Risk & Business Magazine JGS Insurance Risk & Business Magazine Spring 2018 | Page 3

Welcome!
T
wo thousand seventeen
was a year for the record
books. In addition to four
Category 4 hurricanes
making landfall on the
United States and its territories (first
time ever), California suffered from
devastating wildfires that were the most
destructive on record, destroying more
than 1,381,405 acres. This included
five of the twenty most destructive
fires in the state’s history. We also dealt
with massive floods and earthquakes,
making 2017 out to be one of the worst
loss years on record for the global
reinsurance market. According to
the recent Willis Re 1st View (January
1, 2018) reinsurance report, recent
catastrophe loss estimates in the United
States alone are in excess of $136 billion.
Fortunately, traditional reinsurers were
well-capitalized and strongly regulated
so that they can absorb the historic
losses, but many in the marketplace
expect that reinsurers will try and
recoup some of these losses by way of
increased pricing in 2018. A majority of
the losses in 2017 were property losses
(in the $100 billion range), and this
is where it is expected we will see the
biggest rate increases in 2018. According
to the report, here are some key price
predictions for 2018:
LETTER FROM THE PRESIDENT
PROPERTY:
Non-cat risks: Flat to +5%
Cat-exposed risks: +10% to 20%
Cat-exposed with losses: +20% to 25%
CASUALTY:
General liability: Flat to +3%
Umbrella: Flat
Workers comp: -2% to +2%
Automobile: +3% to +8%
Much of New Jersey is considered
to be located in Cat-exposed areas
(catastrophe exposed due to the coastal
exposures). The biggest increases will be
seen by those property-driven accounts
with coastal exposures and that have
bad loss ratios and claims experience,
with rates increasing 20 to 25 percent
and the possibility of reduced coverage.
As of this writing, we are not
experiencing these types of increases
yet, but it will take some time for the
market to correct. We do expect to see
some increases by the end of the first
quarter into the second. We also expect
that the July 1 renewals and third and
fourth quarter renewals to see the
increases as many property reinsurance
contracts will renew effective July 1.
I bring this to your attention so that
you can plan and properly adjust your
budgets for insurance for the coming
year.
Here at JGS Insurance, we were very
fortunate in December 2017 to be
recognized once again as a finalist for
the NJBIZ Business of the Year! We
attended the celebratory dinner on
December 4, 2017, and unfortunately
did not win this year, but we are
working hard to correct that in 2018.
Congratulations to our team on a very
successful year in the many ways we
were recognized (Elite Agency, Insurance
Journal Top 100, Top Specialist Broker,
Top 250 Privately Held Company, and
Business of the Year)!
And thank you all for a successful year
with our publication JGS Insurance Risk
& Business! We are now entering our
second year of publication, and we look
forward to a great 2018!
Sincerely,
Vinnie Hager, President
www.JGSINSURANCE.com
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