Hellenbrand Featured in In Business Magazine: Hard Cases

Cyber, Property & Casualty, Risk

Business insurance is caught in a hard market, which means business operators should plan for higher premium costs and creative coverage. The New York Fed has a recession probability indicator that suggests there is a 68.2% chance of a U.S. recession sometime in the next 12 months, the highest reading in more than four decades.

To help you prepare for a recession using business insurance as a buffer, In Business had an engaging conversation with M3’s Dana Hellenbrand and other insurance executives surrounding several trends — continuing and emerging — for business operators to consider as they make coverage decisions.

Hard Markets

As the property market continues to see increases in premiums, the factors influencing the property market are increasing property values due to rising construction costs. In addition to inflation, the increasing frequency of natural disasters such as hurricanes, wildfires, floods, and tornadoes has caused reinsurance carriers to take significant price increases, which then push down through premium increases to customers.

Think [in terms of] large concentration of values at one location. High-hazard operations that are susceptible to fire without proper sprinkler protection, or if they’re not near a fire department, their insurance costs have been impacted more than others who have more favorable property exposures. We’re helping customers combat the increased premiums by offering higher deductible options and also transferring some risks to captive [insurance] strategies.

— Dana Hellenbrand
Director of Manufacturing and Distribution Practice

Cyber Instability

Hellenbrand notes that insurers had seen cyber insurance premiums begin to level off due to fewer losses in 2022 compared to prior terms, but in the first quarter of 2023, they started to see an up­tick in ransomware events over the final quarter of 2022. She cites loopholes in the configurations of multifactor authen­tication, which allowed threat actors to gain access to computer systems.

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