Associations confront new realities in insurance renewals

Association Services

Community associations heading into the commercial insurance market for coverage will find that market disruptions and a shifting risk environment will make the next property insurance renewal cycle a challenging one. The cost of coverage has skyrocketed in many markets, and it’s becoming more difficult to get insurers interested in proposing and underwriting coverage as demand for commercial property insurance has outstripped the supply.

What's going on in the commercial property insurance market, and how can associations find the property risk coverage they need?

Understanding the property insurance market reset

Almost every factor that could raise commercial insurance rates and shrink capacity has come into play in the commercial property insurance market.  That includes:

  • Losses from natural disasters—from major hurricanes and wildfires to winter storms and flooding—natural disasters have affected many regions of the United States.
  • Inflation and economic uncertainty have pushed the cost of capital higher.
  • The Russia-Ukraine conflict has contributed to geopolitical unrest, adding to losses, and boosting risks that the insurance industry must cover.
  • Supply chain disruptions and labor shortages have driven up construction costs.
  • Higher property valuations have been the result of steep increases in replacement costs.
  • Reinsurers increased rates by 37% at the start of 20231 and have reduced coverage by almost $50 billion in recent years due to heavy losses from natural disasters.2 This has left carriers without the financial partners they need to share key risks.
  • Insurers raised prices after years of perceived softness in pricing and in the underwriting process.

The convergence of these major forces is driving insurance rates for associations to unprecedented levels, while shrinking the availability of insurance coverage.

Carriers pulling back from high-risk markets.

Insurance carriers with a high concentration of property coverage in parts of the South and Southeast withstood the worst of losses from weather-related claims, particularly in Florida. Many of these insurance carriers are reducing their exposure in higher risk markets, with some exiting completely. As a result, there will be less insurance capital available in some markets along with higher rates.

With property valuations rising sharply due to soaring replacement costs, expect insurance carriers to require accurate property assessments and follow up with engineering studies and structural integrity reports to better understand key risks. The days of simply resubmitting the previous year’s application for renewal are gone. Be prepared for a prolonged process of securing coverage that could take several months, and even then, may come with strict conditions to adopt risk-prevention programs.

The market reset doesn’t only affect property insurance—other coverages like general liability, directors and officers, cyber, and other specialized types of insurance are also adjusting to the latest conditions.

Strategies for a successful property insurance renewal

 The commercial property insurance market shakeup may be broad reaching, but there are strategies that you can take to find the coverage your association needs.

To get the right coverage at the best rate, association leaders should:

  • Find the right insurance partner. Insurance brokers are often your best bet because they represent your interests and help you deal with insurance carriers.
  • Use a broker that has in-house resources and expertise, including extensive community association experience that can help make the application or renewal process go smoothly.
  • Start the renewal process as early as possible. Get started at least 4 months before the coverage start date.

Look for a broker that can:

  • Help you develop and implement risk mitigation and risk-prevention programs.
  • Conduct pre-assessments onsite by risk managers and building engineers so you’re better prepared before engaging with insurance carriers. 
  • Identify hazards that might lead to future insurance claims and provide solutions to mitigate those risks.
  • Put you in the strongest position to negotiate for the right coverage at the best rate.

Engage the right resources.

With soaring pricing and tight capacity, getting expert insurance advice and experience working with associations can provide you with a crucial advantage. Your Truist relationship manager and partners at McGriff Insurance Services, part of Truist Insurance Holdings Inc., have the in-house resources to help you secure the right insurance coverage for your community. McGriff’s technical experts include some of the most experienced OSHA-certified risk managers, risk engineers, and building engineers in the industry along with insurance specialists to help you identify and mitigate risks throughout your operation.

Get ahead of the commercial property insurance renewal process.

Finding commercial property insurance for your association will take more work this time around. Talk to your Association Services Truist relationship manager about working with McGriff for creative solutions to secure property insurance coverage. To learn more, contact Truist Association Services at 727-549-1202 or toll free at 888-722-6669 or visit us at

Insurance products and services offered through McGriff Insurance Services, LLC, a subsidiary of Truist Insurance Holdings, LLC, are not a deposit, not FDIC insured, not guaranteed by a bank, not insured by any federal government agency and may go down in value.