JLT report predicts $3.8bn of claims over Madoff and others
Professional indemnity claims against asset managers could reach $3.8bn (£2.6bn) because of the financial scandals, the FT reports.
“A year of disasters in financial services, starting with the collapse of Bear Stearns and reaching a nadir with the revelation of Bernie Madoff’s Ponzi scheme, has led insurers dealing with fund managers to reassess the levels of risk they represent,” it says.
It referred to a report by Jardine Lloyd Thompson (JLT), but JLT could not be contacted this morning by Insurance Times.
“Insurers never expected this aggregation of risks,” the FT quoted Paul Towler, a partner at LT in London. “It’s raised the profile on fund managers.”
JLT’s clients are seeing premium increases across the board, with “suggestions of rate rises ranging from 20% to possibly 200% or more where risks have an adverse claims experience, are poorly managed or, more particularly, have a US listing or exposure”, according to the report.
A number of insurers have withdrawn from this segment of the market.
In its report, JLT points to increasing demand from insurers for information on the insured companies, the FT said
