A majority of respondents to a recent insurance industry survey believe the market is hardening across most lines, including commercial auto, property and specialty lines.
Insurance software provider FirstBest Systems Inc. conducted a survey over the past few months of 72 professionals in North America with IT and business management responsibilities at various insurers. Most respondents (85%) worked in commercial lines, with the remainder in personal lines.
Of those surveyed, 71% said they felt the market was beginning to harden, while 18% felt the market was already hard and only 11% felt the market was still soft. That sentiment was consistent among most lines, although the personal auto market was still perceived by many to be soft.
"While we did not include agent and broker responses in the survey findings, given the response rate was statistically smaller, the sentiment this group provided was in line with their counterparts at commercial lines carriers – that they were experiencing a hardening market even before Hurricane Sandy," Joseph Pilkerton, co-founder and COO of FirstBest Systems noted.
Ensuring a high renewal rate, along with providing faster quality service and decision-making were the top priorities for companies moving into a hard market, according to the survey.
A strong majority (92%) cited underwriting as a very important strategy to achieve growth and profitability in a hard market, but it’s not without its challenges.
A third (33%) of carriers responded that underwriters will be most challenged to "analyze risk in less time to get quotes out quickly,” when preparing for a hard market. Another 24% indicated access to data and analytics to make better decisions as a major challenge.