The outlook for the U.S. home insurance sector is negative, with AM Best reporting that inflationary pressures, challenging regulatory environments and pressures from natural catastrophes and secondary perils continue to hamper the sector's forecast.
While home insurance carriers have attempted to address mounting losses by increasing rates and "inflation adjustment factors," AM Best reported rate adequacy continues to be challenged. Further, the 12-month policies in home lines make it difficult for carriers to respond to these loss trends.
Rate adequacy challenges have driven some carriers to slow business in catastrophe-prone states. This included three of California's largest home insurers as well as a wave of moratoriums on new business in Florida, AM Best noted.
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Steve Hallo
Steve Hallo is managing editor of PropertyCasualty360.com. He can be reached at [email protected]
