Commercial Lines Market Trends Report–Q4 2023

Commercial Lines Market Trends Report–Q4 2023 | Property & Casualty

Commercial Insurance Market Rates Increased by 7%

Recent data from the Council of Insurance Agents &Brokers (CIAB) reveals a steady rise in commercial property and casualtyinsurance premiums over the past 25 quarters. Average rates have increased by 7%across all account sizes, clients are experiencing rate fatigue and growingdisillusioned with their insurance partners.

Despite the continuous increase, most lines experiencedlower average rate hikes than Q3 2023. Notably, D&O premiums faced a slightrise of 0.1%, while cyber liability increases dropped below 1% for the firsttime since the onset of the pandemic. The commercial property market,witnessing the highest increase among all lines, saw moderated increasesreduced to 11.8% from 17.1% in Q3 2023. Workers’ compensation sustained itseighth consecutive quarter of decline, with an average decrease of --1.8%.

Commercial Insurance Property Market Dynamics

Marking a year of double-digit increases, commercialproperty premiums slightly lowered to an average of 11.8% this quarter. Thesecontinued surges are due to exorbitant reinsurance costs and limited capacity worsenedby severe weather conditions and economic challenges. The rising cost ofmaterials, reduced capacity and underwriter demands continue to impactpolicyholders. Insureds should expect underwriter demands for updated propertyvaluations and detailed property exposure information such as roof age and windexposure.

Commercial Insurance Claims & Market Demand

 Commercial insurance claims and market demand areintricately linked, with property and auto claims playing pivotal roles inshaping premium rates and underwriter scrutiny. While these sectors havehistorically been subject to significant pressure due to rising claim volumes,the latest CIAB Q4 2023 data suggests a slight moderation in the increase ofclaims. Despite this, insurers continue to closely monitor these areas,recognizing their potential impact on overall market dynamics and insurancepricing.

 

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Cyberthreats continue to become more advanced and difficultto detect. Organizations across all industries are prioritizing robustcybersecurity measures and insurance coverage to protect their digital assetsand reduce financial losses. Additionally, commercial property insurancecoverage remains in high demand as businesses seek comprehensive protectionfrom various disasters (e.g., fire, theft, weather). As businesses prioritizerisk management and comprehensive insurance coverage, it underscores the essentialrole these coverages play in minimizing financial risk and maintaining businessoperations.

 

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Policyholder Concerns in the Commercial Insurance Market

Rate fatigue continues to be a top reported concern forpolicyholders in Q4 2023. Along with affordability, common apprehensions alsoincluded coverage availability. Report respondents felt increased pressure fromunderwriting requests, especially for cyber and property coverage.

Key concerns reported in Q4 2023 include:

  • Future premium increases
  • Elevated premium costs
  • Coverage restrictions
  • Cybersecurity threats
  • Regulatory & legislative changes

We’re Here to Help You Navigate the Complex Insurance Market

To navigate thesechallenges effectively, businesses must stay abreast of the evolving commercialinsurance market. Partnering with a trusted advisor can help understand theCIAB trends report and develop proactive strategies to lower risks, optimizecoverage, and safeguard operations.  If you have questions about these predictions or risk insurance solutions to help offset these increases, connect with a member of our team


Commercial Lines Market Trends Report–Q4 2023 | Property & Casualtyhttps://www.cbiz.com/Portals/0/Images/GettyImages-506822830-2.jpg?ver=JL-Cn23lywMXDoPF56Zdzw%3d%3dhttps://www.cbiz.com/Portals/0/Images/GettyImages-506822830-1.jpg?ver=Kj0Xt988kO1LhvpL6R53kA%3d%3dSignificant challenges continue in the commercial insurance market. Review the key insurance industry trends from Q4 2023.2024-03-11T17:00:00-05:00Significant challenges continue in the commercial insurance market. Review the key insurance industry trends from Q4 2023.

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