In terms of gross written premiums, business liability insurance was worth approximately €5.81 billion in 2010 across ten major European countries. Experts indicate that this value may increase to as much as €7 billion by the end of 2014.
Financial market research consultancy Finaccord recently completed its research findings that indicated the market growth. Finaccord’s report also indicated that there were more than six million companies across the ten countries it surveyed that would potentially be eligible for business insurance, yet less than 50 per cent of these companies have actually taken out the insurance cover
For some companies, securing a professional indemnity policy is compulsory to conduct business in their chosen profession. However, in some professions it is optional – yet insurance experts recommend that such insurance cover is never a bad idea.
One of the primary market drivers in the future will most likely be an increase in take-up among those companies that are not obligated to secure the cover. The largest segment of such companies, the financial consulting, management, and IT sector, has more than 1.4 million firms in total that could possibly take up new policies.
One of the primary methods by which firms take out professional indemnity policies is through professional associations which set up affinity schemes. Finaccord surveyed 1,100 such associations across the Euro Zone, discovering that 39 per cent of them had decided to establish such an affinity scheme.
57 per cent of professional associations in the UK were found to have such schemes set in place, which led the pack. Other countries with high rates of affinity schemes include Germany, with 52 per cent of associations offering schemes, and Italy, with 48 per cent doing so as well.