FOR IMMEDIATE RELEASE February 3, 2016
Major supplier of Product liability insurance exits marketplace
(Los Angeles, CA). Lexington Insurance Company, a subsidiary of American International Group, has decided to immediately stop offering product liability insurance to the dietary supplement industry. All current Lexington policyholders will receive a notice of non-renewal when their renewal date approaches. This decision will affect the industry across the board: raw materials suppliers, contract manufacturers and retailers.
“This could have a negative impact on premiums for product liability” notes Greg Doherty, EVP and Dietary Supplement Practice leader for Bolton & Company Insurance Brokers. “Lexington tended to target larger accounts in the industry, and for accounts that they liked, they were extremely competitive. The prospect of higher premiums for companies currently insured by Lexington is very real.”
Adds Doherty, “While I don’t think this signals a meteoric spike in premiums overall, as happened in the early 2000’s, it is definitely a reduction on the supply side of the equation, in an already narrow market. That’s Economics 1A. All else being equal, some companies are going to pay more than they are now.”