US Nuclear: Will Push To 7% In 2024 Now
Us Nuclear Weapons,
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According to Swiss Re officials, nuclear convictions in the US are setting new records, with 27 court cases expected to award compensation above $100 million in 2024.
According to Dr. Jérôme Jean Hagel, group chief economist for Swiss Re, social inflation in the US reached a 20-year high of 7% in 2024 as a result of litigation costs from mega-jury awards.
He made this statement at a press conference at this week’s reinsurance Rendezvous de September in Monaco.
Gianfranco Lot, chief underwriting officer for property and casualty reinsurance, joined Hegel at the briefing to talk about a Swiss Re report on social inflation and lawsuit patterns.
“Social inflation is super costly for consumers, corporations and insurance companies as well,” Hegel said, noting that social inflation now exceeds economic inflation as the main casualty-claims driver, leading to underwriting losses, higher premiums and reduced insurance capacity.
“US commercial casualty insurance losses grew by an average annual rate of 11% over the last five years, reaching US$143 billion in 2024
,” said the sigma report, titled “Litigation costs drive claims inflation: indexing liability loss trends.”
To put this figure in perspective, the paper stated that the current cycle of social inflation in the US has been present since about 2015 and that the total amount of casualty claims in the US was 33% higher than the insured losses from natural disasters worldwide last year, which totaled $108 billion in 2024.
There have been two other cycles of social inflation: the mid-1980s and the late 1990s). View the illustration below.
During the press event, Lot clarified that insurers and reinsurers started to re-underwrite their books and decrease limits when they noticed negative trends during the current cycle and started to incur losses.
This had an effect on the supply of insurance and reinsurance.
According to the analysis, between 2014 and 2023—a period of rising loss costs—the median limits obtained for liability towers, also known as stacked liability insurance plans, decreased by an average of roughly 25% in nominal terms and 46% in inflation-adjusted ones.
Lot cited industry categories whose casualty limits have dropped dramatically in the last ten years, including the manufacturing sector (down 39%), the chemical business (down 50%), and the building industry (down around 60%).
Furthermore, over the last ten years, there has been a 25% increase in the number of panel participants.
In response, insurers increased premiums concurrently.US liability premium rate hikes reaccelerated to 7% year-over-year by the first half of 2024, from 3–5% in the previous.
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