Q1 2026 continued to demonstrate soft market conditions with commercial property and casualty (P&C) insurance premiums declining across most account sizes and lines of business. According to The Council of Insurance Agents & Brokers’ (CIAB) Commercial P&C Market Index for Q1 2026 (January 1 – March 31), average premiums decreased by 1.2%, the first overall decline since Q3 2017.
Like last quarter, nine lines of business posted an average decrease in premiums in Q1 2026, underscoring the ongoing soft market conditions across multiple segments. Premiums decreased by an average of 0.3% across all lines, while the major lines of business, including commercial auto, commercial property, general liability, umbrella, and workers compensation, saw a more modest average increase of 0.8%.
Premium Changes by Line of Business
Premiums decreased by an average of 0.3% across all lines of business, a notable shift from the 1.9% average increase recorded in Q4 2025. Commercial property saw the largest decrease with a -5.5% average premium drop.
Other notable rate changes in Q1:
- Commercial Auto (+5.8%)
- Workers Compensation (-3.7%)
- Cyber (-3.5%)
Commercial Property Premiums Decline as Carrier Appetite Grows
Commercial property premiums posted the largest decline in Q1 2026, falling by 5.5%, a significant acceleration from the 0.7% decrease in Q4 2025. This decline reflects increased carrier appetite and competition, resulting in more aggressive pricing and more favorable underwriting terms. Approximately 72% of respondents observed increased underwriting capacity in this line, with some describing it as “significant.”
AM Best’s March 2026 market outlook notes improved loss ratios from 87.9% at the end of 2024 to 85% at the end of 2025, despite notable catastrophe events. This improvement is attributed to disciplined underwriting, risk selection and a strong premium base built in prior years.
Persistent Losses Keep Commercial Auto Premiums Rising
Commercial auto premiums increased by 5.8% in Q1 2026, marking the 59th consecutive quarter of growth. This line remains unprofitable due to high claim frequency and severity driven by social inflation, litigation, rising vehicle repair costs influenced by advanced technology, and increasing medical expenses.
AM Best identifies commercial auto as one of the worst-performing P&C segments over the last decade, with loss ratios exceeding 100% in most years since 2014. Despite some easing in premium growth, ongoing challenges continue to pressure underwriting results.
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 Q4 2025. Readers should contact legal counsel or an insurance professional for appropriate advice.
