Commercial insurance prices in the U.S. increased in the first quarter about 2%, according to insurance broker and advisor Willis Towers Watson.
The company’s Commercial Lines Insurance Pricing Survey (CLIPS) survey compared carriers’ prices charged on policies underwritten during the first quarter of 2019 to those charged for the same coverage during the same quarter in 2018.
Price changes for most lines were similar to or slightly above those reported last quarter. Four standard lines indicated material price increases: commercial auto, commercial property, excess/umbrella liability, and directors and officers liability.
Towers Watson said the outlier in the survey results continues to be commercial auto, where significant price increases were again reported — in the double digits for the fourth consecutive quarter. Price changes were positive and of reasonably similar magnitude across all account sizes.
“Overall, price changes were consistent with recent surveys, with the exception of directors and officers liability, where data now indicate an uptick of price increases into the mid-single digits,” said Jeffrey Carlson, director, Insurance Consulting and Technology, Willis Towers Watson.
Carlson also said that while estimates of 2018 claim cost inflation are still elevated compared to the recent past, they have moderated somewhat from estimates provided in the last survey, as the data continue to mature.
“There is a clear trend across most lines of business and most geographies that insurers are taking steps to return to underwriting profitability. We are seeing price firming almost universally. While capital remains plentiful, insurers are demonstrating their long-sought pricing discipline as they exercise more judicious deployment of capacity,” wrote Joseph C. Peiser, head of Broking for North America, in Willis Towers Watson’s Marketplace Realities commentary on the first quarter.
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