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The Comeback Kid: Buffer Liability

The last time buffer liability insurance was in vogue, Ronald Reagan was in the White House. But now, the need for a buffer layer of excess coverage is emerging back into the structure of risk-sharing within the excess and umbrella insurance worlda sign that the market is transitioning from soft...

By Chad Hemenway | Updated on November 10, 2011
The last time buffer liability insurance was in vogue, Ronald Reagan was in the White House and Tom Cruise crooned “You’ve Lost that Lovin’ Feeling” with his flight-school buddies in the movie “Top Gun.”

“You have to go back to the hard market of about 1986,” says John S. Edack, senior executive vice president of casualty at Arch Insurance Group, recalling the last time buffer liability was as popular as it is becoming today (Edack remembers the term “buffer-ella” being coined during the previous hard-market cycle).

“Buffer is becoming more prevalent,” agrees James Drinkwater, president of AmWINS Brokerage. “It’s an old structure for risk—an old idea getting recycled.”

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