The recently released Global Claims Review of major insurer
Allianz revealed that the US is still the world’s largest liability market, “generating both the highest number of claims and many of the largest claims according to value.”
It stated that claims exceeding $1 billion are becoming more commonplace and globalized. One factor, Allianz said, is the tougher regulations that are being adopted in Europe, as well as the increasing complexity of supply chains and the emerging ubiquity of US style litigation. Increased compensation awareness is also contributing to the upward trend in claims, Allianz explained.
The insurer also outlined that “digitalization and the growing use of new technologies are likely to lead to a further shift in the liability risk landscape.”
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Car insurance claims are expected to go down as autonomous cars take over and make the roads safer, but cyber, product liability and recall risk are expected to cause an increase in liability.
The Claims Review analysed over 100,000 corporate liability insurance claims from more than 100 countries, with a total value of $9.3 billion paid by Allianz and other insurers between 2011 and 2016.
According to the data, product recalls were the costliest liability accounting for 23% of the total value of claims, with companies recording an average loss of $228,000 with the cost of product recalls being a major factor in the claims.
Collisions and crashes was the second most common cause for claims, accounting for 22% of the total value of claims made in the relevant period.
Human error comes in at third cutting a 19% share of the claims pie as it results in major losses such as aviation and shipping events or employee injury, the report said.
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