Dangling carrots, the MGA boom and our inhospitable planet

The U.S. property and casualty sector may have posted premium growth in the first half of the year, but according to Fitch Ratings, this segment will be "hard pressed" to match the 102.8% combined ratio of last year. Headwinds include the uncertainty around future catastrophe losses, the effects of inflation on loss costs, and also loss reserve experience, the ratings agency explained.

Drilling a bit deeper into the numbers shows that the excess and surplus lines market in the U.S. posted double-digit growth for the fifth straight year in 2022, and this year is shaping up to extend that notable streak, Fitch Ratings reported. What's more, E&S outperformed the broader P/C market for the first time since 2015. Historically, the E&S market has accounted for a steady 5% of the total P/C market, but as its growth really exploded starting in 2018, the market now accounts for almost 9% of the total with more to come.

And within that, the MGA market just keeps killing it, outpacing growth in the property-casualty industry by 13.5% in 2022. Watch this interview with AM Best TV and Conning’s William Pitt to learn what is driving this growth.

Back to those cat losses... a deep dive revealed something insurance headlines have been telling us for years now: Earth's becoming inhospitable. "This does not mean that we are pushing the planet across an irreversible collapse,” said Johan Rockstr?m of the PIK - Potsdam Institute for Climate Impact Research . “But it means we are losing resilience — we are putting the stability of the Earth system at risk, and the buffering capacity of the Earth system to buffer stress and shocks at risk.” Read the details on report in the Insurance Journal .

The numbers clearly back that up. From 2013 to 2017, total global insured losses from natural catastrophes averaged $70 billion, which was a steady increase from prior years. From then until now, that average has surged to more than $100 billion a year. And it's not about to change, according to models created by Verisk.

Along with climate, the hunt for talent ranks among the top concerns in the industry, and, as Higginbotham CEO Rusty Reid, CIC explained to Insurance Business America , it's critical to not neglect the inexperienced applicants who can come with novel ideas. “We’ve always brought in youth, and that is what keeps a business relevant,” he said. “They bring a freshness to the industry and can help innovate new ways of doing business through unique perspectives.”

The intersection of the technology boom and the talent shortage is poised to shape the future of the insurance industry, in some difficult, but also some very beneficial ways. Read why CorVel Corporation's Michael Combs believes that technology will not only enhance customer experience, improve risk assessment and become instrumental in fraud detection but will also serve as a dangling carrot for young job seekers taking aim at a cutting-edge career.

While it may be tricky to convince the youngers, those of us in this business already know the insurance industry is a great place to work, and now, according to Twelve Capital, we also know it's a great destination for investment dollars. In fact, when it comes to investment grade bonds, it's about as good as it gets.

In the spirit of dangling carrots, red-hot MGAs and luring in the younger generation, check out Paragon's career page and see if there's a fit.