Key Insights for Q1 2021 Property & Casualty Market Trends

The market hardening trends that defined 2020 continued to kick off 2021, marking the 14th consecutive quarter of pricing increases according to the CIAB’s Q1 2021 Commercial Property/Casualty Market Index. Large- and medium-sized accounts increased by approximately 12.9% and 10.9%, respectively. Smaller-sized accounts again saw less of an increase at 6.3%.

“Umbrella and Cyber continued to pose problems for brokers in Q1 2021,” said Ken Crerar, the Council for Insurance Agents and Brokers (CIAB) President and CEO. “Carriers continued to push for rate increases in Umbrella, noting factors such as nuclear verdicts or social inflation and began to pull back on Cyber risk in the face of rapidly increasing claims from ransomware and attacks that exploit the remote workforce. Though COVID-19 infection rates have been steadily decreasing and employers are beginning to bring their employees back to the office, brokers will need to brace for the aftershocks as we return to a new normal.”

Umbrella/Excess Liability

Umbrella and Excess Liability lines continued to experience significant hardening trends as rates climbed 19.7% in Q1 2021, down slightly from its 21.3% increase in Q4 2020. CIAB survey respondents once again cited factors like nuclear verdicts and social inflation as the driving forces behind this line’s sustained upward trend.

Aside from nuclear verdicts, CIAB survey respondents continued to point to years of underpricing to round out the “why” behind Umbrella and Excess Liability’s climb. When carriers add all of these factors together, it leads to an aggressive reassessment of risk appetite and capacity, as well as the increasing premiums we have seen during the hard market cycle.

Commercial Property

Commercial Property lines also continued to struggle in Q1 2021, with pricing increases of 12%. The increased frequency and severity of natural disasters are the main culprit behind these consistent rate increases. The most notable event from Q1 2021 was an unprecedented February ice storm in Texas. The damage totals for this storm are still being determined; however, some sources currently estimate upwards of $130 billion in losses. 

As we enter the summer months, events like wildfires will be important to monitor in the western United States. The property market is expected to remain difficult as the year goes on, emphasizing the importance of advanced planning for renewals to ensure the best possible outcome.


Cyber has suddenly become a line in distress, as both rates and demand saw significant increases in Q1 2021. When the world’s workforce shifted to remote operations and telecommuting in 2020, vulnerabilities were revealed. The Federal Bureau of Investigation’s 2020 Internet Crime report revealed over 2,400 reported ransomware incidents totaling over $29 million in losses last year. Ransomware and other forms of attack in cyberspace have continued to be a mainstream issue in 2021, garnering the attention of both businesses and underwriters alike.

The diversity of recent ransomware victims underscores that no industry is immune to a large-scale cyberattack. Cyber protections will be paramount moving forward for businesses across all industries to mitigate this emerging risk.

Looking Forward: Emerging Positive Trends

While the difficult conditions that have plagued the market for some time did persist in Q1 2021, signs of stability are beginning to enter the market. Competition for new business has resulted in favorable outcomes for some lines that are helping to offset the pricing increases on other policies.

RCM&D is uniquely positioned to help our clients take advantage of these positive trends. Our proven track record and renewal process can help reduce the total cost of risk by leveraging our industry expertise, risk assessments and more to the benefit of our clients.

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