Professional and casualty liability markets shrink
The liability insurance market shrank further this week after Euclidian suspended all underwriting in professional indemnity, Danish Re cut its casualty liability book and Trenwick International put its non-Lloyd's operation into run-off.
Euclidian is re-examining its professional indemnity business after boosting its writing in other areas, including US property treaty and aerospace.
It is increasing its capacity for 2003 to £350m for Syndicate 1243 after winning more than £20m from Centre Re and capital from two other insurers.
Euclidian chairman James Truscott said it was easier to forecast profits when they were based on short-tail business, rather than the volatile liability market which was influenced by changing legislation.
"You'll never know if you got the price right and to find out you got it wrong years later isn't acceptable," he said.
Last year's 12-month qualifying quota share agreement with Berkshire Hathaway is up for renegotiation before June.
Danish Re, which is to receive $50m from Berkshire Hathaway, is cutting its London casualty liability account prompting speculation that Warren Buffett's investment was conditional on exiting the difficult market.
Group chief executive Leif Corinth-Hansen denied any connection.
"We thought it was going to be one of our core lines but basically we changed our mind," he said. The group's motor liability book will remain a core activity.
A Beazley spokeswoman confirmed this week that Wilkinson would be joining the company on 1 February 2003 to work with Johnny Rowell on the company's large PI portfolio.
She said the company had no position in the US D&O insurance market and no immediate plans to enter it, but that it would be considered in future.
Looking at this possibility would form part of Wilkinson's brief, she said.