Full Results of the Advisen Survey of Risk Managers on the AIG Liquidity Crisis
An Advisen Special Benchmarking Report sponsored by Anderson Kill & Olick
(October 9, 2008) Most AIG commercial lines policyholders participating in an Advisen survey reported that, while they are confident in the financial strength of AIG insurance companies following the $85 billion loan by the federal government, more than two thirds plan to get quotes from AIG's competitors when their policies renew. Excerpting from Advisen's Special Report, one likely outcome is that AIG will compete vigorously to retain business, potentially intensifying price competition in an already-soft insurance market.
Between September 23rd and September 25th, 1,000 risk managers and buyers of commercial insurance participated in an online survey about the AIG liquidity crisis. About 84 percent of respondents have insurance decision-making authority for their companies, of which 76 percent identified themselves as risk managers.
Some buyers are concerned that the AIG companies could be damaged by the loss of too many policyholders, defections of key personnel, or by being sold to lower rated companies, but there is a deep reservoir of good will towards AIG. Survey respondents were generally complimentary about how their brokers have handled the crisis. Data and comments are included in the full report. Based in part on written comments also provided in the full report, it seems likely that AIG will be forced to slash premiums to retain business, which could set off a pricing war throughout the commercial insurance sector.
To download a copy of the full report, click here.
How to track these developments using your Advisen.com login:
Follow the AIG Liquidity Crisis on Advisen Read our Briefing: Our first 4 page brief called "The AIG Liquidity Crisis & Its Impact on the Insurance Market." This item ran in Advisen's Front Page News on September 19. Portions of that briefing are based on our exclusive conversation with AIG Property Casualty Group CFO Rob Schimek on September 18. Click on the Topical Analysis dropdown menu and choose Insurance Market.
Compare Form Wordings: Advisen contains policy wording from 2,300 forms across almost 300 insurance companies. Click on the Policy & Law Comparisons dropdown menu and choose forms from 12 different coverages to compare any two or more forms side-by-side to assess coverage terms and provision wordings.
Track the Markets: Advisen's Who Writes What Coverage Where tool shows you the appetite of 1,142 Markets by displaying which Markets wrote similar cover in the last 18 months. Click on the Prospecting & Peers dropdown menu and choose Who Writes What Where.
Benchmark Premiums, Limits & Retentions: Advisen's program archive contains data from 275,000 insureds. Use this data to view indicative premium, limit and retention data or compare program structures. How much does coverage typically cost? What is the rate per million that companies typically pay? To access, click on the Benchmarking dropdown menu and select Advanced. Contact your Advisen rep at support@advisen.com
