Three of Ohio’s leading insurance carrier partners—Nationwide, Westfield, and Encova—representing $1.75 billion in written premium, approximately 8% of the state’s P&C market, shared their insights on 2024 and 2025. Here’s what they shared about how agents can best position themselves for growth and a strong partnership with their carrier partners.

Understanding Market Conditions and Carrier Performance

2024 Performance: Insurance carriers faced a challenging year in 2024, marked by high catastrophe (CAT) losses and severe weather events. Despite these challenges, some carriers, like Nationwide, reported significant profit improvements due to stringent underwriting actions and rate adjustments. Westfield and Encova also highlighted the importance of proactive communication and strategic adjustments to navigate tough market conditions.

2025 Expectations: Agents should anticipate a continued focus on profitability and cautious growth. Carriers are expected to maintain a balanced approach, with some returning to aggressive growth strategies while others remain cautious due to potential economic uncertainties and regulatory changes.

Importance of Transparent Communication

Carrier-Agent Relationships: Both Westfield and Nationwide emphasized the need for transparent and proactive communication with agents. This includes explaining the reasons behind rate increases, coverage changes, and underwriting decisions. Agents should expect more frequent updates and open dialogues with carriers to ensure mutual understanding and alignment.

Feedback Mechanisms: Carriers are increasingly relying on agent feedback to refine their strategies and improve service delivery. Agents should actively participate in providing constructive feedback and engaging in discussions with their carrier partners.

Adapting to Technological Advancements

Telematics and Smart Home Devices: Nationwide highlighted the growing importance of telematics and smart home devices in the insurance industry. These technologies not only help with risk assessment but also provide customers with more control over their insurance rates. Agents should familiarize themselves with these technologies and educate their clients on the benefits of adopting them.

Digital Tools and Resources: Carriers are investing in digital tools to enhance the customer experience and streamline operations. Agents should leverage these tools to improve efficiency, provide better service, and stay competitive in the market.

Focus on Customer Segmentation and Niche Markets

Preferred and Protector Classes: Nationwide is targeting specific customer segments, such as the “protector class,” which includes customers who value insurance and seek guidance from their agents. These customers are less likely to switch carriers frequently and look for a balance between cost and quality. Agents should identify and focus on such niche markets to drive growth and profitability.

Underserved Markets: There are opportunities in underserved markets, particularly in the realm of diversity, equity, and inclusion (DEI). Agents should consider expanding their reach to these markets by understanding their unique needs and providing tailored solutions.

Preparing for Regulatory and Economic Changes

Regulatory Landscape: The insurance industry is subject to various regulatory changes that can impact carrier operations and agent practices. For example, there are ongoing discussions about third-party litigation financing and its influence on the industry. Agents should stay informed about regulatory developments and understand how they might affect their business.

Economic Factors: Economic conditions, such as inflation and tariffs, can influence insurance costs and market dynamics. Agents should be prepared to navigate these challenges by staying updated on economic trends and adjusting their strategies accordingly.

Performance of Insurance Carriers in 2024

In 2024, insurance carriers experienced mixed performance due to several factors:

• Catastrophe Losses: Severe weather events and natural disasters significantly impacted carriers’ loss ratios. For instance, Westfield reported 17.5 points of CAT losses in Ohio, an unusually high figure.

• Profitability: Despite these challenges, some carriers, like Nationwide, achieved substantial profit improvements by implementing strict underwriting actions and reducing exposure to high-risk areas. Nationwide’s combined ratio improved by 18 points, ending at 96.2.

• Growth: Carriers focused on maintaining profitability while cautiously pursuing growth. Westfield, for example, took a conservative approach to new business, focusing on earning the necessary rate through renewals.

Expectations for Insurance Agents in 2025

Looking ahead to 2025, insurance agents should prepare for the following:

• Continued Market Adjustments: The market is expected to gradually soften, but carriers will remain cautious due to potential economic uncertainties. Agents should be ready for ongoing rate adjustments and changes in underwriting practices.

• Increased Competition: As some carriers return to growth mode, competition for new business will intensify. Agents should differentiate themselves by providing exceptional service and leveraging technology to meet customer needs.

• Focus on Customer Education: With changes in policy terms and conditions, agents will play a crucial role in educating customers about their coverage and helping them make informed decisions. Clear communication and personalized service will be key to retaining clients and attracting new ones.

In summary, 2024 was a challenging year for insurance carriers, but strategic adjustments and proactive communication helped navigate the difficulties. In 2025, agents should focus on understanding market conditions, leveraging technology, targeting niche markets, and staying informed about regulatory and economic changes to succeed in a competitive landscape.

About the Author:

Jeffrey S. Smith, JD, CIC, CAE serves as Chief Executive Officer for Ohio Insurance Agents Association (OIA) and IA Valuations. He is responsible for leading the organization’s strategic initiatives and day-to-day operations.

As CEO of IA Valuations, Smith has consulted and reviewed over 200 agency valuations for independent agents across the US. IA Valuations serves independent agencies as a trusted advisor and strategic business partners as they implement strategies to increase their agency value, grow their businesses, and transition their agencies. Smith provides insights into the agency’s operations, risk factors, and legal guidance on how to perpetuate and maximize value in a sale.