The Q1 results indicate moderate premium pricing increases in most lines, continuing to climb for the 22nd consecutive quarter according to The Council of Insurance Agents & Brokers Commercial Property/Casualty Market Index. Cyber markets showed some signs of relief this quarter.
However, commercial property premiums rose significantly by 20.4% in Q1 2023, marking the first increase over 20% since 2001. Cyber markets showed some signs of relief this quarter. However, 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%.
Cyber Market Shows Signs of Stability
Cyber insurance buyers saw continued pricing relief in Q1, with an average increase of 8.4%, down from 15% in Q4 2022 and down from a high of 34.3% in late 2021. “It seems like that focus on incentivizing insureds to adopt a more aggressive cyber risk management strategy has had some success,” said CIAB. “In Q1 2022, the number of respondents reporting a rise in cyber claims was 72%. But this quarter, that number had fallen to just 39%. Given how severe cyber claims can be, fewer losses on this front may have allowed carriers to ease back on premium pricing increases.”
Commercial Property Sees Highest Spike Since 2001
Commercial property skyrocketed from an average of 8.3% in Q2 2022 to this quarter’s average 20.4% price hike. Insurers’ pressure for rate may not be unfounded—61% of CIAB respondents said they saw a jump in claim frequency in addition to inflation. A majority (85%) also said they saw a significant decrease in underwriting capacity. Many respondents also cited stricter underwriting, with building age a determining factor in getting coverage.
Other Markets of Note
Increases for umbrella liability slowed from 9.6% in Q4 2022 to 8.5%, while commercial auto prices were up slightly, with an average increase of 8.3% from 7.3% in Q4. Workers’ compensation prices decreased an average of 0.5%, while general liability increases moderated to 4.6%.
For a consultative approach to navigating coverage and pricing changes within the insurance market, contact a UNICO Advisor.
For more information, download the full report below.
The Council of Insurance Agents & Brokers’ Commercial Property/Casualty Market Report Q1 2023 (January 1 – March 31). Readers should contact legal counsel or your UNICO Advisor for appropriate advice.
