Premiums increased for the 19th consecutive quarter in Q2 2022, with respondents reporting an average premium increase across all account sizes of 7.1%, compared to 6.6% in Q1. Nevertheless, respondents agreed that the market continued to stabilize in Q2 2022, mentioning some price moderation and that additional competition for desirable accounts made it a little easier on clients to find better terms and conditions.
Average price increases across lines of business did not change much from last quarter, either slightly smaller or larger than what was recorded in Q1 2022, with the average increase across all lines of business coming in at 6.1%, less than half a percent change from Q1’s 5.7%.
The cyber line of business continued to pose problems for respondents. Prices for that line increased by
more than 25% for the fifth consecutive quarter, and many respondents reported higher deductibles, tightened limits, and more underwriter scrutiny.
Most respondents agreed that the recent inflationary trends had a negative effect on the market, especially on the commercial auto and commercial property lines of business. Respondents reported inflation driving up property valuations and the cost of building materials and auto parts, which in turn exerted upward pressure on premiums for those lines.
Property in natural catastrophe-prone areas was also difficult for brokers to place, especially in areas vulnerable to wildfires. Respondents also described increased deductibles, such as named storm deductibles, and more restrictive limits and underwriting requirements.
Work from home is here to stay, despite grumblings from some corners of the industry. Respondents found that adopting a hybrid schedule for workers and being willing to open the search for virtual employees country-wide were both key ways to realize the top broker priority of “recruiting and developing talent.”
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