The fourth quarter of 2019 saw rates for commercial insurance placements in the US increase 5%, a new report has found.
According to MarketScout, the increase marks a steady trend of upward movement, reflecting insurance companies’ plans to continue raising prices for all lines of coverage – save for workers’ compensation.
In an earlier report for Q3 2019, Marsh found that global commercial insurance pricing was up 8%.
“Auto rate increases have been up all year long; however, D&O and professional rate increases have spiked significantly in the fourth quarter,” noted MarketScout CEO Richard Kerr.
A summary of Q4 2019’s rate changes, as reported by MarketScout, is as follows:
|
By Coverage Class |
|
|
Commercial Property |
Up 5.25% |
|
Business Interruption |
Up 5% |
|
BOP |
Up 3.5% |
|
Inland Marine |
Up 4% |
|
General Liability |
Up 4.25% |
|
Umbrella/Excess |
Up 5.5% |
|
Commercial Auto |
Up 8% |
|
Workers’ Compensation |
Down 1% |
|
Professional Liability |
Up 6% |
|
D&O Liability |
Up 8.25% |
|
EPLI |
Up 4.25% |
|
Fiduciary |
Up 3.5% |
|
Crime |
Up 3.25% |
|
Surety |
Up 2% |
|
By Account Size |
|
|
Small Accounts Up to $25,000 |
Up 5% |
|
Medium Accounts $25,001 – $250,000 |
Up 4.5% |
|
Large Accounts $250,001 – $1 million |
Up 5.5% |
|
Jumbo Accounts Over $1 million |
Up 5.5% |
|
By Industry Class |
|
|
Manufacturing |
Up 3.5% |
|
Contracting |
Up 5.25% |
|
Service |
Up 5% |
|
Habitational |
Up 8.25% |
|
Public Entity |
Up 4.25% |
|
Transportation |
Up 9% |
|
Energy |
Up 3.25% |
Kerr proposed in a statement that many of the major property catastrophe insurers are expected to restrict their 2020 writings in California brush, as well as East and Gulf Coast wind areas – these decisions will naturally result in higher rates to insureds.
In another report, Willis Towers Watson suggested that price increases for commercial insurance in North America will continue well into 2020. The risk management and advisory company cautioned that 19 lines of insurance are expected to see price increases – most notably, property, umbrella, and public company directors and officers (D&O) lines will experience hikes as high as 20% in the coming months, WTW projects.
