In its October report, Plane Talking, JLT remarks that insurance rates are up, albeit the variation seen between the hull and liability rate changes of each individual renewal is large. “In general a ‘normal' risk with ‘normal' growth could expect to receive a relatively minor increase, conversely those affected by loss or those with significant reductions in exposures are likely to experience greater increases. A key factor of this differentiation in rating comes as underwriters, still pushing for rate increases, remain under pressure to maintain or grow premium levels.”
There is also no let-up in the availability of capacity, this is driven by lack of return elsewhere, and the need of insurers to diversify their risk for Solvency II which in part also supports the underwriters focus on maintaining or growing premium income.
There are of course other aspects borne from the current state of the market such as an increasing demand for further innovation. Aviation is renowned for its ability to answer the needs of its clients with new products and so perhaps unsurprisingly in the wake of recent large Hull War market losses and ongoing political tensions throughout the world, a new Non-Cancellation Hull War product has been developed. This new innovative product has been developed to mitigate these concerns and to provide better balance sheet protection and security of operation for airlines. This product is currently being adopted by a number of major airlines on renewal.