Executive summary
Today’s commercial insurance landscape is a paradox. On the one hand, buyers are seeing continued pricing relief across many lines. On the other, economic and geopolitical uncertainty persist.
While competition is returning and insurers are signaling growth, they are increasingly focusing on discipline, and prioritizing profitability over market share. The U.S. economy, meanwhile, has shown resilience, but middling GDP growth, weak consumer sentiment, and tariff-related pressures on both consumers and businesses continue to cloud the outlook.
Key economic indicators offer warnings:
Inflation is showing signs of reacceleration.
Unemployment is ticking up amid slowing job growth.
The Federal Reserve's policy on interest rates remains uncertain.
Tariffs have reached historic highs, contributing to consumer unease and reductions in business investment. Bankruptcy filings are at their highest pace since 2010, and regulatory ambiguity is adding complexity across sectors.
In the insurance market, conditions remain broadly favorable for buyers. Insurers are reporting strong underwriting results and investment returns. Property rates are softening, especially in shared and layered placements, while workers’ compensation continues to perform well despite emerging claim trends. However, liability lines face headwinds, with rising rates and increased scrutiny around litigation funding, jurisdictional risks, and persistent exposures such as artificial intelligence (AI).
Meanwhile, directors and officers liability (D&O) insurance is stable, with public company rates flattening and private and nonprofit insurers showing caution amid economic uncertainty. And cyber insurance remains competitive, although carriers are closely monitoring a variety of risks and regulatory developments.
In today’s market, execution matters. Buyers with strategic foresight are best positioned to secure favorable outcomes.
Eight recommendations for risk professionals
01 Elevate risk management by proactively building team capabilities, adopting innovative tools, and fostering long-term resilience.
02 Revamp your renewal strategy by engaging early with brokers and reinvesting savings to align insurance spend with broader risk goals.
03 Strengthen underwriting submissions by showcasing robust risk management practices to secure better terms and pricing.
04 Use risk capital strategically by aligning purchases with objectives and exploring alternative financing to boost resilience.
05 Integrate analytics to leverage data and AI for optimizing program performance and negotiating favorable insurance terms.
06 Test scenarios regularly to ensure crisis readiness through rigorous planning and collaboration with key stakeholders.
07 Reinforce global programs by conducting annual reviews, broadening coverage, and partnering with committed, financially strong insurers.
08 Choose a strategic insurance broker that offers holistic guidance and helps optimize coverage across markets through data-driven insights.
