Commercial Insurance Market Remains Firm, But Shows Early Signs of Moderation
According to the latest data from the Ivans Index, the commercial insurance market continues to stay firm overall. Nevertheless, there are early signals that conditions may be easing from the peak tightening we’ve seen in recent years.
For most major commercial lines, average premium renewal rates increased year-over-year in the fourth quarter of 2025. This is a sign that carriers are still disciplined in their pricing. They demonstrate careful underwriting. However, some lines showed moderation or even decreases compared to the prior quarter.
Here is some notable data by line of business (Q4 2025 vs Q3 2025):
Lines Showing Reduced Renewal Momentum
- Commercial Auto: Average renewal rate declined to 6.97% from 7.60% last quarter potentially indicating more competitive pricing or underwriting tightening easing. Based on other reports I regularly monitor, I don’t expect this to be the case anytime soon.
- Business Owners Policy (BOP): Averaged 7.52% with a slight reduction vs Q3.
- Workers’ Compensation: Continued its downtrend with a -1.61% change. Still negative but a modest move compared with prior quarters.
Lines Still Firm or Hardening
- General Liability: Saw a notable increase……7.23% in Q4 vs 5.89% in Q3.
- Commercial Property: Continued upward momentum with an average 8.01% renewal change.
- Umbrella: Also ticked up slightly, ending the quarter at 9.49%.
The data suggests the overall market is still firm, particularly in liability and property exposures where carriers remain cautious. That said, the softening in some lines, like commercial auto and workers’ compensation, indicates that carriers are adapting. They are reacting to evolving risk conditions and competitive dynamics.
For insureds, expect continued firm conditions in key exposures, especially if loss activity or inflationary pressures persist.
One thing that remains consistent, proactive risk management and strong loss history remain crucial differentiators when negotiating renewals with underwriters.
If you’d like help analyzing how these market trends impact your portfolio, I can also help with your renewal strategy. Feel free to reach out. I’m here to help you navigate this dynamic landscape.
-JK
August 2025 Insurance Trends: What SMBs Need to Know
Running a small or mid-sized business comes with enough challenges—managing insurance costs shouldn’t feel like deciphering Wall Street reports.
Every month, the Ivans Index tracks how commercial insurance renewal rates are trending nationwide. The August 2025 results are in, and there are a few key takeaways that matter directly to your bottom line.
Commercial Insurance Rates Are Still Climbing, But at Different Speeds
- Commercial Auto: Renewal rates slowed slightly, now averaging +7.19% (down from 7.96% in July).
- Businessowners Policy (BOP): Continued climbing to +7.65% (a bump from 7.55%).
- General Liability: Saw one of the bigger jumps, moving to +5.91% (from 4.98%).
- Commercial Property: Ticked down slightly to +7.84% (from 7.98%).
- Umbrella Liability: Rose to +9.02%, the highest among all lines.
- Workers’ Compensation: Still trending negative at –1.45%, but that’s actually good news—premiums are still decreasing year over year.
What This Means for SMBs
- Auto Fleets & Delivery Vehicles
If your business owns company cars or vans, you may see some relief compared to earlier this year. But, rates remain elevated. Now is the time to revisit fleet safety programs, driver training, and telematics—steps that can earn discounts. - Protecting Your Core Business (Businessowners & Property)
BOP and property insurance continue to trend upward. For businesses that rent or own space—or rely heavily on equipment and inventory—this means budgeting for higher premiums at renewal. It’s also a reminder to double-check coverage limits: rebuilding and replacement costs are still affected by inflation. - Liability Coverage
Both General Liability and Umbrella are climbing. With lawsuit costs rising, insurers are charging more to provide extra protection. SMBs often underestimate their liability exposure, but a single claim can easily pierce through a $1M policy. Umbrella coverage, while pricier, is becoming more critical. - Workers’ Compensation
The lone bright spot—rates remain in the negative. If your payroll has grown, this can help offset increases elsewhere. Strong safety programs and low claims history can keep this trend working in your favor.
Why Staying Ahead Matters
The Ivans Index pulls data from over 120 million transactions across 700+ carriers and 38,000 agencies. In short: these numbers reflect what’s actually happening in the market right now.
For SMB owners, the lesson is clear:
- Don’t wait until renewal time to discover higher premiums.
- Review your policies proactively with your insurance broker.
- Explore risk management strategies that can reduce claims and keep costs in check.
Final Takeaway
Insurance costs for small and mid-sized businesses are still trending upward, especially in liability and umbrella coverage’s. Workers’ comp is the exception, offering some balance.
By planning ahead, SMBs can manage these shifts. They can do this by working closely with a knowledgeable advisor. This approach protects both their people and profits.
Beware: Communicable Disease Exclusion for Commercial General Liability Insurance
With more businesses set to slowly open their doors again, I’m certain that insurance carriers are going to start adding this Communicable Disease Exclusion onto Commercial General Liability insurance policies at renewal. I’ve reviewed various policies of my insured’s to see if this exclusion is tucked away in any current policies and I am not seeing much of it at this time, but I bet it’s coming. Here’s the policy form/exclusion I’m referencing:
It’ll be interesting to see how insurance carriers respond. Will they potentially remove it for an additional premium, or if it’ll be straight non-negotiable?
My suggestion is to keep your eyes open on your general liability policy to see if this is added at renewal and what the potential repercussions are for your business.
I think in due time, new regulations will be put in place within the insurance industry to address communicable diseases, but I feel this is critical to look at now from a Risk Management standpoint.
-JK
Commercial Building Insurance – 2401 N. Palm Ave.
Congratulations to a client who closed escrow on this fine 8,250 square foot commercial building in Signal Hill on Wednesday. We wrapped up the Property, General Liability, and Commercial Umbrella insurance for the building so it’s time to move in now.
-JK
Insurance For Condo Homeowners Association in Harbor City
Effective 8/9, I finalized insurance for this Condo Homeowners Association in Harbor City. This is an 18-unit, 25,850 total square feet dual building property. Coverage’s include Commercial Property insurance for the structures, General Liability, and Director’s & Officer’s Liability to help protect the association board. The expiring policy didn’t include the D&O. I was able to add this coverage and still save premium dollars compared to the renewal terms the association received from the incumbent broker.
-JK
Insurance For Medical Office Towers In Torrance
Just wrapped up the insurance renewals for these two medical office towers in Torrance. 140,000 Square feet
- Property Insurance
- General Liability Insurance
- Umbrella / Excess Liability Insurance
- Earthquake Insurance
- Workers’ Compensation Insurance
-JK
Travelers Insurance: Insuring Technology Companies
Travelers Insurance Company has joined the ranks of other major carriers such as The Hartford in writing coverage for technology companies. Travelers Global Technology President Ronda Wescott and Chief Underwriting Officer Mike Thoma provide their perspective:
If you have a Life Science or Software and Information Technology Company and would like a review of your current insurance portfolio, feel free to contact me anytime. I can help market your coverage’s with all the major carriers specializing in this sector.
Some of the most common insurance coverage’s important to the Life Science or Software and Information Technology industry are:
- Property
- Commercial General Liability
- Professional Liability (Errors & Omissions)
- Workers’ Compensation
- Commercial Automobile
- Commercial Umbrella/ Excess Liability
- Cyber Liability & First Party Data Privacy Expense
- Directors and Officers Liability (D&O)
- Employment Practices Liability
- Fiduciary Liability
- Crime
- Kidnap and Ransom
- Group Medical Insurance
- Group Life and Disability
-JK
The Ins and Outs of Small Business Insurance
Being an entrepreneur makes you the boss, but along with getting to choose your own hours, location, and business plan, it also means that you’re responsible for a lot of other things like commercial/business insurance. There’s a lot more to business insurance than getting the lowest business insurance quotes. It means understanding your business’s unique needs and the potential hazards that can threaten its success.
This brief video from the Insurance Information Institute touches on the ins and outs of small business insurance, including coverage for:
- Property loss
- Business disruption
- Theft
- General liability (including product liability)
- Professional liability (also known as “Errors & omissions,” or “E&O”)
- Employment Practices Liability
- Workers’ Compensation
Credit: Insurance Information Institute
-JK
How Are Commercial Insurance Premiums Determined?
The way an insurance policy is rated determines how the policy premium is developed. Rating factors vary based on the line of insurance you are purchasing.
If you are purchasing commercial property insurance, the building rating formula is based on factors including square footage, type of construction, sprinklered or non-sprinklered, the fire protection classification, etc.
If you are purchasing general liability insurance, the rating formula can be based on square footage, payroll, or gross sales depending on the general liability classification codes used. These are known as rating exposures.
Once the rating exposures are identified and the deductibles selected (usually from information you have provided on the application), the premium is calculated by a simple formula: rate x exposure = premium. The deductible amount you choose will be calculated in the rate. The higher the deductible (the amount you choose to self-insure) the lower the rate. By utilizing higher deductibles, you can bring your premium cost down; however, you do not want to jeopardize your company’s financial future by choosing overly large deductibles.
Speak with your broker-agent for the deductible options available to you when purchasing commercial insurance.
The basic rating equation most often utilizes other modification factors, which can include experience modifications, schedule rating, or judgment rating. Because rating formulas can range from simple to complex, depending on the line of insurance, it is important to discuss how your policy is rated and how the policy premium is calculated with your broker-agent.
Source: California Department of Insurance
-JK
What To Do In the Event of An Insurance Claim
When you deal with an incident that gives rise to an insurance claim, it’s usually a pretty crappy situation. It can be stressful, terrifying, frightening, and alarming in many cases. First things first, try not to panic. Hopefully it’s an incident you carry insurance for to be protected.
Your insurance contract requires that you report all claims promptly. Contact your insurance carrier or broker as possible after a property, liability, worker’s comp or automobile claim. An insurance company claims adjuster will be assigned to handle your claim. You should then be able to deal directly with the adjuster to settle your claim, but your broker can be there with you to assist you along the way.
Here’s step-by-step suggestions on how you should handle property, liability, workers compensation, and auto insurance claims.
Property Claims
In the event of damage to your building or contents:
- Protect the property from further damage:
- Call the proper authorities and utilities (gas, electric, telephone).
- Take photos of the damage before having emergency repairs made, such as boarding up windows or covering holes in the roof.
- Call your insurance broker or carrier to report the loss.
- Call a contractor to estimate the building damages.
- Separate damaged contents from undamaged contents. Do not discard any items until the claims adjuster gives you the authority to do so.
- Keep records of expenses if you are forced to temporarily relocate your business.
- Do not authorize repairs until the claims adjuster has given you the authority to do so.
After the claim is reported to the insurance company, the claims adjuster will:
- Contact you by phone or mail to discuss the loss
- Arrange for an appraiser to inspect extensively damaged property
- Assist you with your choice of contractors to make the repairs
- Contact you for a settlement
Liability Claims
In the event of injuries or damage to property of others which you allegedly caused:
- Call your insurance broker or carrier to report the claim.
- Forward any correspondence, including a summons from an attorney representing the other party.
- Do not discuss the claim with the other party or their attorney. Refer them to your insurance company’s claims adjuster or to us.
After the claim is reported to the insurance company, the claims adjuster will:
- Contact you to discuss the incident that allegedly caused the injury or damage to the property
- Deal directly with the other party and/or attorney to handle the claim
Workers’ Compensation Claims
In the event an employee is injured on the job:
- Complete the Employer’s First Report of Injury or Disease form for all claims. Either use the “call in” reporting system or fax the original form to the insurance company.
- Forward a copy of the First Report to your broker in the event of a disabling injury or death claim. They should follow-up with the insurance company for their prompt handling of the claim.
- Contact the insurance company to question the status of a claim. If you experience delays or have questions, contact your broker for assistance.
After you report the claim to the insurance company, the claims adjuster will:
- Contact the injured employee to discuss the accident
- Request copies of bills and doctors’ reports for medical treatment administered
- Contact you, the employer, if there is any lost time from work as a result of the injury
Auto Insurance Claims
In the event of an automobile accident:
- Report the accident to the police.
- Obtain information about the other people involved in the accident such as:
- Names, addresses and phone numbers
- Insurance company
- Type of vehicle
- Auto and driver’s license numbers.
- Have your vehicle towed to the nearest repair shop if the vehicle is not drivable. Do not authorize repairs until the claims adjuster gives you the authority to do so.
- Call your insurance broker or carrier to report the accident.
In the event of a windshield, vandalism or theft loss:
- Report the vandalism loss or theft to the police.
- Call us to report a loss.
After the claim is reported to the insurance company, the claims adjuster will:
- Contact you to request details of the accident and repair estimates
- Arrange for an appraiser to inspect the damages of vehicles that are not drivable or extensively damaged
- Contact you for a settlement
- Deal directly with the others involved in the accident
You should not talk to others involved in the accident, but refer them to your claims adjuster.
-JK
Source: Zywave, Inc.
About Me
I grew up in Fullerton, CA and graduated from Servite High School in Anaheim. I have my Bachelors degree from Loyola Marymount University in Los Angeles. I currently live in Tustin, CA.
Please contact me if you need help with any of the following lines of insurance for your business:
-Cyber / Data Breach
-Commercial Property
-Commercial General Liability
-Products Liability
-Workers Compensation
-Commercial Auto
-Umbrella/Excess Liability
-Errors & Omissions/ Professional Liability
-Employment Practices Liability
-Directors & Officers
-Life & Disability Insurance
Jimmy Kinmartin, CPCU 