Alert AIG Exits PLL Market
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AIG announced internally that they are exiting the Site- Specific Pollution Liability (PLL) market effective immediately. There has not yet been a formal, external announcement to the marketplace. In speaking with senior AIG Environmental personnel, Willis Towers Watson Environmental has the following information at this time: No new business will be quoted effective immediately for the U.S. and Canada. Open PLL quotes for new business and renewals will be honored up until the expiration date of same (generally 30 days from the quote date). Extensions (typically 30-60 days) for expiring/renewal policies may be considered based on individual circumstances. Extended reporting periods (ERP) and other policy terms and conditions within in-force PLL policies will stand. It is reasonable to expect that full ERP fees will apply if such an extension is requested. In-force PLL accounts will be notified of AIG’s intent to non-renew. As such, alternative markets will have to be considered for renewal terms. Coverage will reportedly continue to be available for risks outside of the U.S. and Canada via AIG underwriting offices outside the U.S. and Canada. However, those offices will not be extending coverage to U.S. or Canadian locations. Long-term PLL policies currently in force will likely be moved to a run-off facility but will reportedly continue to be managed by AIG Environmental underwriters for mid-term servicing needs such as location additions/deletions. Consideration may be given to cancelling in-force, long- term PLL policies. However, the possible waiver of minimum earned premiums will be addressed case by case. AIG will continue to write Contractors Pollution Liability (CPL) business, combined GL/PLL (EAGLE) business, and Underground Storage Tank (UST) liability business. These lines will continue to be handled by AIG Environmental personnel. However, if there is PLL coverage tied into one of these products (e.g., separate policy with linked limits or “side-car” via endorsement), it is very likely that these extensions will not be renewed. Obviously there is quite a bit to iron out here, and Willis Towers Watson is actively working to address this unprecedented situation with our clients. It is most important that we work together to assess the best possible approach to the unique elements of each client’s individual PLL program. Now is not a time for hasty actions. Despite a robust PLL marketplace, AIG has historically written more challenging risks, in a wide variety of business classes. Thus the appetite for same may or may not exist in the market. In addition, achieving the exact same terms, conditions and rates may not be viable. However, Willis Towers Watson and its Environmental Practice maintain very strong relationships with all of the major carriers in the PLL product line space and are dedicated to achieving the best possible outcomes for our clients. We have the depth and breadth of resources and expertise in our practice to offer strong alternatives. Alert AIG Exits PLL Market January 2016
Transcript of Alert AIG Exits PLL Market
AIG announced internally that they are exiting the Site-Specific Pollution Liability (PLL) market effective immediately. There has not yet been a formal, external announcement to the marketplace. In speaking with senior AIG Environmental personnel, Willis Towers Watson Environmental has the following information at this time:
�� No new business will be quoted effective immediately for the U.S. and Canada.
�� Open PLL quotes for new business and renewals will be honored up until the expiration date of same (generally 30 days from the quote date).
�� Extensions (typically 30-60 days) for expiring/renewal policies may be considered based on individual circumstances.
�� Extended reporting periods (ERP) and other policy terms and conditions within in-force PLL policies will stand. It is reasonable to expect that full ERP fees will apply if such an extension is requested.
�� In-force PLL accounts will be notified of AIG’s intent to non-renew. As such, alternative markets will have to be considered for renewal terms.
�� Coverage will reportedly continue to be available for risks outside of the U.S. and Canada via AIG underwriting offices outside the U.S. and Canada. However, those offices will not be extending coverage to U.S. or Canadian locations.
�� Long-term PLL policies currently in force will likely be moved to a run-off facility but will reportedly continue to be managed by AIG Environmental underwriters for mid-term servicing needs such as location additions/deletions.
�� Consideration may be given to cancelling in-force, long-term PLL policies. However, the possible waiver of minimum earned premiums will be addressed case by case.
AIG will continue to write Contractors Pollution Liability (CPL) business, combined GL/PLL (EAGLE) business, and Underground Storage Tank (UST) liability business. These lines will continue to be handled by AIG Environmental personnel. However, if there is PLL coverage tied into one of these products (e.g., separate policy with linked limits or “side-car” via endorsement), it is very likely that these extensions will not be renewed.
Obviously there is quite a bit to iron out here, and Willis Towers Watson is actively working to address this unprecedented situation with our clients. It is most important that we work together to assess the best possible approach to the unique elements of each client’s individual PLL program. Now is not a time for hasty actions. Despite a robust PLL marketplace, AIG has historically written more challenging risks, in a wide variety of business classes. Thus the appetite for same may or may not exist in the market. In addition, achieving the exact same terms, conditions and rates may not be viable. However, Willis Towers Watson and its Environmental Practice maintain very strong relationships with all of the major carriers in the PLL product line space and are dedicated to achieving the best possible outcomes for our clients. We have the depth and breadth of resources and expertise in our practice to offer strong alternatives.
AlertAIG Exits PLL MarketJanuary 2016
Contact
If you have any questions, please contact your client service team or feel free to contact me directly.
Richard M. Sheldon, Jr., ARM Environmental Practice Leader/Head of Environmental Broking Willis Towers Watson T +1 610 254 5625 M +1 610 639- 416
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