Prices for overall commercial insurance lines in the U.S. inched upward in the fourth quarter of 2017, although workers’ compensation and directors and officers liability prices actually declined and commercial auto price increases approached double digits.
According to global broker Willis Towers Watson’s Commercial Lines Insurance Pricing Survey (CLIPS), price changes reported by carriers averaged less than one percent for the tenth consecutive quarter, following a moderating trend in price increases that began in the first quarter of 2013.
The survey compared prices charged on policies written during the fourth quarter of 2017 with those charged for the same coverage during the equivalent quarter in 2016.
Commercial property prices, which had been showing decreases for much of the recent past, now indicate increases in the low single digits.
The outlier in the results continues to be commercial auto, where meaningful price increases are again reported and are nearing double digits. Price changes were positive across all account size segments, as large accounts moved from modest reductions to modest increases in aggregate.
Data for workers’ compensation and directors and officers liability indicated material price decreases in the fourth quarter, underscored by larger price decreases than the prior quarter for workers’ compensation, in contrast to most other lines.
“Last year’s weather disasters were some of the most financially disruptive in history, and the survey results indicate we’re likely now seeing the initial response to the catastrophes on the pricing side of the property market,” said Pierre Laurin, Americas Property & Casualty sales and practice leader for Insurance Consulting and Technology, Willis Towers Watson. “Further, commercial auto rate increases show no signs of abatement, as insurers seek to restore the line to a profitable rate level.”
CLIPS data are based on both new and renewal business figures obtained directly from carriers underwriting the business. CLIPS participants represent a cross section of U.S. property/casualty insurers that includes many of the top 10 commercial lines companies and the top 25 insurance groups in the U.S.
Last month, Marsh reported similar findings on a global basis that the average global insurance pricing in the fourth quarter of 2017 increased for the first time since Q1 2013, driven largely by global property insurance. The average pricing increased by 0.8 percent in the quarter, compared to a decrease of 1.9 percent in Q3 2017, said the Marsh report.
Another market barometer, the IVANS Index of premium rate renewals for the fourth quarter, showed a slight rise in the average rate change across commercial auto, business owners, general liability, and commercial property compared to Q3, but a drop in the average change for umbrella and workers’ compensation policies.
Topics Trends Commercial Lines Workers' Compensation Business Insurance Pricing Trends Property
Was this article valuable?
Here are more articles you may enjoy.
Farmers Adjusters Cry Foul Over Workloads, Claims Handling in Letter to Regulators 
House Collapses Into Flood-Swollen River Near Minnesota Dam Amid Storms 
Microsoft Tells Texas Agencies They Were Exposed in Russian Hack 
‘Extremely Dangerous’ Hurricane Beryl Takes Aim at Caribbean 
