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Survey Report

Insurance Marketplace Realities 2021 – Personal lines

Personal Lines

November 18, 2020

Insurance carriers are taking aggressive actions in a drive toward profitability. Buyers need to be creative in finding solutions.

Rate predictions

Rate predictions: Personal lines
  Trend Range
Most risks:
Homes under $1,000,000: Increase (Purple triangle pointing up) +5 to +7%
Homes over $1,000,000: Increase (Purple triangle pointing up) +7 to +9%
Cat-exposed: Increase (Purple triangle pointing up) +20% to +50% with contract limitations
Cat-exposed with losses: Increase (Purple triangle pointing up) +50% to +100% or non-renewal

Key takeaway

Insurance carriers are taking aggressive actions in a drive toward profitability by limiting their appetite in high-density areas while implementing restrictive underwriting guidelines. With insurers trying to push rates higher, buyers need to be creative in finding cost-effective solutions.

COVID-19 has so far spared personal lines from any dramatic actions by insurance carriers.

  • Many individuals are investing in their homes as work from home (WFH) becomes a more permanent situation. Clients should be vigilant in updating property values and informing their insurers of any active remodeling or construction. Property rates continue to climb as climate change impacts frequency/severity of storms.

Property rates continue to climb as climate change impacts frequency/severity of storms

  • In 2020, the West experienced yet another record-breaking wildfire season, while the Gulf Coast had one of the most active hurricane seasons since 2005.
  • Insurers are seeking additional premium wherever possible and applying stricter underwriting, particularly to property valuations.
  • In response to massive rate increases imposed by insurance carriers, many individuals are looking to self-insure.

Auto rates will continue to improve as fewer drivers are on the road.

  • A drop of 40.2% in miles driven by U.S. drivers in April 2020 and 25.5% in May 2020 was recently reported by the Federal Highway Administration.
  • Ongoing health concerns, WFH mandates, and the economic slowdown could result in reduced vehicle usage for quite some time, helping to improve the bottom line for many auto insurance carriers.
  • Reduction in traffic will lower claim frequency.

Liability concerns mount as large verdicts are becoming commonplace.

  • Nearly 10% of auto fatalities can be blamed on distracted driving. Auto safety experts point out that looking away for just five seconds to send or read a text while driving 55 mph is like driving an entire football field with your eyes closed.
  • Jury awards are reaching new highs in personal injury and liability lawsuits, expressing a trend toward what some call a lottery mentality. This is directly impacting rates and coverage, leading to placement capacity issues.
  • High-profile individuals and families are being scrutinized by underwriters looking to limit their exposure to anyone who gathers media attention.

Family offices evolve to protect household members and investments.

  • Single family offices continue to collaborate and join others to establish efficient multi-family office structures.
  • The combination of investment management, financial planning, estate and trust administration, legal work, tax/accounting and philanthropic administration has created additional coverage needs for D&O, E&O, EPL, fiduciary liability, cyber liability and crime.


Willis Towers Watson hopes you found the general information provided in this publication informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, Willis Towers Watson offers insurance products through licensed subsidiaries of Willis North America Inc., including Willis Towers Watson Northeast Inc. (in the United States) and Willis Canada, Inc.


Tyler Banks
National Practice Leader and CEO, Personal Lines

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