UPDATE
Our latest update outlines what commercial insureds need to know heading into Q4, and how to get ahead of year-end renewals.
Mid-Year P&C Insurance Market Update: Property Rates Soften, Liability Costs Climb
Over the past several years, the commercial insurance sector has faced consistent headwinds due to rising claim frequency and severity, social inflation, evolving cyber risks, and continued losses from catastrophic natural disasters—all contributing to a prolonged hard market. During this time, carriers responded by tightening underwriting standards, reducing capacity and increasing premiums across most lines of coverage.
Property Insurance: Pricing Relief For Well-Prepared Accounts
Many commercial property policyholders are experiencing rate decreases at mid-year renewals, especially those with catastrophe exposures and clean loss histories. Increased competition among carriers and improved market capacity are driving this trend, particularly for accounts with:
- Updated property valuations
- Comprehensive risk information
- Strong loss control measures
Insureds who have invested in risk mitigation and accurate, up-to-date data are being rewarded with better pricing and broader options. Those who have not taken these steps may miss out on this window of relief. (Source: Business Insurance – Property insurance buyers see lower prices at renewals, businessinsurance.com/property-insurance-buyers-see-lower-prices-at-renewals)
Liability Insurance: Persistent Rate Increases Continue
On the liability side, the market remains challenging. General and excess liability rates are still rising, with even the best-performing accounts seeing increases of 10% to 25%. Businesses with recent losses or higher-risk profiles may face hikes as steep as 40%. This marks the seventh consecutive year of liability rate increases, fueled by factors such as:
- Social inflation and larger jury verdicts
- Escalating defense and settlement costs
- Underwriter caution, especially in sectors with significant auto, premises, or large deductible exposures
(Source: Business Insurance – Liability rates keep rising during mid-year renewals, businessinsurance.com/liability-rates-keep-rising-during-mid-year-renewals)
Action Steps: How to Navigate the Current Market
- Property: If your account features strong loss control, updated valuations, and minimal claims, consider remarketing now. Do not wait until Q4, when underwriting slows and market capacity tightens again.
- Liability: Request a detailed coverage and pricing breakdown early. If significant rate increases are projected, explore higher retentions, layering strategies, or alternative program structures. Prepare documentation to support your risk profile and demonstrate proactive management.
- Safety & Claims: Highlight investments in safety training, operational audits, and claims oversight. Underwriters are scrutinizing operational controls and incident trends more closely than ever.
- Contractual Risk Transfer: Review your vendor, tenant, and subcontractor agreements to ensure they are current and push liability downstream where possible.
- Renewal Strategy: Start your renewal process 90 to 120 days in advance. Early preparation maximizes your ability to negotiate and pivot to more competitive options if necessary.
Partnering with SterlingRisk
At SterlingRisk, we are closely monitoring these market dynamics and proactively advocating for our clients. Your account team is ready to review your current position and recommend steps tailored to your unique needs. Reach out today to ensure you are positioned for success heading into year-end.
Additional Resources:
Download Our 2025 Mid-Market Update
Questions or need help preparing? For additional risk management guidance, contact us today.
DISCLAIMER: This article is provided by SterlingRisk for informational purposes only and should not be taken as legal advice. For legal advice, consult with your legal counsel.
