Casualty Insurance: State of the Market

While the commercial insurance industry is seeing an opportunity in the positive upturn of the global economic activity, those in the property and casualty insurance industry are still seeing growth in net written premiums and levels of alternative capital. The property and casualty insurance sector is still currently paying out about $30 billion per year in claims, and with claims being time-consuming issues, this number is expected to continue to steadily rise.

Due to the growth in capital, the market has stayed away from significant market-wide rate increases even while experiencing major losses. To get a handle on the where the casualty insurance market is heading, it’s best to see where it’s at currently. Here’s a look at the current state of the casualty insurance market.

Market Movement

Loss development on casualty insurance lines has been changing for the worse for some time, which has, in turn, caused a hardening of the market, even more than what has been expected. From construction to real estate to transportation, the firming across the market is essentially spreading into nearly all sectors of the casualty insurance market. Carriers are increasing their attachment points and rates are approaching full capacity on certain risks.

In the western United States, natural disasters, such as wildfires, are causing billions of dollars in property damage and have caused a lot of problems in the casualty market for major utility companies. And even outside of those areas, brokers and buyers can expect to see a shifting from carriers to focus more on profitability in underwriting.

Resurgent M&A’s

Another notable trend in the casualty insurance market expected to affect risk transfer strategies is the boost of mergers and acquisitions in 2019. Insurance carriers will pursue inorganic growth as well as new technology platforms and talent. Altogether, mergers and acquisitions haven’t had huge impacts on rates and capacity, but it looks to be reducing the number of competitors who are in the casualty insurance market.

Consolidations are expected as a result of more underwriting discipline, which may act as a way to cut off freefalls in rates. Also, another important consideration for buyers thinking about new carrier combinations is a potential change in an insurer’s claim handling and the borders with which the policy is enforced. Working through a changing marketplace makes it important to have a strategic approach as buyers looking at renewals will be shifting their focus on creating submissions using data.

About Genesee General

At Genesee, we strive to provide quality insurance solutions for the Commercial E & S sector. Our longstanding expertise has allowed us to successfully serve your clients for over three decades. Our specialized products include coverages for Transportation, Garage, P & C, Professional, Brokerage Property, Specialty Programs and many more. For more information about our products, we invite you to contact us today at (800) 282-8755.