State of the Insurance Market Report

2024 Initial Outlook:
Business Insurance Solutions

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At a Glance


As expected, 2023 proved to be another year of high demand for captive insurance. Healthcare costs, nuclear verdicts, cyberattacks, catastrophic climate events, and market-specific drivers are leading to steep commercial insurance premiums, prohibitive exclusions, and even complete lack of insurability as reinsurance decreases.


Overall, higher premiums and increased investment returns have helped insurers improve their long-term outlook. However, several trends continue to spur uncertainty in the casualty market. For example, in the second year of post-pandemic court activity, we are seeing increasingly large settlements. Carriers find it difficult to predict losses and price coverage appropriately. Pricing is now more complicated and subject to frequent changes.


The cyber landscape continues to evolve rapidly. While capacity remains, ransomware attacks are resurging, raising insurers’ concerns. Organizations with strong security controls are seeing stable rates; however, those with average to weak controls may experience rate increases.


Rising environmental claims such as indoor air quality, legionella, and redevelopment are driving up costs for the real estate and healthcare sectors. Additionally, social inflation is contributing to higher settlement expenses for environmental claims. The U.S. President administration's focus on stricter environmental regulations reflects how environmental priorities change based on who is in office at the federal, state, and local levels. Prepare for any potential financial impacts if you are operating with environmental liability.


For international property, the hard market continues due to ongoing catastrophe (CAT) activity and a challenging reinsurance market. Loss-free, non-CAT property accounts can expect rate increases in the 10% to 15% range. Accounts with CAT exposure and/or poor loss history will continue to see substantial rate increases of 25% or more, as well as reductions in CAT limits and increased deductibles. The international casualty market remains relatively stable, except for accounts with poor loss experience.

Management Liability

Litigation against corporate leaders is rising, driving greater demand for strong Directors and Officers (D&O) coverage. Businesses and executives need more comprehensive protection now due to a variety of factors, including regulatory scrutiny, shareholder activism, emerging risks like cyber incidents, intensified environmental issues, and more.


Today’s commercial property market is one of the most challenging we have ever faced. Pricing is the highest we have seen in over 30 years, with no signs of slowing. Relentless severe weather events are driving treaty and facultative reinsurance rates higher and causing reinsurers to reduce their aggregate exposures to catastrophic risks.


We have seen continued growth in the construction market, and sureties have shown continued profitability and low loss activity. However, financial strain due to supply and labor challenges, rising interest rates, restricted bank credit, etc., continue to impact the industry. The Surety market is still relatively soft, driven by sufficient reinsurance capacity and new surety companies entering the market.

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The contents of this report are for general informational purposes only and Risk Strategies Company makes no representation or warranty of any kind, express or implied, regarding the accuracy or completeness of any information contained herein. Any recommendations contained herein are intended to provide insight based on currently available information for consideration and should be vetted against applicable legal and business needs before application to a specific client.