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Non-medical professional liability

The market represents nearly $16 billion in premium

The non-medical professional liability market provides $15.9 billion in E&O/professional liability premium, according to data compiled by MarketStance, Middletown, Connecticut. It is a highly diverse category, covering more than 50 different NAICS classes. However, the majority of the premium resides in the top 10 niche markets, which provide $10.5 billion in premium, or 66.2% of the total. The top two niches, engineering services and offices of lawyers, account for nearly half of the total. These are the only two niches that provide more than $1 billion in premium, with engineering services accounting for $4.3 billion and offices of lawyers, for $3.5 billion.

Much of this market remains unpenetrated by the industry, with the majority of the firms in each niche currently being uninsured. Offices of lawyers ranks highest in terms of percentage of entities covered with only 40.1%, followed by securities brokerage firms and offices of CPAs, both at 29.7%. There are a plethora of niche areas where less than 20% of the entities have coverage.

Four niche classes within this category are expected to show better than a 10% average annual sales growth, according to MarketStance, making them possible targets for niche programs, although each represents relatively small total professional liability premiums at the moment. They are other telecommunications firms, with expected sales growth of 16.2%, followed by computer facilities management services (11.7%), Web search portals (10.7%), and Internet service providers (10.7%). Other telecommunications businesses represent professional liability premiums of $3.0 million, computer facilities management services provide $15.4 million, Web search portals account for $7.0 million, and Internet service providers have $6.3 million. It should also be noted that most of the businesses in each of these three categories remain uninsured, with less than 16% of the entities actually having professional liability coverage.

For more information on the professional liability market or other niche markets, call MarketStance at (888) 777-2587 or e-mail info@marketstance.com. *

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