The commercial insurance market in Canada may be starting to see indications of premium rate hardening, Hub International Canada president Tina Osen told Canadian Underwriter recently.
“It hasn’t all hit yet, so I want to be clear on that,” Osen said in an interview. “The indicators are certainly pointing that way.”
“I would agree with that,” Philip Heywood, partner of financial services deals with PwC Canada, said Tuesday. Heywood was asked about rate hardening during a discussion about the impact of rising interest rates on mergers and acquisitions in the P&C insurance space. He also observed how interest rates affect multiples of revenue, digital transformation and M&A trends.
Certain commercial lines – transportation, residential and condominium buildings – are some of the tougher classes of business to place in terms of capacity. They have proven to be a “bit more tricky for underwriters,” Osen reported.
Although it appears specific classes of the commercial market have been hardening this year and during the latter half of 2017, “I think the difference now is we are starting to see general indications from carriers that they need to get rate across broad sweeps of the books of business,” she said. This suggests there will be increases across the business that “quite frankly we haven’t seen in a long time.”
Osen spoke to Canadian Underwriter last month about the Top 3 trends she sees facing commercial brokers in the country. Besides rate hardening, she said she is seeing a significant increase in weather-related losses as a byproduct of climate change and increasing cyber losses.