Commercial Market to Remain Stable, Challenging for Risk Managers: Marsh

Despite the global economic crisis, the commercial insurance market is poised to remain stable through 2010, but new challenges are emerging for risk managers, according to a report issued by insurance broker Marsh.

The financial crisis has brought risk management to the fore within and beyond finance and treasury departments and global risk managers are being challenged by new boardroom demands of insurer security, balance sheet transparency, and heightened accountability, according to Marsh’s report, “Competition Nets Rewards — Multinational Client Service Insurance Market Report 2010.”

“With the ever-increasing complexity of global exposures, successful risk management today depends on timely information, regulatory awareness, and thoughtful anticipation of the range of local and global scenarios,” said Hank Allen, president, Marsh Multinational Client Service. “For global risk managers, the extent of their visibility — extended to the highest levels of their organizations—is the new world of financial risk and accountability.”

Marsh’s report indicates the continuation of stable market conditions in 2010, as illustrated by regional trends:

Marsh’s report further indicates a need to monitor global insurance and tax regulations, which are being enforced more vigorously than in the past. In the European Union, Canada and elsewhere, tax authorities have begun to challenge multinational companies’ insurance programs with a view to assessing and collecting unpaid premium-related taxes — a trend that is likely to escalate.

Risk managers should also monitor several local trends, according Marsh’s report: