US Commercial Insurance Market Stable in 2025 Amid Economic Uncertainties

The US commercial insurance market in 2025 demonstrated general stability amid economic uncertainties, according to Lockton's latest Market Update. Despite challenges, particularly in third-party liability, the industry remains well-capitalized with insurers strengthening financial positions and benefiting from easing reinsurance costs and a quicker-than-expected property market recovery. Property and casualty carriers delivered strong underwriting results, with commercial lines performing well and personal lines improving due to rate adjustments. However, concerns persist around rate adequacy, slower revenue growth, and the sustainability of current market conditions. Economic factors such as rising inflation, unemployment, and slightly lower interest rates contribute to a mixed risk environment for 2026, prompting insurers to focus on disciplined underwriting, pricing, reserving, and portfolio management. In specific sectors, property insurance remains competitive, workers’ compensation coverage is stable but influenced by regulatory and economic factors, and growth in liability insurance is measured with caution due to social inflation and emerging risks. Directors and officers liability rates have mostly stabilized for public companies, while private entities and nonprofits face a competitive market showing signs of firming. Employment practices liability premiums are steadied amid regulatory monitoring, fidelity and crime insurance sees disciplined underwriting against social engineering risks, and fiduciary liability is stable though wary of litigation concerning excessive fees. The cyber insurance market favors buyers but is closely watched due to systemic risks and evolving regulations. Lockton emphasizes the importance of early engagement with brokers, proactive risk management, and strategic insurance program optimization to navigate the evolving market effectively in 2026.