The commercial insurance marketplace is holding steady, despite anticipated policy changes from the Capitol, which have the potential to upend players over the course of the Trump administration.
Major insurer Willis Towers Watson made this forecast in its 2017 Market Realities report.
The effects of revisions to current tax policies and an overhaul of the health insurance system are likely to reverberate with insurers over the medium term. Furthermore, the executive branch is also considering the potential impact of the EU-US Insurance Dialogue Project, which is foreseen to greatly affect the industry.
Yahoo Finance said that the Willis Towers Watson report cited several favorable conditions that augur well for insurance buyers during the year.
Among other factors, Willis Towers Watson pointed out that the marketplace has ample capacity to sustain the industry through persistent soft market conditions.
Capital has remained fluid, which has sustained stable market conditions amid active consolidation efforts by insurers as a measure to weather the challenging situation of the past year. Furthermore, this capacity has also helped tide the market through an increase in losses arising from catastrophes.
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By sector, the property segment has yielded softer underwriting results, with a 32% increase observed in catastrophe-related losses. However, Willis Towers Watson pointed to potential growth from expanded coverage of cyber and non-physical damage.
Similarly, the casualty sector has proven to be generally stable with the exception of energy and trucking risks.
With costs stabilizing, the outlook for workers’ compensation is rosy as well, Willis Towers Watson said.
Meanwhile, the cyber insurance market is becoming more competitive as more players come in, while cyber risks continue to escalate. Most buyers can expect 5% to 10% increases in their premiums with their policy renewal.
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