Commercial property insurance buyers locked in double-digit rate decreases at year-end renewals, as surplus capacity, restrained catastrophe losses, and a market comfortable with its results pushed pricing into openly competitive territory.
After a difficult opening to 2025 driven by California wildfires, the remainder of hurricane season passed quietly.
Insurers grew more confident in their books and shifted quickly from defence to growth, expanding property portfolios with little hesitation.
Brokers expect further easing through the year, assuming underwriting profitability holds, Beinsure noted. Reinsurance set the direction. January 1 treaty renewals delivered catastrophe rate reductions of as much as 20%, releasing pressure throughout primary markets and giving carriers room to sharpen terms.
Across the national property portfolio at Aon, average rate reductions reached 12.5% through the fourth quarter, said Vincent Flood, US property practice leader based in New York.
Shared-and-layered programmes recorded average reductions close to 16%, while single-insurer placements landed mid- to high-single-digit cuts.
Buyers using alternative risk structures or capital markets often achieved an additional 10% beyond standard renewals.
Property continues to attract capital. Flood said five or six new Bermuda markets recently added about $25 mn each in catastrophe capacity, pushing competition further. He expects reductions in the 10% to 15% range to persist as long as loss experience remains stable.
Three consecutive years without major hurricane losses reshaped market behaviour, said Joffre Mishall, Chicago-based head of large property at Zurich North America. More carriers chased the same risks, profitability drew attention, and pricing pressure followed.
Outcomes still vary sharply by account. Mishall pointed to physical protection measures, safety management, catastrophe exposure, and loss history as the main differentiators. Some buyers secured steep cuts. Others saw little movement. The spread widened.
- Catastrophe-exposed accounts moved first. Gregory Mann, US property placement leader at Marsh, said some clients achieved reductions as high as 40%.
- Single-insurer programmes that opened the year flat became steadily more competitive, with buyers switching carriers cutting rates by 25% to 30% year over year.
Mann said insurers are now rewarding long-term investment in property resilience. Buyers strengthened assets and protection. Underwriters responded.
Capacity continues to outweigh demand, said Jeff Buyze, national property practice leader at USI Insurance Services. Pricing softened and terms improved in tandem.
Shared-and-layered structures increasingly displaced traditional single-carrier placements. Incumbents lost share to domestic carriers, London markets, and Bermuda capacity. Buyze cited a USI client with nationwide distribution facilities, about $1 bn in total insured values, and material catastrophe exposure that secured a 47% rate reduction at renewal.
For some buyers, relief remains measured. Advanced ceramics manufacturer CoorsTek expects a flat to low-single-digit decrease at its March 1 renewal, said Ondrea Matthews, senior director of risk management and benefits. The company plans to reinvest savings into capital projects and maintenance aimed at improving loss performance over time.
CoorsTek holds insured values in the low billions and maintains a long-standing relationship with its property insurer, which provides resiliency credits and competitive pricing. At renewal, the insurer will introduce a 2% hail deductible after a Benton, Arkansas site moved into a very severe hail zone alongside facilities in Golden, Colorado.
