A soft market is generally characterised by low rates, high limits and readily available cover. Whereas in a hard market premiums increase, insurers capacity generally decreases and some activities and industries
may no longer be insurable.
This last year has been a difficult time in Australian Insurance.
Catastrophic events have led to a dramatic increase of claims and premiums have sky rocketed.
What does this mean for you?
Insurers have seen a significant increase in claims, mainly due to natural disasters including flash flooding, hailstorms and bushfires. Tie that in with a global pandemic and we are seeing significant rises to premiums across the board.
Your premiums could be higher this renewal period than that of previous years… how come?
Premiums are determined by insurers profitability and available capacity which influences the insurance cycle. Depending on where we are within the cycle, reflects the cost of premiums.
In recent times, we’ve seen insurers increase premiums and carefully chose what risks they will insure due to the high volume in claims which have pushed the insurance cycle rapidly into the ‘hard market’.
Premiums and excesses are increasing for some if not all insurance classes and cover is becoming much more restrictive and expensive to place.
Unfortunately, we predict rates will continue to rise into the foreseeable future, therefore talking to your broker very early before renewal couldn’t be more important.
The advice on this website is general in nature and has been prepared without taking into account your objectives, financial situation or needs. You must decide whether or not it is appropriate, in light of your own circumstances, to act on this advice. You should ensure you obtain and consider the Product Disclosure Statement for the policy before you make any decision to acquire it.