In the midst of the pandemic, Jenna Kirkpatrick Howard of Lockton Companies addresses recent trends to watch for in the insurance marketplace:
As we close out another week in this global pandemic, I am providing an update on what we are seeing in the insurance marketplace. The U.S. property and casualty insurance industry ended 2019 in a strengthened financial position, with net income and surplus on the rise. In fact, it was the second-most profitable year for the industry in the last decade. However, escalating loss severity and persistently low investment yields had made a correction almost inevitable. The impact of this change was broadly distributed, and markets remained disciplined around rate and capacity, begging the question: How much further will the market tighten? Lockton’s team of experts dialed in and examined different industry sectors to provide insights and tactical strategies for organizations to navigate the current marketplace. Access the Lockton Market Update trend report.
Trends to watch:
- Continued reductions in deployed capacity
- Increased litigation over contract wording
- Interim policy adjustments and billing mandates
- Uncertainty as respects impact and potential claim volume – which drives underwriting conservatism
- Continued reduction in interest rates impairing future investment income
- Governmental intervention on matters such as retroactive coverage, presumptive workers’ compensation, and liability immunities
