PII market update—2014
Produced in partnership with Steve Holland of Lockton
PII market update—2014

The following Practice Compliance guidance note Produced in partnership with Steve Holland of Lockton provides comprehensive and up to date legal information covering:

  • PII market update—2014
  • Headline market movements:
  • Primary premium income 1999–2014

In contrast with previous years, the 2014 renewal was relatively benign. The majority of firms renewed their PII with their existing insurers and indeed 90% of Lockton clients remained with their current primary insurer.

A number of the established insurers were pushing rate increases, but this was tempered by competition, especially from new entrants. Premiums did increase for some, however this was a combination of rate rises linked to deteriorating claims and an increase in gross fees. For Lockton clients, overall this meant an increase on average of around 7%.

The new entrants, Endurance and Starr, were able to secure a foothold in the market with premium incomes of £6m and £1.5m respectively. Their appetite for property firms was limited. In common with many other participating insurers they wished to restrict their exposure to firms undertaking residential conveyancing. Insurers very often set a threshold for conveyancing work at no more than 25% of total gross fees.

This year we saw a move away from unrated insurers, as firms were able to successfully secure renewal elsewhere. The proportion of the market in the hands of the unrated insurers dropped by a third to 8% from 12%.

Aviva, having previously shed its SME portfolio o