US Commercial Insurance Rates Up 5% in Fourth Quarter

US commercial rates increase 4% in Q3: MarketScout
October 7, 2019
US Personal Lines Rates Up 4.5% in Q4
January 8, 2020
Personal lines property insurance rates increase

Rates Continue to Increase at Close of 2019

Fourth quarter rates for commercial insurance placements across the United States increased 5 percent. The steady trend of upward rate movement reflects insurers plans to continue increasing prices across all lines of coverage with workers’ compensation being the only exception.

Richard Kerr, CEO of MarketScout noted, “Auto rate increases have been up all year long; however, D&O and professional rate increases have spiked significantly in the fourth quarter.”

According to Kerr, “Insurers are utilizing the many catastrophe modeling tools to carefully analyze their property exposures. We expect many of the major property catastrophe insurers to curtail their 2020 writings in California brush and East and Gulf Coast wind areas. Naturally, this will result in higher rates to insureds.”

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.

The following graphic reflects rate changes in US commercial insurance for the last 18 years.

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Commercial lines rate changes throughout 2019

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A summary of the fourth quarter 2019 rates by coverage, industry class and account size is set forth below.

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%

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By Account Size
Small Accounts Up 5%
Up to $25,000
Medium Accounts Up 4.5%
$25,001 – $250,000
Large Accounts Up 5.5%
$250,001 – $1 million
Jumbo Accounts Up 5.5%
Over $1 million

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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%

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For detailed rating analysis or market projections by industry class, coverage or account size, contact Vilma Scott at vscott@marketscout.com.

About MarketScout

MarketScout, an insurance distribution and underwriting company headquartered in Dallas, compiles the Commercial and Personal Lines Market Barometers. The firm is a Lloyd’s Coverholder and MGA for U.S. insurers. MarketScout owns and operates the MarketScout Exchange as well as over 40 other online and traditional underwriting and distribution venues. MarketScout is founder of the Council for Insuring Private Clients (CIPC) and administers the Certified Personal Risk Manager (CPRM) designation in partnership with The National Alliance for Insurance Education and Research. MarketScout has supported innovation and entrepreneurialism via the Entrepreneurial Insurance Alliance (EIA) since 2007. The EIA supports start up entrepreneurs and innovators via financial, advisory and distribution support. In 2017, MarketScout founded MarketScout InsurTech (MIT) venture fund. In January 2018, MarketScout launched its Incubator to accelerate start-up MGAs and assume operational functions for existing MGAs and insurers. MarketScout has offices in Arkansas, California, Florida, Illinois, Nebraska, Pennsylvania, South Carolina, Tennessee, Texas, and Washington, DC. For more information, please visit us at MarketScout.com. California license #0D60423