NEWS RELEASE – FOR IMMEDIATE RELEASE
Media Contact: Nicole Vasile
Director of Communications
Survey Contact: Zach West
THE COUNCIL’S Q1 2023 P/C MARKET SURVEY SHOWS SIGNS OF STABILIZATION IN CYBER LINE WITH SPIKE IN COMMERCIAL PROPERTY PREMIUMS
WASHINGTON, D.C. – Most lines experienced moderation in premium pricing increases in Q1 2023, according to The Council of Insurance Agents & Brokers’ Quarterly P/C Market Survey. However, premiums overall rose for the 22nd consecutive quarter. Results from the survey showed an average increase of 8.8% across all account sizes, up slightly from the 8.0% recorded the previous quarter.
Signs of relief were clearer for the cyber line of business this quarter. Premiums increased by an average of just 8.4%, slightly more than half of the 15.0% increase last quarter, and down significantly from just a year ago, when increases were more than 20%. A consistent decline in the number of respondents reporting an increase in cyber claims since Q1 2022 suggests that carriers may have eased back on premium increases due to fewer losses. The decline in losses could ultimately be attributed to industry efforts promoting a more aggressive cyber risk management strategy for insureds.
On the other hand, commercial property premiums spiked by 20.4% in Q1 2023, which is the first time since 2001 that this line experienced an increase of over 20%. Respondents agreed that this line had been impacted the most by inflation, mainly due to increases in the cost of repairs. That, in combination with recent severe natural catastrophes like Hurricane Ian, as well as supply chain issues with replacement materials, all contributed to driving up lost costs which, in turn, pushed up premiums.
Property loss trends also brought underwriting changes for the property line. Carriers cut capacity significantly, with 85% of respondents reporting a decrease in underwriting capacity for commercial property. Respondents also pointed to “significant terms and conditions changes, larger deductibles, more significant exclusions, and reduced coverage.”
Besides the usual top two broker priorities and challenges – “driving organic growth” and “recruiting and developing talent” – broker attention was focused on “becoming more data driven,” with 34% of respondents identifying this as one of their firm’s top priorities. Brokers said potential data use included analyzing market opportunities and identifying potential issues as well as enhancing the customer experience by refining applications, eliminating redundancies, and providing decision support.