The first quarter of 2019 saw the excess and umbrella markets start to move toward tighter underwriting, and each quarter since has seen the market get firmer. The second half of the year brought greater capacity restrictions, higher prices, and significant challenges around program structure, due in large part to nuclear jury awards that have hit excess and umbrella lines like never before. Brokers that succeed in 2020’s changing market will depend on creativity, proactive strategic planning, and strong carrier relationships to help clients weather the storm.

The commercial cannabis industry is booming. It now employs more than 250,000 people, with legal marijuana sales reaching an estimated $9.7 billion across North America in 2018.

California juries are handing down million-dollar awards in lawsuits alleging apartment complex owners have failed to maintain ‘habitable’ properties. Insurers, concerned the litigation trend could spread, are adding exclusions to limit their risk. Brokers need to be aware of the impact habitability litigation and coverage restrictions can have on client property programs.

Chemicals commonly used in fire-fighting foams and a wide range of household items, from non-stick cookware to stain-resistant carpet, are turning up more often as exclusions on insurance policies. That’s due to a growing wave of litigation over water contamination and rising concerns among insurers that the chemicals per-and polyfluoroalkyl substances, or PFAS, could expose them to the same kind of expensive, unanticipated claims as asbestos did a generation ago. While property owners may see more scrutiny over PFAS, environmental insurance can still provide effective risk transfer in many cases.

The construction industry has seen significant growth over the last several years. However, emerging trends such as large rate increases and reductions in excess capacity are posing challenges for construction insureds as the insurance market hardens. An increase in high-value claim payments and settlements, labor shortages, and more careful deployment of underwriting capacity are all factors adding difficulty to the state of the market across the country.