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A.M. Best revises the market outlook for commercial properties



A.M. Best & Co. Inc. said on Tuesday that it has revised its outlook for the U.S. commercial real estate insurance market from negative to stable, citing ongoing rate hikes by insurance companies and a reduction in claims for business interruptions. up to 2022, said Best in the report.

Insurance companies' strong risk-adjusted capital and continued insurance discipline are among the factors that support the change in outlook, said Best.

But lingering uncertainty about climate-driven losses and secondary dangers and the long-term effects of 19 continues to pose challenges for the segment, said Best.

Disaster activity has been above average this year, with the winter storm Uri in Texas accounting for nearly $ 20 billion in insured losses and Hurricane Ida likely to result in more than $ 30 billion .

The Oldwick, New Jersey-based rating agency noted that rising inflation is driving up the cost of art.

“The US consumer price index for 2021

is expected to be at a level not seen in over 30 years. Ongoing problems with the supply chain and labor shortages continue to push up prices for a variety of consumer goods and materials, as well as repairs or replacements of damaged property, the report says. because ongoing efforts to ensure that property valuations are adequate will mitigate the effects of higher rates over time, said Best.

for the segment.

In most cases so far, insurance companies have successfully claimed that covid-19 does not lead to physical loss or damage to property, best noted.

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