Property/casualty market robust, in modest transition: Lockton

The U.S. property/casualty market had a robust first half this year, but despite the strong financial performance, the market is still in a modest transition, said Lockton Cos. LLC, in a market update issued Thursday.

There is a “continued increase in the frequency of severe claims, and a prolonged period of large weather events,” said the report Property and Casualty Market Update – U.S.

It said another area to “keep a close eye on” is the cost of debt and collateral, with interest rates starting to rise and another increase expected in December.

Discussing individual lines, the report said the commercial property market “experienced premium pricing increases that outpaced most lines of business,” while casualty results for 2018’s first half mirrored 2017’s second half.”

“Commercial auto rates continued to climb, liability remained slightly up and workers compensation premium savings persisted,” said the report.

During the second quarter, pricing for lead umbrella and excess policies rose slightly for the third consecutive quarter at 2.3%. “The lead umbrella position is driving modest increases, but overall tower pricing change is mitigated by an excess casualty market that is relatively flat,” said the report.

The report said also directors and officers and employment practices liability markets “have generally continued their firming trends.”

In cyber, there has been “a continuation of a very competitive marketplace which benefits clients without losses,” the report said. It said that “the most important items for an insurance buyer to consider are the proven ability to pay claims and the ability to remain sustainable.”