NA commercial property insurance rates fall the most in a decade, hard market reverses: Willis

The North America commercial property insurance market has experienced its sharpest decline in rates a decade, according to broker Willis, with wide-spread double-digit price reductions for clients as the soft market ensues and “the multi-year hard market fully reverses.”

Abundant capacity is weighing on property insurance and in large and complex accounts softening has been seen across all program types, the Willis (a WTW business) Insurance Marketplace Realities report makes clear.

The broker reports that rates for large and complex property insurance programs fell by an average of 14.5% in the second quarter of 2026, an acceleration from 8.4% in the prior year, while shared and layered placements fell further with rates down 23.41%, again accelerated from 14.57% in Q2 2025.

“The market has now moved from the depths of the 2018 through 2024 hard market toward pricing last seen in 2019,” Willis explained.

Treaty reinsurance softening at every renewal date in 2026 is a driver, as abundant capacity and capital levels in reinsurance now cascade through to reinforce abundant primary market capacity, according to the broker.

It leads the broker to predict future rates will be down 5% to 15% for single carrier property programs and down 15% to 25% for shared and layered property placements.

At the same time Willis notes that, “Insurers are increasingly willing to enhance terms, conditions, deductibles and wordings as competition intensifies.”

Willis goes on to explain, “The market trajectory has clearly reversed from the challenging period spanning Q1 2018 through Q1 2024. WTW’s proprietary benchmarking shows the large and complex property market ended 2025 at risk-adjusted rates roughly equivalent to 2022 levels and Q1–Q2 2026 results suggest rates are trending toward 2019 levels.

“Absent an extremely large CAT event ($150 billion+), this trend is expected to continue through year-end, though underwriter discipline around technical rate adequacy should not be discounted.”

At the same time replacement costs are inflating at accelerated rates again, driven by US tariff policy and the Middle East situation, making accurate and updated valuations critical, the broker noted.

Property rates also continue to soften in the middle-market, where secondary peril exposure and risk discipline are shaping outcomes, Willis explained.

Buyer-friendly conditions ensue as the weight of capital and capacity drive favourable outcomes for buyers. With reinsurers and insurers both in strong financial health at the same time, it appears there’s no sign of a bottom being in sight at this time.

As well as the United States, the Canada property insurance market also remains “awash in capacity,” continuing the competitive environment driven by softened reinsurance pricing, benign losses and underwriting profitability and rates down 5% to 20%.

In the Bermuda market, non-catastrophe property rates are predicted down 15% to 30%, while catastrophe exposed programs are down 10% to 20%, according to Willis.

However, Bermuda seems running ahead of pace as reductions are slowing and the focus has shifted to competition on expanded coverage, lower attachment points and reduced retentions.

All of which speaks to the fact insurance and reinsurance market appetite for property risks remains high at a time when rates are approaching the previous soft market lows.

Once again this calls for discipline, although at this stage growth still remains on the agenda for many traditional markets it seems.