Aon Study Highlights Key Market Differentiator in Insurance Sector | Insurance business America
Experts noted a new focus among customers in an evolving landscape
The latest Global Transaction Solutions Claims Study from Aon and Mergermarket highlights the importance of claims processing by insurers in the transaction solutions insurance market. Despite a slowdown in M&A activity and representation and warranty (R&W) policy placements in 2023, Aon clients continued to achieve positive results in the claims process, it said.
The study found that Aon customers filed over 140 new R&W claims last year, bringing the total to more than 950 in North America by 2023. Of these claims, 39% were settled within the policy deductible, 17% resulted in payments from the insurer, 24% remained active, 16% are inactive and 4% were denied.
R&W insurers have paid over $1 billion to Aon customers in North America, including $550 million in the last three years. Claims filed over a 12-month period after the transaction closed resulted in payments of more than $300 million. In EMEA, insurers have paid out over $120 million, including more than $20 million since the last report. In Australia and New Zealand, claims have continued to be made under one of five guarantee and indemnity (W&I) insurance policies since 2012.
The competitive landscape in 2023 was characterized by lower prices and expanded insurance coverage, with insurers’ claims performance emerging as a critical factor. Customers today value fair and efficient claims processing processes rather than mere pricing.
“It is critical for our clients to gain insights into global M&A insurance claims activity to effectively manage risk,” said Stephen Davidson, Head of Claims for Transactional Solutions at Aon. “A collaborative approach between stakeholders is essential to a smooth claims process. When we see this collaborative approach, in most cases we see positive and appropriate solutions for Aon customers.”
Aon Transactional Risk Solutions
Aon helped customers resolve over 150 new claims in North America and 48 in EMEA in 2023. In Australia and New Zealand, claims rates have historically been stable at almost one in five policies. The study now includes more comprehensive data from North America and EMEA, with 18 insurers participating in Aon’s North America survey and 14 participating in the EMEA survey.
“At Aon, we always strive for affordable solutions, which reflects our commitment to customer satisfaction,” said Claire Fleetwood, senior claims advocate for M&A and transaction solutions at Aon.
In 2023, Aon helped clients protect against losses of nearly $250 million in North America and nearly $50 million in EMEA and APAC.
“As the transaction solutions market matures, experienced buyers will gain greater insight into claims processing across the industry,” said Anthony Dragone, senior vice president of the claims team, M&A and transaction solutions at Aon.
Key results of the study:
- R&W insurers paid over $1 billion to Aon customers in North America by 2023.
- Compliance with laws has become the third most important driver of losses.
- The average loss estimate for damages discovered between 2020 and 2023 rose to $13 million.
- Industries showed different types of violations:
- Compliance breaches were common in the retail and consumer sectors.
- There were more serious breaches of contract in the financial services sector.
- Energy suppliers reported violations of asset representation more frequently.
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2024-05-24 04:20:00
www.insurancebusinessmag.com
