Proceeding with caution

While P&C insurers remained profitable through 2022 and forecast strong investment income in 2023 and 2024, loss severity is increasing because of natural catastrophes and economic and social inflation. And a recession — which is possible in 2023 — could lead to greater pressure in insurance pricing.

For insurance buyers, now many be the time to reconsider risk tolerance and volatility thresholds — and the role of insurance overall. And as insurers stay focused on risk selection, highlight commitments to loss control could lead to better outcomes at renewal.