How Hoteliers are Banding Together in 2026 to Lower Insurance Premiums Nationwide

Insurance premiums have become one of the fastest-growing and most painful expenses on a hotel’s profit and loss statement. According to CBRE data, hotel insurance costs surged 19.5% year-over-year in 2023, with many operators facing continued double-digit increases through 2025 and into 2026. Reinsurance rates for hospitality jumped another 20–50% in 2025, and those hikes are now flowing directly into nearly every renewal — even for properties with clean claims histories.

Natural disasters, soaring reconstruction costs, and rising liability claims have carriers tightening terms and raising premiums. The old playbook — simply passing costs to guests through higher rates or quietly absorbing them — is no longer sustainable. Aggressive rate hikes can soften demand, while absorbing the increases quietly eats into your ability to reinvest in the property, staff, and guest experience.

There is a smarter path forward. Forward-thinking hoteliers, including many AAHOA members, are moving beyond fighting these costs in isolation. They’re banding together to share risk, strengthen negotiating power, and create new revenue streams.

The Power of Collective Action

When independent and boutique hotel owners collaborate on risk management and guest protection, the results are measurable:

• Improved overall loss history that insurers reward with better terms
• Stronger negotiating position at renewal time
• Faster recovery of disputed revenue that would otherwise be written off

The most effective strategies focus on preventing guest issues from escalating into formal claims and resolving disputes fairly and efficiently at the property level. Hotels that adopt this proactive, group-oriented approach typically see:

• Fewer claims reaching insurance carriers
• Better data and documentation for renewals
• Direct revenue recovery from incidents previously treated as losses

Why Banding Together Outperforms Going Solo

Traditional insurance is reactive. A collective approach to guest protection and dispute resolution is proactive. By addressing issues early and consistently across properties, hotel groups demonstrate serious risk management to carriers — the same collaborative philosophy that works for purchasing cooperatives and shared marketing programs, now applied to risk and revenue protection.

This shift turns hoteliers from price-takers in a tough insurance market into owners of their costs and outcomes.

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