Insurance is like a safety blanket that helps people and businesses stay safe from unexpected money problems. But did you know that the insurance world goes through ups and downs? In this article, we’ll break down what a “hard insurance market” is and how it can impact regular people like you.

The Ups and Downs

First, let’s talk about the insurance cycle. Think of it as a cycle of good times (soft market) and tougher times (hard market). In the good times (soft market), insurance companies are friendly and give out policies easily. This makes them compete with each other, which brings down the prices you pay for insurance. So, you get more choices and can save money. But then comes the tough times (hard market). This is when things change, and it affects everyone who needs insurance.

Understanding the Tough Times

During a hard insurance market, a few important things happen:

  1. Picky Choices: Insurance companies get pickier about who they want to cover. They start looking at people and businesses very carefully before giving them insurance.
  2. Higher Costs: This is a big sign of a hard market. The prices you pay for insurance go up. The insurance companies have more costs, and they pass those costs on to you by charging you more.
  3. Less Choices: Insurance options become limited. It’s like going to a store with fewer things to choose from. You might not find exactly what you need.
  4. Less Competition: Insurance companies stop competing so much. They care more about making money than trying hard to get your business.

How It Affects You – Real-Life Examples

Now, let’s see how all this affects regular people like you:

  1. Tight Budgets: When insurance costs more, it can be tough on your wallet. If you live in a place with lots of accidents, your car insurance might go up, and it could be harder to afford.
  2. Protection Gaps: Less insurance options mean you might not have coverage for everything you need. Imagine your home isn’t covered for flood damage, and a flood ruins everything – that’s a problem.
  3. Tricky Choices: Finding the right insurance gets trickier. Maybe you’ve had a few accidents, and now finding affordable car insurance is like solving a puzzle.
  4. Thinking About Safety: When insurance is harder to get, people start thinking about safety more. Business owners might make their workplaces safer to avoid accidents that could cost a lot.
  5. Planning Ahead: Businesses have to rethink their long-term plans. Construction companies, for instance, might create a special savings plan for accidents since regular insurance is too expensive.


The insurance world isn’t always the same – it goes through ups and downs. When things get tough (hard market), it affects you and your money. Even though it’s not easy, you can manage it by being smart about your choices. Remember, insurance is about more than just papers; it’s about staying strong and secure even when things get tricky.

Michael Vereecke, CLCS

Agent/President, Customers First Insurance Group