Most Commercial Lines Saw Q4 Rate Hikes; Workers Comp, Not So Much

Most commercial insurance lines experienced rate increases for the 2018 fourth quarter, with workers compensation continuing to serve as a notable exception, according to the latest IVANS index regarding the sector.

IVANS found that commercial auto, general liability, commercial property and umbrella coverage also saw premium rate changes compared to the 2017 fourth quarter. Most commercial lines also saw premium renewal rate average increases versus Q3 2018.

Workers compensation, by contrast, saw its average premium renewal rate change drop, keeping it in negative territory as it has been through 2018, IVANS said.

Here’s a breakdown of Q4 2018 commercial insurance renewal rate highlights:

• Commercial Auto: Premium renewal rate change averaged 4.66 percent for the quarter. The 2018 average premium renewal rate change for commercial auto was higher compared to 2017 throughout the entire year, peaking in September with an average hike of 4.5 percent in 2018 versus 2.55 percent in 2017.
• BOP: Quarter premium renewal rate change averaged 4.23 percent, an average jump over Q3 of more than 4 percent.
• General Liability: Q4 premium renewal rate change was more than 2.5 percent on average versus 2.35 percent in Q3. General Liability started out 2018 in January and February with lower average premium renewal rate than 2017, averaging a 0.44 percent increase from March through the rest of 2018 versus the same period the year before.
• Commercial Property: Q4 premium renewal rate change rose an average 3.74 percent during the quarter versus 3.34 percent in Q3. The 2018 average premium renewal rate change for commercial property was mostly higher in 2018 compared to 2017.
• Umbrella: Q4 saw a 2.4 percent average premium renewal rate change versus 1.9 percent in Q3. The 2018 average premium renewal rate change for umbrella was about .70 percent higher compared to 2017.
• Workers Compensation: Average premium renewal rate change for the quarter dipped more than 3 percent compared to an average of 2.76 percent in Q3. The 2018 average premium renewal rate change for workers compensation showed a consistently more negative decline compared to 2017, with the exception of December, which ended at -2.66 percent in 2018 versus -2.92 percent in 2017.

The IVANS index, released monthly, is based on the analysis of more than 120 million data transactions, covering more than 32,000 agencies and 380 insurers and MGAs. IVANS is a division of Applied Systems.

Source: IVANS