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H2Q
Are insurance rates falling? If so, how low will they go?
Six leading aviation insurance experts share their insights on how industry rates will trend in the months ahead.
Gary Moran, Aon
Yes, general aviation insurance rates are declining but the correction is controlled. Rate softening is most apparent in well-performing general aviation risks, driven by new market entrants bringing fresh capacity and targeted underwriting. However, underwriters remain cautious on loss-affected or complex accounts. Reinsurance costs, inflationary pressures and long-tail liabilities continue to act as natural rate stabilisers. While further easing is possible in the short term, a return to pre-hard market pricing (over the next 12 months) is unlikely. The market is adjusting, and we would expect selective competition to continue and not a freefall drop in rates. It is worth noting that general/business aviation is diverse and an offshore rotor wing operation could be viewed differently to a corporate jet department.
“...Rate softening is most apparent in well-performing general aviation risks, driven by new market entrants bringing fresh capacity and targeted underwriting. The market is adjusting, and we would expect selective competition to continue.”
Ryan Cranford, Rhodes Risk Advisors
The insurance market is broadly softening. There is more capacity with additional underwriting market entrants, as well as more appetite given the adjusted rate levels over the recent hard market cycle. Most operators in the Pt. 91 and 135 sectors should see stabilisation in insurance expense year-over-year. In some cases, we are seeing decreases anywhere from 5-20% in current cycles. This is of course considering clients with favourable loss performance and similar exposure levels at renewal. The market can be slow to turn, therefore absent a rash of large losses, major global economic events or natural disasters we expect a stable environment across the next 12-18 months.
Zoë Layden, Claveaux Consulting
Supply and demand, competition. These are the words that continually pop up when talking about the aviation insurance marketplace in 2025. Despite the high profile losses featured at the end of 2024 into early 2025 and the recent departure of a significant lead insurer in the sector, capacity continues to be more than sufficient in the general aviation (GA) market. Against a backdrop of headline making fire losses in California and the ongoing court proceedings of the Russian aircraft leasing cases, GA is still looking to be an attractive market for insurers which translates into a good renewal environment for insurance buyers.
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Jeff Rhodes, 5X5 Aviation Insurance
Aviation insurance rates have been on a general decline for the past few years. The industry is cyclical in nature and overall rates rise and fall over a four-to-five year cycle with regularity.
World and market events can serve to disrupt the timing of the cycles and they can affect the amplitude of the waves – how hard is the hard market, or how soft is the soft market? Many events may not be directly involved in the performance of the general aviation or other aerospace sectors, but can still create pressure on global reinsurance markets, which supply the capital upon which all aviation insurance relies. Global events don’t usually break the hardening or softening cycles, they only serve to interrupt.
We have had success this year by positioning our US general aviation-only insurance product as a reinsurer’s hedge against worldwide major risk aerospace exposures. Small specialty insurers may have an advantage in the current market over the large, broadly leveraged insurers that seem to be exposed to major high-limit loss trends.
“Many events may not be directly involved in the performance of general aviation or other sectors, but can still create pressure on global reinsurance markets, which supply the capital upon which all aviation insurance relies.”
Todd Guelich, SVP Assured Partners
Premiums are primarily associated with the “cost” of insurance. Q4 of 2024 offered an initial reversal from the conservative, risk adverse underwriting attitudes which began in 2018. We are experiencing a consistent reduction in rates across multiple facets operations and with additional underwriting capacity, a more liberal interest in accepting risk. While these changes vary, it is a welcome change from 2024’s increases. Equally, coverages, expanded limits and deductible improvements are accompanying this revitalised underwriter aggressiveness. Provided we don’t experience a significant loss event, this trend is anticipated to continue.
Alex Trotter, Willis Towers Watson
Capacity in the general aviation market remains healthy but economic challenges are complicating the outlook. The general aviation insurance trading environment is following the trends set by the airline and aerospace markets last year. While negotiations have become more robust, insurance capacity for well-managed general aviation risks with good loss records remains relatively high and is the key driver of the competitive pricing dynamics. In conclusion, the general aviation sector offers customers a varied selection of solutions, from executive travel in the latest business jet to helicopter-slung load aid deliveries in challenging locations. Insurers, while instinctively conscious of anything out of the ordinary, continue to respond to the challenges operators and their brokers present to them. As ever, transparency and communication all parties remains key.
