Ohh we are heading into the hardest market in a long time. You will see property rates start going through the roof. Think 30 to 100% increases1-3 years for everything. For the first time in 30 years working for the largest brokers in the world I am seeing 100% uninsurable properties, commercial and personal. Auto ins is a mess nationwide as well. Only solid market right now is WC and not going to help you in ND of course.
It's not a collapse, just going to be very tough, but you are going to make a lot more money. Agents will be fine, customers are in for a sad rude awakening. Ins carriers have been losing a lot of money for a while in certain sectors, capacity for reinsurance on property has dried up. Auto is most major cities is loser as well and carriers are sick of it all going to attorneys. California lost the largest insurers in the country and world, Florida same deal. Nevada and several other states are no better. If you are on the broker side you will do great, if I was a captive I would be scared.
Brush fires are a huge issue, property in general has had a net industry loss now for about 20 years, Commercial auto ins is costing 5-10k for a basic commercial PU now in lots of states and most carriers don't even want it at that price. Attorneys and run away juries from decades of negative ins company sentiment has made it almost unsustainable in a lot of places.
Yes, we are seeing huge increases. You will lose some clients for sure, but someone the increases make it up and some carrier will give you prices at insane prices and sadly most companies will pay it. I have been watching auto get worse and worse for a decade now. Last renewal was an expiring 150k account that renewed at 325k and that was the lowest of 3 quotes, 25 declines and it's not that bad of an account. Sadly the insured has no choice, sucks. It's hard, you have to really dig deep to help folks anymore. Super stressed out every day this year, I might make more money, but could die of stress also. I work for one of the largest brokers in the world, I am seeing it every day. Find your markets. Folks think insurance is expensive until you can't buy it then they know the real price. I know of an area in Utah with 5-10 million dollars homes that are now basically uninsurable, having to get a crap surplus lines policy for 10x what they were paying.
I know I received a notice of cancellation for my cabin, they said wildfire risk and are dropping coverage. This of course is after 22 years of no claims and on time paymments. Maybe the share holders should take less of a cut.
I got a quote recently for a new home. They quoted almost $6500/yr and with what equates to a $20k deductible for hail and wind. Hail is our most frequent claim around here, and a $20k deductible will pay for a new roof. So that coverage is worthless to me. My concern is always a total loss or almost total. Everything else I can take care of myself. But since the house is in a high fire risk area, insurance will be high regardless.
Collapse?
Going to be a lot of this.... Share with us, what else you find please.
Basically, property insurance has had it's worst few years ever, about 27 billion in underwriting losses. Some places like CA, FL, TX, etc will see it a lot worse. Lot of carriers are leaving states completely like State Farm. Nationwide, etc leaving California completely. The reinsurance carriers in Europe are either increasing their rates a ton or decided to take on a lot less exposure to property and auto. Father in law in Alabama just saw a 400.00 hike this year on his simple home, I have friends in Utah who can't even buy home insurance at all right now from anyone. If you are in a high brush zone that's going to be an issue. Commercial trucks in Las Vegas would have been about 1,200 a unit say 10 years ago, now it's 5 to 10k per truck and very few if any carriers want it at all even at those insane prices. Some Condos in Florida are seeing increases of 1,000% this year. It's just all starting right now, seem to be brewing and all the carriers seem a bit panicked. Stuff I would have had quotes for in the past easy, are all declines now, non-renewals flooding in every day. Been though hard markets where rates went sky high, but never seem so many just flat declines like this. What's your biz and where located? Low risk stuff will likely be ok, just might see some 10,20, 30% rate hikes in the next 1-2 years. I see the carriers focusing on states that have better laws, easier DOI to work with, less brush and storm exposure.
