Global Insurance Law Connect

AI provides opportunity for insurance industry to transform itself by embracing change | February 2024

Global Insurance Law Connect (GILC) has launched its first ‘Artificial Intelligence Report’, providing insights from 18 countries (including Australia) on how artificial intelligence is impacting the insurance industry in their own markets. As well as providing details on changes to AI regulation and risk prediction and analysis, the report also finds that while AI will continue to bring greater efficiency to many areas of the insurance process, this does not come without challenges. AI algorithms may have inherent biases and lack transparency, raising concerns about data privacy and ethical issues, and the use of AI also increases the potential for cyber-related events.

Gillian Davidson, GILC’s Chair and Partner at Sparke Helmore, commented, “AI has already become an essential part of our daily lives and is quickly making its way into the insurance sector.  This trend is expected to continue as AI offers numerous benefits including faster claims processing, improved underwriting, innovative insurance products, streamlined administration processes, and more efficient chatbots.”

Better understanding of risk

The research highlights the ability of AI to quickly analyse vast quantities of data as a powerful tool for insurers in predicting and assessing risks, particularly when there is a significant source of data. As Gillian explains, “The use of AI can help insurers enter markets that may be challenging due to lack of lengthy loss histories for certain types of risks.  AI can rapidly digest large volumes of data and produce more precise analytics, which can be useful in designing coverage for large-scale cyber incidents, for example.

“Ultimately, this improved risk analysis will benefit consumers as it enables insurers to offer more relevant and tailored coverage to their customers.”

New models, new distribution

Insurers and their legal advisers will closely monitor the progress of regulations and legislation specific to AI; the EU’s forthcoming AI Act will become the benchmark for many jurisdictions around the world. They will also be keenly aware of the liability, privacy, and cyber exposures that could emerge as their policyholders adopt AI in their business models.

In Australia, the Government in January 2024 published its response to public submissions to a discussion paper on ‘Supporting Responsible AI’, which examined the need for a combination of general regulations, sector-specific regulations, and self-regulation initiatives to support safe AI practices.  The Government has also said it is considering implementing mandatory guardrails for the use of AI in high-risk settings, either by amending current laws or creating new laws specific to AI.  In addition, from March 2024, a new online safety code will be introduced covering search engines and providing protection against generative AI-related risks. 

Jehan Mata, Sparke Helmore Partner and Cyber Insurance Leader, added, “The Australian Government needs to ensure greater collaboration with the insurance industry to provide much-needed certainty around legal, regulatory, and voluntary AI frameworks, and provide a clear roadmap for their adoption.  Otherwise, Australian insurers may be hesitant to embrace AI to its full extent.”

In many markets, AI is being utilised or is likely to be adopted to optimise distribution models. The COVID-19 pandemic accelerated a shift by many insurers towards digital and online tools, replacing traditional distribution models. We are likely to see a similar rapid expansion in the use of digital techniques, including smartphone apps that often involve AI, to distribute insurance policies.  This trend will be especially beneficial in markets with low insurance penetration.

AI could create new challenges

Insurers face a significant risk with regards to data privacy, which could be exacerbated by the widespread adoption of AI. The processing of vast quantities of personal and often sensitive data will mean that insurers need to have robust procedures to ensure compliance with national and international data protection standards.

Insurers also need to be mindful of the need to have measures in place to safeguard against data breaches, and to have adequate processes to handle the reporting and management of any breaches should they occur.

“For the Australian insurance industry, AI and generative AI technologies present significant opportunities and associated challenges. The use of predictive AI will need clear parameters and overarching guidance and preparedness to face the challenges across data privacy, ethics and bias in order for insurers to prevent financial, regulatory, legal, and reputational risks”, Jehan commented.

Gillian concluded, “Currently, insurance solutions tailored to the risks associated with artificial intelligence are still in the early stages of development. However, as the technology advances and becomes more prevalent, and regulatory bodies sharpen their focus, we can expect an increase in AI-targeted risk solutions.”

Click here to access the full report.

Global trends in product liability litigation and claims| October 2023

Global Insurance Law Connect (GILC) has launched its first product liability report. The report provides insights from 17 countries, including Australia, on product liability insurance in their domestic markets. The report provides details on the changes to the product liability market globally and forecasts future developments.  Growing consumerism, the globalisation of supply chains, the emergence of new technologies, and the need to innovate are driving an increase in product liability claims globally.

Gillian Davidson, Sparke Helmore Partner and Chair of Global Insurance Law Connect, commented: “These current and future trends in claims globally stem from a combination of consumer and regulatory pressures. While modernisation and innovation are increasingly important factors in today’s consumer society, at the same time, concerns around privacy and environmental preservation are also front of mind for many consumers.  Alongside this, the growing body of legislation affording greater consumer protection rights has led to increased awareness of product liability insurance.

Some less mature insurance markets are still relatively underdeveloped, and in these markets product liability coverage is a relative newcomer and often occupies a small niche in the overall product mix.  Nonetheless, the global tide of regulatory and legislative change is set to encourage consumers and corporates alike to increasingly hold manufacturers, importers and suppliers to account for the products and services that they provide.”

The research highlighted one of the latest and most rapidly evolving issues impacting product liability is artificial intelligence.  As Gillian explains, “One area that has thrown up challenges for regulators and legislators alike is the unprecedented growth of new technology platforms and tools such as artificial intelligence—and particularly the speed at which they are entering the daily lives of consumers and businesses.  Although regulators are making a concerted effort to introduce frameworks that will both mitigate the risks to users of this new technology and protect them from harm, many are playing catch-up, and we are likely to continue to see an increase in the number of claims.

“As awareness of product liability issues grows, the market for insurance coverage is expected to grow alongside it.  In more developed insurance markets, the strengthening of consumer protections across a range of industry sectors (including the expanded definition of who or what constitutes a consumer in the eyes of regulators) is bringing more businesses into scope for potential product liability claims, driving appetite for coverage.

Australia’s product liability regime is a combination of common law, contract and the Australian Consumer Law (ACL).  The ACL contains a unique prohibition on misleading and deceptive conduct, a regime of consumer guarantees, and imposes strict liability for products found to have safety defects.  The ACL allows consumers to take action against suppliers, manufacturers and importers with the onus on the defendant business to seek contribution from other parties at fault; importers may be classified and deemed ‘manufacturers’ if the actual manufacturer does not have an Australian presence.

Kiley Hodges, Sparke Helmore Partner, commented, “Large product liability claims are usually commenced in the Federal Court of Australia or the Supreme Courts of the states and territories. With the recent changes and developments in case law, the defendants in product liability matters can be broad and include manufacturers, suppliers and retailers, although they are usually corporate entities. A wide spectrum of claimants also exist—from individual consumers and small businesses to large corporates and the Australian Competition and Consumer Commission depending on the scale and complexity of the matter.”

Continued Kiley, “Product liability class actions have been a well-established part of the Australian legal landscape for the last decade, aided in part by the increasing role of litigation funders and ‘no win, no fee’ lawyers.  Australian product liability litigation often follows product recalls, overseas lawsuits, or regulatory investigations and enforcements.

“Class actions have more recently involved pharmaceuticals, pesticides, chemicals, medical devices, motor vehicles and a range of consumer products.  Under the ACL, the definition of ‘payment of goods’ by a ‘consumer’ in respect of the breach of consumer guarantees has increased from $40k to $100k, which may also be contributing to an increase in litigation.

“A number of legislative changes were passed in November 2022 to increase penalties for companies that breach Australian competition and consumer laws.  These changes include the introduction of penalties for businesses that use unfair contract terms in standard form contracts entered into with consumers and small businesses.  The amendments will take effect in November 2023 allowing businesses enough time to change their standard contracts.  Sparke Helmore has released three articles on unfair contract terms amendments—the articles can be accessed here, here and here).”

In closing, Gillian says, “Whether countries have the most consumer-friendly laws in the world and a mature product liability market to match, or whether they have evolving legislation and a nascent insurance market for these risks, it is clear that this class of business will continue to grow at a fast pace in the coming years.

“In this rapidly evolving market, insurers will need to be alert to new exposures and opportunities alike.”

The product liability report covers Australia, Belgium, Brazil, Chile, China, Denmark, Finland, France, India, Italy, Mexico, Netherlands, New Zealand, Norway, Poland, Spain and the United Kingdom. Click here to download the full report.

Risk Radar Report | ESG edition | May 2023

Global Insurance Law Connect (GILC) has launched its fifth annual Risk Radar report. For the first time, we zero in on a single topic — Environment, Social and Governance — and highlight its worldwide impact on the insurance industry. A collection of insights from leading specialist insurance law firms across 21 countries, the Report details the growing awareness globally of ESG risks and how the insurance industry is well positioned to respond.

GILC member firm Sparke Helmore provided the commentary for Australia and noted the three stand-out ESG issues:

• Environment: Climate change—with increasing natural disasters in Australia, insurance coverage remains both a challenge and an opportunity for innovation for the industry.
• Social-Inflation—a rising tide of living costs, supply chain issues and class actions costs. Social inflation is a key issue for the industry.
• Governance-Modern Slavery—risk management is front of mind for the insurance sector and the Insurance Council of Australia.

Gillian Davidson, Sparke Helmore Partner and Chair of Global Insurance Law Connect, commented: “It is unsurprising that the consensus from our member firms is that ESG has become an increasingly important issue for insurers and the wider business community. 

“We are already seeing the significant impact of ESG on the insurance industry, for example with the dual governmental and social pressures of new regulation and stakeholder activism. The increased scrutiny of ESG strategies in many jurisdictions is also impacting directors’ and officers’ and financial institutions’ coverage, as well as professional indemnity policies for firms advising on climate related financial disclosures.

“There is recognition within the insurance industry that embracing appropriate ESG policies can lead to significant growth opportunities, the creation of long-term value, and risk management benefits. While insurers have made advances in this area, more needs to be done to meet governance and climate change risk assessment obligations.

“Members are also seeing the impact of ESG on the business community. Organisations that rely on carbon-intensive production are struggling to find insurance options, and it is increasingly difficult in many parts of the world to underwrite business for frequent and severe natural catastrophe events. In addition—against a backdrop of geopolitical risks, supply chain disruptions and inflationary pressures—organisations are coming under increasing strain as they aim to strike the right balance between ESG investments and managing increasing costs.”

The Risk Radar report covers Australia, Belgium, Brazil, China, Denmark, Finland, France, Germany, India, Ireland, Italy, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Spain, Switzerland, United Kingdom and the United States.

Click here to download the full report.

Business Interruption Report | January 2023

Global Insurance Law Connect (GILC) this week launched its first global report on business interruption, providing insights from 19 countries on business interruption insurance in their domestic markets. The Report provides details on the key changes to the global business interruption market and provides a predicted outlook for coming years.

The Report finds that following the pandemic and despite the backdrop of high inflation, increased scrutiny on wordings and higher premia, there is now more clarity for both businesses and insurers around what can be expected from a business interruption policy.

Gillian Davidson, GILC’s Chair and a Partner at Sparke Helmore, commented: “Business interruption insurance was thrust into the spotlight as the pandemic took hold and the world went into lockdown. The report highlights that even though businesses globally were facing similar challenges the response from the insurance industry, governments and regulators varied markedly in each jurisdiction. However, a consistent picture is that globally demand for business interruption has increased as businesses have become focussed on the need to have the right type of cover.

“Despite some short-term pressures on pricing caused by global inflation, a recent wave of cases in Asia (including a potential new variant in China) and ongoing legal challenges hanging over from the pandemic, the outlook for business interruption insurance as a class is more positive than it has been for some years. The pandemic has focused the market on the need for clarity in policy drafting and has led to a proliferation of COVID-responsive policies that either clearly exclude or include pandemic cover providing more certainty for insurers globally, and their clients. 

“Consequently, business interruption insurance as a class could see a period of growth and stability at last (particularly in more traditional areas of coverage such as property damage). However, there will still be a need by some clients for pandemic cover (particularly if the recent resurgence of cases in Asia leads to renewed COVID measures and focus on such protection) and it remains to be seen what appetite insurers will have for such cover and at what cost.”

In Australia, a small number of claims have been paid out by insurers since the pandemic began.  These claims have typically been submitted by companies seeing recovery under specific covers, for example, event cancellation.  Insurers have contested a number of claims, and these have led to litigation. 

As Mark Doepel, Partner at Sparke Helmore points out, “ Claim numbers have been low, although this is attributed to claimants adopting a ‘wait and see’ approach pending the resolution of the two BI test cases rather than decreasing demand. The test cases have and will continue to result in increased scrutiny of BI policy wordings by insurers and insureds. In the positive, the two test cases have created more certainty in the industry by confirming principles to be applied to each claim, albeit each matter will have to be determined on its facts.” Continued Mark Doepel, “BI policies will continue to be sold in the Australian market, potentially in greater numbers, given most small businesses are underinsured.”

Sparke Helmore is a member of GILC and the sole Australian representative firm. Click here to access the full report. 

Click here to visit the Global Insurance Law Connect website.

Cyber Insurance report | October 2022

Global Insurance Law Connect (GILC) this week launched its inaugural Cyber Insurance report. The report captures the challenges associated with the cyber security market and analyses the different ways that regulators and insurers in different regions have been and are intending to approach this very real and constantly evolving threat.

Globally, there has been a record level rise in catastrophic losses during the last three to four years. While the majority of incidents for cyber-attacks are through ransomware, there has been an uptick in the number of state-sponsored cyber-attacks not witnessed before. The level of possible impact on businesses from cyber criminals has become increasingly clear; these include not only threats to infrastructure but also to the integrity, availability and confidentiality of the information we digitally capture, analyse and exchange.

For many buyers worldwide, the experience of buying cyber insurance cover for their business is challenging.  Cyber insurance has become more expensive and can provide limited coverage, particularly outside Europe and North America.

In the short term, insurers are likely to include more caveats in policies regarding silent cyber and supply chain attacks and will also adopt more sophisticated pricing techniques.  Insurers will have an increased focus on educating policyholders and providing resources to help them understand and manage cyber risk.

The reports notes that there is one certainty—that cyber insurance is a market that has the potential to become as globally ubiquitous as car and home insurance.

The Cyber Insurance report received input from Australia, Belgium, Brazil, China, Denmark, Finland, France, Germany, India, Italy, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Spain, Switzerland, Taiwan, the UK and the United States. Sparke Helmore is a member of GILC and the sole Australian representative firm.

Click here to visit the Global Insurance Law Connect website. Click here to download the full report.

Risk Radar Report | May 2022

Global Insurance Law Connect (GILC) has launched its fourth annual Risk Radar report. The report pulls together the key themes from across the GILC network and gives a snapshot of the major issues that are currently bubbling up in each major insurance destination where the GILC has a presence—23 countries.

GILC member firm Sparke Helmore provided the commentary for Australia and noted that many issues that defined 2021 remain front of mind for 2022.  The top three issues that stand-out in the Australia as creating significant headwinds for the local industry are:

• Climate change—insurability or affordability of insurance in flood prone areas
• Regulation—Australian insurers have been subject to sweeping regulatory reforms
• Class actions—increasing restrictions for third party litigated funders

The 2022 report sees many of the areas of focus from last year continue to be at the forefront of members’ minds.  The rise of digitisation and cyber risk, increased climate risk, and regulatory change are all themes that run through this year’s report, with insurers having to continue to adapt with 2022 being no less eventful than 2021.  Many insurers have been turning their minds to the longer-term implications of the pandemic including potential consequences for the D&O market should the decisions of senior management during this extraordinary period come under the spotlight.

The Risk Radar report covers Australia, Belgium, Brazil, China, Denmark, England & Wales, Finland, France, Germany, India, Ireland, Italy, Luxembourg, Mexico, Netherlands, New Zealand, Northern Ireland, Norway, Scotland, Spain, Switzerland, Taiwan and the United States.

Click here to visit the Global Insurance Law Connect website. Click here to download the full report.

D&O: Global trends, insurance capacity and pricing | November 2021

Global Insurance Law Connect Legal network this week launches its first research report into global D&O markets. The report has had input from insurance lawyers in 20 countries around the globe and provides an overview of global trends and also gives a snapshot of how D&O coverage shapes up country by country.  GILC member firm Sparke Helmore provided the input for Australia.

In many countries, D&O rates are rising, and in some places, those increases are extreme, but this is not the case everywhere.  In a few markets the green shoots of recovery are showing as clients reach the limits of what they are prepared to pay, and prices look set to finally stabilise. 

Australia is one such country where the price limit has been reached.  As Dino Liistro, Sparke Helmore Partner, comments, “The recent experience of underwriters had been that insureds were prepared to increase their spend. The limit may have been reached.  Over the last year, insureds began maintaining the same legal spend in the face of rising premiums by increasing excesses or reducing limits of cover and in some cases looking to other risk management solutions to bridge the gap.”

The report also notes other tumultuous global events beyond pricing are impacting D&O including:

• the global surge in M&A
• regulatory pressures
• cyber
• growth markets
• environmental and ESG issues, and of course
• the pandemic.

These issues add up to the increased need for protection for directors and officers, driving up the demand for cover.  The report found that while emerging markets in particular have a growing appetite for D&O there is a lack of capacity in many of these markets, with only a small number of insurers operating in the region. European markets also have capacity for growth with some smaller economies showing an upward trend in demand.

Meanwhile in Asia, markets such as China that have fast-growing D&O books have also seen increased securities-related litigation and in India, the basis for D&O claims has widened exponentially.

For Australia, the COVID-19 pandemic appears to have created a volatile and uncertain environment for businesses in a strained D&O insurance market.  It is anticipated however that the market will stabilise and soften over the next two years.  This optimism is attributed to (now past) increases in premiums together with an apparent slowing of certain types of claims namely, securities related litigation. 

Dino Liistro noted, “There has been a decline in securities and insolvency-related investigations and claims over the past 12 months.  Early in the pandemic, legislative changes were made in the area of insolvency, and other legislative changes and government support assisted companies.  Perhaps because of these actions there has been a decline in corporate insolvencies from pre-pandemic levels, and consequently a decline in insolvency related claims against company directors to now.  In the event of insolvencies increasing in the future, of course, we may again see a rise in insolvency related claims.” 

“Also related to the pandemic, underwriters anticipate further claims in the employment practices liability space—around changing conditions in workplaces—and in respect of policies with an element of crime cover.”

Cyber is another area that continues to be in the spotlight in Australia, as it is around the globe.  Underwriters typically consider cyber risk to be covered under D&O insurance policies; to date, there has been very limited claims activity in Australia.  Theoretically, a director’s failure to implement reasonable data protection and security controls could ground claims against them.  Dino Liistro said, “I anticipate that the risks associated with such claims will grow commensurate with companies’ increasing reliance on technology and data to drive revenues and business operations.”

As Jim Sherwood, Global Chairman of Global Insurance Law Connect, states on the report overall, “The changes of the past decade and recent economic shocks have led to an increased need for protection for directors and officers, in a market that lacks capacity to supply it.  The impact has been a notable growth in self-insuring for this class of cover, alongside increased use of letter of indemnity for directors and officers.”

Click here to visit the Global Insurance Law Connect website. Click here to download the full report.

GILC Economic Update: Pandemic rebound has further to run | November 2021

Over the past few months, Global Insurance Law Connect has worked together with Capital Economics to analyse global economic trends. As a result, GILC has launched a new report, which provides GILC clients with a broad view of the global economy. Insurance, as with all industries, is seeing changes to the market due to global economic pressures, and this report has been produced to give insight as well as to be used as a tool to shape insurers planning for the months ahead. 

Jim Sherwood, Chairman of Global Insurance Law Connect commented, “Macroeconomics now, more than ever, impacts every aspect of the insurance value chain. Recent discussions with our members have highlighted how across the globe, demand for insurance varies by line of business. However, as economies transition to the ‘new normal’, we are likely to see growth in those classes of insurance that have fallen in the last two years.

“M&A activity within the insurance market has increased in many regions, as insurers seek to provide a full-scale offering or upgrade their technology to offer their consumers a more streamlined service. In addition, there is also a greater demand for increased transparency and competitiveness, coupled with tougher regulatory regimes.  All of this is critical to our clients’ working lives.”

Click here to visit the Global Insurance Law Connect website.  Download the full report here.

Risk Radar Report | June 2021

Global Insurance Law Connect (GILC) has launched its third annual Risk Radar report. The report pulls together the key themes from across the GILC network and gives a snapshot of the major issues that are currently bubbling up in each major insurance destination where the GILC has a presence—22 countries.

GILC member firm Sparke Helmore provided the commentary for Australia and noted that a number of issues stand out as having a significant impact on the local insurance industry and the way it operates.  The top three issues that stand-out in the Australia as creating significant headwinds for the local industry are:

• Business interruption losses
• Marine delay coverage and supply chain challenges, and
• Cyber and privacy.

The 2021 Radar Report has seen a marked globalisation in tone.  For the first time, many of the issues member law firms have reported as being currently critical in their markets have converged, with a truly universal focus on cyber, climate change and the impacts of the pandemic bringing new challenges to many markets. A subsidiary point, but one of much importance to all in our industry, is the follow-on impact of the ‘powering up’ of digital marketing, sales and claims processing, as insurance buyers around the globe move online permanently after a year of cultural change.

The global issues of cyber and the impact of the pandemic particularly, resonate in Australia.  Insurers and their customers have had to be quick to respond to enable business continuity and establish a stable position in the market.

The Risk Radar covers Australia, Belgium, Brazil, China, England & Wales, Finland, France, Germany, India, Ireland, Italy, Luxembourg, Mexico, Netherlands, Northern Ireland, Norway, Scotland, Spain, Switzerland, Turkey, Taiwan and United States.

Click here to visit the Global Insurance Law Connect website. Click here to download the full report.

Sparke Helmore appointed to Zurich’s new APAC panel for large and complex losses | April  2021

Zurich Insurance has introduced a new legal panel to provide legal services for large and complex claims in the Asia-Pacific (APAC) region following last year's legal panel arrangement for Europe, Middle East, and Africa (EMEA). Sparke Helmore is delighted to confirm that through its association with Global Insurance Law Connect (GILC), it was successful in appointment to this new legal panel. This appointment complements our longstanding relationship with Zurich Australia, having been part of their legal panel nationally for several years.

Speaking to Insurance Business Australia, Zurich head of claims for APAC Matt Cottrell said: “This is great news for our customers and our broking partners who will be able to receive specialist legal advice provided by highly respected international law firms that are based in the region and have a global reach. The legal and market insights they'll provide to Zurich and our customers will be invaluable, particularly for larger, more complex claims.”

Partner Gillian Davidson (APAC Board representative for GILC and Zurich Relationship Partner), commented to say: “This recent appointment is testament to the strength of our relationship with Zurich and the quality of legal work provided by expert legal team at Sparke Helmore and across the GILC network. We are very excited by the opportunity and look forward to collaborating further with an extremely important partner in Zurich.”

Sparke Helmore is a proud member of GILC and the sole Australian representative firm. GILC is a formal network of leading insurance law experts with its formation inspired by client demand. The network is comprised of like-minded and high-performing independent firms from across the globe that specialise in insurance law.

Approaches to coronavirus | March 2021

Global Insurance Law Connect has launched its 2021 report into the impact of COVID-19 on global insurance markets.  Member firms in 17 countries around the world have contributed and, drawing upon their in-depth understanding of the local jurisdiction and cultural, political and geographical challenges, the report provides a unique overview for the insurance industry.  Member firm Sparke Helmore provided the commentary for Australia.

Gillian Davidson, Partner Commercial Insurance at Sparke Helmore and GILC Board Representative for Asia Pacific commented, “Since our first report on the impact of COVID-19 in July 2020, we have seen changes in the way we live and work and have only just begun to understand the challenges for businesses and economies around the world.  This latest analysis highlights the common themes that are emerging—from coverage to regulatory change—as well as focusing on country specific issues.

“For example, disputes concerning business interruption have triggered challenges in numerous jurisdictions, including in Australia.  We are also seeing courts continuing to adapt and implement the technological leaps and bounds made during COVID, as permanent.  Another recurring theme across many member firm jurisdictions is the change in work practices and business environment as well as the acceleration in digitisation, which has seen the insurance industry move several years’ forward in just a few months.”

Click here to visit the Global Insurance Law Connect website.  Click here to download the full report.

Global Run-off and Legacy Trends report |February 2021

Global Insurance Law Connect (GILC) member firm Sparke Helmore has launched its first run-off report, looking at the drivers of legacy business in both mature and emerging insurance markets.  Specialist insurance law firms in 20 countries around the world have classified their local run-off market, in terms of both its maturity and direction of travel and looked at some of the dynamics behind these developments.

The best way to sum up the findings is “growth held back by legislation”.  One universal truth is that in every market, insurers are looking for opportunities to divest themselves of unwanted legacy portfolios.  While some of the exact drivers may differ, we see a common pattern: in markets where regulation permits portfolio transfers, creative solutions flourish with multiple parties cooperating in flexible ways and, very often, delivering a more positive outcome for those parties.

Closer to home, the Australian run-off market is starting to gain more traction and in 2021, it looks likely to continue to grow and gather momentum. Large global players are looking to run-off specialists to acquire legacy portfolios, which enables them to have a clean and decisive exit from lines of business that are taking up capital and capacity.

Click here to visit the Global Insurance Law Connect website. Click here to download the full report.

Run-off is a global trend, but local expertise is the key to success | October 2020

In 2019 PwC’s Global Insurance Market Run-Off Survey estimated global non-life run-off reserves at circa $790bn, with legacy management expected to become part of the “new normal”. The drivers are different in different regions, but the underlying trend is the same – a new focus on run-off, supplement with a growing awareness that the legislative environment is changing, meaning that deals are demanding and require technical expertise to price and complete successfully.  Read the article, with contributions from Chris Wood and Gillian Davidson.  The article first appeared in Insurance Day UK in October 2020.

Approaches to coronavirus report | July 2020

Global Insurance Law Connect this week launches its new report, “Approaches to coronavirus”. The report brings together the latest views on COVID-19 from Global Insurance Law Connect member firms in sixteen countries around the globe.

The report examines some of the common themes of coverage as well as legal and regulatory issues observed by the member firms. It also looks at the potential claims emerging and how the depth and breadth of those claims could impact a local insurance industry.

GILC member firm Sparke Helmore provided the commentary for Australia and noted that we are seeing COVID-19 have impacts in the travel, life, health, event cancellation and business interruption classes, where limits of coverage are being pushed in respect of losses associated with the pandemic. But we are also seeing impacts across liability, defence costs, financial lines and D&O classes. We think the majority of claims will be long tail claims, both in this pandemic phase but also when the recovery begins.

The Report covers Australia, Belgium, Brazil, China, England & Wales, Finland, France, Germany, India, Italy, Luxembourg, Mexico, Norway, Spain and Switzerland.

Click here to visit the Global Insurance Law Connect website. Click here to download the full report.

Risk Radar | April 2020

Global Insurance Law Connect (GILC) today launched its second annual Risk Radar report. The report pulls together the key themes from across the GILC network and gives a snapshot of the major issues that are currently bubbling up in each major insurance destination where the GILC has a presence—19 countries.

GILC member firm Sparke Helmore provided the commentary for Australia and noted that a number of issues stand out as having a significant impact on the local insurance industry and the way it operates.  The top three issues that stand-out in the Australia as creating significant headwinds for the local industry are:

• climate risk
• technology, and
• war for talent.

Shortly after our members drafted this year’s report, the world was shocked by the advent of the COVID-19 pandemic and we are already seeing COVID-19 have a significant impact across multiple lines of cover.  GILC will be publishing a separate guide dealing with specific coronavirus legal issues and I will share that with you in the near future.

The Risk Radar covers Australia, Belgium, Brazil, China, England & Wales, Finland, France, Germany, India, Ireland, Italy, Luxembourg, Mexico, Norway, Scotland, Spain, Switzerland, Taiwan and United States.

Click here to visit the Global Insurance Law Connect website. Click here to download the full report.

Annual Review 2019 | January 2020

Global Insurance Law Connect (GILC) this week launched its Annual Review for 2019. The compilation provides a consolidated look back at the most noteworthy articles on global insurance from major markets including Australia, Brazil, France, India, Italy, Norway, Switzerland, Taiwan, and United Kingdom—providing insight to the key issues faced by the ever-evolving industry throughout 2019.

Click here to download the full report.

Click here to visit the Global Insurance Law Connect website.

Spotlight on Emerging Markets | October 2019

As growth within the mature insurance markets stagnates, so carriers and brokers are looking for opportunities for growth in the emerging economies. When you consider that these countries include global economic giants China and India, you can see how important the “emerging” players are for insurers.

These markets are growing rapidly, which makes them exciting places to work and invest, but sometimes also higher risk. Each emerging market has its own complexities, its own legal structures, and often a distinct approach by its own government, which must be understood when considering growth prospects and possibilities for entering the market.

One of the strengths of Global insurance Law Connect is the wide membership among specialist firms in emerging (as well as established) insurance markets. As these firms have unique and well-recognised expertise in insurance law in their own markets, it was concluded that clients would find a spotlight on the local nuances of emerging market helpful—a “what’s happening now” guide for insurers who have an interest in this area.

In addition, the comparison of different markets allows readers to understand common and particular themes, and to see how different countries have tackled different growth, regulatory and economic issues. 

Click here to download the full report, which is accompanied by a seminar video series presented by GILC on each of the Emerging Markets, available here.

Click here to visit the Global Insurance Law Connect website.

Risk Radar | July 2019

Global Insurance Law Connect (GILC) this week launched its first annual Risk Radar report. The report pulls together the key themes from across the GILC network and gives a snapshot of the major issues that are currently bubbling up in each major insurance destination where the GILC has a presence—15 countries listed below. Click here to download the full report.

About GILC

Sparke Helmore Lawyers is proud to be a member of GILC and the sole Australian representative firm.

GILC is a formal network of leading insurance law experts with its formation inspired by client demand. The network is comprised of like-minded and high-performing independent firms from across the globe that specialise in insurance law. 

What makes GILC a stand-out is its special legal and risk interest groups. We see this collective contribution of local expertise from each of the member firms as a powerful proposition. There are currently 14 special interest groups including construction and cyber.

Click here to view the current GILC brochure (September 2023).

Click here to visit the Global Insurance Law Connect website.