What Is Hard Market vs. Soft Market?
A hard insurance market means rates are rising and carrier appetite is tightening as underwriters restrict what they will write; a soft market means the reverse, rates flattening or falling and carriers competing harder for the same accounts. Per CIAB's own 2025 survey data, the commercial P&C market has been actively softening since mid-2025.
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A hard insurance market means rates are rising and carrier appetite is tightening as underwriters restrict what they will write; a soft market means the reverse, rates flattening or falling and carriers competing harder for the same accounts. Per CIAB's own 2025 survey data, the commercial P&C market has been actively softening since mid-2025.
Hard Market vs. Soft Market explained
CIAB's Q2 2025 Property/Casualty Market Survey put overall commercial rate increases at 3.7%, down from 4.2% in Q1, still the 31st consecutive quarter of increases but decelerating quickly. Five lines, cyber, EPLI, terrorism, workers' comp, and D&O, posted outright rate declines that quarter, and large-account rate increases fell to 2.9%, a 45% drop from Q1. Commercial property increases moderated to 1.9%, down roughly 70% from Q4 2024's 6.0%. CIAB's own Q3 2025 resource used the headline "Soft Market Clear."
Umbrella and excess liability is the one loud exception, still rising 11.5% in Q2 2025, driven by 135 nuclear verdicts in 2024 (up 52% year over year) that blew through primary limits, a combined-ratio-driven hard pocket sitting inside an otherwise softening overall market.
None of the competitor content reviewed for this research mentions the 2025-2026 softening cycle at all, which leaves a specific, differentiated prospecting angle open: a softening market means more carrier competition for the same accounts, and less rate-shock leverage for an incumbent agent trying to retain a client passively. Lower switching friction, because a competitor can realistically beat a soft-market renewal quote, paired with lower client inertia, is arguably a stronger moment to prospect aggressively on x-dates than during a hard market, not a reason to ease off.
Why it matters when you're buying
If your prospecting pitch or your own sales motion still assumes a hard market, where clients feel stuck and rate shock does your retention work for you, update it. CIAB's own Q3 2025 data calls the market softening clear, which means incumbents have less passive leverage right now and switching-focused outreach around x-dates has more room to work, not less.
Frequently Asked Questions
Is the commercial insurance market hard or soft right now?
Why does a softening insurance market matter for prospecting?
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