Most A&E insurers to raise rates amid inflation concerns: Ames & Gough

Most insurers providing architects and engineers professional liability insurance plan to raise rates this year amid concerns about the persistent effects of inflation on claim expenses, uncertainty about the U.S. economy, as well as other new exposures including artificial intelligence, according to a report Wednesday from specialty insurance broker Ames & Gough.

Among insurers surveyed this year, 71% are seeking rate increases, 24% plan to keep rates flat and just one insurer expects to reduce rates, Ames & Gough said.

This year’s survey includes responses from underwriting executives at 17 leading insurers providing architects and engineers professional liability insurance, the report said.

Insurers remain concerned over the impact of inflation on claims and costs, with 83% of the insurers surveyed citing inflation as having an impact on their decision to implement a rate increase.

More than two-thirds, or 67%, of insurers plan to target rate increases for accounts with adverse loss experience, “as has historically been the case,” the report said.

The planned rate increases are set to come despite previous profitability and increases, according to the report.

In 2024, insurers experienced premium growth for the fourth consecutive year, and nearly one-fourth saw double-digit percentage increases, the report said. Of the 14 insurers reporting premium growth in 2024, nearly 29% had growth of 11% to 15%.

Of the 17 insurers surveyed this year, 13 raised their rates in 2024 due to persistently deteriorating claims experience and heightened risk.

Ames & Gough has offices in Boston; Philadelphia; Orlando, Florida; Charlotte, North Carolina; and Washington, D.C.; and says it has more than 1,700 architects, engineering firms and other construction professionals as clients.