قالب وردپرس درنا توس
Home / Insurance / D & O interest rate pressure continues, SPAC exposures increase: Alliance

D & O interest rate pressure continues, SPAC exposures increase: Alliance



Fresh capacity has provided some stability in the market, but many CEO and service insurance buyers are still seeing interest rate hikes and lowered limits, according to a report published on Wednesday by Allianz Global Corporate & Specialty SE.

SPAC exposures are also growing, with losses already reported flowing through the D&O market, AGCS, a unit of Allianz SE, said in the report.

US-listed companies, including IPOs, continue to experience significant price pressures, as does the pharmaceutical industry. , technology, life sciences and retail companies.

D&O capacity levels are still not at the soft market levels seen before 2018, even with new insurance companies entering the market, according to the report.

"This means there is still an imbalance between supply and demand and many companies would like to buy more limits than the industry can currently offer, "the report said.

Global insurance pricing for D&O was seen earlier. Double-digit increases in all key markets in 2021

, according to third-party data included in the report.

Some slowdown in premium increases has been reported this year compared to 2020, although pricing varies by region.

Financial and Professional prices increased by 25% in the US, driven by D&O responsibility and cyber pricing, based on Marsh LLC Global Insurance Market Index for the second quarter of 2021.

Insurance companies adjust coverage to provide adequate protection d for sponsors, board members and shareholders in a SPAC agreement, the report said.

While SPAC offers a more efficient path to public markets, SPAC has a set of specific insurance-related risks.

"Depending on the type of insurance for Every stage of their life cycle, inherent exposures can potentially result from misconduct, fraud or intentional and material misrepresentation, incorrect or insufficient financial information or breaches of SEC rules or disclosure obligations, Lydia said. Miller, global underwriting and product analyst at AGCS, said in the report.

If the transaction is not completed within the two-year period, insider trading during the time a SPAC is published and lack of adequate due diligence in the target company may also come into play, Miller said. [19659002] After the merger, the risk that the future company will perform as expected or failure to meet the new obligations to be a listed company is among other emerging SPAC risks that should be considered.

Catalog


Source link