GL/PL Rates went up! 2

[CateAESSoil]

Is there a trend (I'm new to the business) of the Professional Liability/E&O insurance going triple what it was last year in California? I'm trying to find out, but because our next renewal is far away, no one wants to give us quotes! I've not been able to find any easy-info sites to help me get an answer to this. Anyone here able to help? Thanks!

Cate@aessoil.com

 

[PEinc]

I'm not in California, but my PL insurance just went up almost 12% and I still have never had a claim. My broker even looked around for cheaper quotes.

I don't understand. When times are good and claims are low, insurance companies take our premiums readily; we get no rebates or reductions. When times are bad and claims are up (like after 9/11), everyone's premiums go up even if not involved in the "problem." Doesn't sound like much risk for the insurance companies when they can just "surcharge" everyone for the big losses of a few. Why do we have to pay twice? Where are the insurance companies' deep pockets when we need them?

 

[Focht3]

It has little - if anything - to do with claims. If that's what your agent is telling you, they're lying. The increase in rates in 2002 had everything to do with the decline in the stock market, and nothing to do with the terrorist attacks.

Look at the stock market trends in comparison to premium increases. Premiums go up when the stock markets are down -



Please see FAQ731-376 for great suggestions on how to make the best use of Eng-Tips Fora. See faq158-922 for recommendations regarding the question, "How Do You Evaluate Fill Settlement Beneath Structures?"

 

[PEinc]

That's just ANOTHER reason (excuse). But what I want to know is what did the insurance companies do with all the premiums they collected previously. Even a squirrel knows to save for the winter days. Seems to me that insurance companies should, in good times, escrow more money for bad times. If I lose money in the stock market, I don't immediately surcharge my clients in order to fully recover my loses. Maybe I should!

 

[BigH]

PEinc - they made a nice pile of money. Brokers got their new BMWs or Hummers and they smiled very readily!

 

[PEinc]

You got that right, BigH!

 

[eric1037]

Are any of your firms members of ASFE? Along with their extensive work with professional liability issues, they have an associated PL insurance company called Terra Insurance. They have a pretty good philosophy. It's worth the cost of belonging to ASFE for the ability to get Terra Insurance alone. Their web site is

http://www.ASFE.org

Check it out.