Griffiths & Armour Europe DAC PII

the most difficult in a generation. Despite that, we have retained insurer support for our facilities and at a time when all Insurers are looking to restrict cover, the breadth of protection under those facilities continues to be broader than that generally available in the insurance market. But we are not completely immune from conditions within the wider market and we fully appreciate the fact that 2021 is going to present challenges in a number of areas:

Fire Safety

Fire safety risks will continue to dominate discussions; the tragic fire at Grenfell Tower in London has understandably raised the profile of such issues and resulted in more detailed underwriting assessments. The combustibility of cladding is possibly less of a concern in Ireland given the nature of our building stock, but fire safety is a recurring theme and particularly so when it comes to legacy risk and ‘Celtic Tiger’ era developments. But what these developments, and indeed Grenfell, have brought home to insurers is the catastrophic nature of the risk, the unknown perils that can exist and the need for them to manage their potential portfolio exposure. As a result, the wider market is seeing restrictions being introduced but to date, there is no ‘market standard’ approach as such; some insurers simply avoid risks that have exposure to multi-unit developments, others will look to restrict cover to aggregate and some will apply inner limits etc. An increasing number will not underwrite ‘fire safety’ cover at any price. The insurers who take that last view are far from being on the ‘fringe’. There will be some insurers who may continue to provide cover on an ‘each and every claim’ basis, but that would tend to be under an ‘off the shelf’ policy wording that would not provide sufficient protection in other areas, such as for liability assumed under contract. There are clear concerns around the long-term viability of such products too. It is our view that policies which continue to offer this cover ought to be viewed with caution and some concern as to their likely availability in the medium term. In assessing the Scheme position on cover for fire safety risks, we need therefore to do so in the context of the conditions that prevail within the PI Insurance market generally. Our Scheme is not immune from what is happening in the wider market and the difficulty we have faced in resisting insurers efforts to introduce some restriction is that without conceding some ground we are all but certain to lose their support altogether. It is not a hyperbole to suggest that without some sort of action in this area, our Schemes for construction consultants would not have renewed.

Of course, our Schemes are more than just about measuring the extent to which we can insure fire