2026 MARKET TRENDS
Casualty
Key Takeaways
- The casualty insurance market remains highly competitive, with softening rates across nearly all lines of business
- Abundant capacity allows for negotiation of improved terms and conditions while securing more favorable pricing
- An uptick in claims frequency for General Liability and challenges to exclusive remedy in Workers’ Compensation have not yet materially affected rates
The strong capacity environment allows brokers to negotiate improved pricing along with enhanced terms and conditions for customers.
Overview
The casualty insurance market remains highly competitive. With a few notable exceptions, rates continue to soften across most lines as carriers that previously limited new business now seek to grow premium and expand their portfolios. This strong capacity environment allows brokers to negotiate improved pricing along with enhanced terms and conditions for customers.
As inflation continues to pressure overall operating costs, a softening casualty market creates meaningful opportunities for organizations to achieve savings at renewal while maintaining appropriate coverage .
The automobile liability market remains firm, with 5-10% annual increases and limited capacity for larger fleets lacking controls or with prior loss history.
Market Conditions
Carriers are actively pursuing new business as they look to grow premium volume heading into the new year. This increased competition creates favorable conditions for insurance buyers and keeps renewals highly competitive. Organizations with low loss frequency or severity often have opportunities to secure lower rates and premiums in the current casualty market.
At the same time, claims frequency is rising for Personal and Advertising Injury under General Liability, along with more frequent challenges to the exclusive remedy doctrine in Workers’ Compensation. The broader market impact of these trends remains uncertain.
While conditions continue to soften across much of the market, select industries are experiencing more stable or firmer pricing environments. These sectors include:
- Transportation
- Hospitality
- Heavy construction
- Habitational
In these segments, excess liability terms and pricing remain challenging. For difficult risks, many carriers are reducing limits, forcing multiple carriers with minimum premiums to secure the needed limit, which is driving premium. Sexual abuse and molestation, assault and battery, human trafficking and firearms exclusions/limitations continue to remain prevalent in terms and conditions for many types of risks, including hospitality, habitational and real estate.
Impacts & Considerations
As inflation increases the cost to operate, hire and produce, the current soft casualty insurance market presents a meaningful opportunity for businesses. For the first time in many years, lower casualty renewal costs can help offset rising expenses across other areas of the organization.
Businesses are well positioned to take advantage of current market dynamics by leveraging increased carrier competition and favorable pricing conditions. To navigate this cycle and help strengthen renewal outcomes, organizations should consider the following actions:
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