Upward pressure on liability rates rising to-date in 2024: Gallagher

Upward rate pressures in liability lines may have risen throughout Q1 to keep rate trends on an upward trajectory, top officials at global re/insurance brokerage Arthur J Gallagher have contended. 

The evolving view is driven by “a tone of concern that seems to be louder today in our interactions with carriers and clients around casualty rate adequacy” vis-a-vis the lay of the land prevailing when Gallagher last gave its outlook in March, CFO Doug Howell told his company’s Q1 earnings call. 

“We feel that casualty rates are more likely to be going up again in each of the next three quarter than we would see it going down, by any means,” Howell said under questioning. 

That market read is still heavy on touch-and-feel versus cold, hard data. 

“There is a tone shift there, I can't quite see it 100% in our data yet, but it seems like it’s coming," Howell told analysts. 

General liability has the likely greater upside, vis-a-vis the view just over one month prior. 

“That's where I think probably we’ve got to look at our carriers and say are there going to be some reserve challenges going forward?” CEO Patrick Gallagher noted, citing recent price gain near 7% with an outlook for “maybe a push up a bit”. 

Elsewhere, umbrella has last traded with a 9% gain to match prior signals; package was listed up 8% and workers comp 2%, he said.  

Factors such as social inflation, litigation finance and the outlook for medical expense “lead us to believe further rate increases are to come in casualty,” the CEO said. 

Property is now at “the other end of the spectrum” and, while rate increases are “still pushing double digits” in Q1, carriers are proving “more than willing” to meet upward shifts in demand, the CEO said.

Did you get value from this story?  Sign up to our free daily newsletters and get stories like this sent straight to your inbox.