Personal & Commercial Auto Liability Insurance in the US. Impact of Inflation
Inflationary trends in auto liability insurance, personal and commercial combined, drove loss and defense containment costs between $96 bn and $105 bn higher
Inflation on the Insurance reviews focuses the impact of inflation on the insurance industry. This category covers how rising prices affect insurance premiums, policyholder costs, and overall industry profitability. It explores the relationship between inflation and insurance claim costs, as higher inflation rates can lead to increased claims expenses and pressure on insurers to adjust premiums accordingly.
The reviews in this category analyze how insurers adapt to inflationary pressures, including adjustments in coverage and changes in underwriting practices. Additionally, it assesses the broader economic implications for policyholders and the insurance market. By providing insights into these dynamics, the category aims to help stakeholders understand the effects of inflation on insurance and navigate its challenges effectively.
Inflationary trends in auto liability insurance, personal and commercial combined, drove loss and defense containment costs between $96 bn and $105 bn higher
The current environment is complex: inflation has stayed higher for longer than expected, natural catastrophes cause increased losses
Analytics forecast 2.2% global real GDP growth in 2024, rebounding to 2.7% in 2025, driven by lower inflation and interest rates
Natural catastrophe-related losses will continue to be the largest risk to Japanese nonlife insurers’ earnings in fiscal year 2023, though the effects of inflation are catching up
Every insurer should closely monitor price developments, focusing on the drivers relevant to the respective insurance coverages, such as repair costs, construction prices or medical inflation
The immediate impact of inflation on non-life (P&C and health) insurers’ earnings is negative, primarily through rising future claims costs on current insurance policies
In response to high inflation, central banks have hiked their base rates, which, in turn, can impact the balance sheets of (re)insurers as a result of fixed-interest securities falling in value
The insurance industry is often described as “recession proof” but it’s definitely not inflation-proof. We’ll try to cover the what, why, and how of inflation