Rate Increases and Market Exits in the U.S. Insurance Industry

U.S. property/casualty insurers are responding to higher inflation and natural catastrophe losses with rate increases when possible and exits when not, Swiss Re Ltd. said Wednesday in a report.

Halts to new business and non-renewals in certain lines were among the steps taken by insurers as they retrenched from catastrophe-prone markets such as California, Florida and Louisiana, in the first half of this year, Swiss Re said.

Underwriting actions have extended to commercial property and personal auto lines even while the focus is on homeowners insurance, according to Swiss Re Institute’s June U.S. Property-Casualty Outlook.

Insurers cite the economic environment, natural catastrophes, inflation and reinsurance costs in some cases as factors that have prompted a surge in expenses resulting in underwriting losses, Swiss Re said.