State of the Insurance Market Report

2025 Initial Outlook and 2024 Wrap-Up

Relocation

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During 2024, the global relocation and moving market continues to be buffeted by significant headwinds that originally emerged from the COVID-19 pandemic. While access to qualified labor resources to manage the physical packing and loading of moves has improved, the overall industry shipment volumes are mostly flat or slightly down depending on the region.

Market Conditions

In the U.S., higher mortgage interest rates coupled with continued higher-than-average inflation is dampening the availability or supply of homes for sale and impacting homeowners’ desire to sell their properties. That is certainly understandable, since the increase in mortgage rates will cost thousands of dollars more a month.

This dampened enthusiasm for relocating has most certainly impacted corporate relocations and moves both domestically and abroad. While some industries like hospitality, finance and manufacturing have seen a modest increase in corporate move volumes, companies within the technology sector continue to see drastically reduced move volumes in 2024, some by as much as 80% less than 2023.

Other factors likely impacting overall relocation volumes are housing shortages in major metropolitan regions across Europe, illustrated in summer 2024 by demonstrations in Spain, Portugal, and Germany. Add to that political upheaval and conflicts in Eastern Europe and the Middle East, and the aforementioned challenges continue to mount.

Corporate relocations remain essential not only to individual companies, but to local and global economies. Some employers have responded by offering qualified employees more comprehensive relocation packages, including home selling and buying support, flexible moving timelines, and resources to address financial concerns.

Regarding more flexible moving timelines, traditionally, the prime moving season runs from May to July each year. In 2024, we noticed a distinct shift of this prime season to July and August, which likely expanded into September this year. These observations are supported by relocation service providers who confirmed that move initiations with move dates in August and September or after increased from previous years.

Technology and more flexible employment policies are impacting relocation volumes worldwide as well. Companies are recognizing the importance of offering tailored benefits that align with the unique priorities of employees in different regions around the world.

The U.S. domestic moving industry awaits the potential significant impact of the Global Household Goods (GHC) Contract which was awarded to the HomeSafe Alliance by U.S. Transportation Command (USTRANSCOM) at the end of 2021. While the program was projected to be fully operational by the summer of 2024, HomeSafe has only moved a few hundred shipments under the GHC so far, instead of the tens of thousands that had been anticipated. The overall success of the GHC is yet to be determined in the coming years.

Coverage Considerations

  • Pressure on coverage rates to maintain manageable loss ratios persists. Clients with adverse loss ratios should assess whether the valuation basis for their shipments is adequate, considering that household goods costs have increased more than 20% in the past three years.
  • Underwriters are continuously reevaluating coverage levels for major loss categories such as mold and mildew remediation, which may result in reduced coverage offerings and/or caps.
  • Clients may wish to consider retaining more risk to obtain more favorable rates, which could positively impact their overall loss ratios.
Relocation Rate Forecast
Relocation: +4% to +6%

Recommendations

As the number of qualified underwriters offering household goods and relocation coverage continues to shrink, clients should be cognizant of the fact that securing new markets for their insurance needs will become increasingly challenging. Maintaining a manageable net loss ratio will be critical to preserving existing relationships with underwriters. To achieve that, we recommend clients:

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Gather relevant shipment and claims data for both origins and destinations and apply targeted analytics to identify suppliers or trade lanes responsible for disproportionate losses.

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Implement mitigation strategies to reduce the frequency and severity of recurring damage or loss claims.

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Introduce a deductible or loss participation fee for service providers to lower direct claim costs.

Overall, the global relocation market is adapting to new economic realities and employee expectations by emphasizing flexibility, leveraging technology, and addressing regional challenges. Companies that succeed in this evolving landscape will be those that prioritize employee experience and adapt to the changing dynamics of the global workforce.

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The contents of this report are for general informational purposes only and Risk Strategies Company makes no representation or warranty of any kind, express or implied, regarding the accuracy or completeness of any information contained herein. Any recommendations contained herein are intended to provide insight based on currently available information for consideration and should be vetted against applicable legal and business needs before application to a specific client.