A leading insurer has raised concerns over the expansion in the number of insurers offering financial lines cover, saying unsustainable businesses could leave customers high and dry.
Suncorp Commercial Insurance claims customers could be left without financial lines cover because their insurer decides to refuse renewal or exits the market entirely because of market conditions.
Edward Rawnsley, national manager professional & financial risk with Suncorp Commercial Insurance said: “Not long ago there were less than 10 insurers providing financial lines in Australia and now there are more than 40.”
“These high levels of capacity in the market have expanded consumer choice, but brokers and customers also need to consider the question of long term sustainability.”
Rawnsley said: “There have been cases in the past of customers being left in a predicament when their insurer decides not to offer them a renewal or to exit the market entirely because of changed market conditions.
“As Australia’s largest financial lines insurer, the focus for
Vero is to offer customers the right cover for their business at a sustainable price,” said Rawnsley.
“The question that has to be asked is, will this insurer be able to provide me this cover in the long term,” he said.
New entrants have been seeking market share by discounting premiums, leading a recent JP Morgan/Taylor Fry report to warn of declining profitability in the sector.
