Woodruff Sawyer: Commercial Insurance Market to See More Competitive Pricing in 2025

SAN FRANCISCO, Dec. 12, 2024 /PRNewswire/ -- Woodruff Sawyer, one of the largest independent insurance brokerages in the US, announced today the release of the 2025 Property & Casualty Looking Ahead Guide. After seven years of significant rate increases, the commercial insurance market is finally showing signs of relief. As we head into 2025, businesses can expect flat to low single-digit premium increases across many lines of coverage, signaling the end of the prolonged "hard market" that has dominated the industry since 2017.

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According to the latest industry forecasts, the hard market—which typically involves steep price hikes and limited coverage availability—has eased. Key segments like directors & officers (D&O), cyber, and property, saw some of the most dramatic pricing increases, but these conditions are now stabilizing as insurers adjust to improved financial conditions.

The commercial insurance market is shifting, driven by improved profitability. The US property & casualty industry's combined ratio dropped to 98% in the first half of 2024, down from 103% in the first half of 2023. This change isn't due to fewer natural disasters but to insurers collecting higher premiums over the past seven years, helping them better withstand catastrophic losses like those from Hurricanes Helene and Milton.

Carolyn Polikoff, President, Commercial Lines, observes, "In 2025, businesses will likely benefit from more favorable insurance pricing. This improvement is driven by stronger balance sheets, bolstered by the high premiums of recent years, decreasing inflation, and rising investment income. However, with increasing competition, it's essential for insurance buyers to exercise caution. Smaller insurers with weaker financials may relax underwriting standards to win business, potentially exposing buyers to risk if those insurers face financial challenges. Selecting financially stable, long-term insurance partners will be critical to navigating this evolving landscape."

About Woodruff Sawyer

As one of the largest independent insurance brokerage and consulting firms in the US, Woodruff Sawyer protects the people and assets of more than 4,000 companies. We provide expert counsel and fierce advocacy to protect clients against their most critical risks in property & casualty, management liability, cyber liability, employee benefits, and personal wealth management. An active partner of Assurex Global and International Benefits Network, we provide expertise and customized solutions where clients need it, with headquarters in San Francisco, offices throughout the US, and global reach on six continents. For more information, call 844.972.6326, or visit woodruffsawyer.com.

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SOURCE Woodruff Sawyer