Commercial lines saw prices grow in Q2 2021
Workers’ compensation was the only line to buck the price-growth trend, which has been slowing.
During the most recently concluded quarter, commercial insurance prices grew 6%, in aggregate, according to Willis Towers Watson (WTW), which reported data for almost every line indicated a significant price increase.
While prices grew quarter-on-quarter to start 2021, rate increases in the second quarter showed more moderate gains than the same period the year prior, which saw prices grow more than 10%, according to WTW. During the first quarter of 2021, commercial insurance rates grew an aggregated 8%.
Excess/umbrella showed the largest pricing gains, while commercial auto, property, and directors and officers (D&O) each saw gains near or above double digits. However, compared with the first quarter, rates for excess/umbrella have seen one of the largest declines in price growth, while D&O rates also showed more moderate increases than the first quarter.
For commercial auto, price increases have been a trend for the past 15 quarters, while property rates continued a nine-quarter trend, according to WTW.
“The rate of price increases has moderated again in the second quarter while still elevated versus historical norms. This is largely driven by significantly lower price increases for excess/umbrella and directors’ and officers’ liability than previous quarters,” Yi Jing, director, insurance consulting and technology for WTW, said in a release.
Bucking these commercial insurance trends, workers’ comp continued to see slight price reductions, WTW reported. For example, West Virginia’s workers’ compensation system recently saw a proposed rate decline because of consecutive years of favorable loss experiences, according to NCCI’s State Relations Executive David Benedict.
“The loss cost decrease is primarily driven by changes in lost-time claim frequency, which has continually declined since 2010,” he told PropertyCasualty360.com. “The lower proposed overall average assigned risk rate level reflects the observed improvement in the assigned risk market experience and lower assigned risk expenses.”
The news from WTW follows a recent review of cyber insurance lines, which grew 7% for small businesses and around 20% for medium and large enterprises, according to AdvisorSmith.
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