AIG Israel Insurance Company Ltd. is considering providing professional liability for investment houses and other financial institutions in response to the difficulty in finding reinsurers in the sector. AIG Israel will apparently offer the professional liability beyond what is offered by the reinsurance unit of American International Group Inc. (NYSE: AIG), AIG Israel's parent company.
AIG Israel said in response, "We're examining entry into every insurance sector that can contribute to the company's profits, including all types of professional liability."
Last week, sources said that Israel Phoenix Assurance Ltd. (TASE: PHOE1;PHOE5) would begin providing professional liability after organizing a syndicate of four reinsurers for these policies, three of them from the Lloyds market. With this move, Phoenix joins Harel Insurance Investments and Financial Services Ltd. (TASE: HARL) in providing professional liability and finding its own reinsurance solution for the sector, and Menorah Mivtachim Holdings Ltd. (TASE: MORA), which is the leader in the Israeli professional liability market and is expected to stay in it even if its market share is reduced.
Insurance agents are also a factor in these arrangements, due to the severe problem faced by their investment house and financial institution clients, which are struggling to obtain legally mandated professional liability insurance.
Published by Globes [online], Israel business news - www.globes-online.com - on January 19, 2009
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