MRH Trowe Looks Ahead on Risk Pricing Trends

Some insights from MRH Trowe on insurance risks and pricing in 2025;

The forthcoming 2025 renewals in the industrial insurance sector will bring interesting dynamics. From MRH Trowe’s point of view, however, the price development in the industrial insurance sector must be viewed in a very differentiated way. While premiums are expected to stabilise or even decline in some segments, an increase remains likely in others. The importance of risk prevention and proactive risk management cannot be overstated.

Lars Mesterheide, Chief Broking Officer of MRH Trowe: “The developments in the market show that companies that invest in risk prevention and practice comprehensive risk management can benefit from stable or even falling premiums in the coming round of renewals. However, it remains important that we keep an eye on the individual needs and challenges of our customers and offer tailor-made solutions.”

The experts from MRH Trowe have analysed the current developments in the various insurance lines and provide an overview of the trends and challenges to be expected.

Property

Markus Mehlis, Head of Property at MRH Trowe, assumes that prices for major customers will stagnate if companies invest noticeably in risk prevention. “For medium-sized companies, on the other hand, the challenge of financing additional prevention measures remains. We continue to see an increase in premiums here, especially for customers who are insufficiently positioned,” said Mehlis.

Liability insurance
Karl Erwin Schönberger, Head of Casualty, emphasizes that the inflation of the last two years is only now taking full effect. “Incumbent carriers are limiting their capacity for exposed risks, leading to more restrictive regulatory practices. Proactive prevention is still a neglected field in medium-sized companies,” explains Schönberger.

M&A insurance
Boris Prochazka, M&A insurance expert at MRH Trowe, observes that the ROL (rate on line) has been falling continuously since 2021. “We expect ROL to move around 0.75 percent by 2025 and possibly increase again in 2026 as the number of deals increases,” Prochazka said.

D&O insurance
Arno Schröder, Head of Financial Lines, notes that a clear distinction is made according to risk types. “In the case of critical risks, prices rise and capacities fall, while in the case of welcome risks, premiums fall and capacities increase. On average, premiums are likely to be stable to slightly falling. The size of the company is also relevant: While premiums in the corporate customer segment tend to be stable, there is often room for negotiation in the SME sector. The problem is to check this with the high quantities in the SME sector and to use the leeway.”

Car insurance
Oliver Rehbeil, Head of Motor, emphasizes the need for price adjustments in the motor insurance sector. “Due to the drastic development of spare parts prices of automobile manufacturers and rising labor cost structures as well as scarce resources in the area of damage repair and spare parts supply, we see a need for adjustment of 15 percent and more in the area of private customers and small fleets. In the large fleet sector, a consistent restructuring of the premiums is necessary in order to achieve a positive combined ratio, which can be as high as 50 percent or more in individual cases. We recommend a sensible adjustment of the existing deductible regulations, dealing with the topic of claims management and claims management as well as preventive risk management,” says Rehbeil.

Real Estate
The placement of real estate portfolios remains tense. “Leading insurers are withdrawing due to increasing administrative requirements and divergent risk assessments are making syndicated transactions more difficult,” says MRH Trowe board member Michael Hirz. “More frequent losses and the expectation of future major losses due to natural events are increasing the premium requirements of risk carriers. In particular, natural hazard cover is more difficult to place and the risk appetite for residential portfolios continues to decline significantly. Rising reinsurance costs are also leading to higher premiums and increased retention claims from primary insurers.”