Any transfer of risk to an insurer is an uncertain hedge against loss!

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This is because an insurance carrier cannot be your business partner, despite marketing to suggest otherwise!

Their relationship with you is one of "counter-party to a contract of insurance" and, as such, they need to protect their own interests. One way is getting better at managing their financial exposure to loss through much smarter, data-led, underwriting of each policyholder.

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This is becoming especially important in relation to high-severity risks, such as those covered by Professional Indemnity, Cyber Risks, Intellectual Property Rights and other legal liability insurance, which are increasingly managed by the introduction of sudden and unexpected restrictions on the scope and levels of cover provided.

Even our most seasoned insurance wording specialists find it difficult to assess the efficacy of coverage, from an Insurer's "product summary" for these types of insurances, without full examination of the clauses, definitions, conditions and exclusions in policy documents that may run to 100 pages
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That said, the insurance market for the evolving tech business sector was generally soft for insurance buyers over the past 10 years. Which has meant that an abundance of competition from every kind of insurance provider drove low premiums and broad cover. 
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Unfortunately that softness was not sustainable for very long; which is why a general insurance market correction has been underway since 2020.

 

Making it doubly important to fully review your insurance programme and placing arrangements every year.