may not fully appreciate where their insurance cover stops. A zoo is a visitor attraction as much as an animal collection, he said, often running restaurants, play areas, animal experiences, educational activities and sometimes accommodation, each of which can introduce a different exposure.

“Animal escapes are another important consideration. A zoo might have public liability insurance, but does that policy cover all the consequences of an escape? What happens if the attraction is forced to close for several weeks? Who pays for the lost income?” he said.

Mallia said standard business interruption cover typically requires physical damage to property to trigger it, so a closure following an injury to a member of the public may not automatically be covered. He said operators should work with their brokers to include non-damage business interruption extensions, and check indemnity periods and policy limits against a potential fall in visitor numbers.

“One thing I always stress is that having £10 million of public liability insurance doesn’t necessarily mean you’re covered for every eventuality. It’s the wording, exclusions and conditions that really matter,” Loud said.

He advised operators to work with a broker who genuinely understands the leisure and wildlife sector, declare every activity and review their policy regularly, adding that the cheapest policy is not necessarily the best one.

Scrutiny rather than a market shift

Mallia said insurers will want reassurance that operators have robust health and safety procedures that are regularly reviewed, along with details of how they maintain the standards required under the Zoo Licensing Act 1981.

“Given where the current market sits, I would not expect to see a single incident cause a sudden change in capacity nor premium,” he said, adding that each incident would be reviewed individually.

Loud said insurers may review an attraction’s risk management, claims history and underwriting information after a serious incident, but that this does not automatically mean premiums will rise or cover will be withdrawn. Much depends on the circumstances and the measures taken afterwards, he said.

With the council’s investigation ongoing, the brokers expect scrutiny of individual attractions rather than a sudden change in pricing or capacity across the zoo market.

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In Insurance news

Liam Coleman confirmed as permanent FOS chair as new complaint dismissal rules go live

Liam Coleman (pictured) has been confirmed as permanent chair of the Financial Ombudsman Service (FOS), taking up a three-year term on October 10 as new complaint dismissal rules take effect and a registration stage pilot begins, changes to how complaints about insurers and brokers are screened.

Coleman has served as interim chair for the past year. He was appointed to the interim role in October 2025 after an initial recruitment campaign proved unsuccessful, and succeeded Baroness Zahida Manzoor, who stepped down in August 2025 after two terms. The FCA board made the permanent appointment with Treasury approval.

He has more than 30 years of financial services experience. He was chief executive of the Co-operative Bank, deputy group treasurer and group head of capital management at Royal Bank of Scotland and group director of treasury at Nationwide Building Society. He has also held roles at the FCA, where he sat on the board before joining the FOS, and at an NHS foundation trust. He is group chair of London & Quadrant Housing Trust.

Ashley Alder, chair of the FCA, said Coleman’s experience across financial services, regulation and public service organisations “will be invaluable as we work together to support a redress system that is fair, predictable and effective for consumers and firms.”

New rules for complaints

The changes follow the FOS policy statement published in August after the joint FCA and FOS consultation CP26/9, which ran from March to May 2026. Formal changes to the dismissal framework took effect on October 1. They add or restore grounds for dismissing complaints, including where a matter has already been reviewed under regulatory standards or a consumer redress scheme. The FOS also removed the word “material” before financial loss in one dismissal ground, so a complaint can be dismissed where the complainant has not suffered financial loss, material distress or material inconvenience. The dismissal changes apply to current and future complaints, while the amended fair and reasonable test applies to new cases.

A registration stage that adds work earlier in the process is being piloted, starting with fraud and scams casework this month. Formal registration rules are deferred until the FOS consults on case fees, and not before April 2027 at the earliest. The Financial Services and Markets Bill, still progressing through Parliament, also contains changes to the redress system and the FOS. The reforms follow the government’s 2025 plans to overhaul the ombudsman, and Coleman’s permanent appointment gives the board continuity while they bed in.

Insurance complaints

The FOS received 53,600 complaints between April and June 2026, 600 more than the previous quarter. Car and motorcycle insurance complaints rose to 4,100 from 4,000 in January to March, with consumers citing claim values, policy cancellations and claim delays. Travel insurance complaints rose 30% year on year to 1,300.

The service handles insurance among most financial services, and since April 2019 its remit has covered complaints from larger small and medium-sized businesses as well as consumers. The FCA and FOS said they are working with the government to deliver a redress system that is consistent, predictable and fair for firms and consumers.

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