Benchmark Provides More Timely Results; Validates Property, D&O Trends Chicago

Preliminary results from the Risk and Insurance Management Society Inc. Benchmark Survey, available online for the first time in its history, suggest that property and excess casualty coverage prices appear to be softening, while directors and officers and fiduciary coverage continues to be expensive and difficult to find.

“The survey validated what we thought to be the case with D&O. Its still out of control,” said Chris Mandel, president of the Risk and Insurance Management Society Inc., at its annual conference here.

“On the other side of the fence, with respect to property and excess from a casualty standpoint, its beginning to moderate substantially,” Mr. Mandel said.

(Mr. Mandel will serve as president until May 1, when Lance Ewing, executive director of risk management for Park Place Entertainment Corporation, will take over.)

The survey, for the first time offered online, provided a “thumbnail sketch” as well as an immediate benchmark for the data, he said.

“Lets face it, the Benchmark Report of the past was always dated,” he said at a press briefing. “It was at least six months old by the time it hit hard copy. Now people can go online and really see what is going on in the current marketplace.”

Mr. Mandel told National Underwriter that the fact that data is so quickly available now, versus in the past when the survey was conducted on paper, means that RIMS can access the survey more often and may possibly follow trends on a quarterly basis. He said RIMS is still deciding how to use the data and how often to report on it.

Mr. Mandel said there is a “crying need” for immediate data.

“In my culture, management expects me to be able to show how we compare with others like us, and to be able to do it on a contemporary basis.” He continued, “Management likes nothing less than to have data put before them that is antiquated.”

In addition to the price trends, the preliminary results also revealed that coverage is harder to place, requiring more insurers to secure necessary program limits. Risk managers are also spending more time to negotiate terms and conditions.

According to RIMS, any financial professional may contribute data to the survey, which is ongoing.

Participants can create charts and schedules of insurance programs and interactively compare their data with previous years survey data. Participants also may use interactive benchmarking tools to compare costs and programs against continuously updated marketplace data, RIMS said.

Reproduced from National Underwriter Edition, April 21, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.

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Benchmark Provides More Timely Results; Validates Property, D&O Trends

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