Real Estate & Hospitality Market Update - Spring 2018
2018 has thus far been a year of firming property premiums due to the $135BB (and counting) of losses in 2017 and early 2018. Based on a February 2018 report in the publication Carrier Management, the U.S. property/casualty insurance industry will show a combined loss ratio of 105.1%. To put that into English, for every dollar of premium, $105.1 will be paid out. Speaking of the English, Lloyds of London has also suffered massive property losses particularly in the Hospitality industry with Irma and Maria claims in South Florida and the Caribbean. Their Combined Property Loss Ratio is now pegged at 127.6% excluding reinsurance claims. To make matters even more interesting, Colorado State University climatologists are predicting an above average hurricane year for 2018. Suffice to say, the property underwriters are re-examining their approach to underwriting high hazard flood and wind areas. Even the most “clean” (no losses) accounts will likely see single digit rate increases.