AXA XL has taken over from AIG as the leading directors and officers (D&O) insurer, now commanding a 15% market share, according to analysts at Fitch Ratings.
Fitch noted that perennial market leader AIG has conceded significant market share over the last several years in an effort to reposition its book of business and improve profitability.
This trend continued through 2019 and the company had a strong influence on market direction by pulling back on underwriting limits and capacity this year.
D&O insurance is a relatively small specialty segment of the property and casualty (P&C) market, representing approximately 1% of total industry direct premiums.
At year-end 2018, the 10 largest D&O writers held a combined 70% share of all direct premiums, Fitch reported, and only 35 individual organisations wrote greater than $10 million of D&O direct premiums.
Historically, the three largest writers consistently have been AIG (with 13% of 2018 industry direct written premiums), Chubb (12%), and AXA XL (11%).
Fitch believes that these three companies will remain relatively close as the top three D&O underwriters going forward, although it warned that AXA XL may not maintain the top position in the longer term.
Several underwriters also expanded or gained entry to the D&O market in recent years via acquisitions, Fitch observed.
These include: Chubb, through its merger with Ace Group; AXA Group, via the acquisition of XL Group; Tokio Marine US, via HCC Insurance Holdings; and Sompo Group with the purchase of Endurance Specialty Holdings.
Berkshire Hathaway represents the one leading insurer that has expanded organically in D&O over the last several years, Fitch noted, moving to the eighth largest market participant at mid-year 2019, up from ninth in 2018.
