The Association of Insurers and Risk Managers (AIRMIC) has indicated that the EC has softened its position on the London subscription market following the recent Commission Inquiry into business insurance. The inquiry had raised particular competition related concerns about the alignment of terms and prices in the subscription market. Various industry bodies prepared submissions in defence of these practices, as reported here.
EC officials, in a January meeting with AIRMIC, have confirmed that they are willing to accept shared wordings on the same risk. This means that the contract certainty regime is not under threat. However it appears likely that the alignment of prices will be abolished. Brokers may be required to make it clear to insurers that the lead underwriter’s price is not binding and that they are free to negotiate against other potential insurers in the same layer.
