Insurance rates hikes likely to moderate in 2024: Alera
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Commercial insurance buyers will likely see price increases for several lines of coverage next year, but with a stabilized reinsurance market and more capacity coming online, the hikes should be more moderate than in the past year, Alera Group said in a report Monday.
In its property/casualty market outlook, which is based on a survey of underwriters and wholesalers, the Deerfield, Illinois-based brokerage said commercial property and commercial auto insurance rates will likely increase the most next year, with projected rate hikes of 10% to 15%.
While property rates may moderate in midyear 2024, absent any extraordinary catastrophe losses, even the best accounts will likely see 6% to 8% increases, the report said.
Most other commercial insurance lines, including cyber, general and excess liability, employment practices liability, environmental liability, medical malpractice, professional liability and surety, will see rate increases between 1% and 10%, the report said.
Workers compensation rates will likely be flat, as it remains a profitable line of business for insurers.
“Workers compensation business will continue to be targeted for growth by most commercial lines insurers,” the report said.
Directors and officers liability insurance rates, which softened throughout 2023, will likely fall 1% to 10% next year, according to Alera.
D&O buyers may see more capacity available in 2024, with 33% of respondents saying capacity will increase and 67% saying it will remain the same, the report said. D&O underwriting requirements will also likely ease with 67% of respondents saying public D&O underwriters will be more flexible and 44% saying private D&O underwriters will be more flexible in the year ahead.
