The trend of increasing commercial insurance premiums that began in the fourth quarter of 2017 continued last quarter. Average premiums across all sized accounts increased by 1.5 percent in Q2, according to The Council of Insurance Agents & Brokers’ latest Commercial Property/Casualty Market Index Survey.
With the exception of workers’ compensation, which experienced a decrease in premiums of 2.9 percent, all lines of business saw either no or slight increases in premiums in Q2 2018, according to the survey. The average increase across all lines was 2.0 percent, compared to 2.2 percent in Q1 2018.
The commercial insurance broker respondents agreed that commercial auto—a continuing problem line for the industry—and commercial property, experienced the most stress in terms of premium pricing and underwriting in Q2 2018. Survey results showed that commercial auto and commercial property both experienced the highest increase in premium pricing, at 8.2 percent and 2.2 percent, respectively. Several respondents also noted a tightening in underwriting as well as a decrease in capacity for both lines.
“Although commercial auto continues to be a concern for brokers and carriers alike, other lines appear to stabilize across the board, following several quarters of soft market conditions,” said Ken A. Crerar, president/CEO of The Council.
Demand for cyber insurance remained exceptionally high: 77 percent of respondents reported an increase in demand for cyber. At the same time, rates for cyber increased only 0.1 percent.
Generally, respondents agreed that the workers’ compensation market has been very competitive and that carriers are “expanding appetite and lowering minimum premiums to gain market share.” They also mentioned that carriers were cutting workers’ compensation rates to offset increases in commercial auto.
Source: The Council
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