Carriers keep on truckin’
in an ever-hard market
By Joseph S. Harrington, CPCU
Depending on who’s counting, commercial auto insurance has been unprofitable for 13 to 15 straight years. That means this prolonged market cycle is almost old enough to get its own driver’s license.
AM Best, an authoritative source of insurance industry information, characterized the market in a September 2025 report: “Stuck in Reverse: Commercial Auto Losses Keep Mounting.” Despite overall improvement in their underwriting expense ratios, commercial auto carriers suffered nearly $5 billion in losses in 2024, almost twice the annual average for the preceding decade.
“We’ve gone through soft cycles and hard markets,” says Mark Gallagher, vice president of national transportation for Risk Placement Services (RPS). “This hard market in commercial auto has been a longer, more sustained one with little signs of easing up.
“As insurance costs continue to climb, so do losses,” he adds, citing nuclear verdicts, social inflation, and litigation financing as factors contributing to escalating claim costs. Gallagher also points to another factor less widely acknowledged: late claims reporting, which hinders efforts for timely and cost-effective loss adjustment.
Apart from the challenges of managing fleet risk, Gallagher says shippers and motor carriers need to review and update their cargo coverage. “With increased growth in commodity values, whether through tariffs, inflation, or normal appreciation, traditional motor truck cargo limits of $100,000 or $250,000 may no longer be sufficient to insure cargo.”
Package, monoline, or both
One consequence of the prolonged distress in commercial auto insurance is the reluctance of some insurers to write the coverage on a stand-alone, monoline basis, according to Alan Adkins, vice president of commercial lines insurance operations at MOTER, a managing general agency and insurtech that utilizes behavior scoring models to underwrite and control losses in commercial auto insurance.
“Industrywide, we see many insurers have less appetite for writing any stand-alone lines of business,” Adkins says. “Many standard insurers now often require package policies or multi-policy accounts that combine commercial auto coverage with general liability, property, excess, cyber, or other coverages.”
James McGee, a vice president with Amwins Brokerage, agrees but points out that distressed auto accounts may have to break out auto coverage to make the remaining package more palatable. “When packaging coverage, the auto component may not be performing as well as the others,” McGee says. “So, the auto may be pulled out and placed with an excess and surplus (E&S) lines carrier to provide insureds with expanded options for saving on premium.”
McGee goes on to say that when an insured is not bound by the terms of a package policy, it sometimes allows for broader coverage or increased savings on individual lines. “Commercial auto ‘carve outs’ in package placements may also allow retail buyers to achieve premium savings with monoline placements for cyber, general liability, excess/umbrella liability, and other coverages.”
Premium increases
Wholesale broker Johnson & Johnson (J&J) and its commercial auto clients are used to hard market conditions, according to Jennifer Ridgill, J&J’s assistant vice president of transportation.
“We have to approach every account with the expectation that rate increases will be part of the equation at renewal,” she says. As an E&S specialist, Ridgill notes that “we’ve seen consistent opportunity with accounts that previously would have remained in the standard market.”
As she tells it, one or two substantial claims can quickly exhaust an account’s standard market options. “Insureds often need access to E&S markets just to continue operating,” she says. “Our role is to provide a solution during a challenging period.
“Many insurance carriers and programs have pivoted to a data-driven, tech-enabled, highly selective approach to curb commercial auto losses. This affords our clients a greater number of insurance options as well as premium subsidies from some insurance carriers.”
—Mark Gallagher
Vice President,
National Transportation
Risk Placement Services
“Since much of our commercial auto book is written in the E&S market, we’re typically working with new ventures, younger drivers, or classes that don’t fit standard market appetite,” Ridgill says. “We work closely with carriers to structure terms on most submissions, but the pricing must reflect the exposure, and not every insured can make the numbers work.”
Buying choices
As for the reaction of insureds, Ridgill finds them to be making “more deliberate coverage decisions.
“For years, $1 million in liability limits were considered the norm,” she says. “Now, we’re seeing more requests for lower limits when contracts allow it. Businesses are looking for ways to manage premium increases, and adjusting limits is a lever they can pull.
“The same is true for physical damage (PD) coverage,” Ridgill adds. “If it’s not required by a lienholder, some insureds are choosing to go without PD coverage to reduce costs. In many cases, it comes down to prioritizing what’s essential so they can stay in business. Coverage is still available, but insureds are taking a closer look at how much risk they’re willing and able to retain.”
McGee sees similar dynamics in play.
“While limit requirements have remained consistent, insurers are opting to [impose higher] deductibles to control their risk exposure” rather than rely solely on premium increases, he says. “In commercial auto liability, we are seeing insurers impose $5,000 to $10,000 deductibles to help control costs whereas auto liability was previously a [first-dollar] coverage.”
Churn, churn, churn
Ridgill and McGee both see many opportunities in the ever-churning market for commercial auto insurance.
For her part, Ridgill sees that motor carriers and shippers who address operational issues and institute rigorous loss control can earn their way back into the graces of admitted market insurers. “That’s part of the natural flow of commercial auto today,” she says.
“Even with the ongoing challenges in commercial auto, we continue to grow in the line,” Ridgill continues. “Submission volume is up, and as standard markets [tighten their underwriting or implement significant rate increases], more accounts are being marketed, and more of them are finding their way into E&S markets.
“Retention can be challenging,” she acknowledges. “Rate increases lead to more shopping and more movement among markets. We do lose some accounts, either because pricing becomes too onerous or because an account can move back to the standard market after improving its loss experience.
“That said, the overall rate environment has helped balance things out. The higher premiums on the business we are writing help offset accounts we are unable to retain.”
Up for grabs
In McGee’s estimation, “new business opportunities remain plentiful,” even as the emergence of new players poses a growing challenge to renewals. It seems that more and more accounts are up for business every year.
“Many standard insurers now often require package policies or multi-policy accounts that combine commercial auto coverage with general liability, property, excess, cyber, or other coverages.”
—Alan Adkins
Vice President, Commercial Lines Insurance Operations
MOTER
“The greatest challenges we see generally involve renewals and accounts re-shopping their coverage,” he says. “We’ve been able to maintain a healthy retention rate, but there are many non-traditional options popping up. Though these players may not last long term, they are impacting the renewal process.”
MOTER is among those “non-traditional options.”
“As a relatively new MGA startup, we have yet to experience any difficulties or limitations when it comes to growing our commercial auto book profitably,” says Adkins. “Our retention rates remain well above industry levels for the line.”
Key to MOTER’s retention results, according to Adkins, is the role of its Insurance Risk Management Solution as a tool for collecting and presenting comprehensive real-time driving information on a client’s fleet operations.
“Commercial auto ‘carve outs’ in package placements may also allow retail buyers to achieve premium savings with monoline placements for cyber, general liability, excess/umbrella liability, and other coverages.”
—James McGee
Vice President
Amwins Brokerage
“Users access an AI-assisted fleet portal to monitor drivers’ individual trips and review summary reports to improve vehicle uptime and reinforce safe driving habits,” he says. “The information provided helps fleet owners negotiate better pricing with their insurers by providing a complete picture of risk, including access to dashcam recordings in the event of an accident.”
Technology advances
The use of advanced technology to monitor and report on fleet operations has spread rapidly in recent years, says Gallagher.
“We’ve seen numerous motor carriers adopt telematics over the past few years,” he says. “Fleet operations often include a safety director charged with understanding telematics data and coaching drivers to improve performance and reduce risk.
“Retention can be challenging. Rate increases lead to more shopping and more movement among markets. We do lose some accounts, either because pricing becomes too onerous or because an account can move back to the standard market after improving its loss experience.”
—Jennifer Ridgill
Assistant Vice President, Transportation
Johnson & Johnson
“Several insurance programs now require the sharing of electronic logging device (ELD) data recorded within vehicles,” Gallagher adds. “Many insurance carriers and programs have pivoted to a data-driven, tech-enabled, highly selective approach to curb commercial auto losses. This affords our clients a greater number of insurance options as well as premium subsidies from some insurance carriers.”
Difficult as market conditions have been for so long, commercial auto insurance “keeps on truckin’.”
“There is still strong demand for commercial auto coverage,” says Ridgill. “It simply requires more flexibility and realistic expectations from everyone involved.”
For more information:
Amwins Brokerage
amwins.com
Johnson & Johnson
jjins.com
MOTER
moter.ai
Risk Placement Services
rpsins.com
The author
Joseph S. Harrington, CPCU, is an independent business writer specializing in property and casualty insurance coverages and operations. For 21 years, Joe was the communications director for the American Association of Insurance Services (AAIS), a P&C advisory organization. Prior to that, Joe worked in journalism and as a reporter and editor in financial services.
