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"To harden rates, there has to be an impetus, and in this case, the industry points to 'social inflation,' not replenishment of capital,” said Tracy Dolin, credit analyst at S&P Global Ratings. (Photo: Shutterstock) “To harden rates, there has to be an impetus, and in this case, the industry points to ‘social inflation,’ not replenishment of capital,” said Tracy Dolin, credit analyst at S&P Global Ratings. (Photo: Shutterstock”To harden rates, there has to be an impetus, and in this case, the industry points to ‘social inflation,’ not replenishment of capital,” said Tracy Dolin, credit analyst at S&P Global Ratings. (Photo: Shutterstock)

The P&C insurance industry is once again motivated to “find religion” on pricing thanks to mounting concerns about loss emergence, says a new S&P Global Ratings report.

The industry’s new-found drive comes amidst a loss-cost driven hardening rate cycle, says the “The Outlook On The U.S. Property/Casualty Insurance Sector Remains Stable; ‘Social Inflation’ Puts A Spotlight On Pricing Complacency” report. With market capital recently reaching record highs, the current cycle is in contrast to previous years when rate cycles were driven by capital-replenishment, explains S&P. Yet, despite ample capital, “P&C insurers are still demonstrating restraint by withdrawing underwriting capacity in underperforming business lines, raising attachment points, and reducing limits and asymmetrical re-pricing efforts where it is needed the most,” the report notes.

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Heather A. Turner

Heather A. Turner is the managing editor of ALM's NU Property & Casualty Group. She can be reached at [email protected].

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