Analysts at MarketScout, a Managing General Agent, Lloyd’s Coverholder and wholesale broker, have suggested that losses from Hurricane Ian will “dramatically” impact insurance pricing across both commercial and personal lines.
MarketScout data shows that the commercial market composite rate for the third quarter 2022 increased 5.28%, with property rates up 7.67%.
It’s expected that coastal areas in particular will see commercial property rates rise post Ian.
“Losses from Hurricane Ian will significantly impact rates in Florida and other wind exposed coastal states,” said Richard Kerr, CEO of MarketScout.
On the broader commercial picture, he added: “We are seeing softening in the D&O/professional sector as additional markets expand available capacity. Cyber rates are still increasing significantly despite additional capacity.”
Meanwhile, for personal lines, MarketScout data shows that the US composite rate moved up 4.58% as compared to the same time period last year.
Here, automobile rates were up slightly from the prior quarter and personal article rates moderated slightly from the second to third quarter.
Analysts expect that Hurricane Ian will further restrict capacity in the Florida market and cause a “dramatic” hike in pricing in the near term.
Data shows that rates for homeowners under $1 million value were up 4%, while homeowners over $1 million were up 6%.
“High value homes are experiencing more aggressive rate increases,” Kerr continued. “This is largely because, on a composite national basis, more high value homes are located in catastrophe prone areas of the US which naturally are assessed higher rates.”
“Hurricane Ian is going to be a huge loss for insurers covering properties in Florida. Excluding coverage for flood and storm surge, estimates are from $25 to $45 billion. Including flood claims, the total will most likely surpass $100 billion. Rates will be up dramatically in Florida for the foreseeable future.”
