Still flying high
The Australasian Professional Indemnity Group is celebrating three decades of connecting and educating professionals
By Wendy Pugh
Regulatory and legal changes, easing premiums, artificial intelligence and the search for talent are among the top topics in financial lines as the Australasian Professional Indemnity Group marks its 30th anniversary.
The group has focused on education and bringing people together since it started, to the benefit of participants across financial lines and buyers of insurance, president Mitchell Spurr says.
“We get better results for our clients at the end of the day when we’re all up to date on what the exposures are, what’s happening in the market, what’s happening in the industry, where prices are going or not going, maybe where there’s pressure and what sort of covers people need,” he tells Insurance News.
APIG was established in Melbourne in 1995 by Robert Mauldon, a pioneer in Australian directors’ and officers’ insurance. He is also credited with the association’s name and light-hearted acronym – early on the logo was a pink pig with wings.
Since then, the group has grown to about 1600 financial lines professionals across Australia and New Zealand and it hosts many events.
About 300 people are expected at the national conference at the Sofitel Sydney Wentworth on September 4, and typically more than 500 attend the associated gala dinner.
Mr Spurr says APIG provides opportunities for people “four steps removed from each other in the insurance process” to meet. Participants catch up on developments and learn what’s on the horizon in a sector with long timelines.
“We’re about giving resources to people at all levels. It’s not just brokers, it’s not just underwriters, it’s not just lawyers or claims people. It’s everyone.”
The long-tail nature of financial lines means years can pass before claims emerge, while a moving feast of legislative and regulatory changes, as well as court decisions, affects policies.
Significant decisions include the High Court’s Pafburn ruling last December on building defects and proportionate liability between parties, and the way that relates to the NSW Design and Building Practitioners Act.
“Those decisions impact, ultimately, an insurer’s liability, and we’re talking about risks that may have been written many years ago, even maybe before the act, and now you’re seeing claims,” Mr Spurr says. “Construction is a topic that comes up a lot.”
Securities class actions are another active and closely monitored area, with liability implications quickly flowing from the high-profile cases.
D&O premiums were surging a few years ago amid rising class action activity, but they are now declining amid a wider financial lines softening that is creating a different set of challenges.
New financial lines entrants have set up in Australia, providing cover in D&O, professional indemnity, cyber, crime, employment practices liability and other areas.
Mr Spurr says from an underwriting perspective, the environment heightens the focus on risk selection, which requires being well informed, addressing elements that can be controlled and knowing where room exists to move on pricing.
“In a good client-underwriter-broker meeting, hopefully you prompt the client to think about their risk management and improve their processes,” he says.
“It’s not just about selling an insurance policy to somebody and walking away, because that makes our industry less sustainable.”
Attracting talent to insurance remains a long-standing challenge, and financial lines has a lower profile than property, where loss impacts are more obvious. Mr Spurr, the professional indemnity underwriting manager at Probitas Pacific in Sydney, says once people enter insurance, they tend to remain, and financial lines is an expanding and rewarding area.
“We essentially insure intangibles and that can be quite challenging, but that’s what makes it interesting. You’re often crafting policies … for what can be known unknowns.”
For a decade, APIG has run a scholarship, supported by Wotton Kearney, that sends a young professional to an international industry conference.
Emerging financial lines issues include the growing use of AI, raising risks for insureds and for underwriters facing widening impacts.
“People who provide professional services are going to probably increasingly rely on technology and AI to help them do that, so that creates a different kind of exposure,” Mr Spurr says.
APIG’s membership has surged in the past decade – including during covid years, when online events were strongly supported – and while it has become larger and more sophisticated, Mr Spurr says the group remains volunteer-driven and its ambitions are consistent with early goals.
“It’s not an association that starts with an agenda beyond education, networking, leadership and bringing people together to talk about what’s happening in our industry, and I think that’s a really important role.”
