US insurer targets high volume SME risks in UK regions
WR Berkley (Europe) confirmed this week that it had entered the UK directors' and officers' (D&O) market.
A source close to WR Berkley said the insurer made the move because it represented a "natural fit" with the company's professional indemnity (PI) business.
"D&O is written on a 'claims made' basis, it fits its [WR Berkley's] systems, and it's seen a good pricing increase."
The source said WR Berkley would be writing mainly SME risks in the regions. He added the insurer would be offering up to £5m of cover on any one risk.
The company has recruited former Newline underwriter Simon Mepham to manage its D&O business.
WR Berkley has also begun writing public and products liability business. The company will be focusing on high volume, regional business lines.
WR Berkley recently recruited former RK Carvill broker James Bright to head up its liability underwriting business.
The insurer will be offering up to £5m of cover for each public and product liability risk.
WR Berkley (Europe) began trading last year writing professional indemnity (PI) risks. The insurer generated around £11.5m of premium income from solicitors' primary PI renewals in its first year.
WR Berkley (Europe) was established by WR Berkley Corporation (WRBC) and RJ Kiln, with a capitalisation of £80m, of which 80% is provided by WRBC and 20% by RJ Kiln.
Capacity has flooded into the D&O market in 2004. Recent entrants include, Allianz Global Risks, Axis, Catlin, Novae Underwriting and XL Insurance Professional.
Market analysts have estimated that around £200m of new D&O capacity has entered the London market in 2004.
A recent Datamonitor report said premiums for UK D&O cover have soared as a result of recent corporate scandals such as Enron and Equitable Life.
It said the increase in corporate accountability and the appetite of shareholders to claim against company directors had exposed UK insurers to potentially severe claims.