QBE's Lessman: M&A Market Boom Boosting Claims, Pricing for Transactional Insurance
Mergers & acquisitions reached record levels in 2021, which could result in higher claims for reps & warranties insurers, said Toria Lessman, senior vice president and head of transactional liability for QBE North America. She spoke with Insider Engage at RIMS 2022 in San Francisco.
How would you describe the current M&A market? What trends are you seeing?
2021 was a year unlike any other for transactional liability. Deal flow was at an all time high and while we've seen a little bit of a slowdown in the first quarter of 2022, deal flow still remain strong. Pricing towards the end of 2021 was also at a record high. We have seen it come down a little bit but rates are still healthy and it's a very stable environment. We're also seeing deals using reps and warranties insurance in sectors that historically had not. So we're really excited about the year ahead.
What claims trends are you seeing?
With the uptick in deal activity, we expect to see more claims being reported. Nothing scary, nothing that anyone's concerned about, but we do expect that. The other thing is that we're taking lessons learned from claims and using that in our underwriting. So you may see some differences in pricing terms depending on the sector. But here at QBE we understand that paying claims is an integral part of the marketplace and is very important to us.
What do you see in the future going forward?
Deal flow continues to remain strong. There is some uncertainty out there with some potential supply chain issues, the war, inflation and some potential changes in the tax law. But here at QBE, we're very excited about the year ahead, and we've positioned ourselves really well for 2022.