IUA and Airmic push outcome-based insurance to close protection gaps

Tom Hughes, Director of Underwriting at the IUA, said there is consensus among underwriters and insurance buyers that the protection gap is real, structural, and growing. “Both parties want a different conversation and getting that conversation right is the key to ensuring the long-term value of the insurance industry.”

Hughes added that the IUA and Airmic will work together to promote greater communication and knowledge sharing. “A better understanding of clients and risk profiles is in the interests of all and will result in better pricing, fewer disputes, and longer-term relationships.”

Diane Maxwell, CEO of Airmic, said the industry faces a widening protection gap as organisations confront an unprecedented convergence of emerging risks. “They are creating exposures which existing products, distribution channels, and capital structures do not fully address.”

The report also recommends reviewing how policy exclusions are finalised for major classes of business and developing new approaches to testing wordings against loss scenarios.