The hard market is softening in some lines, workers’ comp is still the profit engine, climate risk is exposing weak spots in property, and P&C profitability has a neutral outlook heading into 2026.
1. Commercial Insurance Rates Finally Tilt Toward Buyers
Marsh’s latest Global Insurance Market Index shows global commercial insurance rates fell an average of 4% in Q3 2025, the fifth consecutive quarterly decrease after seven years of increases. All regions saw composite rate declines, and for the first time in this cycle, the US composite is down about 1%, while global property rates fell roughly 8% and casualty remains the big outlier, still up around 3% globally and 8% in the US.
Source: Marsh
Key takeaways:
- The market is no longer universally “hard.” Property, financial lines, and cyber are increasingly negotiable on clean mid-market risks.
- US casualty pricing is still pushing up, so expect tougher conversations on GL, auto, and umbrella for accounts with severity exposure or loss history.
- Agencies that bring tight submissions and a clear story about account performance are in a strong position to win better terms while carriers compete for good business.
2. Workers Comp Remains The Profit Engine Of Commercial P&C
NCCI’s “2025 in Sight, 2024 in Review” shows workers comp is still the star of the commercial portfolio. Private carriers posted a 2024 combined ratio of 86.1% and an operating gain of 23.7%, the eighth consecutive year with operating gains above 20%. Net written premium fell about 3.2% to $41.6 billion, as rate decreases outpaced payroll growth. Accident Year 2024 lost time claim frequency is estimated 6% lower than 2023, while indemnity and medical severities are up around 5–6%.
Source: NCCI
Key takeaways:
- Comp is still the profit engine, which is why carriers keep pushing rate reductions or credits on clean risks in many states.
- Frequency keeps dropping, but severity is climbing, so underwriting will stay focused on safety programs, light duty, and return to work.
- For agencies, comp is a strategic lever. It is a powerful cross-sell, retention, and relationship tool, not just a throw-in line to close a package.
3. Florida Home Insurance: Profit On Paper, System Still Under Stress
An AM Best segment review summarized by Reinsurance News shows Florida’s personal property insurers posted their first underwriting profit in eight years in 2024. A composite of 45 active Florida personal property carriers reported a 93.1 combined ratio and an underwriting gain of about $206.7 million, compared with a $174.4 million loss in 2023, and a pretax operating income of roughly $492.3 million. At the same time, those carriers still show a direct premiums written to surplus ratio of 3.2x and ceded reinsurance leverage over 500%, far above US personal property norms.
Deep Sky Research’s “Uninsurable: Florida’s Home Insurance Collapse Signals National Trend” shows the structural cracks underneath that profit. Between 2014 and 2024, active home insurance policies in Florida fell from about 3.2 million to 700,000 plus, roughly a 78% decline, while Citizens’ market share grew from 6% to 63% and the average annual premium climbed to around $3,454, about 22% higher after inflation than in 2014.
Sources: Reinsurance News, National Mortgage News
Key takeaways:
- Florida’s domestics finally printed an underwriting profit, but they did it with heavy reinsurance reliance in a shrinking private market.
- The mix of fewer private policies, rising premiums, and a dominant residual market is a warning shot for other catastrophe-exposed states.
- Even if you are not in Florida, expect more client questions about availability, residual carriers, and what happens if standard markets keep pulling back from high-risk property.
4. Fitch Sees Strong P&C Profits Carrying Into 2026
Fitch Ratings has published its 2026 outlook for the US P&C sector, keeping a neutral fundamental view on both commercial and personal lines. According to the report, the industry enters 2026 in a strong position, supported by solid statutory results, continued improvement in personal auto, a mild hurricane season, and higher reserve releases.
Fitch expects the industry combined ratio to improve by nearly three points in 2025, to about 93.7 percent, before easing slightly in 2026 with a combined ratio in the 96 to 97 percent range. That still implies healthy underwriting profit, just not the same level of lift seen as the market corrected from the 2021 to 2023 loss years. The agency also projects adjusted return on surplus of roughly 10.1 percent in 2025 and 9.1 percent in 2026, helped by higher book yields, even if falling interest rates put some pressure on new money returns.
Source: Reinsurance News
Key takeaways:
- Fitch sees 2025 as another strong profit year for US P&C, with underwriting results improving again before normalizing in 2026.
- The sector’s capital and ratings profile remain very strong, which supports continued capacity even as pricing softens in some lines.
- For agencies, this points to a market where carriers stay picky on risk quality and submission quality, but where there is more room to negotiate on desirable accounts as competition returns.