Workers' compensation and commercial auto risks saw the steepest rate increases in January at +4% compared to the same month in 2013, but the commercial-lines market overall continued its moderating trend, MarketScout says.
MarketScout officially listed January's composite rate at +3%, the same as December, but CEO Richard Kerr notes, If we were to post rate changes by fractional increments, you would see the actual increase at 2.55 percent, so the moderation trend continues.”
Recapping the previous year, MarketScout notes that 2013 began with a composite rate increase of +5 percent, moderated slightly in July, and ended up at +3 percent at year-end.
For January, Kerr says, “Rates for five coverage classes declined 1% as compared to one year ago. No coverage classifications had a rate increase. By account size, half the accounts measured enjoyed premium reductions of 1%. By industry class, four out of seven were down 1%.”
He explains, “Additional capacity, insurance-linked securities and a more stable economic environment (despite recent stock-market adjustments) are partly responsible for the moderating rate environment.”
Both workers' comp and commercial auto saw 4% rate increases. BOP, general liability and umbrella/excess rates were up 3%. Commercial property, business interruption, professional liability and D&O rates were up 2%. Inland marine, EPLI, fiduciary, crime and surety risks all increased by 1%.
Small accounts saw the steepest rate increases at 4%, medium accounts were up 3%, large accounts up 2% and jumbo accounts up 1%.
By industry, risks in manufacturing, contracting, service and transportation all saw 4% rate increases. Habitational risks were up 3%, public entity and energy risks were up 2%.
Personal lines
Personal lines rates also moderated in January, up by 2% year-over-year compared to 3% in December.
Kerr says, “2013 was a good year for personal lines insurers. We expect continued aggressive pricing, but that will be geographically modified as appropriate. Coastal homeowners continue to enjoy competitive rates because of the lack of windstorm activity in 2013, despite Superstorm Sandy.”
For January, he adds, “Homes under $1 million in value were assessed a 2% increase, while high-value homes paid an additional 4%. Both metrics were down 1 percentage point from December 2013.”
Automobile and personal articles were both increased by 2%, a slight reduction for personal articles and the same rate for automobile.
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
