On page 22 of chapter 15 the notes refer to T&Cs and state "changes in these elements of cover tend to vary in relation to different phases of the underwriting cycle: as the market hardens, insurers remove or reduce the more optional - and often more expensive - parts of the cover, and these gradually come back in again as the market softens". As the market hardens, the premiums become more profitable for insurers - so why would they then remove the "optional and more expensive" parts of the cover at this point in the cycle, when they can afford it more? I guess you could counter this argument by saying that as the market hardens there is less competition, so less need to add optional parts to the cover to try differentiate from the competition. Thanks
I'd go for the last part of your explanation. The "optional" parts of the cover (riders) are offered to win over customers. When the market is hard, there are less competitive pressures and therefore less need to entice customers so these riders are not offered.
