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Real estate insurance market review

Risk & Analytics
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By Paul Chetwynd-Talbot , Paul Turnbull and David Tilley | February 12, 2021

Where is the real estate insurance market heading in 2021? We share our insights in this market review

Over the course of the last decade or so, the real estate insurance market has enjoyed the broadening of coverage and consistent rating reductions.

2020 saw the real estate market sector follow others in to a “hard market”.

However, 2020 saw the real estate market sector follow others in to a “hard market”. With that came cover restrictions, increased rates and reduced line offers from insurers, amongst other challenges.

Insurer profitability is a key driver for market change and although several corrective measures were taken throughout 2020, the profitability challenge remains. As such, the early signs for 2021 are that insurers will continue to focus on improving bottom line profitability with upward movement of standard and peril specific excesses, alongside rating increases. We also expect the introduction of communicable disease and cyber exclusions marketwide following the year end treaty renewals.

Those portfolios with a residential bias, poor risk management and challenging claims performance should expect increased focus as well. With market change however, comes opportunity, and this meant some “non-traditional” real estate insurers have showed an increased appetite for real estate.

This market overview explores our observations of the key drivers of real estate market behaviour, and our expectations for the future.

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Authors

Managing Director
Real Estate Practice

Head of Client Services
Real Estate Practice

Placement Broker
Real Estate Practice

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