October 5, 2018| Business Insurance
Author: Mark A. Hoffman
U.S. commercial property/casualty insurance rates rose 2.5% on average in third-quarter 2018, matching the rate increase of the second quarter, MarketScout Corp. said in a statement issued Friday.
Commercial auto lines saw the steepest increase at 6%, according MarketScout. Commercial property, general liability and employment practices liability followed with increases of 3% for each line. All other lines tracked by MarketScout posted smaller increases except for workers compensation, which dropped 3%, and surety, which remained flat.
“Rates continue to move slowly upward as insurers take a measured approach to price increases,” MarketScout CEO Richard Kerr said in the statement. “However, transportation and commercial auto rates continue to be assessed with more aggressive rate increases.”
“Clearly, insurers feel these exposures are tough and merit aggressive rate increases,” Mr. Kerr said. “Moreover, the market is accepting the increases because of the small number of insurers willing to write commercial auto and trucking risks.”
By industry class, the only changes from the second to the third quarter were with contractors, where rates were up 4% compared with a 3% increase in the second quarter, and habitational accounts, where rates fell to a 3% increase from a 4% increase in the second quarter
Small accounts up to $25,000 saw a 3% rate hike in the second quarter, as did medium accounts ($25,001-$250,000). Large accounts ($250,001-$1 million) were up 2% as were jumbo accounts (over $1 million).
The National Alliance for Insurance Education and Research conducted pricing surveys used in MarketScout’s analysis of market conditions. “These surveys help to further corroborate MarketScout’s actual findings, mathematically driven by new and renewal placements across the United States,” MarketScout said in the statement.