US Insurance Markets and Risk Trends in 2016
Entering 2016, US commercial insurance marketplace conditions are generally positive for buyers, according to speakers on Marsh’s January 27 The New Reality of Risk® webcast.
With few exceptions, buyers of property, casualty, financial and professional, and political risk insurance can expect to see a continuing soft market for rates and opportunities to improve terms and conditions, barring unforeseen circumstances.
“The overall lack of losses helped the US commercial property insurance market soften further in 2015, which continued a two-year trend that is expected to keep going in 2016,” said Duncan Ellis, leader of Marsh’s Property Practice. Other factors at play include competition among insurers for business and an influx of alternative capital.
The casualty markets likewise can expect generally soft conditions in 2016, barring unexpected changes, said Marsh’s US Casualty Practice Leader Steve Kempsey. One area of exception for many companies may be auto liability, which has replaced workers’ compensation as a sometimes troublesome area.
As was the case in 2015, cyber insurance is likely to be an area of some volatility in pricing, with variability based on such factors as industry, loss experience, and other individual organizational characteristics.
In addition to discussing the state of the insurance market, the panel covered strategies for successful renewals and arising trends such as the use of drones and wearable technologies.