Habitational insurers are becoming more reluctant than ever before, as they find themselves close to potential losses. Property valuations, rates and deductibles have quickly spiked throughout the past year, and carriers are closely scrutinizing the risks they are willing to obtain. Here are 5 trends you should see coming in 2022.
5 things you should know while insuring your multifamily property in 2022
1. As higher property valuations are inserted into their catastrophic modeling, carriers are hesitant to offer larger limits on excess layers. Expect the larger, more complex programs to be increasingly difficult to assemble this year.
2. Regarding excess liability insurance, average risks are experiencing 30%-50% increases. Properties with higher numbers of subsidized units and significant loss history could experience even higher rate increases.
3. Your broker will need to expand marketing efforts as carriers are scaling back limits, especially for excess and umbrella policies. Many insurers are reducing lead capacity from 25 million to 10 million.
4. Carriers are concerned about the habitability claims they are experiencing on the west coast. Analysts fear this
trend could soon spread across the country. Habitability claims are related to the status of living conditions and do
not require a bodily injury or property damage instance to occur.
5. Crime statistics are playing a massive role in the placement of casualty policies. With more data readily available to underwriters, they are heavily focused on crime scores in the areas surrounding your property. Many carriers are not quoting over a certain level of the crime score. Multifamily insurers are currently as cautious as ever. Years of losses, an abundance of recent claims, and skyrocketing property valuations have forced the retraction of capacity for many carriers. Consult with your broker to discuss the marketing of your account earlier than normal in 2022 and learn how BKS Partners’ Risk MapTM can provide the guidance needed when insuring your multifamily property.
Contact us today to connect with an expert on our Multifamily Practice team who can evaluate your needs and help you navigate the challenging market we are experiencing.
Individuals and companies who need help navigating the complexities of insuring their assets should lean on experts who have proven success in helping clients get the coverage they need, even in a hard market. Contact us today to learn more about how we can help you assess your risk profile and protect your assets and investments.
This material has been prepared for informational purposes only and was generated from information provided to BKS from the client and/or third-party sources. Therefore, BKS makes no warranty or representation(s) as to the accuracy or appropriateness of the data and/or the analysis herein. This information is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your tax, legal and accounting advisors for those services