Green shoots in packages and specialist segments amid commercial lines premium slump

A 7.7% year-on-year drop in commercial lines revenue in the first quarter of 2026 now means that brokers have seen six consecutive quarters of declining income, standing as a powerful reminder that soft market conditions show no clear signs of abating.

This finding – reflective of the total gross written premium (GWP) placed by commercial lines brokers through the Open GI insurance platform – is from the latest Insurance Times Commercial Lines Premium Index, released in  May 2026 in association with insurance technology partner Open GI.

The index confirmed that the 7.7% revenue drop seen in the first quarter of this year stands slightly lower than the 10.8% fall posted in Q4 2025 and the 10.7% dip reported in Q3 2024.

Nick Giddings, director of brokers and MGAs at Open GI, said this data revealed that the commercial lines sector remains “firmly in a soft market” – with these persisting conditions leading to changes in insurers’ pricing strategies.

He explained: “In the second year now of [this] soft market [cycle], competitive pricing has become more apparent from the outset.

”Whereas before, an insurer might try to renew at similar rates to previous years but new business rates were more aggressive, we are now seeing more insurers quote renewals at far lower rates from [the] beginning.”

Luigi Maggio, director at commercial insurance broker McCarron Coates, added: “[The soft market] dynamic is very positive for clients – [they] are seeing large premium reductions, leaving them with more funds to reinvest in their business.

“However, while this continues to be positive in the shorter term, there needs to be a managing of [client] expectations that the cycle will change [at a future point] and the value of the insurance programme [should] not [be purely] focused on cost.”

Green shoots

Unlike Q4 2025’s results – in which no major commercial line product saw year-on-year growth across the quarter – some tentative green shoots have surfaced in the latest set of data.

Brokers providing packages saw their GWP increase 3.4% over the last year, while specialist brokers saw a more modest 2.1% revenue improvement. This finding will be especially welcome for the packages segment, which posted an 18.8% year-on-year decrease in revenue in the last iteration of this index – the worst result among major lines.

Specialist lines also saw a big GWP fall in the previous edition of the index, down by 10.9% year-on-year for the last quarter of 2025.

By contrast, in Q1 2026, property owners (-1.8%), fleet (-4.8%), contractors and tradesmen (-8%), combined liability (-12.3%) and commercial combined (-13.9%) brokers all saw a decline in GWP.

Giddings commented: “There are early signs of rates hardening in some lines, with packages and specialist lines of business showing low levels of premium growth. This growth in packages is largely driven by marine insurance. [Rates] in property owners, fleet and liability premiums also reduced.

“But it would be wishful thinking to read too much into that at this stage. Commercial liability is in its third consecutive quarter of double digit rate decreases and commercial combined [is in] its second.”

The consecutive falls in rate seen in commercial liability and commercial combined lines – two traditionally large areas of business – are growing increasingly concerning. Over the last three quarters, commercial combined has seen year-on-year GWP declines of 7.9%, 15.1% and 13.9%, while combined liability has posted drops of 20.1%, 13.5% and 12.3%.

Additional benefits

With soft market conditions persisting, Maggio highlighted strategies by which brokers can take advantage of the market cycle.

“Brokers can use the soft market to secure additional benefits or programme structures such as low claims rebates on policies, reduced excesses, increased limits of cover and, importantly, broadening covers with the sale of products that clients see as either secondary exposure or additional cost,” he said.

“No client can afford not to purchase the likes of cyber insurance and by benefiting from reductions in premiums elsewhere, it should allow brokers [to] have a greater conversion of such products while also providing vital covers.

“We must use this time to utilise the advancements in artificial intelligence (AI) to ensure the expense base remains the most optimised while delivering service that is highly efficient and consistent with what clients expect.”