The Swett & Crawford Group Inc.

10/14/2024 | News release | Archived content

Excess & Umbrella REDY® Index Q3 2024

The REDY Index leverages CRC Group's collection of actionable data - the wholesale industry's largest. It provides critical pricing analysis monthly, giving you a snapshot of the marketplace. The REDY Index generates instant intelligence on pricing trends by industry or coverage, enabling our retail partners to set accurate data-driven expectations with their clients. Removing the guesswork empowers CRC team members to negotiate competitively, consistently producing better outcomes, better deliverables, and better results. Removing the guesswork empowers CRC team members to negotiate competitively, consistently producing better outcomes, better deliverables, and better results.

EXCESS & UMBRELLA REDY® INDEX- October 2024
MONTHLY RENEWAL PRICING ANALYSIS

WHY YOUR RESULTS MAY DIFFER

Results displayed above reflect average CRC Group excess and umbrella liability renewal pricing changes by month (over the previous 12 months). Results are limited to brokerage accounts that renewed in the same month as the prior year with the same total account limits. To remove outliers, the top and bottom 1% of accounts by YoY % change have been removed, as well as the top and bottom 1% of accounts by rate on line (Premium/ Limit*100). The REDY Index is intended for educational purposes only as individual accounts typically differ from average pricing trends.

ONGOING EXCESS & UMBRELLA ISSUES

  1. Q3 XS Casualty pricing remained relatively consistent to prior quarters with an additional upward trend observed in tougher classes and via compounding of exposure growth plus rate increases.
  2. Overall, the market remains stable and dynamic due to another fresh round of entrants. This unexpected capital support by reinsurers aligns with a belief that casualty rates have not peaked. For insureds, fresh capacity is favorable as mature portfolios continue to be pruned to combat loss issues. Entrants over the last three to five years are already remediating or adjusting rates upwards, particularly for excess auto due to unexpected early claims.
  3. Low attaching layers and complex accounts are typically the first target of rate and deal restructuring, but the proliferation of $100M+ demands and jury verdicts have prompted carriers to rethink mid and high excess layer pricing and relativities. Lower middle market remains price competitive yet balanced by restrictive, and often undesirable, terms and conditions to limit coverage.
  4. In 2023, reinsurers were questioning rate adequacy. This year reserving adequacy is also being reviewed. The issues are not simply lag and inflation; loss development patterns are emerging worse than expected in recent years. The market will likely remain firm and rate increases may accelerate again in Q4 2024 as previously observed in Q4 2023.