A new study from Towers Watson, a worldwide professional services firm, has found that prices for commercials insurance have remained the same for the ninth successive quarter. Overall, prices for commercial property and management liability lines have decreased over the past two years. Workers compensation, however, saw a steep increase in the first quarter of this year. The study also finds that prices for other commercial lines of insurance have been steadily increasing.
The director of Towers Watson’s Property & Casualty practice, Bruce Fell, notes that the increases in workers compensation prices are much higher that what has been seen in previous years. Fell says that market prices remain flat throughout the industry, but warns that steadily rising prices could be a precursor to significantly higher prices later this year.
The global insurance industry has had a rough couple years. 2010 has become infamous for the destructive catastrophes that meant huge losses for insurers. This year’s natural disasters have proven far more destructive than any risk modeling firm had expected, causing billions in losses relatively early in the year. As hurricane season threatens to batter both the East and West coast U.S. and Mexico, many insurance companies have taken to raising their rates to offset the probability of calamity.
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The data compiled by Towers Watson suggests that any changes occurring to insurance rates in unlikely to deviate from traditional actions insurers take after a natural disaster.