Somewhere in your 2027 budget there's an insurance line, and I'd bet a coffee it says last year's number plus 5% or so. That was a reasonable shortcut when every line went up together. It's a worse one now, because commercial insurance rates for 2027 are heading in different directions depending on the line, and your particular mix decides whether the renewal comes in under budget or well over it. So it's worth ten minutes with what the brokers are forecasting before anyone fills in that cell.
Where commercial insurance rates are heading in 2027
Broadly, property is getting cheaper and casualty isn't. Marsh's Global Insurance Market Index had US composite rates down 2% in the second quarter, with property down 13% and casualty up 7%. The Council of Insurance Agents and Brokers survey, as Insurance Journal reported it, showed average premiums down about 2%, with commercial property down 6.3%, workers comp and cyber each down 3.2%, commercial auto up 4.5%, and umbrella up 5.3% for its 35th quarterly increase in a row.
For next year, WTW's outlook, summarized by Business Insurance on October 1, has large account property falling 5% to 15% on single-insurer programs, auto liability rising 8% to 15% for low to moderate hazard risks, umbrella up 3% to 12%, middle market workers comp down by as much as 5%, cyber somewhere between down 5% and up 5%, and private company D&O flat to up 5%.
I'd treat those ranges with some care. They lean toward large, complex buyers, and smaller accounts aren't seeing the same relief. The Ivans index, which tracks smaller commercial policies, still had property up 5.69% in August, per Insurance Journal. Mid market companies land somewhere in between. Your broker will know which end you're nearer.
Why casualty keeps climbing
Mostly it's jury awards. Marathon Strategies counted nearly 200 verdicts of $10 million or more against companies in 2025, up 40.7% from 2024 and adding up to more than $25.6 billion. Carriers price auto and umbrella against that tail. So a distributor with a fleet can keep paying more for liability while its warehouse property gets cheaper, and CIAB's respondents described carriers using property pricing to offset the auto and umbrella increases. Contractors and healthcare providers are in a similar spot. None of them can do much about where verdicts land; what they can influence is how their own claims history and safety record look when an underwriter opens the file.
How to budget for an insurance premium increase by line
To see what the split does, take two companies buying in the same market. These use rough midpoints of the WTW ranges, so treat them as illustration.
A manufacturer pays $400,000 for property, $300,000 for auto, $200,000 for umbrella, $100,000 for general liability and $150,000 for workers comp, about $1.15 million altogether. With property down 10%, auto up 11.5%, umbrella up 7.5%, general liability up 6% and comp down 2.5%, the total goes up by roughly $12,000, call it 1%.
A distributor with a bigger fleet pays $150,000 for property, $600,000 for auto, $300,000 for umbrella, $100,000 for general liability and $200,000 for comp, and when you run the same rate changes through that mix it ends up about $77,000 higher, close to 6%. If both had budgeted 5%, the manufacturer would have padded its number for no reason and the distributor would come up around $10,000 short, which isn't a disaster but is the sort of thing that gets asked about in the March review.
Then add exposure. Premium is rate times exposure. And exposure grows on its own as the business does. If payroll grows 10% and the comp rate stays flat, the comp bill still goes up about 10%. Budget templates miss this all the time, the same way the health cost line gets the trend budgeted and the headcount change forgotten.
An insurance renewal checklist for the CFO
Insurance is one of the few costs where outside news almost never mentions your company by name, so it tends to get rolled forward without much thought. A slightly better routine:
- Ask your broker for premium by line for the last three renewals, and budget each line separately, using the ranges above as a starting point.
- Update the 2027 exposures your broker is going to ask for anyway, starting with payroll by class and the vehicle list.
- Start earlier than feels necessary. Baldwin's renewal timeline has policies, financials and loss runs gathered about 120 days out and submissions going to insurers around 60 days out, so for a January 1 renewal you're already in the window.
- Price a couple of deductible options instead of renewing as-is. Carriers compete harder on structure when property is softening, and Lockton's October update suggests revisiting retentions and program structure for the same reason.
- If you run vehicles, tell the broker the fleet story, from telematics and driver hiring standards to how quickly claims get followed up; underwriters can price those things, but only if someone bothers to put them in the submission.
- Ask your broker which of your lines they're most worried about and what would improve it, then budget for their answer, even if it's worse than the one you'd hoped to write down.
Insurance is a good candidate for a budget assumption that breaks by spring, along with the ones in this list, and a free briefing on your company will flag outside cost moves like these against your own margins as they happen.
CFOmarketIQ reads the week's cost and rate news against your own numbers, and the first briefing is free.
Questions CFOs ask about insurance renewals
Are commercial insurance rates going down in 2027?
For property, mostly yes. Brokers expect further declines, at least for larger buyers. Auto liability and umbrella are still forecast to rise, and workers comp and cyber look roughly flat to slightly lower. Whether your total falls depends on how your premium splits between property and the auto and umbrella lines.
Why is my premium going up if insurance rates are falling?
There are usually two reasons. Your mix may lean toward lines that are still rising, like commercial auto and umbrella. And your exposures may have grown, since premium is rate times exposure, so a bigger payroll or a few more trucks push the bill up even when rates are flat.
How much should I budget for my business insurance renewal?
Budget each line on its own rather than applying one percentage to the total. Start from last year's premium by line, apply a realistic rate change for each from recent broker outlooks, and adjust for growth in payroll and vehicles and any change in insured values, then have your broker sanity check it before the budget is locked.
When should I start my commercial insurance renewal?
About four months before the renewal date. Brokers suggest pulling together loss runs and financials roughly 120 days out, reporting business changes around 90 days out, and getting submissions to insurers about 60 days out, which leaves the final month for comparing and negotiating terms.
A note on all of this: it is general information, not financial, legal or tax advice. Run anything you plan to act on past your own advisors first.