NEWS RELEASE – FOR IMMEDIATE RELEASE
Media Contact: Nicole Vasile
Director of Communications
Survey Contact: Zachary West
Market Intelligence & Insights Associate
CYBER PREMIUMS CONTINUED TO CLIMB WITH ANOTHER RECORD INCREASE IN Q3 2021, ACCORDING TO THE COUNCIL’S MARKET SURVEY
WASHINGTON, D.C. – Premium prices continued to increase in Q3 2021, according to The Council’s Commercial Property/Casualty Market Index. Prices increased for the 16th consecutive quarter across all account sizes, at 8.9%, up slightly from the average increase of 8.3% recorded in Q2 2021. When segmenting the data by account size, large accounts had the highest increase out of all account sizes, at 10.4%, while prices for small accounts increased the least, at 6.2%.
Cyber once again saw a record increase in premiums in Q3 2021, at 27.6%. Respondents agreed that one of the primary drivers behind these increases was the rise in cyberattacks, specifically ransomware, phishing, and social engineering attacks. They also pointed to the fact that Cyber had been historically underpriced in the past, due to a lack of historical data and competition incenting carriers to keep prices low, so the line has been experiencing an adjustment period in terms of premium pricing.
“Carriers continued to take a hard line on cyber risks in Q3 2021,” said Ken A. Crerar, President/CEO of The Council. “Brokers and clients that take proactive action on cybersecurity risk by implementing stricter loss controls, such as requiring multi-factor identification for access to company systems and employee training, will be at a distinct advantage when it comes to finding robust, affordable cyber coverage.”
Respondents also saw an uptick in claims for lines like Commercial Property, Commercial Auto, and Workers’ Compensation as employers began to bring employees back in to the workplace. “Claims are still below pre-pandemic levels but increasing as more people are on the road and back to work,” explained one respondent from a large Southwestern firm. “Courts started to open, people were out on the road driving, and severe weather events increased,” said another respondent from a large Northeastern firm.”
Leveraging technology was again a key theme in broker responses when asked how they would drive organic growth and recruit and develop talent. “New technology platforms are creating opportunities for commercial insurance brokers to serve clients without interruption in real-time, providing consulting services based upon data, not guess-work, and responding to client service needs promptly and accurately,” said one respondent from a large Northeastern firm. And as for recruiting and developing talent, “We need to be creative, hire people from other locales who can work remote,” said one respondent from a large Northwestern firm. And according to another respondent from a large Midwestern firm, “The ease for employees to change employers in working virtual can either be a problem or an opportunity for brokers.”
Read our Q2 and Q1 reports below.