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Hadley, Cook, and Quillen Insurance Agency Blog

All You Ever Wanted to Know About Insurance

Hard and Soft Insurance Markets

You may have recently seen news stations and politicians on both sides signaling a potential economic recession in the near future. We all know this can come with higher gas prices, shortages of goods, housing and stock market decline, and the list goes on. What you may not be aware of, is a shift in market strategy from all insurance carriers across the board. We are potentially seeing a change from a "soft market" to a "hard market" in the industry. The following differences will directly affect you and your finances, and are likely to be seen sooner rather than later. 

From a Soft Market...

-Large competition between carriers for market share of all classes of business.

-Less strict underwriting guidelines.

-Prices hold steady or decrease year over year.

-Insurance Companies' profits decrease, while increasing in quantity of customers.

To a Hard Market.

-Limited classes of business accepted.

-Less competition between carriers leading to increase in pricing.

-Narrower and lesser coverage options available.

These changes can be caused by more than just a recession; catastrophic weather events, civil unrest, and potential lawsuits for carriers can also harden the market over time. Consumers should take note and be prepared to see potentially dramatic increases in pricing in the coming years. As always, reach out and contact us at Hadley, Cook and Quillen for any questions regarding your policies or the insurance industry as a whole.