Current Factors Driving Today’s Crane Insurance Market Crisis


Part One: Overview of Current Factors Driving Today’s Crane Insurance Market Crisis

• “Challenges ahead for U.S. reinsurers amid spike in rating downgrades” – [Gallagher Re, in ‘ReInsurance Business’ publication, February 2024]

• “Hard market conditions driving buyer interest in alternative methods”- [Guy Carpenter, in ‘Global Reinsurance/GR’ publication, October 2023]

• “The market has been hardening over several years and there are no signs that the market is going to turn any time soon” – [Oxbow Partners, in ‘Insurer Viewpoint’ publication October 2023]

These three recent quotes are from Global Commercial Insurance and/or Reinsurance publications. Each of these organizations (Gallagher Re/Guy Carpenter/Oxbow Partners) quoted are major global reinsurance organizations. These quotes summarize a few of the current dynamics involved in today’s insurance market for crane operations. Reinsurance entities back the financial obligations of traditional commercial insurance carriers that underwrite insurance for crane operations, and they have a very significant impact on crane insurance availability, capacity, terms and conditions, and premium rates charged year to year due to the high-risk nature of crane operations. The global reinsurance market impression of crane risk in America is a crucial factor in finding long term, viable solutions for today’s crane insurance market challenges.

Among the issues occurring in today’s crane insurance is that many industry stakeholders believe it is time to examine how crane owners as insurance buyers should consider alternative risk treatment methods to offset the continued upward trajectory in their insurance pricing. These growing hard market dynamics are creating demand for crane owners to band together to consider alternative insurance structures with alternative risk support services to counter these current insurance cycle challenges. 

There is power in numbers, but first we need to identify contributing factors that are driving the current insurance market disruption.

The Hard Insurance Market — Why Is It Happening?

The global commercial property and casualty insurance market has been hardening slowly and consistently for several years, and there are no signs that the market is going to turn positive anytime soon, according to major/global reinsurance market sources. Market-rate movements ultimately come down to the balance of demand and supply, and it is clear that demand currently outstrips supply in the corporate and specialty markets serving our crane industry today. Additionally, when we consider that the two recent high profile crane accidents (Dallas, Seattle) produced nearly $1 billion in combined settlements that directly impacted the supply side of the insurance equation, the outcome of which is driving these micro factors in the wrong direction. From a macro perspective in market dynamics, our industry needs some radical change to be in any position to affect market improvement locally, nationally and globally.

The global reinsurance marketplace sets the overall tone and risk appetite with traditional insurance carriers that take risk across most classes of business (including U.S. crane operations). This insurance/reinsurance factor represents a macro-view of today’s insurance marketplace, and it’s based on multiple risk factors, most commonly including the holistic performance of (multiple lines) of insurance coverage in (multiple industry) segments across world markets. 

So, the point is that this current insurance market disruption is not attributable exclusively to U.S. crane organizations, but rather is symptomatic of much larger global risk supply and demand factors due to higher-than-normal loss performance results.

Recognizing Demand Factors Contributing to Hard Market Conditions

There are two contributing factors (within the technical insurance jargon realm) that are contributing to our local demand increase: prior-year loss factors and in-year losses (for all lines of insurance, in all market segments). Despite the rising prices these last few years, it has still been a tough market for most specialty insurers and reinsurers. This has been especially true in property/catastrophe markets given recent storms, such as Ian in 2022 and Ida in 2021, in addition to war risk in the Middle East and Ukraine, which are examples of overall prior-year losses. Even though these exposures are not directly related to U.S. crane insurance markets, the global reinsurers that are involved (behind the scenes) supporting U.S. specialty insurance markets are the same reinsurers that support weather/war related losses. They have all taken a pounding recently, which indirectly impacts our crane market conditions going forward. 

Additionally, in-year losses (from another technical insurance verbiage standpoint) are a driver of short-term changes in market demand, and since we have had another year of elevated large crane loss activity, including the Dallas/Seattle cases that manifested in 2023. These incidents, compounded with the other normal amount of crane related in-year losses, will further increase the demand for cost increases in reinsurance protection to our local insurers in 2024 and beyond. 

Loss cost increases to reinsurers equate to cost increases to local crane insurers, which in turn equate to driving hard market conditions for our crane industry. Lastly, as a major contributing factor to our insurance market-cycle disruption, there has been a measurable increase in “nuclear verdicts” in overall U.S. casualty claims as the “nuclear verdicts” chart exhibits.

Lastly, macro trends. such as climate change and inflation. would point to a continuation of the hard market conditions, especially in high-risk business environments such as crane rigging and heavy haul transport segments. However, there are many forces that combine to define the market “clearing price” and there are some overall industry views that the market may begin to soften in 12-24 months. 

This view is subject to exposure (demand) for reinsurance capital exceeding (supply) in the global reinsurance market, as the “exposure” chart indicates.


Typical insurance market cycles can run, on average, for five to seven years. However, our crane industry as a microcosm of the overall global insurance market has experienced anything but a typical run these past few years. So, we could be in for a longer run of these hard market conditions. 

The next two editions of our three-part article series will further address finding viable solutions to today’s hard insurance market. 

Article written by Kevin Cunningham, president and CEO of Crane Risk Logic Inc., and has 27 years of experience in crane risk management. He can be reached at


Crane Hot Line is part of the Catalyst Communications Network publication family.