Automobile
In the face of high inflation and ongoing uncertainty, market conditions became more challenging in Q3. Price increases were common, and capacity was constrained, especially for large fleets and out-of-appetite risks. Underwriting remained cautious and conservative. Looking ahead, current market conditions are expected to continue.
Casualty/Liability
Market conditions remained moderate, although challenges continued for poor-performing industries such as healthcare, energy, chemicals and food/feed, some of which experienced limit and sub-limit decreases as well as a challenging pricing environment. But pricing overall remained only modestly up. Capacity was sufficient, although insurer appetite was focused. Looking ahead, current market conditions are expected to continue.
Cyber
While market conditions remained challenging, insurers indicated an expansion of appetite, triggering an uptick in competition, although new capacity will take some time to mobilize. Pricing continued to rise but less steeply. Underwriting remained rigorous; quotes were not provided where risk posture was deemed insufficient. Deductibles remained under pressure as many insurers positioned coverage to apply to major losses only. Ransomware coverage remained available, but restrictions for ransomware, known vulnerabilities and end-of-life products continued. Looking ahead, a challenging market is expected to persist at least through the end of 2022.
Directors and Officers
Moderate market conditions continued in Q3. Pricing remained modestly up; however, outcomes varied by segment and industry. Underwriting remained cautious and concern related to the geopolitical events in Eastern Europe, as well as inflation, remained elevated. Looking ahead, current market conditions are expected to continue; however, inflation is expected to have a growing impact.
Property
Market conditions remained stable as insurers continued their focus on valuations. The market narrowed as insurer consolidation continued. Pricing was generally flat, although distressed risks and food/feed risks continued to experience more challenging conditions. Capacity remained generally sufficient. Quality, detailed risk information remained key to achieving superior outcomes. Looking ahead, market conditions are expected to remain stable. Areas of focus for insurers will continue to be: the geopolitical events in Eastern Europe, the ESG landscape, inflationary pressures, and declared values.
Trade Credit
Market conditions remained moderate following historically favorable claims ratios in 2021; however, underwriters are keeping a watchful eye on the geopolitical events in Eastern Europe and their potential impact on risk. Flat pricing was achieved for many risks – especially those with increased turnovers – while modest price increases were the norm overall. Underwriting was flexible and limit increases – driven primarily by inflation – were generally available. Looking ahead, insurers are expected to continue to monitor economic trends and will likely modify their stance if insolvency rates begin to increase.
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