Insurance producers advising property and casualty insurance clients can expect favourable terms and price decreases of between five and 15 percent in 2015, according to a recent report from
Marsh.
According to the broker’s annual U.S. Insurance Market Report, the competition among insurers for P&C accounts will continue into the year, favouring clients with low risks and good loss histories. Businesses with non-catastrophe exposed risks can expect decreases of between five and 15 percent, while catastrophe-exposed clients are at even greater advantage, standing to see decreases of between 10 to 15 percent depending on their risk profile.
“Strong capital positions, ample capacity and competition within the U.S. property and casualty market are leading to favourable conditions for insureds, especially those with well-managed risks,” said Robert Bentley, president of Marsh’s U.S. and Canada division. “While this is good news, organizations need to remain vigilant in their efforts to stay abreast of the changing marketplace, where new and emerging risks can quickly escalate if not properly managed.”
And while overall softening is expected in nearly all P&C lines, rates for cyber insurance have been and will continue to be volatile.
This is driven in part by the growing trend among insurers to expressly exclude any damage related to data breach from business interruption and general liability policies.
“Policyholders will continue to face cyber risk challenges stemming from a 2014 decision by the Insurance Services Office,” states the report. “ISO contends that damages related to data breaches and certain data-related liabilities are not intended to be covered under GL policies, and should be addressed through dedicated cyber insurance policies.”
The report goes on to say that cyber insurance rates increased an average two to 10 percent in the fourth quarter of 2014 for clients with average to good loss histories. The broker expects this trend to continue through the year as unexpected loss events like the Sony and Anthem hacks, coupled with increased supply and demand from carriers, lead to uncertain pricing.
