As 2026 starts to wind down and we look ahead to 2027, there are certainly many different topics within the insurance industry that are worth following. Not every type of insurance is getting more expensive, but the two key areas that Strickler Insurance has been watching develop are the rising costs of umbrella liability insurance and commercial auto insurance.
For homeowners and business owners alike in Lebanon, PA, these are topics that are worth watching develop, and while the costs might start to rise, there are luckily some strategies that can help reduce the impact on your budget. Find out more about our 2027 insurance projections and how to manage them.
Umbrella Insurance Rates Are Projected To Increase Significantly In 2027
One of the highest-rising insurance categories is umbrella insurance. While we will primarily be covering the rising costs of commercial umbrella insurance rates, we are also seeing similar patterns in individual umbrella insurance policies. Umbrella insurance offers extra liability coverage if a covered claim exceeds the limits of certain existing policies. This comes in handy when businesses or individuals have their coverage broken down into many different policies based on the different liabilities they might have. For example, if a business has a policy for their vehicle, one for their tools, one for their workers’ comp, and multiple other aspects of their business, but the applicable policy doesn’t cover the total cost of a claim, umbrella insurance can step in and cover anything that is left over.
In 2027 we see that excess liability and umbrella insurance rate increases can be anywhere from 5% to 15%. While the exact rates will heavily vary based on the specifics of each business, this can seem concerning. Let’s look at why this is happening and what businesses can do to help lower their insurance costs.
Why Umbrella/Excess Insurance Rates Are Going Up
The rising cost of major liability claims is one of the biggest factors behind the rising cost of umbrella insurance. If you suffer serious injuries or there’s been a property damage lawsuit, the settlement or verdict can be in the millions. When a covered claim exceeds the limits of the underlying liability policy, umbrella or excess insurance may have to help pay the difference.
This problem concerns commercial vehicle accidents especially hard. In the event of a serious accident involving a company truck, the costs of injuries and legal claims can easily exceed the limits of a commercial auto policy. This pattern isn’t exclusive to just commercial auto, as prices to repair and replace things like tools or damaged customer property are also getting higher. If insurers are forced to pay out on these big claims, they may raise umbrella rates or be more choosy about risks they will take on.
What You Can Do To Combat Increased Umbrella Insurance Rates In 2027
Luckily, there are things that can be done to handle increased umbrella insurance rates. One of the best things to do is to review how much liability protection your business needs. Think about your vehicles, operations, contracts, and possible financial exposure. While you certainly want to have enough coverage, oftentimes your policies might be set for more protection than you actually need. Regularly reviewing your coverage can help make sure your insurance is best set up for success. It’s also smart to review your existing general liability and commercial auto policies. Some umbrella carriers require minimum limits of underlying coverage, and those requirements can vary.
On top of this, it’s also important to shop around for your umbrella insurance and excess liability coverage. You can’t assume that your current carrier will always give you the best rate. By shopping around, you can be confident that you’ve got the right coverage at the best market price.
Commercial Auto Rates Are Also Rising In 2027
Costs to insure commercial vehicles in 2027 are also rising. Whether you have one work truck or a whole fleet of vehicles for your business, commercial auto insurance can be another rising cost. Just like with umbrella insurance, many are predicting commercial auto costs to rise anywhere from 5% to 15%. If your business has delivery vans or work trucks, or you use company cars to transport your employees around for various duties, this will be an important trend to be aware of.
Reasons Why Commercial Auto Insurance Costs More In 2027
One of the biggest reasons why commercial auto insurance rates are increasing in 2027 is that fixing vehicles has become much more expensive than it used to be. New trucks and vans are packed with costly electronics, cameras, sensors, and specialty components. Even small accidents can lead to big repair bills. On top of this, the costs for injury claims are also skyrocketing. Serious accidents can lead to costly claims for insurance companies, including medical bills, legal costs, and large settlements. Those higher claim costs can impact premiums, even for businesses that haven’t had a recent accident.
Another important reason why commercial auto insurance costs are high is the driving record that a business’s employees have. Increasingly we have seen businesses, especially trade businesses, add employees to their auto insurance coverage with poor driving records, including multiple accidents and DUIs. While this certainly isn’t every business, it is a factor contributing to increased commercial auto rates that many businesses are not aware of.
How To Lower Your Commercial Auto Insurance Costs In 2027
An easy place to start reducing your 2027 commercial vehicle insurance cost is to review who is on your policy. Make sure that anyone who can drive your business’s vehicles is a responsible driver without a massive claim history. Another good improvement is to use dashcams and telematics to prove safe and responsible driving habits (learn more about how dashcams can lower auto insurance rates).
When your policy comes up for renewal, review the vehicles and drivers covered, the deductibles you can afford, and if other carriers can provide competitive rates. The aim is to cut down on unnecessary costs without leaving your business exposed.
Strickler Insurance Can Help You Set Up Your 2027 Insurance Coverage
Insurance prices may change in 2027, but your business shouldn’t accept any price hike without looking at its options. At Strickler Insurance we help businesses in Lebanon, Pennsylvania, and surrounding communities shop for insurance coverage from multiple carriers.
We can help you get ready with commercial umbrella insurance, commercial auto insurance, or policy review. Contact Strickler Insurance today to get a quote and learn about coverage options that may be right for your business.
