Insurance Marketplace Realities 2025 – Crisis management

Rate predictions: Crisis management

	Trend	Range
Terrorism and sabotage		-5% to +5%
Political violence		-5% to +25%
Active assailant		Flat to +10%
Kidnap & ransom		+5% to +10%

New entrants provide pricing relief on terrorism and political violence risks.

• Following several years of heightened loss activity, carriers have largely rebalanced their portfolios and passed treaty-driven cost pressures downward to insureds.
• There remains very limited appetite for “terrorism only” coverage in highly volatile areas due to uncertainty around peril delineation — with insurers preferring to offer “full political violence” protection, or nothing at all.
• For exposures in locations experiencing current conflict, premiums are re-rated entirely at renewal, often at multiples of the prior terms.
• A reduction in average line size deployment is offset by the introduction of new carriers seeking to benefit from the new rating environment, and we expect this competitive force to provide pricing relief through 2025.

As the market for active assailant insurance matures, interesting buying patterns emerge.

• The hospitality, leisure and healthcare sectors have proven to be the largest buyers of active assailant insurance, although policy premiums tend to be highest in the public sector and education.
• New state laws in California and New York now mandate that employers implement workplace violence policies, drawing additional focus on an issue that continues to concern risk managers.

An increase in kidnaps for ransom intensifies a complex claim environment for insurers.

• There has been a steady rise in the number of recorded kidnap-for-ransom cases around the world, with a 13% increase over the first half of 2024.^[1]
• On a year-on-year basis, the jump was more pronounced, with 69% more cases recorded (726) in Q2 2023 versus the same period a year ago.^[1]
  • This means that kidnap activity has returned to pre-COVID-19 levels in several countries, notably in Colombia, Mexico and Nigeria.
  • Coverage restrictions for such high-risk territories as Haiti and Israel are selectively applied by certain insurance markets, but these positions are expected to shift in line with security developments.
  • There has been a noticeable rise in policies being triggered through endorsed coverages, particularly through threats made to corporations in North America and security evacuations from more traditionally high-risk regions around the world.

Disclaimer

Willis Towers Watson hopes you found the general information provided in this publication informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, Willis Towers Watson offers insurance products through licensed entities, including Willis Towers Watson Northeast, Inc. (in the United States) and Willis Canada Inc. (in Canada).

Footnote

1. Special Contingency Risks (SCR), Alert:24 data, 2024 Return to article undo

Contacts

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Fergus Critchley

Head of Crisis Management, North America

email Email phone +1 212 915 7651

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Philipp Seel

Head of Special Crime, North America

email Email phone +1 212 519 7202

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Peter Bransden

Head of Sales, North America

email Email

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