Softening market, rising risks: Aaron Woodhams on maintaining underwriting standards

Our Chief Underwriting Officer, Aaron Woodhams, recently spoke on the panel ‘Underwriting under pressure: discipline, disclosure and market behaviour’, at Insurance Post’s Underwriting Club 1, exploring how underwriters are navigating increasing market pressure. The discussion focused on underwriting discipline, disclosure challenges and how behaviour is shifting as conditions begin to soften. Aaron spoke with fellow industry experts Kathleen Durling, Underwriting director at Jensten Underwriting, and Alan Spivey, Divisional director, property & commercial at Touchstone Underwriting.

During the session, Aaron shared observations from our work here at Iprism, and emerging trends in the wider sector, highlighting concerns around pricing adequacy and technical underwriting standards in the market.

Market pressure and underwriting discipline

Aaron explained that the business is seeing a growing number of risks being presented that have previously been placed elsewhere, but where coverage and pricing raise concerns. ‘Looking at our own portfolios, we are seeing a lot of stuff coming to us from other markets where the endorsements are not correct, there is incorrect coverage, and there is a lot of stuff out there which is heavily under-priced.’

The panel agreed that this is an industry wide issue, exacerbated by the softening market. Aaron recognised the need for quality support and training for upcoming underwriters as the market continues soften, and pressures rise. ‘Some underwriters don’t understand the risk. There is a lot of inexperienced people out there in the industry which due to the soft market have been forced to write outside of their expertise.’

His comments reflected a wider theme from the panel: the softening market can put pressure on underwriters to compete at the expense of technical discipline and deep understanding of the risk.

Preparing underwriters for a changing market

Aaron also spoke about how we are preparing our underwriting teams, particularly those who haven’t yet have experienced a softer phase of the cycle. He shared our recent dedication to internal workshops and training sessions to help our teams better understand how the market behaves during these periods and how to assess the quality of risks being presented. As these challenges grow, our aim is to help underwriters recognise the difference between opportunities that are well-priced and those that may reflect poor market practice.

As Aaron described, the goal is to highlight the difference between those prioritising profit over discipline, and ‘who is being good’.

Underinsurance and longer-term market impact

Another key topic raised during the discussion was underinsurance, which continues to be a growing issue across the market. Kathleen Durling, underwriting director at Jensten Underwriting, noted that many risks are being quoted on lower declared values than the full exposure, agreeing with Aaron’s observations around competitive pressure and underwriting behaviour.

The panel concluded that these practices are unlikely to only affect the market in the short term, but may also have consequences for rates and sustainability in the years ahead if they continue.

Maintaining standards as the cycle shifts

As Aaron clarified, here at Iprism we prioritise strong underwriting standards, even as market conditions evolve. Ensuring teams remain technically confident, well trained and able to challenge risk quality will be essential as competition increases and the cycle continues to shift. While pricing pressure may fluctuate, consistent discipline and a deep understanding of risk are key to ensuring long-term market stability.