Rate increases can hold the 2021 pace with all drivers firmly in place: AJ Gallagher
P&C insurance rates show no sign of slowing thus far in 2022 with the full set of recent drivers all in place or intensifying, top officials at insurance brokerage Arthur J Gallagher have said.
"We aren't seeing a meaningful rate slowdown," CEO Patrick Gallagher told an investor call. "Pricing continues to increase in nearly all geographies and product lines around the globe."
Rate increases in renewal contracts in the first two months of 2022 are coming in "at around 7.5%, broadly consistent with increases we saw in 2021," he said.
Drivers are numerous and familiar, with Russia's invasion of Ukraine set to intensify some of those pressures, Gallagher believes.
The Gallagher read: loss frequency is on the rise in many lines post-pandemic; claims inflation has been spiking and could worsen on the Russian-Ukrainian war and cat loss history still has underwriters "reassessing rate adequacy."
"We see difficult P&C market conditions continuing at least through 2022," he concluded.
Cyber continues to stand out for tightest capacity and strongest rate gains. "Our risk-bearing partners remain cautious," Gallagher said, a situation which has been "exacerbated" by developments in the Ukraine.
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