Information for policyholders and agents


COVID-19 has undeniably impacted insurance companies and the policyholders they service. However, commercial insurance rates, including property rates, were trending higher in Q1 even before the pandemic came into prominence. In fact, the reported 21% increase in U.S. commercial property rates was the largest year-over-year jump for the Marsh Global Insurance Market Index since it was created in 2012.

Part of a larger trend

This trend in rising insurance rates is not exclusive to commercial property lines, or even to the United States. As a whole, global commercial insurance prices rose 14% in Q1. However, commercial property is a significant driver in this, due to the ongoing effects of climate change on weather-related risks. The U.S. sector is also among the fastest growing, outpacing the Q1 global rate increase at 21% vs. 15%, respectively.

Continued impact of COVID-19

With commercial property rates in the U.S. demonstrating increases over the last 10 quarters, the introduction of the COVID-19 pandemic is an additional confounding factor in an already-hardening market. As estimated by Lloyds of London and reported by Property Casualty 360, claims related to COVID-19 are having a financial impact on insurers comparable to recent catastrophic hurricanes – costing more than $200 billion in coverages directly impacted by the pandemic, such as business interruption coverage.

While the rate increases that occurred in Q1 did not reflect this impact of COVID-19, these price increases are expected to continue through 2020 due to continued economic effects of the pandemic.

What this means for policyholders

Severe catastrophic activity over the last few years, compounded by the impacts of COVID-19, are manifesting in increased costs for insurers and increased premiums for insureds. These unprecedented increases in rates come at a time when the threat of global recession may be inhibiting payment of many household and business premiums. With rates rising across the board, and increased pressure on both policyholders and carriers, it is important to keep the following in mind:

Stability matters: In times like these, it may be tempting to base insurance decisions solely on price. However, price is not the only factor to consider when purchasing commercial property insurance. Policyholders need to be sure their insurance company has the resources to service and pay claims following a catastrophic loss. American Capital Assurance Corp (AmCap Insurance) continues to adhere to its principles of sound underwriting, reinsurance programs tailored to extreme weather exposure, and exceptional service.

We are here to help: In an effort to provide flexibility and support during this trying time, AmCap Insurance has enacted measures to help make payment easier for our customers. Please visit our COVID-19 information page to learn more.