2 May 2018Insurance

Gallagher CEO calls rate increases justified

The current rate increases in the insurance sector are justified, Arthur J Gallagher CEO J Patrick Gallagher, Jr., said during the broker’s first quarter 2018 results conference call.

Property and commercial auto are seeing the largest price increases up 3 percent to 5 percent, casualty and specialty lines are "flat up 2 percent" while workers' comp is "flat to down about a point," he said.

“Property casualty insurance pricing in Australia, New Zealand is in the mid-single digit range with strength across all classes. Our UK and Canadian operations are seeing a flattish pricing environment while rates in our London specialty operations seem to be nearing a bottom,” Gallagher, Jr. said.

Prices are mostly up in hurricane-related property and some cat-hit property is up around 10 percent, Gallagher, Jr. said. Prices for risks that are not cat exposed and didn't burn the market, are seeing rates up between 3 percent and 5 percent, he added.

“When you think about where the rates were pre-hurricanes, they were as low as they've been in over a decade. So I do think that the rate increases are justified, they are selling in the market now,” Gallagher, Jr. said.

“I don't see a return to a vast soft market anytime quickly,” Gallagher, Jr. commented. But at the same time, he believes that once the balance sheets have had a chance “to heal a little bit and the wind doesn't blow,” rates may come down again.

Make sure you are GDPR compliant and  confirm your email address to keep getting our daily emails

More of today's news

Gallagher CEO works on $400m acquisition pipeline

Aon appoints new chief commercial officer, CEO of global specialties

Allstate Q1 profit jumps 42% as claims drop 

Reinsurance unit drives growth at Arch while profits drop

Don't miss our insurtech email newsletter - sign up today


More on this story

Insurance
11 May 2018   Insurance brokerage and risk management firm Arthur J Gallagher has signed a definitive agreement to acquire 100 percent of the equity interests of Pronto Holdco, the parent company of Pronto Insurance.

More on this story

Insurance
11 May 2018   Insurance brokerage and risk management firm Arthur J Gallagher has signed a definitive agreement to acquire 100 percent of the equity interests of Pronto Holdco, the parent company of Pronto Insurance.

Intelligent Insurer
Newton Media Ltd
Kingfisher House
21-23 Elmfield Road
BR1 1LT
United Kingdom