What to expect from commercial property insurance in 2022
Commercial property rates have seen double-digit increases for two straight years and Gary Wells, managing partner at The Liberty Company Insurance Brokers, does not foresee a notable drop any time soon.
The 2022 outlook for this segment is still quite uncertain as severe weather events continue to present challenges for carriers, brokers, and clients.
“We are still going to see increases, but it won’t be as high as we have experienced over the last couple of years,” he stated.
Another challenge Wells mentioned was the lack of capacity in the industry, especially for property driven accounts.
“During the pandemic, there were many people who couldn’t pay rent as they were receiving less revenue,” he noted. “Couple that with shortages on labor and materials, and insurance carriers requesting major increases on insurable values – those three things combined are really affecting commercial real estate clients.”
Wells deals with multifamily properties and explained that properties in states like Texas and Florida have been particularly hard to handle as carriers are pulling back the amount of capacity they are willing to have in those areas based on weather-related exposures.