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Asset management market update – Q2 2020

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By Timothy M. Sullivan | August 11, 2020

A series of insights diving into the latest liability insurance market trends, issues and activities for non-publicly traded asset managers and their sponsored funds.

We are pleased to present FINEX’s Asset Management market update for Q2 2020. In this issue, we explore the current state of the market for Directors’ & Officers’ and Errors & Omissions (D&O/E&O) liability insurance for Asset Managers and their sponsored funds. Many of the issues addressed in this edition apply to both publicly traded and privately held Asset Managers. However, the scope of our insurance market commentary does not extend to public company D&O insurance, which is addressed separately in our Marketplace Realities publication.

With the first half of 2020 now behind us, we can say with confidence that virtually all industries are in the midst of a challenged insurance market with no immediate relief in sight. Asset Management D&O/E&O premiums are generally increasing by 10-15% on a primary basis, with excess insurers either following the primary or pressing for greater increases when current premiums are deemed insufficient. With some exceptions, however, Asset Management is generally considered to be the most desired sub-sector of the Financial Institutions industry, often realizing more favorable renewal results than other sub-sectors, such as Insurance and Banking.

In this edition, we also highlight some of the new and emerging issues impacting the Asset Management industry more broadly. Noteworthy items discussed include the continued and evolving implications of COVID-19, the heightened Cybersecurity risks arising from the pandemic, and increased pressure on regulators regarding ESG-related disclosure requirements. The implications of these issues on a firm’s risk profile and D&O/E&O insurance programs are also addressed.

We expect that both the D&O/E&O insurance market and the Asset Management industry will continue to face numerous challenges in the second half of 2020. However, we hope this publication offers valuable insights as to how to successfully navigate through these turbulent times. Should you have any questions or would like to discuss any of these issues in greater detail, please reach out to myself or any member of your Willis Towers Watson team.


Table of Contents


  1. 01

    Asset management market update, Q2 2020

    Timothy M. Sullivan | August 11, 2020

    A deep dive into the D&O/E&O insurance market, including a focus on cost, markets, targeted segments, capacity and coverage.


  2. 02

    Asset management industry trends, Q2 2020

    Timothy M. Sullivan | August 11, 2020

    Key issues for non-publicly traded asset managers surrounding top industry concerns.


Disclaimer

Each applicable policy of insurance must be reviewed to determine the extent, if any, of coverage for COVID-19. Coverage may vary depending on the jurisdiction and circumstances. For global client programs it is critical to consider all local operations and how policies may or may not include COVID-19 coverage. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal and/or other professional advisors. Some of the information in this publication may be compiled by third party sources we consider to be reliable, however we do not guarantee and are not responsible for the accuracy of such information. We assume no duty in contract, tort, or otherwise in connection with this publication and expressly disclaim, to the fullest extent permitted by law, any liability in connection with this publication. Willis Towers Watson offers insurance-related services through its appropriately licensed entities in each jurisdiction in which it operates. COVID-19 is a rapidly evolving situation and changes are occurring frequently. Willis Towers Watson does not undertake to update the information included herein after the date of publication. Accordingly, readers should be aware that certain content may have changed since the date of this publication. Please reach out to the author or your Willis Towers Watson contact for more information.

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Asset Management Industry Leader, Willis Towers Watson

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