Wotton + Kearney Insurance Year in Review – 2011Insurance Year in Review
We are delighted to introduce our fifth annual Wotton + Kearney “Insurance Year in Review” publication.
In last year’s publication we described 2010 as a year dominated by weather events. Those events now look somewhat benign when compared with the 2011 calendar year our industry is experiencing. A second Christchurch earthquake coupled with the Brisbane floods and Cyclone Yasi have led to literally billions of dollars of losses. Throw in the public relations nightmare the industry faced given the absence of flood cover for many Queensland property policy holders and it is little wonder that we expect that most insurers will not regret the passing of 2011.
Despite the frequency of these CAT events, many classes of insurance remain relatively “soft” given a robust supply of capital exists for many risks. Property lines of business, particularly loss-affected accounts, are the obvious exceptions as the cost of reinsurance increases.
On the claims front, it is not surprising that we are now starting to see some significant legal impact from some of the major losses which flowed from the Global Financial Crisis. In particular, we highlight the article written by Patrick Boardman and Michael Bath addressing the Federal Court’s decision in proceedings involving directors of the Centro group which appears to significantly raise the bar for directors seeking to ensure compliance with their statutory obligations.
As we approach the tenth anniversary of Wotton + Kearney we trust that this publication continues to assist in keeping all industry participants aware of developments in insurance law across the various lines of insurance business. Please do not hesitate to contact the articles’ authors if you would like further information on any of the topics covered.20/10/2011