As we step into the final stretch of 2025, the commercial insurance industry finds itself at a unique and promising inflection point. After years of navigating volatility — from pandemic fallout to inflationary surges and geopolitical uncertainty — we are now approaching a clear and stable horizon. With capital abundant, technological advancements accelerating and risk insight tools more powerful than ever, the industry is poised for progress.
At the heart of this transformation is artificial intelligence. AI is no longer a vision for the future; it's a force actively reshaping our industry today. From the boardroom to the underwriting desk, AI-enabled tools are unlocking deeper insights, driving more informed decision making and expanding the very definition of insurability.
We see this in emerging infrastructure-supporting data centers, where new insurance products are being tailored to match the scale and complexity of an AI-powered digital world. And we see AI in our own investments — such as Willis,’ a WTW business, proprietary Auto Liability Risk Index, seamlessly embedded into our Broking Platform — helping clients quantify auto-risk with more accuracy, speed and foresight.
Equally powerful is the infusion of capital into the market. With industry surplus surpassing $1 trillion and reinsurance capital exceeding $725 billion, there is a strong appetite for innovation. This capital abundance is not just stabilizing — it’s energizing. It allows carriers and brokers alike to pursue bold, client-focused solutions.
That’s exactly what we aim to do with the launch of Gemini, our global follow facility. Gemini helps mitigate uncertainties — including the often-cyclical nature of risk — by creating consistency and scale in how risk is placed. It is a clear example of how strategic innovation, backed by smart capital, can deliver better insurance products (and capacity) for clients worldwide.
Today, nearly every commercial line of insurance — aside from excess casualty — finds itself in soft-market territory. For buyers, this creates a rare window of opportunity: expanding coverage, enhancing structural positions and reexamining your portfolio through the lens of a broader and more flexible market. It’s also a strategic moment to align with markets and partners who are equally focused on building long-term resilience and value.
The horizon is indeed clear — but clarity doesn’t mean complacency. The conditions we enjoy today can shift rapidly. A turbulent close to hurricane season, a globally coordinated cyber event, or unexpected financial market disruptions could darken the skies ahead. That’s why the opportunity in front of us demands both vision and vigilance.
We invite you to explore this 2026 edition of Insurance Marketplace Realities, where we examine the key risk drivers and market dynamics shaping today’s insurance landscape — both at the line of business level and across industries. In this issue, you’ll also find timely insights from Harris Wiener, Head Coverage Officer for WTW North America, who revisits a fundamental aspect of liability coverage — clearly defining "Who is an Insured." We hope this edition makes things clearer about today's environment and gives you the knowledge to handle it confidently.
Clarity in liability policy language is crucial. Broad form named insured endorsements impact coverage, corporate risk, and contractual obligations.
The property insurance market is experiencing a softening trend. Despite significant catastrophe losses, the market remains competitive.
The casualty insurance market is currently experiencing significant firming, but in some instances, increased flexibility and the development of new strategies is evident.
Q3 2025 commercial insurance shows softening in property lines, pressure in casualty, and strategic multi-line solutions for middle-market clients.
The Canadian casualty insurance market remains resilient with strong domestic capacity and is adapting to changes like Ontario's modular auto-insurance system.
Canadian property insurance rates softened in Q3 and are expected to remain stable into 2026.
Bermuda’s market shows stability in financial lines, easing in casualty, and sharp property shifts—offering strong execution for complex global risks.
Given the prolonged period of market stabilization, cyber insurance direct written premiums declined 2.3% in 2024.
The D&O market remains competitive, with the abundance of capacity moderated by continued pressures toward rate stabilization.
As more guidance emerges from the current administration, we anticipate an increase in claims and adjustments may be made in more risky jurisdictions and industries.
While some primary insurers are still trying to impose claims inflation increase of 2% to 3%, primary policy rate increases for large law firms have mostly leveled off with reductions possible.
The fidelity and crime market remains stable, even in an ever-evolving threat landscape. Rate pressure may be present on programs with meaningful coverage enhancements and/or loss experience.
Although some traditional fiduciary carriers continue to be wary, there have emerged enough carriers with increased appetites to create improved and stabilized market conditions.
The financial lines market is currently experiencing a mixed state, with both softening and hardening trends depending on the segment.
Alternative Risk programs grow in use. Structured, parametric, and captive stop loss solutions help insureds manage tough risks and reduce capital erosion.
A&E professional liability carriers face increasing claims severity (85%) driven by social inflation, economic uncertainty, and emerging risks like AI and climate change.
The aviation and space insurance market faces pressure from rising claims, inflation, and geopolitical uncertainty. Rate increases are widespread, but capacity remains available with oversight.
Global turbulence drives need for robust risk management. Captives and parametric solutions gain traction as traditional insurance markets face capacity constraints.
The construction insurance market faces challenges across multiple lines, with general liability and auto under pressure, while workers' compensation remains stable.
Insurers are adapting to evolving security threats, maintaining steady capacity despite heightened tensions.
The Q1 2025 property energy insurance market saw slowed rate reductions due to large losses. Property rates remain competitive, while liability classes with heavy auto exposure face challenges.
Environmental insurance market trends for 2026: Rate predictions, emerging exposures, and new product developments in pollution liability and environmental coverage.
The top 50 malpractice awards averaged $56 million in 2024, reflecting a 14% increase from 2023 and a 75% increase from 2022.
We are still experiencing rate stability, largely due to the ongoing influx of new capacity and no signs of a slowdown in marketplace competition.
While market rate conditions have eased, underwriting factors, such as increased exposures, may still lead to premium increases.
Marine cargo and stock throughput insurance markets remain soft, offering insureds better rates, enhanced coverage, and protection across the supply chain.
Marine Hull & Liability market improves for insureds. New entrants and growth-focused carriers drive better rates, coverage, and cost efficiency.
Insurance markets are shifting, with rising U.S. excess liability rates and a focus on risk management. Review your coverage annually and implement risk mitigation measures to stay protected.
The political risk insurance market is currently experiencing a hard state but is showing flexibility, especially for multicountry programs that exclude high-risk areas.
With tariff-driven cost inflation and multi-hundred-million-dollar loss activity, recall programs must be stress-tested for adequacy.
Cost of litigation, social inflation and large verdicts continue to be a concern for the senior living industry.
The surety industry is adapting to evolving needs through innovative solutions and expanded capacity.
The trade credit market is beginning to see positive conditions for new insureds, despite an increase in business bankruptcies and insolvencies.
WTW hopes you found the general information provided here 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, WTW offers insurance products through licensed entities, including Willis Towers Watson Northeast, Inc. (in the United States) and Willis Canada Inc. (in Canada).
