In the lead up to January 1st there was a great deal of speculation about the potential for a hard market. There were certainly some leading underwriters trying to talk up pricing.

The hard market has not occurred. Property was hit hard and a tougher stance is naturally being taken. Elsewhere the abundance of risk capital and the ability to reload very quickly has meant no more than a tightening in conditions for some (but by no means all) areas of the market.

Underwriters are being more thorough in their underwriting approach and trying to apply some discipline and rigour to terms and conditions. This is most apparent in CAT hit sectors and accounts that have suffered losses. This gives more knowledgeable and experienced brokers an opportunity to differentiate themselves, with a more proactive and strategic approach providing superior terms for their clients.

Holding a line on thin ice

In some cases, senior underwriting management are taking an entrenched 'no more reductions' position across all lines. In those cases their class and line underwriters are unable to make commercial decisions, with the inevitable knock on effect that they are losing existing accounts due to remarketing. Those same underwriters are then chasing new business at more competitive terms to replace their lost income, and thus the cycle continues.

Varied and changeable conditions

There are different circumstances within our different lines and classes of business. This update from our teams therefore provides a snapshot of those conditions at mid-January 2018. The situation is fluid and there will be changes.


Looking back, 2017 became a year of transition. From a soft market in Q1 to one in flux by early Q3, moving to a hardening market by year end due to unforeseen catastrophic loss activity globally.

Hurricanes Harvey, Irma and Maria combined with the California wildfires are expected to cost insurers USD100bn, according to Munich Re. A further USD35bn of insured losses were caused by other catastrophe events, from cyclones in Asia, two quakes in Mexico and a spate of tornadoes and hailstorms in the US. At last report the recent California mudslides are expected to cost over USD100m.

Set against a recent backdrop of attritional loss activity for insurers, they now find themselves forced to increase ratings if they are to remain underwriting. It is now typical for us to see CAT exposed, loss free accounts renewing for +10% to 20% rate increase and loss affected, CAT exposed accounts renewing with anywhere from 25% and upwards. this is dependent on quantum with the demand for improved COPE if underwriters are to renew or participate as new. Those insureds suffering Maria losses are finding it most difficult to renew programs as certain markets have retracted from Carribean writing, such is the severity of losses.

Your contact: Honor Jones | | +44 20 7031 2513



  • Little underlying shift in carrier appetite with continuing gradual increases in enquiries coming in to London as some sectors of the domestic market tighten.
  • Some London underwriters pulling back on capacity but others ready and willing to replace that capacity.

Your contact: Jonathan Coombes | | +44 207 031 2539



  • The market remains very soft and intense competition abounds.
  • Property rate increases can distort the cost of TRIA, which is often a percentage function of the property all risks premium. This is creating more opportunities on standalone terror which is anyway a superior product.
  • Active assailant represents opportunity for new income but has far more likelihood of losses, so pricing and coverage consistency still developing.

Your contact: David Eliot | | +44 207 031 2683



  • This market has not been profitable since 2010.
  • 2017 was particularly challenging, as in addition to the HIMN losses, the wildfire losses in the Napa/Sonoma regions have had a huge impact on underwriters given the large London wine portfolio.
  • The overall impact of the Southern CA wildfire on insurable losses remains unknown.
  • Underwriters are seeking renewal rate rises in the region of +5% to 10% and depending on CAT exposure or loss record, possibly more.
  • However, very competitive deals are available on new business and remarketing; underwriters with generally smaller CAT portfolio books to date are being particularly aggressive on pricing.
  • Enquiries and orders are increasing as the stock pricing advantages of the stockthroughput policy are coming to the fore and helping to offset rate increases on real property parts of accounts.

Your contact: Jamie Kearney | | +44 207 031 2555


  • Upstream risk rate renewals on a like-for-like basis range from +5% to 7.5%. The rate rise can be negated if client shows growth. Exceptions do exist, such as large North Sea operations and new business where markets remain competitive.
  • For upstream CAT Gulf of Mexico Named Windstorm Capacity (NWS), some syndicates are under internal pressure to reduce their exposure and to utilise NWS capacity on other lines of business, e.g. for Florida property exposures.
  • Underwriters are pushing for rate increases within the Offshore Contractor market, with areas of concern being the deactivation of rigs reducing the quality of available crews. Premium base on Offshore Contractors is greatly depleted with increased onshore activity, loss of one large Jack Up would eradicate Global Offshore Contractor premium.
  • An increased number of Construction projects in the Energy Construction market are reaching FID, however, the number of markets prepared to quote appear to be reducing.

Your contact: Alastair Dalrymple | | +44 207 031 2738

Within the midstream and downstream markets rate renewals range from +5% to 10% on clean business, and at least 10% increases for Nat CAT exposures, although onshore reductions are still available on ‘new to London’ business. Axis have closed their downstream book (USD75m capacity).
Your contact: Daniel Nicholls | | +44 207 031 2738

Energy liabilities

  • Market renewals for US business are currently around flat to a 5% rise.
  • Primary US market is a little more restricted, with underwriters being more selective on individual risks.
  • International renewals are seeing fewer reductions and are predominantly flat.
  • Long Term Agreements (LTAs) are coming under pressure with some underwriters refusing to quote them and will come off of business.
  • The marine liability market is seeing some increases rises up to 7.5%.

Your contact: Martin Henderson | | +44 207 031 2593



  • 5% to 10% increases on clean non-CAT renewals and a minimum of 10% on CAT exposed business.
  • Continued losses on GE LMS100s machines.
  • Some markets are pulling out of coal (green credentials) from 1/1.
  • Some new capacity looking to get into space in 2018 and underwriter movement continues.

Your contact: Graeme Valentine | | +44 207 031 2652



  • New MGAs are targeting US solar and wind for 2018.
  • Novae book being rolled into Axis. Accounts outside of core wind and solar expected to be discontinued, with a number of markets willing to replace the lost capacity. 

Your contact: Daniel Nicholls | | +44 207 031 2738


Onshore Construction

  • Market for risk domiciled away from locations directly affected by last year’s weather events remains incredibly soft.
  • Aviva have established a new team. 



The market hasn’t made profit during the last 18 years, with the pure hull account continuing to settle at 100% each year. This was compounded in 2017 by:

  • Increased ‘significant’ loss activity (top nine 2017 hull losses equate to approx. USD205m).
  • Continued depressed rates on ancillary marine interests.
  • Increased global CAT activity (hurricanes, earthquakes, floods and fires).

We are consequently seeing:

  • Small rate rises of 0% to 10% on clean business.
  • Increased rate rises of 10% on less desirable business.
  • No ‘straight’ rate reductions.

Looking forward at the mid-term outlook our expectations are:

  • The present modus operandi will continue, unless there is a marked increase in significant class or CAT losses.
  • London is leading in terms of a response to market losses. International competitors’ are yet to show a consistent hand.

Your contact: Rick Kerr | | +44 207 031 2477


The yacht-specific class as a whole is experiencing huge aggregate losses as a result of HIM. Markets are now imposing increases in both rates and deductibles as a starting point for any renewal, regardless of the vessel’s trading pattern. Alongside this, there is a greater focus on aggregation in windstorm exposed areas, together with the requirement for appropriate and robust windstorm plans.

Your contact: Aaron Jago | | +44 207 031 2927

Product Recall

  • This non-correlating business class has suffered its own spate of losses.
  • Most significantly this led to sector withdrawal from Liberty Mutual, with the renewal rights to their book being purchased by Hiscox – we are consequently experiencing increased activity. 

Your contact: Michael Horner | | +44 207 031 2568


  • Due to high severity and frequency of losses in respect of non-appearance placements, underwriters are seeking increased rates.
  • More in-depth medical information is being requestedby a majority of underwriters, such as bloods on non-appearance placements.
  • Competition in respect of event cancellation placements (excluding non-appearance) remains strong.
  • Divergence in views on coverage and particularly basis of indemnity or ‘to pay’ placements.
  • Capacity and competition remains high in various aspects of contingency products.
  • Increase in sophisticated buyers looking at creative ways to insure their risk.

Your contact: Andrew Thompson | | +44 207 031 2376


  • The market remains highly competitive and rates continue to reduce as capacity increases.
  • Differentiation is largely around coverage terms and efficiencies of handling smaller accounts.
  • Buyers more aware that business interruption and liabilities arising increasingly important.
  • Increased loss activity not having any real impact as more buyers entering the market and changes in European legislation create more opportunities.
  • Recent ransomware events (WannaCry/NotPetya) have impacted a number of major multinational businesses with the resulting loss in revenue and costs widely publicised in the press. This has reinforced the fact that cyber is not just a Privacy / Data driven product, but one that is applicable to all industries.

Your contact: Dan Leahy | | +44 207 031 2310



  • Losses have been increasing in frequency which is gradually – consequently we are beginning to see slight rate increases.
  • Bio-tech and pharma industry sectors are becoming particularly challenging.
  • Nevertheless it is business as usual with London appetite and capacity increasing especially for excess layers.


  • Business continues as usual with no change in appetite or pricing since the CAT losses, and overall our volumes of accounts are increasing.
  • Within the following three distinct sectors Miller has multiple exclusive binders allowing us to access underwriters within the Lloyd’s market who will write these classes to no other brokers:
  • Architects/Engineers/Contractors/Design Builders E&O
  • Manufacturers E&O
  • Standalone Sexual Abuse Liability

Your contacts:

Andrew Bettis | | +44 207 031 2687

Nick.Fearon | | +44 207 031 2498



Healthcare rating remains consistent and US market pricing is getting closer to convergence in the Long Term Care and Assisted living sector as US market rates increase.

Your contact: Danny Towner | | +44 207 031 2482


Kidnap & Ransom

  • The market remains highly competitive with no shortage of capacity (although Liberty withdrew from the market effective January 1).
  • Differentiation lies in the experience, resources and expertise of the crisis response consultants retained by the insurers.
  • Significant area of underwriting focus is cyber extortion and its subsequent business interruption – a narrowing of terms and conditions, and a reduction in limits has emerged from most markets in response to the growing number of Ransomware attacks.
  • Growth areas are Active Assailant, either by way of an extension to the K&R or a standalone product, and products which address wider people and security related issues.

Your contact: Richard Scurrell | | +44 207 088 9121

Let’s keep talking

Our specialists are in the market every day and we encourage you to speak with them to remain up-to-date with the circumstances of each sector. Our teams can explain how they are navigating the market and achieving continued success in winning and retaining business. This will help you identify opportunities and improve your communication with clients and prospects with regards to upcoming renewals and new business.