PVT insurance market growing amid increased global political instability: Miller’s Floyd

By Mia MacGregor

May 16 - (The Insurer) - As global political tensions escalate, the political violence and terrorism (PVT) insurance market is experiencing increased competition and capacity, according to James Floyd, head of terrorism and political violence at specialty broker Miller.

Speaking to The Insurer at RIMS' Riskworld conference in Chicago, Floyd described the current environment as "an exciting time to be a broker in our market, and a good time to be a client as well".

He noted the challenges posed by conflicts in regions such as Russia, Ukraine, Israel and Gaza, coupled with broader global political instability and macroeconomic policies that heighten tensions among major players.

Despite these challenges, Floyd said that new entrants and expanded capacity in the PTV market are driving competition and exerting downward pressure on rates.

“We've had a number of new entrants over the last year or so, which has massively stimulated competition, and it's definitely putting pressure on rates,” he said.

"We're seeing more of a softer market condition," Floyd added, noting a shift from the previous hardening period after the war in Ukraine began to a more favourable rate environment.

ACTIVE ASSAILANT SEGMENT GROWTH IN US MARKET

Floyd pointed to active assailant coverage in the U.S. as a rapidly expanding segment of the PVT market.

He explained that the rise in gun violence since the COVID-19 pandemic has prompted insurers to address this exposure, with exclusions increasingly appearing in general liability programs. This presents opportunities for the PVT market to fill coverage gaps, according to Floyd.

“In the last five to 10 years, we have seen the evolution of the activist assailant space, and that's definitely coming more and more to the forefront of clients' minds. We're seeing more interest, as well as increased uptake,” he explained.

Traditionally, coverage has focused on sectors with high public exposure, such as sports, entertainment, healthcare, education and public sector municipalities. However, Floyd noted a shift, with interest now extending to clients in diverse sectors, including manufacturing.

“All you need is one disgruntled employee who is angry, potentially with a weapon, and that situation can easily escalate from something quite small into a more serious event.”