HSBC and Newline latest to enter indemnity market
Legal Week reports
July 24, 2002 at 08:03 PM
2 minute read
HSBC Insurance Brokers has confirmed plans to enter the primary layer solicitors' professional indemnity market in partnership with Lloyd's syndicate Newline, as new providers aim to take advantage of the predicted explosion in the costs of solicitors' insurance.
HSBC Insurance Brokers managing director Charles England told Legal Week: "It is a perfect time to enter the market."
He said Newline was offering HSBC Insurance Brokers "significant levels of capital". The pair expect to be writing policies for solicitors from the beginning of August.
Newline, which has written excess level insurance for a number of years, will be underwriting policies for two- to 20-partner firms and will also offer top-up insurance.
Newline is the second new entrant to the market this month. American Re, a reinsurance company owned by reinsurance giant Munich Re, entered the primary layer market earlier this month.
This recent trend is in contrast with last year when a number of insurance providers, including Cox and Axa, pulled out of the market, citing lack of profitability.
Since then the insurance market has hardened significantly. Solicitors' professional indemnity rates are expected to rise by about 40% for the first £1m layer when policies come up for renewal at the end of August, while top up cover is expected to more than double.
"Now the market is hardening and the rates are going up, the solicitors professional indemnity market is looking more attractive for new entrants than it did a year ago," said Mike Rendell, director of professional indemnity brokers PYV.
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