Commercial insurance buyers can expect hard market conditions to continue throughout 2021
For the first time, Insurance Marketplace Realities predicts that buyers across every line except one will see rates increase
ARLINGTON, Va., Nov. 19, 2020 (GLOBE NEWSWIRE) -- North American commercial insurance prices are expected to increase in every line except one, according to Willis Towers Watson’s (NASDAQ: WLTW)
2021 Insurance Marketplace Realities report. Promisingly, the leading global advisory, broking and solutions company suggests that the
insurance industry will adapt to the continuing hard market by utilizing analytics and data-driven tools to change the way both buyers and sellers approach the negotiating table when it comes to
The report, published today, points to several factors accentuating the current hard market, underscored by the significant withdrawal of capacity in response to systemic changes in risk exposures. These triggers include the surge in frequency and severity of natural catastrophes across the world, the persistent increase in man-made property damage losses and rise in severity for liability losses of all types attributed to “social inflation.” Further and unsurprisingly, the pandemic continues to hurt our populations and economies, exacerbating the hard market.
“We have to look back to the defining hard market crisis of the mid-1980s to see market conditions of the proportions we are currently experiencing — one of double- and triple-digit rate increases in most lines of business and dramatically reduced capacity in key lines,” said Joe Peiser, global head of Broking, Willis Towers Watson. “However, our experience in this hard market is that there is a wide range of results; renewal results are not huddled around the mean. This means underwriters are underwriting, and there is the opportunity to differentiate your risk.”
The report emphasizes the significant role analytics is playing across the industry, especially as organizations demand to know the value insurance brings. “Insureds are finding that risk analytics provide the insights they need to measure this value and set insurance priorities,” said Peiser. “Analytics can also make our industry more relevant to global business leaders, as we advise them on the sources of volatility to their bottom line, backed up by credible analytics.”