In times of great uncertainty, facts, thorough research, and expert insight make all the difference. The May 2020 Lockton Market Update delivers a comprehensive review of commercial insurance market conditions and provides an insightful look at specific sectors.
Understanding, however, is only part of the equation. This is why Lockton’s product line experts also share actionable strategies and examples of what can be done to navigate today’s marketplace.
A global pandemic strains an already challenged market.
The US property and casualty insurance industry ended 2019 in a strengthened financial position, with net income and surplus on the rise. In fact, it was the second-most profitable year for the industry in the last decade. However, escalating loss severity and persistently low investment yields had made a correction almost inevitable. The impact of this change was broadly distributed, and markets remained disciplined around rate and capacity, begging the question: How much further will the market tighten?
The last several weeks have made queries around the potential duration of any hard market almost academic. Businesses already struggling with the impact of a rapidly hardening insurance market have suddenly been confronted with a global pandemic whose impact has yet to be fully realized.
Trends to watch:
Continued reductions in deployed capacity
Increased litigation over contract wording
Interim policy adjustments and billing mandates
Uncertainty as respects impact and potential claim volume – which drives underwriting conservatism
Continued reduction in interest rates impairing future investment income
Governmental intervention on matters such as retroactive coverage, presumptive workers’ compensation, and liability immunities
The current market situation has created different challenges across various industries. One size does not fit all, so Lockton’s team of experts dialed in and examined different industry sectors. A commitment to deliver best-in-class solutions informs every aspect of the Market Update.
For us, it’s not enough to cull the data and present the facts. To make the content more meaningful, we elevated our update by asking the follow-up questions: Why? What’s next? What can be done? And, then, we provided answers.
Download the May 2020 Lockton Market Update (opens a new window) to learn more and view actionable take-aways to help businesses prepare for and navigate the headwinds of the current market.