Personal lines reserve redundancy grew $2.5 billion to $10.1 billion.

Aon Benfield Americas Chief Actuary Brian Alvers says while personal lines reserves showed “a meaningful amount of redundancy,” the industry released almost 40 percent of the redundancy by the end of the first quarter of 2013.He says commercial lines continued to release reserves to start the year–$1.6 billion during the first three months, which “have increased pressure on this segment,” says Alvers, in a statement.

The lack of reserve cushion will push commercial line rates even further, he says. The most recent MarketScout report on commercial line rates put the increases for May at 5 percent holding a steady rate of increase over the past three months. Aon Benfield says all company rates have increased for nine consecutive quarters, dropping slightly in Q1 2013 to less than 8 percent. Personal lines are rising also, as MarketScout says rates rose 4 percent in May.

The report attributes the deficit in commercial lines to the combination of a significant portion released in 2012; deterioration in loss experience in accident years prior to 2012, and the 2012 accident year booked at a deficiency. On the personal lines side, 2012 reserves regained strength from favorable loss experience for prior accident years and conservatively booked 2012 accident year.