A softening market has seen the price of insurance limits in the technology, media and telecommunications (TMT) sector drop by almost 20% in the past two years, according to Marsh. However, its new report, Managing liability in the technology, media and telecommunications sector, finds that companies are not taking advantage of the softer market to purchase greater coverage, despite rising risks.
The firms benchmarked in the UK purchased €53m in limits on average, while the median was €36m. This differential may be attributed to the larger firms in the survey buying higher levels than their peers, suggesting a lack of awareness by the middle market sized firms on their liability exposure.
Convergence of the sectors is gathering pace, with telecommunication companies now offering fast access to the media through broadband connections, mobile phones downloading MP3 files and other content, and distinctions between transmitters of information and suppliers of information are blurring. This convergence is increasing professional liabilities, such as a virus being transmitted through a company's website, and highlights the rise of technical risks that need to be addressed and insured.
