The prolonged hard market in North American commercial insurance has begun to ease, creating a new challenge for property and casualty (P&C) insurers as they look to maintain profitability, improve risk selection and adapt to a more competitive market environment.
According to ReSource Pro’s latest eBook on Earnix, The Next Challenge in Commercial Insurance Pricing, insurers are entering a period where success will depend less on market conditions and more on pricing accuracy, underwriting discipline and the ability to respond to increasingly complex risks.
As pricing pressure increases, operational optimisation has become a key priority for commercial insurers looking to strengthen margins and improve efficiency. ReSource Pro’s research found that pricing precision now ranks fourth among 13 strategic priorities identified by insurance executives, highlighting the growing importance of accurately assessing risk as premium growth slows.
At the same time, the commercial insurance market is becoming increasingly specialised. Insurers are developing tailored products for specific industries and smaller risk segments, creating opportunities for more targeted coverage but also increasing pressure on underwriting teams. Many emerging segments lack extensive historical claims data, making risk assessment and pricing more challenging.
This is driving investment in underwriting transformation, with ReSource Pro finding that 91% of commercial lines insurers are actively developing or implementing underwriting transformation strategies in 2026. Nearly half (48%) plan to add or upgrade their underwriting systems as carriers look to modernise their operations.
Technology, particularly artificial intelligence, analytics and real-time data, is expected to play a growing role in helping insurers improve decision-making. By combining data from multiple sources, carriers can gain deeper risk insights, improve pricing accuracy and move towards more proactive risk management.
Commercial fleet telematics is one example of how this shift is taking place. Data from connected vehicles, mobile technology and electronic logging devices can support usage-based insurance models, allowing premiums to better reflect actual driving behaviour rather than relying on fixed renewal cycles. Similarly, Internet of Things (IoT) sensors are helping insurers collect real-time information on properties, equipment and environmental conditions to support underwriting, loss prevention and claims management.
ReSource Pro’s research also identified data capabilities as a critical area of investment, with 78% of commercial lines insurers highlighting advanced analytics, predictive modelling and AI as key priorities. Beyond technology, insurers are also focusing on AI governance, employee adoption, strategic partnerships and building the digital infrastructure needed to support long-term transformation.
The findings highlight a broader shift across commercial insurance, as carriers move from traditional risk assessment models towards more data-driven and dynamic approaches. Insurers that successfully combine AI, analytics and modern underwriting systems will be better positioned to navigate changing market conditions and deliver more precise risk solutions.
ReSource Pro’s eBook, The Next Challenge in Commercial Insurance Pricing, explores the technology, processes and operating models insurers need to modernise pricing and underwriting strategies.
Read the full Earnix article here.
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