Q2’24 to see hardening Auto rates while Cyber experience softening: CAC Specialty

The overall trend for Auto Liability and Umbrella & Excess for the second quarter of 2024 is a hardening market with rates forecasted to go up to 15%, while markets like cyber are softening with rates going down to 0%, according to CAC Specialty.

The insurance broker’s report on the State of the Market forecasted Auto Liability rates for Q2’24 to grow from 5% to 15%. Alongside a hardening market, experts predict increasing pricing, static UW & coverage and constrained capacity.

Additionally, analysts note that Auto Liability will face adverse reserve development, CDL driver shortages and training programs and telematics.

On the other end, experts predict Cyber rates could go from -10% to 0% with overall softening. Pricing is predicted to decrease with ample capacity and static UW & Coverage.

According to analysts, Cyber will experience adequate security posture (MFA, EDR) in Q2, with systemic risk and single point of failure with increased regulatory claims activity.

For D&O public accounts rates are predicted also to go from -10% to 0% with private accounts going from -5% to 5% with overall softening.

Pricing is expected to decrease, with expanding UW & coverage and constant capacity. According to experts there will be favourable supply and demand dynamics for buyers, increasing severity of derivative settlements as well as increased regulatory action from SEC.

Regarding General Liability, CAC predicts pricing to go from 5% to 10% with overall hardening. Increasing pricing is also expected with static UW & coverage and constant Capacity.

This will be influenced by social and economic inflation and post-pandemic court backlog of claims as well as emerging Risks such as PFAS and cannabis.

For Property, preferred risks are forecasted to go from 0% to 5% and challenged risk from 5% to 15% with overall stable rates and flat pricing. UW & coverage is expected to be static in the quarter with constant capacity.

Analysts expect pricing moderation with insurer growth goals, with the quarter experiencing secondary peril risks/losses and alternative insurance strategies.

Workers compensation is to stay overall stable in the quarter with rates going from -5% to 0%, flat pricing, static UW & coverage and constant capacity .

Reduced claim frequency and favourable loss development is also expected amid rising medical costs, but improving collateral terms.

Finally, for Umbrella & Excess rates are predicted to go from 5% to 15% with overall hardening. The quarter is to see increasing pricing with restrictive UW & coverage and constant capacity.

Analysts predict there will be attachment scrutiny for Umbrella & Excess in this period with increase in excess layer capacity and nuclear verdicts and litigation funding.

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