Rise in Commercial Property
Insurance Rates Continue at Midyear Renewals
Highlights:
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- The commercial property insurance market witnesses another rate increment at midyear renewals.
- 5 to 15 percent increase for the highest loss-free business and 20 to 50 percent for accounts that were exposed to catastrophe losses.
- Losses for the majority of property insurers, at least in the first quarter, appear to have been less severe than in the same time last year.

Rates for commercial property insurance have significantly increased in recent months. As a result, the rate went up once more at midyear renewals. Inflation is one of the main causes for the increment, resulting in renewal increment this July.
According to research by Gallagher Re, the reinsurance division of Arthur J. Gallagher & Co., mid-year reinsurance renewals revealed significant gains in U.S. property business and more moderate changes in casualty rate trends.
Insurance companies are concentrating on accurate reporting of property values and replacement prices as a result of high inflation and persistent supply chain disruptions.
According to NU Property and Casualty, in Florida, increases range from 5% to 15% for the highest loss-free business to 20% to 50% for accounts exposed to catastrophe losses. As a result, Florida’s habitational and condo businesses are highly affected. With the increase in losses, rates grew by up to 25% for health care liability, but only 0%-5% without a loss. This shows that the frequency of natural disaster in major U.S. states has a considerable impact on property insurance rates.
It is becoming more difficult to find buyers for coastal properties that have experienced losses as a result of reinsurance renewals. It has also led to capacity issues concerning certain accounts. To make up for the lack of reinsurance capacity, primary insurers are struggling to put together sufficient catastrophic capacity and are charging more for it. This holds true for all high-hazard perils, including convective storms, floods, wind along the Gulf of Mexico, and earthquakes in California.
According to a Boston-based U.S. property practice leader—Rick Miller— “In this situation, a little more optimism is possible. Since losses for the majority of property insurers, at least in the first quarter, appear to have been less severe than in the same time the previous year”