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D&O Insurance in Switzerland

Table of Contents

Executive Summary

Introduction

Market Analysis

Appendix

List of Graphics / Tables

 

0.0 EXECUTIVE SUMMARY

1.0 INTRODUCTION

What is this report about?

Rationale

Several factors underpin the rationale for the production of a study about D&O insurance

Methodology

Research program

Market data analysis

Definitions

D&O insurance

Policies are usually taken out by companies rather than by company managers…

… and typically pay for both defence costs and the damages paid to the claimant

D&O insurance can be bought by a variety of different types of entity

In Europe, policies typically incorporate Side A and Side B cover but not always Side C cover

Stand-alone cover bought for certain specialised risks is excluded from the definition of D&O insurance

Premiums

Sectors

Abbreviations

Finaccord

2.0 MARKET ANALYSIS

Introduction

Regulatory background

Swiss stock corporations do not have to be structured with a two-tier board model

In certain circumstances, both directors and other managers may be held personally liable…

… and they cannot contractually limit their liability towards their company

There are no provisions under Swiss law dealing specifically with D&O insurance

Number of insurable entities

The number of publicly listed companies in Switzerland has fallen slightly since 2010…

… although unlisted enterprises with an annual turnover above EUR 10 million have grown in number

Market value, growth and segmentation

The Swiss D&O insurance market is well-developed but delivering little growth…

… having previously risen in value in the wake of the bankruptcy of Swissair in 2001

Stagnation has come about in part through sharply falling premium rates

Publicly listed companies account for slightly over a half of the total Swiss market value…

… with around 30% due to the manufacturing and primary sectors

Lloyd's of London has significant representation in the Swiss market

Penetration levels

A rising proportion of unlisted entities with annual revenues above EUR 10 million is buying D&O cover…

… meaning that there are around 2,800 insured firms in this category

Underwriter market shares and specialisms

Four underwriters are regularly used for D&O insurance by more than a half of brokers surveyed…

… and nine are believed to hold a market share of 5% or more

Zurich is likely to be the market leader in Switzerland by a narrow margin

AXA is strong among SMEs while ACE is mainly focused on large corporate customers

As in other countries, Allianz is active through both AGCS and its local insurance business

Several indigenous underwriters are known to reinsure most or all of their D&O portfolio

Key brokers and broker specialisms

Brokers account for the lion's share of distribution of D&O insurance…

… with Kessler, Aon and Funk Gruppe likely to be the most influential

Trends in claims and key risks

Switzerland is characterised by comparatively low claims ratios for D&O insurance…

… partly because claims notifications tend to be settled at an early stage

Future outlook

Market growth may be driven by achieving higher penetration among uninsured SMEs

3.0 APPENDIX

Brokers and insurers participating in the survey

4.0 LIST OF GRAPHICS / TABLES

0.0 EXECUTIVE SUMMARY

Key market data for D&O insurance in Switzerland

1.0 INTRODUCTION

2.0 MARKET ANALYSIS

Number of entities by legal structure and sector in Switzerland, 2014

Premiums for D&O insurance and the percentage of the total general liability insurance market that this represents in Switzerland, 2010 and 2014

Segmentation of D&O insurance premiums in Switzerland between publicly listed corporate enterprises, unlisted corporate enterprises and other organisations, 2014

Segmentation of D&O insurance premiums in Switzerland between the financial services sector, the non-financial services sector and the manufacturing / primary sector, 2014

Ratio of D&O insurance premiums to gross value added in the financial services sector, the non-financial services sector and the manufacturing / primary sector in Switzerland, 2014 (table)

Ratio of D&O insurance premiums to gross value added in the financial services sector, the non-financial services sector and the manufacturing / primary sector in Switzerland, 2014

Segmentation of D&O insurance premiums in Switzerland between underwriters based in Switzerland and underwriters based abroad, 2014

Proportion of publicly listed corporate enterprises and unlisted corporate enterprises with revenues above EUR 10 million with D&O insurance in Switzerland, 2014

Frequency of usage of specific insurance underwriters by major brokers of D&O insurance in Switzerland, 2014

Estimated market shares of D&O insurance premiums of underwriters in Switzerland, 2014

Segmentation of claims costs between defence costs and other claims costs in Switzerland in a typical year

Forecast premiums for D&O insurance in Switzerland, 2018

3.0 APPENDIX

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