Webinar replay: Education industry state of the insurance market
Overall, in the fourth quarter 2022, US insurance pricing experienced a decrease in financial and professional lines, but property and casualty pricing continued to rise. These challenging market shifts continue to impact nearly every line of insurance coverage for educational institutions including both higher education providers and K-12 schools.
Marsh’s Education Practice leaders recently presented a state of the insurance market, including a review of 2022 outcomes and anticipated market conditions for 2023.
Event highlights and market dynamics:
- 2022 brought above average catastrophe activity and we saw much more economic volatility in 2022.
- Many of the same challenges insurers encountered in 2022 will persist - weakened economy, supply chain challenges, labor shortages, higher cost of claims, reinsurance challenges and pressure on capital.
- Overall, the US P/C Industry remains strong both financially and fundamentally.
- Cyber insurance rate increases are stabilizing; the underwriting process continues to go deep on cybersecurity controls. Coverage scrutiny remains. Underwriters continue to view Education as a challenging industry. Premium rates are increasing but at a decreasing rate.
- Property insurers are testing the market by pushing significant rate increases on Q1 renewals and finding replacement, new or additional natural catastrophe capacity is challenging.
- Insureds are encouraged to develop contingency plans for both price and capacity – identifying which objectives are critical vs. manageable?
- Current casualty trends are expected to continue through 2023. Higher retentions may be needed to balance the continuing challenges in the casualty market and the increased claim activity.
- Behavioral health needs continue to evolve - health planning must address the increasing demand of behavioral health services for both students and staff.
Strategies to consider when planning for 2023 renewals:
- Develop a plan to differentiate your risk
- Institutions should prepare for additional underwriting questions.
- Excellent cyber controls are now the baseline to access cyber coverage, it is critical to get started early.
- Insureds with property renewals should become acquainted with alternative forms and coverage - balance the value drivers between coverage, capacity, and price.
- Communicate often with internal stakeholders to manage expectations.
A replay of the event, as well as a copy of the presentation with panelist contact information, can be found below.