For 2020, you can expect some major changes to commercial insurance. Across most lines of insurance, commercial insurance buyers throughout America will see significant price hikes. These price hikes, which picked up steam during mid-2019, are set to continue through 2020, and possibly beyond. This information is sourced from Willis Towers Watson, who tracked 19 commercial lines to determine this forecast. Some areas like worker’s compensation have remained stable, but the overall trend in other areas is aggressive price hikes.
The cause of these hikes are the rise of unsustainable claims and the trend of low interest rates. This enables lower limits and tight coverage.
There are several factors at play that have created the hardened market environment. Low interest rates have negatively impacted insurer returns on their investment portfolios. Across commercial property, extreme weather and wildfires since 2017 have had a direct impact on pricing (especially in States like California which has been notorious for harsh fires), causing the market to harden.
Have questions how the commercial insurance market will affect you in 2020? Don’t hesitate to contact Kelly Williams Insurance to get the assistance you need.