Three ways to position yourself for a changing market

First, consider that your customers may not understand insurance market cycles, especially the unique conditions we see today. Clearly, underwriting and investment losses have cut capacity, but the dramatic price run-ups across all lines that are typical of a hard market could be masked by the recession and the resulting decrease in demand for new policies. So unless catastrophic events trigger sudden market changes, we may very well see a more gradual hardening than we have seen in recent cycles.

You need to educate your customers in a soft market, explaining how market cycles work and how they should plan for them. If your customers have been saving money in the soft market, I encourage you to tell them to put some of those savings away because you’ll be back to ask for it when the market hardens and rates increase.