Insurance

Insurance Rate Hikes Projected to Slow Down Over Capacity Expansion

Insurance Rate Hikes Projected to Slow Down Over Capacity Expansion

Based on a report from Willis Towers Watson PLC, business insurance purchasers in North America are set to witness relief from the hard market one year from now with a couple of lines seeing flat level renewal or even reductions, as per a report from Willis Towers Watson PLC.

According to the report released Tuesday, some lines, such as cyber liability, remain difficult, and purchasers should expect considerable rate rises.

According to Jon Drummond, head of broking, North America, “the hard commercial insurance market remains, although with a slowing in rate rises.”

According to the Willis report, property rates are expected to rise 2% to 10% in 2022, general liability rates are expected to rise 5% to 12.5 percent, auto rates will likely be 5% to 15% higher, excess casualty rates will likely be flat to 15% higher for low to moderate hazard risks and 15% to 30% higher for high hazard risks, and workers compensation rates will likely be down 2% to up 4%. Last spring, most of the lines saw bigger rate increases.

The primary rates for directors and officers liability for public companies will be flat to up 25%, with flat to up 20% for extra layers; private company D&O charges would be 5% to 40% higher, according to the research.

As cyber insurers continue to reduce their exposure to ransomware damages, cyber liability rates are likely to rise 50 percent to 150 percent next year, according to the report.

In other words, employment practices liability rates are expected to rise 10% to 30%; errors and omissions rates are expected to rise 5% to 20%, depending on the profession insured; construction general liability and auto liability rates are expected to rise 5% to 15%, and medical malpractice primary rates are expected to rise 5% to 10%.

The Author

Oladotun Olayemi

Dotun is a financial enthusiast who specializes in first-in-class financial content, including crypto, blockchain, market, and business, to educate and inform readers.