No one starts the new year thinking, “I wonder what will happen to insurance?” OK, maybe I do, but most people aren’t giving a great deal of thought about insurance on the first day of January.
Although insurance may not be the first priority once Big Ben chimes, the new year will bring significant changes to the insurance sector, which could have a knock-on effect for businesses. Economic and social shifts mean some insurances may become more important, as well as impacting premium levels.
Below, I’ve broken down the key factors set to shape insurance prices, product trends and risk behaviours over the next year. My conclusions are based on industry forecasts, economic signals and, most crucially, the conversations we’re having every day with clients.
1. Insurance prices are still rising (but more slowly)
The last few years have seen significant upward pressure on premiums. In 2026, most experts expect prices to keep rising, but at a more predictable and steady pace. Several factors are driving this:
• Higher rebuild, repair and replacement costs. Materials, labour and supply chains have stabilised, but not returned to pre-pandemic levels.
• More extreme weather events. Flooding, heatwaves, storms and water damage continue to increase claim volumes.
• Greater digital risk and higher cyber claims. Insurers are pricing more carefully in light of new loss patterns.
Most businesses should expect modest increases in property, liability and cyber insurance in particular. Keeping the cover up to date will be the best way to control costs. And keep an eye on the valuations of what is being covered.
2. Cyber insurance demand will continue to surge
Cyber incidents have risen sharply in recent years, and businesses are becoming much more aware of how disruptive they can be. Businesses are at risk from hackers and can be impacted by stolen data. A significant cyber incident can halt operations, damage customer trust, and lead to major legal and financial repercussions.
In 2026, we expect cyber insurance to become:
• More widely purchased, especially by SMEs
• More detailed and tailored
• More tightly underwritten by insurers
Before higher limits are offered, businesses will be asked to demonstrate stronger cybersecurity controls, such as multifactor authentication (MFA), and will be expected to have secure backups.
3. New and emerging insurance products will gain traction
2026 is likely to be a year where several specialist products break into the mainstream as risks evolve:
a) Business interruption for utilities and supply chain
More owners are looking for cover that reflects real-world vulnerabilities such as power outages, broadband failure, infrastructure damage, and supplier breakdowns. Expect demand for more comprehensive business insurance extensions.
b) Reputation and influencer-related cover
With influencer marketing now a core part of many campaigns, businesses are more exposed to reputational risk. Specialist cover will be required to cover negative PR and brand damage. Influencer awareness of the need for cover will continue to grow, as we are now seeing regularly at base Insurance.
c) AI liability
As AI becomes embedded in workflows, businesses are asking: “What happens if AI makes a mistake?” Insurers are beginning to define products covering algorithmic error and data bias, as well as automation-related liability.
4. Economic uncertainty will change how businesses think about risk
With recession fears still lingering, borrowing costs high, and insolvency rates rising, many business owners are becoming more cautious. When the economic outlook feels uncertain, protection becomes more important.
That means increasing interest in:
• Directors’ and Officers’ insurance (D&O)
• Professional indemnity
• Legal expenses
• Trade credit insurance
• Enhanced business interruption cover
We’re seeing more clients wanting to “protect the downside” as they navigate a challenging landscape.
5. Underinsurance will be one of the biggest risks in 2026
One of the clearest patterns emerging is that many businesses have outdated valuations. The cost of buildings, stock and equipment has risen significantly, yet their cover often hasn’t kept pace.
Insurers are warning of:
• More claims being reduced or partially paid
• Greater scrutiny on declared values
• A rise in surveys and checks to confirm accuracy
A quick valuation review can make a major difference, and it’s often the simplest way to avoid a nasty surprise at the claim stage.
6. Sustainability and climate resilience will factor into cover
Insurers are already adjusting how they assess environmental risk, and this will grow in 2026. This includes:
• Higher scrutiny of flood zones
• Questions around sustainability credentials
• More products designed for green tech, EV fleets and renewable infrastructure
If your business is investing in greener operations, you may need updated cover to match the technology.
In my crystal ball, 2026 will reward proactive businesses
While insurance might not be front of mind for every owner, there will be shifts in pricing and risk exposure throughout 2026. The businesses that fare best will be the ones who:
• Review their policies early
• Update valuations accurately
• Strengthen cybersecurity
• Adapt cover to new and emerging risks
At base Insurance, our job is to make this simple. If you’d like to sense-check your protection for 2026 or explore smarter ways to safeguard your business, we’re here to help.
Get in touch and let’s make sure you go into the new year properly protected.
Daniel Stoner
Founder / Managing Director of
base Insurance Brokers.
Find out more at www.baseinsurance.co.uk
