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Commercial insurance premium hikes begin to ease

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At Schauer Group, we want to help our clients understand the factors influencing hard market conditions. Please reach out to us if you have questions or would like to discuss these issues.

Commercial insurance pricing is still rising, but the hikes are less steep than they were a year ago.

The end of 2023 marked the 25th consecutive quarter of commercial insurance premium increases, with a 7 percent average premium increase across all account sizes, according to a market index report from The Council of Insurance Agents and Brokers. This is down from last year’s peak of an 8.9 percent average increase.

Once again, commercial property premium increases continue to outpace other areas, but they have dropped, rising an average of 11.8% during Q4 2023. Even so, commercial property capacity remains limited. These constraints, along with higher prices for reinsurance, increased natural catastrophe losses, and inflation all are playing a role in higher premiums.

The Council’s report shows commercial insurance clients not only have concerns about high current premiums and possible future increases, but they’re also worried they’re going to be on the hook for risk improvements driven by underwriting requirements. And, in the Midwest and Southeast, clients are experiencing “extensive” requests about exposures, such as roof age and wind exposure.

Across all business insurance areas, however, there is some pricing relief:

  • Directors and officers liability insurance continues to see average increases well below 1 percent.
  • In Q4 2023, cyber premium increases fell below 1 percent for the first time since 2019.
  • Workers’ compensation premiums have continued to decrease during the past two years.

Our advisors can’t control market pricing, but they can help your company negotiate for and secure the best coverage at the best price. To discuss further, please reach out to your Schauer Group representative.

Read the report from The Council of Insurance Agents and Brokers here.

Brought to you by the insurance professionals at Schauer Group.
This article is not intended to be exhaustive nor should any discussion or opinions be construed as professional advice. All rights reserved.
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