U.S. commercial insurance prices accelerated during the third quarter of 2019, as the aggregate price change reported by carriers exceeded 4%, according to insurance broker Willis Towers Watson.
WTS’s Commercial Lines Insurance Pricing Survey (CLIPS) survey compared prices charged on policies underwritten during the third quarter of 2019 to those for the same coverage during the third quarter of 2018.
Data for commercial auto, commercial property, excess/umbrella liability and directors and officers (D&O) all indicated significant price increases. The survey reported price reductions for only one line — workers’ compensation — although the reductions were more modest in the third quarter than in prior quarters.
Price changes were more pronounced for large accounts than those reported for small and mid-market accounts. Specialty lines price increases also trended upward significantly, WTW said.
“This quarter we saw the largest overall price shift since 2013,” said Alejandra Nolibos, senior director, Insurance Consulting and Technology, Willis Towers Watson. “Price increases for D&O liability are well into the double digits, with employment practices liability and medical professional liability also showing sizable upward shifts. Commercial auto did not let up, with insureds looking at double-digit increases again.”
Nolbos said the survey confirms that insurers have been responding to worsening loss trends across affected lines through pricing, while other sources suggest terms and conditions have tightened.
“The question is whether and when workers compensation loss trends will turn, too,” she said.
CLIPS data are based on both new and renewal business figures obtained directly from carriers underwriting the business.
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