Lockton shares tips on navigating XOL insurance renewals amid market challenges
Lockton shares tips on navigating XOL insurance renewals amid market challenges | Insurance Business Australia
Insurance News
Lockton shares tips on navigating XOL insurance renewals amid market challenges
Guide emphasises importance of preparation, information, and relationships
Insurance News
By
Roxanne Libatique
Lockton has released a guide to help insurers secure the most favourable terms for their excess of loss (XOL) renewals amid challenging conditions.
The guide, titled “Excess of Loss (XOL) Insurance: Renewal Guide 2024,” offers a roadmap for navigating renewals strategically, emphasising the importance of preparation, information, and relationships in securing favourable outcomes.
How to achieve optimal XOL renewal outcome
Early engagement in the renewal process
Lockton emphasised the importance of beginning the renewal process well ahead of the expiration date. This early start allows brokers and self-insurers ample time to assess the existing program, consider any necessary adjustments, and address the increasingly detailed information requirements from reinsurers.
Comprehensive program analysis
Before entering the renewal phase, it’s crucial for self-insurers to conduct a detailed review of their XOL insurance program. This involves evaluating factors like past claims, risk tolerance, and financial capacity to determine the most suitable Self-Insured Retention (SIR) level.
Thorough information provision
Lockton advises self-insurers to supply comprehensive data to their reinsurers. Providing full and accurate information enables reinsurers to assess the renewal application thoroughly, facilitates smoother negotiations, and can lead to more favourable renewal outcomes.
Implementation of robust claims estimation and notification processes
Insurers favour clients who have established effective procedures for estimating and reporting claims. Lockton suggests that if organisations haven’t already set up such processes, doing so before the renewal can positively influence the renewal outcome.
Fostering strong relationships with reinsurers
The role of the broker is highlighted as critical in building and maintaining relationships between self-insurers and their reinsurers. Lockton pointed out that established relationships can be particularly advantageous during the renewal process, offering opportunities for better communication and understanding between parties.
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