Hurricane Harvey could upend a trend of nearly flat commercial insurance prices that has continued since 2015, Willis Towers Watson said in its latest industry survey.
“Insurers are bracing for a significant volume of complex commercial property claims, as well as significant business interruption, commercial auto and multiple peril activity stemming from Harvey-related losses,” Pierre Laurin, Willis Towers Watson’s Americas Property & Casualty sales and practice leader for Insurance Consulting and Technology, said in prepared remarks.
Through the 2017 second quarter, however, the price trend remained flat overall, according to Willis Towers Watson’s latest Commercial Lines Insurance Pricing Survey (CLIPS).
Price changes reported by carriers averaged less than 1 percent for the eighth consecutive quarter. This has continued since 2015, and the moderating trend in price increases has gone on since the 2013 first quarter.
Also, as Willis Towers Watson noted, there was a modest deterioration in loss ratios of less than 1 percent through the first two quarters of 2017. That’s similar to the same period in 2016, with results driven in both period by “benign estimates of claim cost inflation.”
Broken down, Willis Towers Watson said that workers compensation, property and directors & officers liability experienced price decreases. Commercial auto, however, continued with “meaningful price increases” that are seeing some acceleration.
Price changes were slightly positive for small accounts and flat for mid-market and large accounts, Willis Towers Watson said.
Source: Willis Towers Watson