The US Property insurance market faces challenges on all fronts, according to the 2023 US Property Market Outlook by Risk Placement Services (RPS): Drastic rate increases, a difficult reinsurance renewal period, growing underwriting losses and reduced capacity.
The US Property Market Outlook examines the current and future trends in the US Property insurance industry. Here are some takeaways:
- The increased frequency and severity of catastrophic events has led to a demand surge for materials and labor, affecting claims.
- Insurers are putting more emphasis on valuations, requiring policyholders to update the value of their portfolio for rising inflation and the increased cost of construction.
- Some carriers could reduce their capacity by as much as half over the coming year.
- A reduction in capacity has also hit the MGA sector, which has led to greater-than-average rate increases for middle market business.
- Companies that invest in their risk resilience — including new properties built to withstand natural catastrophes — could benefit from lower rates compared to other areas of the market.
