Surveys about commercial P/C coverage show increasing rates.
For the fifth quarter in a row, Towers Watson insurance news is showing that commercial property and casualty coverage saw an increase in its prices.
The first quarter of 2012 saw a rise in rates by almost 5 percent.
Furthermore, the loss ratios for commercial insurers was found to have stabilized for the majority of coverage lines, and saw improvement in the lines that had the largest increases in their rates. This, according to the data collected from the Commercial Lines Insurance Pricing Survey (CLIPS), which was released by the professional services firm.
The CLIPS data allowed for a comparison between the prices that were seen for the policies that were underwritten throughout the first three months of the year, with those for the same coverage and during the same months the year before. It found that the most significant increases in rates were, as was the case for five consecutive months, in the lines for commercial property and workers’ compensation.
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This insurance news does not come as a surprise to everyone.
According to the Towers Watson property and casualty sales and practice leader for the Americas, Thomas Hettinger, “We are seeing a continuing trend of price-level increases in the commercial insurance marketplace.” He went on to point out that “This quarter, the industry reached a significant threshold — an aggregate price increase of nearly 5% — the largest quarterly increase we’ve seen since 2004.”
There were also rises in prices across all of the standard commercial lines, regardless of the size of the accounts, though the largest increases were in the accounts in the mid-market range. There was a lag in the specialty lines, where the increases were more modest, at under 2 percent.
Participating carriers that provided their insurance news data regarding historical loss costs indicated a decrease of under 1 percent in the loss ratios for the 2012 accident year, when compared to that of the year beforehand. This is much more promising and positive than what was seen between 2010 and 2011, when it was estimated at approximately 3 percent deterioration.