U.S. commercial insurance prices continued rising at an accelerated pace in the 2019 fourth quarter, with the aggregate price change exceeding 6 percent, according to a new Willis Towers Watson report.
The Q4 results continue a price increase trend Willis Towers Watson said it has tracked in previous quarters.
Commercial auto, property, excess/umbrella liability and directors and officers liability all produced significant prices increases that “exceeded double digits,” Willis Towers Watson said.
Broken down, price changes were much larger for mid-market and large accounts than small accounts. Specialty lines price increases also trended higher at a healthy clip in the fourth quarter, according to the report.
On the other hand, the survey continued to indicate price reductions for workers compensation in contrast to all other surveyed lines, though reductions are smaller than the recent past, something that Willis Towers Watson found particularly noteworthy.
“Even workers compensation prices, which had been decreasing substantially recently, are moderating, a trend that we have observed throughout 2019 — despite the continued large price drops for California business,” Alejandra Nolibos, senior director, Insurance Consulting and Technology, Willis Towers Watson, said in prepared remarks.
Willis Towers Watson’s full report – its Commercial Lines Insurance Pricing Survey (CLIPS), compared prices charged on policies underwritten during the fourth quarter of 2019 to those for the same coverage during the fourth quarter of 2018. The report is a retrospective look at historical changes in commercial property and casualty insurance (P&C) prices and claim cost inflation.
CLIPS data are based on both new and renewal business figures obtained directly from carriers underwriting the business. CLIPS participants represent a cross section of U.S. P&C insurers that includes many of the top 10 commercial lines companies, among others.
Source: Willis Towers Watson